United Nations

NEW YORK, 8 November (UN Headquarters) -- The very fact that the International Civil Service Commission (ICSC) had managed to consistently sustain and foster dialogue, while providing new policies to uphold the United Nations common system, was a testimony both to its success and to the wisdom of its founders, Mohsen Bel Hadj Amor, Chairman of that body, told the Fifth Committee (Administrative and Budgetary), as it commemorated the Commission’s twenty-fifth anniversary this morning.

He went on to say that its single overriding achievement was its contribution to the creation of a truly international civil service with a common esprit de corps, common values and common goals.  The Commission had also unified the salary system and ensured that it was underpinned by sound methodologies. 

The Fifth Committee Chairman, Gert Rosenthal (Guatemala), said that from the vantage point of the Fifth Committee, the ICSC had facilitated its work enormously.  Its opinions on working conditions of United Nations staff and its orientations on human resources policies had illuminated the Committee’s debates.  Its technical and moral authority had had facilitated resolution of contentious questions, and it played a leadership role for the rest of the system regarding common work conditions.

Congratulating the ICSC on behalf of the regional groups were the representatives of Mauritania (on behalf of the African Group of States), Kyrgyzstan (on behalf of the Asian Group of States), Slovenia (on behalf of the Eastern European Group), Brazil (on behalf of Latin American and Caribbean Group of States) and Germany (on behalf of the Western European and Other States).   Also speaking were the representatives of Sierra Leone, Malawi, Egypt, Russian Federation, Bangladesh, Cuba, Nigeria (on behalf of the “Group of 77” developing States and China), Argentina and India.  

 Also this morning, the Committee concluded its general discussion on the reports of the United Nations Board of Auditors.  

The representative of the United States thanked the Board for its reports, but expressed disappointment that it had found it necessary to qualify its audited opinion for four United Nations organizations because they had failed to provide sufficient information about funds advanced for national execution projects.  Credible and verifiable documentation of all national execution expenditures was an absolute necessity, he said. 

Also speaking on behalf of New Zealand and Australia, the representative of Canada expressed a concern that was also raised by other speakers about the lateness of the presentation of financial information to the Committee.  Timeliness was a key characteristic of good accounting:  a fact the Board itself had noted with respect to the internal audits.

The representative of Cuba said that the reports of the Board were of high quality, but regretted that some of the Board’s previous recommendations had not been implemented.  She also expressed concern about the difficulties caused by the late issuance of audit reports.

The representatives of Norway, the Republic of Korea and China also spoke on the issue.  The United Nations Controller, the Assistant Secretary-General for General Assembly Affairs and Conference Services, and a member of the Board of Auditors from the Philippines responded to questions raised by Member States.

Also this morning, the Committee decided to refer to the Assembly’s Third Committee (Social, Humanitarian and Cultural) the problem of finding a consensus text on the United Nations human rights programme for the medium-term plan for the Organization.  It took this decision without a vote.  The representative of India, who had chaired the Fifth Committee’s informal consultations on this issue, recommended this decision to Member States.

The Committee will meet again tomorrow morning at 10 a.m., when it is expected to begin consideration of the question of results-based budgeting.

Committee Work Programme

 This morning, the Fifth Committee (Administrative and Budgetary) was expected to hear a statement by the Chairman of the International Civil Service Commission (ICSC) in commemoration of that body’s twenty-fifth anniversary and to conclude its general discussion of the reports of the Board of Auditors.  

Statements

 GERT ROSENTHAL (Guatemala), Chairman of the Fifth Committee, said that a few days ago the Committee had received the Secretary-General’s proposal which put forward a profound reform of the Organization’s human resources.  At that time, numerous delegates highlighted the extent to which its staff were an invaluable asset for the United Nations.  All wanted a Secretariat of excellence, and that would depend, to a large extent, on the quality of its leadership and its staff.  While the Secretary-General’s reform concentrated on issues such as recruitment, mobility and geographical and gender representation, of equal importance was the constellation of institutions that had been set up to support the consolidation of an excellent international civil service.  The International Civil Service Commission (ICSC) was one of those bodies, inasmuch as it regulated and coordinated conditions of service within the United Nations common system.

 He said that today the existence of an international civil service that was objective, independent, qualified and motivated by the high ideals of the Charter was often taken for granted.  Article 100 of the Charter laid down the principle of independence and objectivity, while Article 101 established the standards of competence and integrity.  The concept of an international civil service had been an important innovation of the past century.  An alternative would have been to make a government responsible for fulfilling the role of a Secretariat on a pro tempore basis, or staffing an intergovernmental secretariat like that of the United Nations with seconded national officials from Member States.  Neither modality would have been satisfactory.  The international civil service was the Organization’s main asset.  

 Although the Committee was celebrating the twenty-fifth anniversary of the ICSC, the impartial regulatory functions it performed had been necessary ever since the creation of the United Nations, he said.  From the vantage point of the Committee, the work of the ICSC facilitated its work enormously.  Not only its opinions on the working conditions of the staff of the common system, but also its orientations on policies concerning the human resources of the system, illuminated the Committee’s debates.  The technical and moral authority the ICSC had earned over the years also facilitated the resolution of questions that were often contentious.  Further, since the ICSC was dependent on the General Assembly, that gave it a leadership role vis à vis the rest of the system regarding common work conditions.  Just as the Secretary-General had submitted his proposal on reform of human resources of the Secretariat, he had also been proposing a review of the ICSC.  In the Committee’s deliberations they would have before them the Secretary-General’s report on strengthening the international civil service.  The Committee was, therefore, not only celebrating the ICSC, but it would also consider later on whether something needed to be done to adapt its functions and to strengthen it.

 MOHSEN BEL HADJ AMOR, Chairman of the ICSC, said that today the ICSC was approximately half as old -– or as young -– as the United Nations.   The Commission had been created to coordinate and regulate the conditions of service for some 14 organizations, in addition to the United Nations, and for five United Nations affiliated bodies, funds and programmes.  The Commission’s mandate was complicated and challenging, given the diversity of structures, operations and needs of the different members of the common system.  Their needs required a carefully balanced, or rather, a nuanced approach.  He believed that it was fair to say that the Commission had succeeded in maintaining the proper equilibrium between regulation and responsiveness, between coordination and flexibility and between aspirations and constrains.  

 However, it would be naïve to think that any organ could be all things to all of its constituents or please all of them, he continued.  Since the Commission had been created to arrive at technical decisions based on objective information, it was inevitable that not all of its decisions would find favour with all parties.   From its inception, the Commission had approached its work with a single overriding objective:  the maintenance and unity of the common system.  The very fact that the Commission had managed, in the face of daunting challenges to consistently sustain and foster dialogue, while providing new policies to uphold the common system, was a testimony both to its success and to the wisdom of its founding fathers.  The General Assembly had repeatedly reaffirmed the central coordinating role of the ICSC and expressed confidence in its ability to discharge its functions in a technical and impartial manner.  

 Anniversaries provided the opportunity to revisit past accomplishments and disappointments, drawing lessons from them, he said.  They also gave a chance to look to the future with a renewed sense of purpose and commitment.  If he had to point to a single overriding achievement, he would say that the Commission’s policies had contributed to the creation of a truly international civil service with a common esprit de corps, common values and common goals.  The Commission had also unified the salary system and ensured that it was underpinned by sound methodologies.  For example, the methodologies for the post adjustment system ensured the global equalization of purchasing power for staff, and the job classification system ensured equal pay for equal work.  This year, the Commission was reinforcing its mandate by presenting to the General Assembly an integrated Framework for Human Resources Management, which would help in the modernization of the common system.

 Turning to the future of the ICSC, he said that, for some years now, Member States had emphasized the need to improve efficiency and productivity.  The ongoing reform within the common system organization was aimed at that very goal.  However, that could be achieved only with the full and active participation of an empowered workforce.  In the final analysis, the system’s most precious resources was its staff who carried out the mandated programmes.  The role of the Commission in that respect was to be catalyst to that process, to make responsible technical recommendations to the Assembly and to provide guidance which would result in an reinvigorated, more motivated staff, possessing the expertise and the ability to meet the challenges of the future.   At the same time, it was clear that the strengthening of the staff could not be carried out by casting doubt among Member States as to the competence of the expert bodies which had direct responsibility for personnel matters.  

 That brought him to the question of the review of the Commission, he said.  In general, he had a healthy respect for reviews, for in any organ there was room for periodic re-examination and even criticism.  That was why the ICSC had already undertaken numerous reviews of its functioning and working methods over the past decade or so.  However, reviews must be dispassionately motivated and underpinned by a sound raison d’être.  Only when clear objectives and transparent criteria were established should a review be undertaken.  In past reviews of the Commission, whether they had been at the request of Member States or of others, certain principles had been held as inviolate to ensure that the Commission was not weakened.   Among those principles were the Commission’s independence, its authority and the integrity of its statute.  Those were not mere commodities that could be negotiated or traded away for others.  They were fundamental to the effectiveness of the Commission.  In short, the Commission must not become vulnerable to a watering-down or weakening of its strength.  Respect for those principles remained a necessity to ensure that the ICSC did not become an empty shell, serving no purpose.  As for the membership, that matter remained the exclusive preserve of Member States.

 The common system derived its strength from the Member States and could only be as strong as its employers wanted it to be, he continued.  The Commission would continue, as it had for the past 25 years, to carry out its mandated technical responsibilities and keep working to ensure that it provided organizations with the guidance, policies and tools needed to fulfil their missions.  That would reinforce the cohesiveness of the common system, strengthen the staff and modernize the international civil service.  In the rapidly changing world, the Commission was committed to remaining relevant, responsible and flexible.   However, some changes would be required in the profile of the international civil service in the coming years.  It was necessary to ensure that the international civil service renewed itself and became more efficient and streamlined, on a basis of cost-effectiveness.

That would require enhanced performance, with a focus on the development of skills and competencies, more modern and flexible work methods and organizations structures, and accountability through continuous evaluation and a continuous search for better performance, he said.  It was necessary to strengthen the management culture to be more accountable, output-oriented and results driven.  It would be necessary to engage more rigorous selection criteria, especially for core staff, depoliticize the recruitment process, give more responsibility to managers, increase teamwork and develop the tools to recognize and reward work.  Lastly, it would be necessary to leverage technology to be more responsible and service-oriented.   He was convinced that the Commission would continue to play a vital role in shaping the common system of the future.

 MAHFOUDH OULD DEDDACH (Mauritania), speaking on behalf of the Group of African States, said that the ICSC had a difficult and delicate task.  In its mission, the Commission faced numerous challenges everyday.  Among its functions, it had to reconcile the interests of various parties within the common system.  At a time of constant change, the Commission had attempted to meet the long-term needs of international civil servants.  That was why its independence remained essential.

 ELMIRA IBRAIMOVA (Kyrgyzstan), speaking on behalf of the Asian Group, said that the achievements of the ICSC were worth celebrating.  They were both real and remarkable.  The Commission’s role was an important one in the United Nations system, influencing the lives of many thousands of staff members globally.  It had undertaken important work in the setting and rationalizing of Professional and General Service salaries.  It had also established technical methodologies to ensure that the United Nations system was an attractive employer, thus, providing Member States with an opportunity to keep civil servants of the highest calibre in the Organization.

Examples of important achievements of the ICSC include the post adjustment system, which equalized purchasing power worldwide, and the development of job classification standards for staff at all duty stations to ensure equal pay for equal work, she said.  The annual reviews of the Commission became an important part of the modernization process of the Organization’s staff management practices.  The framework for the management of human resources developed by the Commission over the last year had become a key instrument in supporting the reform of the Organization.  The ICSC had evolved much over the past 25 years.  The world had also changed much during that period.  Today, the Commission succeeded in maintaining and reinforcing the cohesiveness of the common system through its technical decisions on matters of key importance to organizations and staff.  At the beginning of the new century, the international civil service faced massive challenges or redefinition, reorientation and purpose.  The role of the Commission in that respect was of great importance.

 ERNEST PETRIC (Slovenia), speaking on behalf of the Group of Eastern-European States, said that the ICSC had been established to regulate and coordinate the conditions of services of the United Nations common system.  That difficult and sensitive role was complex and often challenging.  However, since its inception, the Commission had been successfully reconciling the concerns of various parties involved.  It had succeeded in maintaining and reinforcing the cohesiveness of the common system through its technical decisions on matters of key importance to organizations and their staff.  The Commission had undertaken important work in the standardization of job classifications and restructuring and revitalizing the salary system.

 The ICSC was created as an expert, technical and independent body, he added.  It had been empowered to make recommendations and take significant decisions affecting the common system.  The Group of Eastern European States would continue to support efforts by the ICSC to respond effectively to changing demands and human resources mangement across the United Nations system.  It also recognized the pivotal role of the Commission in the modernization process of the Organization’s staff management practices.

 GELSON FONSECA (Brazil), speaking on behalf of the Latin American and Caribbean States, congratulated the Commission for the excellent work.  Since its inception, the Commission had been an essential reference for human resource managers of the United Nations system.  Its importance transcended the realm of international organizations.  The studies and recommendations of the ICSC had influenced many national public administrations, as well.

 In the 25 years, the Commission had been at the forefront of decisions that contributed to the creation of better service conditions for the staff, he said.  Among its main achievements, he highlighted the establishment of the post adjustment system and the development of job classification standards for all staff at all duty stations.

 Last week, Deputy Secretary-General Louise Fréchette had presented to the General Assembly the latest report on human resources management reform, which contained a comprehensive set of proposals in that area.  In its turn, the ICSC had developed a framework for human resources management with a view to enable the organizations of the common system to manage their human resources effectively.  The framework would also serve as a reference point for future reforms affecting human resources.  Both documents deserved careful examination by the Fifth Committee.  

 DIETER KASTRUP (Germany), speaking on behalf of the Western European and Others Group of States, said that, as the Secretary-General had pointed out to the Commission at its last session, the unique diverse international civil service of the United Nations could not be matched by any other workforce in this world.  That was reflected in the budgets of the organizations, where staff counted for more than 80 per cent of all expenses.  The Commission had been created to take care of that precious asset.

 It was not the task of the Commission to please everyone, he continued.  Interests of staff, organizations and Member States were not always easy to reconcile.  The ICSC and the Joint Staff Pension Fund formed the pillars of the common system of benefits and allowances.  Beside important achievements through post adjustment and job classification, the Commission had, in the past, taken the lead in gender- and life/work-related issues.  In the twenty-fifth year of its existence, the Commission had also taken up the important issue of a new code of conduct for the common system.  The anticipated review of the pay and benefit system would give answers to the problem of the increasingly divergent needs of organizations in a rapidly changing global environment.  

He went on to say that many international organizations, which were not part of the United Nations family, and others applied the decisions and recommendations of the Commission for their staff.  The existence of that “shadow common system” reflected the respect that the Commission had earned through its independent and technically sound work.  Looking ahead, the Commission had an ambitious work programme, which it would present to the Committee later this week.  Member States were looking forward to new personnel tools, a streamlined and competitive compensation package, and the ability to encourage and reward high performance and managerial excellence.

 SYLVESTER EKUNDAYO ROWE (Sierra Leone) said that his delegation would like to join in the commemoration of the twenty-fifth anniversary of the ICSC. The Commission had become an icon in the field of systemic coordination and integration of human resources management.  He applauded all its staff, who worked to improve the conditions of service of the international civil servants. 

 The concept of an international civil service remained the cornerstone of the future success of the United Nations, he continued.  However, it could only survive if the staff were given an opportunity to perform their functions under equitable and fair conditions.  In that respect, the Commission served as a bridge between the need to ensure efficiency and establish favourable conditions for staff.  The Commission should also serve as a catalyst for change within the system. 

The Commission’s recommendations would not always receive unanimous approval, he said.  Some of its decisions were open to question, but, given the scope of its mandate and the complexity of issues, it had maintained its objectivity, independence and technical expertise.  It faced many challenges in the entire United Nations reform process.  Today’s anniversary presented an opportunity to sum up its achievements and to look into the future.  The Commission had matured, and now it would emerge revitalized to promote an efficient and effective international civil service.

 YUSUF M. JUWAYEYI (Malawi) said that he continued to follow the work of the ICSC with great interest.  He noted the pivotal role of the Commission in supporting the lives of thousands of staff members globally.  During its existence, the Commission had undertaken many challenging tasks, including the post adjustment system and the hardship scheme for staff serving in difficult duty stations.  The Commission had developed a framework for the management of human resources, which it envisaged as a key instrument in supporting the reform efforts of the United Nations common system.  It had succeeded in maintaining and enforcing cohesiveness of the organizations of the common system. It had often managed to balance the delicate needs of the different parties.  The ICSC, by virtue of its status, had remained above the fray, with the single objective of creating competitive conditions of service within the United Nations system.

 While applauding the Commission’s work, he also had several concerns, he said.  Firstly, the concerns of staff and their unions on the new methods of human resources management must be taken into account in any future plans for enhancing the Commission’s work.  Also of concern was the issue of training.  He requested the ICSC to look into the modalities for the training of staff.  The Commission should add those two issues to its agenda of work.

 AHMED H. DARWISH (Egypt) said that the celebration of the twenty-fifth anniversary of the ICSC was indeed of extreme importance.  The Commission had undertaken landmark work, including settling the issue of Professional and General Service salaries, establishing methodologies for ensuring that the United Nations was an attractive employer, and encouraging high standards of integrity in the recruitment of staff.  He reiterated the importance of maintaining the independent, impartial and technical nature of the Commission.

 NIKOLAI V. LOZINSKI (Russian Federation) said that 25 years ago the General Assembly created the ICSC to regulate and coordinate conditions of service for the organizations belonging to the United Nations common system.  It was one of the main links in that common system.  It had played a defining role in creating a single international civil service and strengthening its unity and cohesion.  An effective methodology had been developed to determine conditions of service.  The creating of the Commission had marked a new stage in the development of the international civil service.

In accordance with its mandate, the Commission had to develop unified standards for classification of posts, and to create uniform conditions of service for staff, he said.  As a result of the development of unified standards, other international organizations outside the United Nations had been borrowing from the Commission’s experience.  The unique database it had created was being used by Member States to develop principles and standards for their own civil service organizations.  The Commission was faced with the many new challenges facing the world today.  The Commission could, and must, make a valuable contribution towards developing international cooperation. 

 RIAZ HAMIDULLAH (Bangladesh) said that Bangladesh fully associated itself with the statement by the representative of Kyrgyzstan on behalf of the Asian Group.  He congratulated the ICSC on all its accomplishments, and thanked the Chairman of the Commission for his statement.  Soon the item related to the work of the ICSC would be considered in the Fifth Committee.  Currently before the Committee was an important item on human resources management, and he appreciated the guidance and expertise of the ICSC on that question over the years.  Its work required careful balancing between the interests of various bodies, and he had high hopes for its work in the future.

 LOIBA SANCHEZ LORENZO (Cuba) said that the anniversary of the ICSC was extremely important.  That organ was very useful for the work of the Fifth Committee.  When faced with proposal to reduce the role of the Commission, her delegation always considered the void that such a step would create in the United Nations common system.  The ICSC was a fairly young organ with complex and unique functions, and it should continue its work.

 HASSAN MOHAMMED HASSAN (Nigeria), speaking on behalf of the “Group of 77” developing countries and China, said that the silver anniversary of the ICSC presented an opportunity to evaluate the work of that important body.  The Commission’s efforts should be highly appreciated.  The main challenge today was the need to implement mandates with fewer resources, and he agreed with the assessment of the situation of the Chairman of the ICSC, which he had expressed this morning.  He supported the work of the ICSC.

 GUILLERMO KENDALL (Argentina) endorsed the statement by the representative of Brazil on behalf of the Group of Latin American and Caribbean States.  He wanted to congratulate the ICSC, its Chairman and all of its staff.  The ICSC was providing an invaluable service to the United Nations.  In particular, it had contributed to the work of the Fifth Committee.  Its prestige and authority were of great importance.  In conclusion, he reiterated his delegation’s confidence in the ICSC for the future.

 A.V.S. RAMESH CHANDRA (India) said that he wished to brief the Committee on a draft decision agreed to yesterday in informal consultations in the context of the agenda item on programme planning.  There was consensus that the Third Committee (Social, Humanitarian and Cultural) be requested to re-examine the possibility of a consensus text on program 19, human rights of the medium-term plan.

The Committee then decided, without a vote, to refer that matter to the Assembly’s Third Committee.

Mr. BEL HADJ AMOR, ICSC Chairman, thanked all who participated this morning in the commemoration of the ICSC’s anniversary and for all who spoke words of great encouragement for its future work.  He would do everything in his power not to disappoint the Committee and to meet all its expectations. 

The Committee then turned its attention to the reports of the United Nations Board of Auditors.

ANNE MERCHANT (Norway) said that she regretted the very late submission of some of the reports.  Even after the Committee had started the formal debate on the issue, some of the reports were still unavailable.  Norway attached great importance to the Board of Auditors’ reports, and the very late submission of the reports made the Committee’s task difficult.  She strongly supported the work of the Board and the implementation of its recommendations, and was pleased to note that some 69 per cent of the Board’s recommendations had been fully implemented and that about 26 per cent were in the process of being implemented.  She agreed, however, with the Advisory Committee on Administrative and Budgetary Questions (ACABQ) that all concerned should monitor the process in terms of its efficiency and its capacity to produce clear and concise reports on time to facilitate the management of the monitoring and reporting process.  

It was also of concern that the Board had to qualify its opinion on the financial statements of the United Nations Development Programme (UNDP), the United Nations Population Fund (UNFPA), the United Nations International Drug Control Programme (UNDCP), and the United Nations University (UNU), she added.  Regarding the UNDP, UNFPA and the UNDCP, it was of special concern that the Board had restricted the scope of its audit opinion because it was unable to obtain sufficient audit evidence, as audit reports from its implementing partners were lacking.  She had taken particular note of the fact that the Board had had to restrict the scope of its audit statement for the UNDP because of uncertainty  over unidentified amounts totalling some $11.1 million arising from bank reconciliation.  That matter warranted immediate attention.  She also agreed that the Assembly should defer action on the financial statements of the UNDP, UNDCP and the UNFPA, and that the matter should be brought to the attention of the respective governing bodies.  

Regarding accountability of implementing partners, she agreed on the need for capacity-building support for partners in programme management, for the purpose of ensuring coherent budgeting and reporting practices, and also supported encouraging partners to perform audits and implement control mechanisms.  

JOHN ORR (Canada), speaking also on behalf of New Zealand and Australia, said that there were 15 financial reports and audited financial statements.  Due to the volume of documentation presented, he would limit his comments to general observations.  He was concerned about the timeliness of financial information presented to the Committee.  It was well known that timeliness of financial information was a key characteristic of good accounting.  Indeed, the Board itself had noted that, with respect to the audit reports of the Office of Internal Oversight Services.

The financial statements of an organization were a key accountability document and a key part of planning, budgeting and expenditure cycles.  He was puzzled that governing bodies of funds and programmes did not more actively review and approve audited financial reports and statements.  The reduced role for governing bodies had led to the situation today where the Board had had to qualify the financial statements of four entities.  Canada concurred with the recommendations of the ACABQ, but also believed that more action must be taken.  He reiterated the call for organizations that did not receive any funds from the General Assembly to submit their audited financial statements to their governing bodies, through the ACABQ and not the Fifth Committee.

He said that there was also a need to streamline the numerous supplementary financial statements and schedules submitted by each organization.  United Nations Accounting Standards noted that a complete set of financial statements consisted of four basic statements.  Yet, many of the organizations presented numerous other schedules and statements that could be eliminated or submitted as supplementary information.  Commending the quality of the Board’s reports, he said their emphasis had shifted to management issues, rather than compliance.  The system-wide audit of procurement showed that it remained an area of concern across the United Nations system.  He noted that the United Nations Procurement Division was leading the way, with its use of the Internet and open tendering, to ensuring fair and equal access to the United Nations system.  Other organizations were also urged to enhance transparency and fairness of the procurement systems.  He was pleased that the International Tribunal had issued separate financial statements.  As the budgets of those organizations were approved on an annual basis, their financial statements should also be prepared on an annual basis.  He asked for further information from the Board regarding the some $7.66 million in the 1996-1997 financial statements that were used for purchases made in 1998-1999.  If that money was not a valid charge against 1996-1997 financial statements, it should have been returned to Member States.  

 THOMAS A. RESPASCH (United States) said that the reports of the Board of Auditors provided Member States with a comprehensive overview of the financial conditions and operations of the Organization, its subsidiary organs and its specialized agencies.  He expressed disappointment at the fact that most of those reports had not been issued on time.  As the external oversight body for the United Nations, the Board was an essential component in efforts to maintain and improve financial management and accountability at all levels of the Organization.  

 The United States was satisfied that the Board had fully carried out its work, and he was pleased to read about improvements in financial management and internal controls in a number of organizations, he said.  He had no doubt that most of those improvements were the result of the actions by oversight mechanisms to press programme managers for much needed changes.  He continued to be concerned, however, over several of the major findings of the Board.  Once again, Member States were confronted with new reports of deficiencies at the managerial level.  Also, some of the Board’s previous recommendations had not been implemented.   He hoped that financial management would be strengthened and that accountability for management irregularities would become as routine as the issuance of the Board’s reports.  

 He expressed disappointment about the qualified audit opinions for four United Nations organizations, he said.  Together, the UNDP, UNFPA and UNDCP had failed to provide sufficient evidence that funds totalling over $835 million advanced to them for national execution projects had been used for the purposes intended.  The UNDCP had yet to offer an explanation for the $17.9 million, for which the Board requested audit reports during the 1996-1997 biennium.  Furthermore, the UNFPA’s proportion of national execution expenditure covered by audit reports had decreased from 70 per cent in 1996-1997 to 50 per cent in 1998-1999.  He would like to know the reason for the reduction of proper audit reporting and what was being done to rectify that situation.  Irregularities at the UNU also continued to be a matter of serious concern to his delegation.

 Overall, those situations reflected poorly on the financial management, he said.  Credible and verifiable documentation of all national execution expenditures was an absolute necessity.  His delegation thus requested assurance that United Nations bodies made proper and complete corrections to their audit reports before the Committee endorsed their financial statements.  He fully supported the recommendations of the ACABQ in that respect.  Another cause of concern was what appeared to be a precarious financial situation in several organizations where expenditures were greater than their incomes.   Another finding that merited attention was the fact that some United Nations agencies were bypassing or ignoring procedures requiring competitive selection and evaluation of consultants.  

 Regarding the situation at the United Nations, he said that an accurate and flexible management information system was crucial to more efficient financial operations.  Several findings in respect of the Integrated Management Information System (IMIS) caused concern, and he agreed with the Board of Auditors’ recommendation on the need to fully implement IMIS as soon as possible.  He was pleased that the Board had included in its audit an examination of the effectiveness of internal audit services.   Some outside counsel working with the Legal Division had started their work even before the contracts had been signed, and he would like to know what had been done to ensure that such practices did not continue.  He also had some questions regarding the billing procedure used in Nairobi for payment for conference services.  

 His delegation was very pleased that separate audit reports had been presented for the two International Criminal Tribunals, he continued.  He proposed that consideration of those reports be continued under the agenda items dealing with the proposed budgets for those tribunals.  While those reports included much useful information, they seemed to be products of two different audit approaches.  The report on the former Yugoslavia Tribunal focused on what had been accomplished in terms of its overall mandate, while the report on the Rwanda Tribunal contained more findings about administrative and management issues.  He requested further information regarding some aspects of the work of the tribunals and said that the usage of the courtrooms by the former Yugoslavia Tribunal seemed unacceptably low.  Those practices were wasteful and indicated the need for much better management of court proceedings.  

 He said that the United States was pleased to read that the financial position of the UNDCP had improved considerably.  However, it was disappointing that monitoring and evaluation of that body’s performance was not comprehensive or consistent.  That was true for other programmes as well.  He wanted to know what had been done to correct that deficiency.  His other questions concerned the measures to ensure achievement of objectives of the United Nations Children’s Fund (UNICEF) in the current biennium; provision of appropriate information on the International Trade Centre; and actions to correct inadequate separation of financial management responsibilities in the Office of the United Nations High Commissioner for Refugees (UNHCR) field offices.  He also noted that the auditors had found an accounting discrepancy in the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) relating to the understatement of its assets.  He also made an appeal for the synchronization of the Auditors’ terms in office with the budget cycle.  

 Ms. SANCHEZ LORENZO (Cuba) said that the reports of the Board were of high quality, and the presentation of separate reports on the two International Tribunals should be commended.  She also appreciated the work of the Board and regretted the fact that some previous recommendations of that body had not been implemented.  She did not understand, however, how Member States could possibly analyse the financial situation of various bodies if the reports were not issued on time.  She said that documentation should be issued on time and urged the Secretariat to strictly follow all procedures in that respect. 

 PARK HAE-YUN (Republic of Korea) expressed concern about the late availability of the reports.  In the context of the current reform process, the role of the Board had become increasingly important.  An effective audit improved effective delivery of programmes.  He reiterated support for the role of the Board and welcomed the strengthened coordination of audit activities of both external and internal oversight mechanisms.  The Republic of Korea generally endorsed the Board’s findings.  

Among the range of issues covered, he attached high priority to procurement reform, he said.  He was concerned at poor contract management, and stressed the importance of improving procurement planning and strengthening internal control over procurement management.  On the current practice of handling procurement-related arbitration cases, he was concerned that the process of selecting arbitrators and outside counsel was not sufficiently transparent.  He endorsed the Board’s recommendation to establish clear guidelines for selection of outside counsel.  He also welcomed the horizontal audit of procurement activities.

The Republic of Korea regretted that the Board continued to present qualified audit opinions, he said.  Qualified audit opinions should not be a normal feature of the audit function.  He also stressed the importance of implementing the Board's recommendations in an effective manner. Out of 167 recommendations, he was pleased to note that 115, or 69 per cent, had been fully implemented.  

 CELSO GANGAN, Philippine member of the Board of Auditors, expressed his appreciation for the interest that the Fifth Committee continued to show in the Board’s work.  The Board had taken note of the comments on the separate reports for the two Tribunals.  It had produced the two separate reports following a request from the ACABQ, which was subsequently approved by the Assembly.  He also noted the suggestion that it would be advantageous to adopt a more consistent approach to the audit of the two Tribunals.  The Board had already taken steps to achieve that.  

Concerning the manner in which consultants were hired, the Board would return to that issue in forthcoming audits, he said.  In response to the question on the $7.66 million, he said that the Rwanda Tribunal had used miscellaneous obligating documents to reserve credits for inclusion in the 1996-1997 financial statements.  The Board was satisfied that the amount represented a valid obligation.   He reassured the Committee that the Board examined unliquidated obligations recorded at the end of the financial period and challenged any amounts which appeared to be invalid.  Although the United States rightly expressed concern that some recommendations had not been implemented, France and Norway had both referred to good implementation of the Board’s recommendations.  The Board would continue to monitor that important matter and encourage the administration to maintain good records in that regard.

 On qualified audit opinion for the UNDP, UNFPA and UNDCP, and the ACABQ’s recommendations that the Assembly defer action on those financial statements, he welcomed that proposal and commended it to the Committee.  Regarding the question of the implementation of the IMIS, he suggested that it was an issue best addressed by the Secretariat.  On the concern for timeliness of reports, Auditor John Bourn had already responded to that issue.  The question of timeliness was perhaps best addressed by the Secretariat.  For example, the Board had received the UNDP’s financial statement on 14 July.  It was signed on 28 July and submitted to the General Assembly on 31 July.  He was also pleased to hear the suggestion concerning the synchronization of terms of office for members of the Board of Auditors with the budget cycle.

TANG GUANGTING (China) said that his delegation, like many others, was concerned over the late issuance of the documents before the Committee.  He hoped that in the future the reports of the Board of Auditors and the ACABQ in all languages would be distributed before the beginning of the session of the General Assembly.  That would allow Member States to devote proper attention to the substance of the documents.  The qualified opinion regarding the financial situation of the UNDP, UNFPA and the UNDCP was justified, and he supported the recommendation to defer approval of their financial statements pending adequate measures being taken to rectify the situation.

China was pleased to note that many agencies had improved their implementation of the recommendations of the Board of Auditors, he continued.  The Board’s reports testified to the fact that most of its recommendations had been fully implemented, and that 25 per cent of them were in the process of being implemented.  Only 10 of them had not been implemented, some of those for legitimate reasons.  He hoped that such a situation would continue and that the Board of Auditors would enhance its monitoring of the implementation of its recommendations.

He also noted the situation on procurement matters, and agreed with the opinion of the Board and the recommendations of the ACABQ in that regard.  He hoped the Secretary-General would report on the implementation of the recommendations on procurement arbitration cases to the Committee so it could continue consideration of that question early next year.  Detailed information about arbitration cases was needed.  China would actively participate in the future discussion of the item in question.

JEAN-PIERRE HALBWACHS, United Nations Controller, said that some comments in the discussion on the presentation of financial statements before the Board of Auditors deserved attention.  The procedure to be followed in that respect should be decided on.  He explained that shortly the Fifth Committee would have before it 12 reports on the implementation of the IMIS, which would provide information on that system.  As for consolidation of financial statements, he hoped that the task of the Board would be facilitated by that.

Responding to a question regarding billing for conference services in Nairobi, he explained that formerly it had been provided after the completion of a meeting.  That system had been changed now, based on the anticipated use.  The major part of the total amount would now be billed in advance of the meeting, and the difference would be paid afterwards.  Steps were being taken for the United Nations Centre for Human Settlements (Habitat) to reimburse the United Nations Office in Nairobi expenditures.  On the issue of legal contracts, he said that the Legal Division should review and approve contracts of outside counsel in a more efficient way.  Answers to several other questions would be forthcoming from the International Tribunals soon.   

Turning to the suggestion by Canada that audits of the Tribunal should be performed on an annual basis, as their budgets were presented annually, he said that such a practice would produce an even greater number of reports than now.  Maybe it would be useful to consider presenting the Tribunals’ budgets on a biennial basis instead.  As for the late issuance of the documentation, he said that historically it had been decided that the reports of the Board should be issued not later than June.  Today, the number of those reports had grown, which made the situation more difficult.

 FEDERICO RIESCO, Assistant Secretary-General for General Assembly Affairs and Conference Services, said that according to the six-week rule for documentation, all documents should have been issued by late July.  For that to have happened, reports should have been submitted to document processing services by late June.  By the end July, some 16.5 per cent had actually been delivered to the processing services.  About 63 per cent of documents were submitted over August, September and October.  The situation had improved.  It was indeed important to set priorities.  However, there were almost always problems producing financial documents.  The problem did not lie with the submitting office -- the Office of Programme Planning, Budgets and Accounts.  That office was, in fact, exemplary.  The problem had to do with the sheer volume of material.  There were 21 documents on this agenda item this year.  Thirteen documents had been delivered to processing services in early July and another 13 were issued over the period of August, September and October, within a reasonable time frame.  Apparently, there had been a mishap somewhere along the way to documents control.  He had not been able to find out where the reports had been derailed.  He apologized to the Committee and said that he would discuss with the Committee’s secretariat how to improve delivery of documents in the future.  

 Ms. SANCHEZ LORENZO (Cuba) asked if Mr. Riesco’s explanation could be submitted to the Committee in writing.
 
 Mr. CHANDRA (India) informed the Committee that he had requested officials to be present at the deliberations in the Third Committee to brief that Committee on the nuances of the medium-term plan.  There was also need to underline the urgency that the Committee attached to the matter.