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UN Board of Auditors approved 28 audit reports at its seventy-first regular session

On 25 and 26 July 2017, the seventy-first regular session of the UN Board of Auditors was held at the United Nations Headquarters in New York. Kay Scheller, the German SAI’s President, attended the meeting in his capacity as member of the Board. For the first time Kay Scheller presented the audit reports on UN organisations that were part of the German SAI’s portfolio. The Board unanimously approved the audit reports of the German SAI.

Approval given for a total of 28 audit reports


At the seventy-first regular session of the UN Board of Auditors, the three members of the Board (in addition to Kay Scheller, the Board comprises Shashi Kant Sharma, Comptroller and Auditor General of India and Chairman of the UN Board of Auditors, and Mussa Juma Assad, Controller and Auditor General of the United Republic of Tanzania) approved a total of 28 audit reports.

Their audit work focused on the annual financial statements issued by 24 organisations, funds and programmes as at 31 December 2016 (not including 2015/16 reports on peacekeeping operations. The relevant recommendations were all adopted by the General Assembly). The Board also presented a wide range of audit findings developed as part of management and performance audits. Four other reports dealt with cross-cutting or horizontal audit issues. The Board noted that employee benefit liability, i.e. notably post-employment benefits, is one of the major liabilities for most of the entities. Employee benefit liability is more than 50 per cent of the total liability at half of the organisations and is as high as 94 per cent in one case. Therefore the Board stressed the need for entities to develop a funding plan for this liability. The Board pointed out that a funding arrangement was important to ensure payment of the employee benefit liabilities in the long term.

From the General Assembly’s point of view, the overall rate of implementation of earlier recommendations is a major measure of success of the Board’s work. The overall rate slightly increased to 45 per cent in 2016 over 43 per cent in 2015.

More information on the audit reports approved at the regular session is available in the press release of the Board at: https://www.un.org/press/en/2017/org1652.doc.htm.

The audit reports approved are scheduled to be published in September 2017.

The German SAI’s President presents the audit reports issued under the German portfolio
All financial statements audited by the German SAI received unqualified opinions

 

At the seventy-first regular session, Kay Scheller presented to the other Board members the audit reports issued under the German SAI’s portfolio. “We suggest issuing unqualified opinions for all the institutions we reviewed”. These were the words opening Kay Scheller’s statement. Then he presented the audit observations and recommendations in detail to the other Board members.

The German SAI’s President also highlighted the SAI’s audit findings on implementing the Sustainable Development Goals adopted by the UN. The Board uses a horizontal approach in auditing this issue at all UN entities. “Not all organisations and entities under review have formulated a long-term strategy on their role in the implementation of Sustainable Development Goals”, Kay Scheller said. “Such a strategy needs to be in place. The strategy is to be complemented by measurable indicators as a yardstick to evaluate any progress made. This is needed to clearly allocate budget to finance the activities related to the implementation of the Sustainable Development Goals.”

The audit portfolio encompassed audit findings developed by the German audit team at:

  • UNHCR (United Nations Office of the United Nations High Commissioner for Refugees) with total expenses of $3.8 billion and more than 10,800 staff;
  • UNODC (United Nations Office on Drugs and Crime) with $242 million and almost 650 staff;
  • UNU (United Nations University) with $90 million and 725 staff;
  • UNFCCC (United Nations Framework Convention on Climate Change) also with $90 million and more than 420 staff;
  • UNITAR (United Nations Institute for Training and Research) with $24 million and some 40 staff; and
  • UNCCD (United Nations Convention to Combat Desertification) with $16 million and some 60 staff.

As to UNFCCC and UNCCD, the German SAI noted with concern that these organisations did not provide any legal mechanism for the Board to present its audit findings directly to the governance bodies. The Board explicitly reiterated this observation.

 

The German SAI’s share in Volume I assignments


The Board also approved the Volume I report for which the Indian SAI is the lead auditor. Volume I covers the General Secretariat and the UN Administration. The audit teams of the German SAI have supplied major input to this key report. The German audit assignments encompass:

  • UNPD (United Nations Procurement Division);
  • OHCHR (Office of the High Commissioner for Human Rights);
  • UNOG (United Nations Office at Geneva);
  • SHP (Strategic Heritage Plan).

Kay Scheller stated that “The Volume I report reflects close and trustful cooperation among the members of the Board”.
 

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