United Nations Panel of External Auditors

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    1998-2008
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Modus Operandi of the Panel

Standards of Auditing

Panel members conduct their audits in conformity with the International Standards on Auditing. The audits are also conducted in accordance with the Financial Regulations and Rules of the individual organisations.

Financial and Compliance Auditing

The core responsibility of the members of the Panel is in relation to financial and compliance auditing. In this regard, the Panel is required to, inter alia, ascertain whether:

• The financial statements present fairly the financial position as at the end of the period and the results of operations for the period then ended;
• The financial statements were prepared in accordance with stated accounting principles;
• The accounting policies were applied on a consistent basis with those of the preceding financial period; and
• Transactions were in accordance with the relevant Financial Regulations and legislative authority.

TopPerformance Auditing

The Panel derives its mandate to conduct performance audits from the Financial Regulations and Rules of the organisations concerned. In this regard, the Panel may make observations with respect to the efficiency of the financial procedures, the accounting system, and the internal financial controls and, in general, the administration and management of the organisation.

The results of performance audits undertaken are normally integrated with those of the financial and compliance audits and are reflected in the individual Panel member’s long-form report to the governing bodies.

TopRules of Procedure

The Panel is guided in its work by its Rules of Procedure which provides, among others, for election of a chairperson and for the convening of meetings when necessary but normally not less frequently than once every two years. The current practice is for meetings to be held every year, normally in November-December, and for the chairperson to be elected at that meeting.

TopThe Technical Group of the Panel

Technical Group members at the Cours des Comptes of France during the Panel's meeting in December 2008

The Panel established its Technical Group at its 26th session in 1984. The Group comprises the Directors of External Audit, or equivalent, and the Executive Secretary of the Panel. Much of the Panel’s work is undertaken by the Technical Group which is mandated to research and review specific topics of interest to the Panel. The Technical Group reports to the Panel at its regular meeting on the topics reviewed and its recommendations.

The Chairperson of the Technical Group for 2009 is Mr. Michael Schrenk (Germany) while the Vice-Chairperson is Mr. Imran Vanker (South Africa). The Technical Group normally meets formally immediately prior to the Panel's regular session

TopPanel Activities

To date, the Panel has discussed about 250 topics of which the following are the most recent ones:

December 2008 Session

• Update on United Nations reform initiatives
• IPSAS & ERP implementation: WFP/WMO audit experience
• IPSAS & ERP implementation: WHO audit experience
• IPSAS & ERP implementation: system-wide
• Progress report on the revision of the Financial Regulations and Rules of the UN System in preparation for IPSAS
• Audit of end-of-service liabilities, including ASHI
• Update on the ‘single audit’ principle
• Impact of voluntary contributions on the United Nations organisations
• Recent developments in International Standards on Auditing
• Auditing an international organization – a Chinese perspective
• Feedback on attendance at RIAS
• Significant lessons learnt arising out of the audits of the United Nations System

December 2007 Session

• Update on response to the Tsunami Report;
• Lessons learnt from DPRK audit;
• Update on United Nations reform initiatives;
• Progress on the implementation of IPSAS and its impact on the role of the external auditor;
• Auditor’s consideration of negative equity resulting from the provision for liabilities for ASHI;
• Proposed new format for short-form report;
• Certification of internal controls;
• Update on the ‘single audit’ principle;
• Impact of audit recommendations;
• Availability of internal audit reports of the United Nations organizations to Member States and other stakeholders;
• Update on the coordinating activities of the audit working group of United Nations Development Group;
• Comparative analysis of Financial Regulations
• and Rules of the UN system relating to the external audit function;
• Lessons learnt arising out of the audits of the United Nations system;
• Update on INCOSAI Mexico Conference.

December 2006 Session

• Update on United Nations reform initiatives;
• Discussion on PwC report on governance and oversight;
• Audit of tsunami-related activities;
• Results of survey on performance auditing;
• Performance audits of human resources management;
• Accrual budgeting – the ICAO experience;
• Introduction of IPSAS and its implications for the United Nations financial Regulations and Rules;
• ‘Emphasis of matter’ and the auditor’s opinion;
• Update on the United nations Task Force on Accounting Standards;
• External auditing of the United Nations system and the ‘single audit’ principle;
• Peacekeeping audit of payments to troop contributing countries;
• Electronic New Government Accounting System – the Philippines experience; and
• Update on the activities of the United Nations Development Group.

December 2005 Session

• Lessons learnt from the Oil-for-Food Inquiry;
• Reflections on United Nations reform initiatives;
• Developments and challenges in internal auditing;
• Audit committees and management oversight boards;
• Audit efforts on tsunami-related activities;
• Impact of conditions attached to voluntary contributions;
• Overview of the activities of the United Nations Development Group;
• Standard terms of reference for external auditors;
• Short-form audit reports;
• United Nations System Accounting Standards;
• Managing stakeholder expectations;
• ‘Single audit’ principle regarding UNDG Iraq Trust Fund;
• Charter level recognition for external auditors;
• Appointment of private auditors for UN organisations;
• European Commission and the ‘single audit’ principle; and
• Joint Inspection Unit “oversight lacunae” report.

December 2004 Session

• Effectiveness of internal audit functions as well as internal control systems and practices;
• UNDP inter-office voucher procedures at individual organisations;
• The role of audit committees;
• Information and communication technology systems within the UN organisations;
• Validating performance indicators in the United Nations system;
• Valuation of after-service insurance within the United Nations system;
• Recognition, valuation, and reporting of environmental costs, liabilities and assets;
• Sharing of experiences in audit planning and discussion of recent developments in this area;
• Third party audits;
• Format of the audit opinion of the Panel, including the issue of a separate compliance opinion;
• Impact of the implementation of the recommendations of the external auditor;
• Exchange of practices on materiality in audits;
• Responsibility for the detection of fraud;
• Update on United Nations System Accounting Standards;
• Adequacy of donor reports and progress of HLCM review;
• Update on audit of Oil-for-Food programme;
• Access to audit work papers by third parties; and
• Terms of reference of external auditors.

Top Panel Achievements

Among the achievement of the Panel over the years are:

• Was instrumental in assisting in the development of the United Nations Accounting Standards (UNSAS) and new formats of the financial statements;
  
  
• Developed the Common Auditing Standards for Panel Members;
  
  
• Made proposals on changes in the content and presentation of the results, of actuarial valuations of the Pension Fund, and the presentation of the Funds financial statements;
  
  
• Reaffirmed co-operation with the Joint Inspection Unit through meetings, exchange of long-form audit reports, and providing information on plans of Panel members to carry out examinations of the economic and efficiency in the United Nations organizations they audit;
  
  
• Provided advice on how oversight functions could be improved;
  
  
• Put forward to the Secretary-General proposals to revise the audit opinion and the additional terms of reference governing external audit to bring them in line with revised standards set by the International Federation of Accountants (IFAC). The General Assembly approved of an amendment to the additional terms of reference governing the audit of the United Nations;
  
  
• Put forward to the General Assembly proposals for strengthening the implementation of external auditors’ recommendations. The General Assembly accepted the proposal;
  
  
• Reaffirmed to the Secretary-General the Panel’s position on the ‘single audit’ principle;
  
  
• Agreed to conduct audits in conformity with the International Standards on Auditing issued by the International Auditing and Assurance Standards Board of the International Federation of Accountants (IFAC);
  
  
• Issued its first report on the lessons-learned from the audit of tsunami-relief activities;
  
  
• Reaffirmed the Panel’s role as governance partners and its availability to contribute to the United Nations reform initiatives;
  
  
• Provided input in the proposed terms of reference of the Independent Audit Advisory Committee (IAAC) especially with regard to the preservation of the independence of the external audit function;
  
  
• Advocated that the United Nations moves towards the adoption of internationally recognised accounting standards as a replacement for the United Nations system Accounting Standards (UNSAS). The General Assembly has since approved of the adoption of International Public Sector Accounting Standards (IPSAS);
  
  
• Reiterated its position that Supreme Audit Institutions are better placed to render external audit services to public funded organisations such as the United Nations system. Accordingly, the Panel advocated recognition of this at the highest level, this is, in the United Nations Charter; and
  
  
• Emphasised that certain conditions attached to donor contributions are inconsistent with the statutory goals and principles of the United Nations Charter.