Budget Committee Discusses Annual Report of Main United Nations Oversight Body, Stresses Need for Improved Risk Management, Investigative Capacities

8 October 2012
GA/AB/4039

Budget Committee Discusses Annual Report of Main United Nations Oversight Body, Stresses Need for Improved Risk Management, Investigative Capacities

8 October 2012
General Assembly
GA/AB/4039
Department of Public Information • News and Media Division • New York

Sixty-seventh General Assembly

Fifth Committee

3rd Meeting (AM)

Budget Committee Discusses Annual Report of Main United Nations Oversight Body,

Stresses Need for Improved Risk Management, Investigative Capacities

Despite laudable progress in lowering its overall vacancy rate to 11 per cent and streamlining and strengthening work processes, the Office of Internal Oversight Services (OIOS) still had work to do to improve its capacity to analyse risks and investigate complex financial and procurement cases, speakers said today as the Fifth Committee (Administrative and Budgetary) discussed programme monitoring and reviewed the efficiency of United Nations administrative and financial functioning.

Switzerland’s representative, speaking also on behalf of Liechtenstein, lauded the strategies of OIOS — the Organization’s main oversight body — to centralize certain administrative functions, as appropriate, and its move to conduct more individual audits and recommendations.  But, in order for OIOS to better flag high-risk areas for Member States’ priority attention, it should scrutinize audit patterns and trends more closely.

Similarly, the United States representative was pleased with the significant efforts to improve OIOS’ audit, investigation, inspection and evaluation functions, as well as the move this year to begin posting audit reports on the OIOS website.  But, he was concern that key capacities — notably to investigate complex financial and procurement cases — were still underdeveloped, placing the Organization at serious reputational and operational risk.  He hoped the recent external review of the Oversight Office’s Investigative and other Divisions would spur concrete improvements in the way such investigations were conducted.

OIOS’ progress in analysing audit risk trends, conducting reviews of its three divisions and other steps aimed at increasing efficiency and effectiveness were outlined in its annual report for the period 1 July 2011 to 30 June 2012, which was introduced today by David Kanja, Assistant Secretary-General for Internal Oversight Services.

The European Union’s delegate was worried that, as of 31 March, the Secretariat had implemented only 35 per cent of OIOS’ outstanding critical recommendations, and called on programme managers to beef up efforts in that regard.  He also concurred with the Independent Audit Advisory Committee (IAAC) — an expert panel that advises the General Assembly on the effectiveness of the Organization’s oversight function — that OIOS should bolster steps to create a full risk-based work plan.

Adrian Strachan, IAAC Vice-Chairman, who introduced that body’s report on its activities from 1 August 2011 to 31 July 2012, said recommendations by the oversight bodies should be high quality, add value and be implemented in a timely manner.  In addition, an organization as large, complex and important as the United Nations should have a robust enterprise risk management programme directed from the highest level.  He welcomed the designation of the Management Committee to serve as the Enterprise Risk Management Committee and stressed the need for a Chief Risk Officer vested with appropriate authority and consistent with bench mark 6 of the report of the Joint Inspection Unit (JIU) on enterprise risk management in order to prevent each department from operating in a silo.

Also today, the Committee began its discussion of programme planning, and on that topic, Eric Franck Saizonou ( Benin), Chairman of the Committee for Programme and Coordination (CPC), introduced the report on the body’s fifty-second session, held from 4 to 29 June 2012.  Johannes Huisman, Director of the Programme Planning and Budget Division, introduced the Secretary-General’s report on the proposed strategic framework for the biennium 2013-2014; and Mario Baez, Chief of Policy and Oversight Coordination Services of the Department of Management’s Office of the Under-Secretary-General for Management, introduced the Secretary-General’s report on the programme performance of the United Nations for the biennium 2010-2011.

Algeria’s representative, speaking on behalf of the Group of 77 developing countries and China, fully endorsed the CPC report’s recommendations and conclusions and welcomed its guidance on the proposed strategic framework for the period 2014-2015.  He expected Secretariat programme managers to diligently implement CPC’s recommendations and conclusions on evaluation functions, as well as to consult widely with Member States before presenting proposals on management reforms to the Assembly.

Cuba’s representative said that the Secretariat should formulate strategic frameworks in strict compliance with the legislative mandates and in a way that reflected the actions taken to implement them.  In reviewing the proposed framework for the period 2014-2015, he shared CPC’s concerns over the continued inclusion of concepts and terms that had not been approved by the relevant intergovernmental bodies.  For example, he questioned the reluctance to submit to the Human Rights Council the strategic framework prepared by the Office of the High Commissioner for Human Rights (OHCHR), considering the functions of that intergovernmental body.

Japan’s representative said his Government had recognized CPC’s significant role in preparing the Organization’s regular budget and had re-instated its full, active membership in that body earlier this year.

The representative of Singapore also spoke today.

The Committee will meet again at 10 a.m. on Tuesday, 9 October, to take action on a draft resolution concerning the scale of assessments for the apportionment of United Nations expenses, as well as to begin discussing the scale for United Nations peacekeeping operations; administrative and budgetary coordination of the United Nations specialized agencies and the International Atomic Energy Agency (IAEA); and United Nations partnerships.

Background

The Fifth Committee (Administrative and Budgetary) met this morning to consider the United Nations programme performance for the period 2010-2011, the proposed strategic framework for the period 2014-2015, activities of the Office of Internal Oversight Services (OIOS), and a review of efficiency.

Under the programme planning and proposed strategic framework heading, it had before it the report of the Committee for Programme and Coordination on the work of its fifty-second session (document A/67/16), issued following the body’s substantive session from 4 to 29 June 2012.  As the main subsidiary organ of the Economic and Social Council and the General Assembly for planning, programming and coordination, the Committee is involved with regulations and rules governing programme planning, the programme aspects of the budget, monitoring implementation and evaluation methods.

The report sets out the Committee’s conclusions and recommendations on the Secretary-General’s report on the United Nations programme performance for the biennium 2010-2011; the proposed strategic framework for the period 2014-2015; coordination questions; and the report of OIOS on the triennial review of the recommendations the Committee made at its forty-ninth session when evaluating United Nations coordinating bodies, lessons learned concerning protocols and practices and United Nations support for least developed countries, landlocked developing countries, small island developing States and Africa.

The report on the proposed strategic framework for the period 2014-2015 (documents A/67/6 (Part I) and (Part II)) lists the Organization’s longer-term objectives, priorities for 2014-2015 and the structure and format for them.  The proposed priorities include promotion of sustained economic growth and sustainable development in line with relevant Assembly resolutions and recent United Nations conferences, maintenance of international peace and security, development of Africa, promotion of human rights, effective coordination of humanitarian assistance efforts, promotion of justice and law, disarmament, and drug control, crime prevention and combating international terrorism.  Part II of the report gives a detailed breakdown of each of the 28 programmes of the biennial plan and their respective goals and strategies to implement them.

The Secretary-General’s report on the programme performance report of the United Nations for the biennium 2010-2011 (document A/67/77) gives an overview of the major developments and work performed by the Secretariat during the biennium and includes information on the Organization’s results in terms of expected accomplishments and output.  It reports on the progress of each of the 36 sections of the budget in implementing the 856 expected accomplishments and their respective challenges and obstacles.  It also highlights the progress of the Organization’s 10 main programme areas and gives a detailed account of output delivery and resource utilization.  According to the report, 32,300 outputs, or 90 per cent of those mandated, were implemented during the 2010-2011 biennium, up one point from the previous biennium.

Under the OIOS activities heading, the Committee was set to consider an OIOS report on that Office’s activities for the period from 1 July 2011 to 30 June 2012 (document A/67/297 (Part I)).  Its six main sectors cover initiatives aimed at improving OIOS functions; its plans to strengthen the effectiveness of internal audit reports; internal audit risk trend analysis; oversight results of the Internal Audit Division, Inspection and Evaluation Division and Investigations Division; and mandated reporting on oversight activities concerning the Capital Master Plan, the United Nations Compensation Commission and the construction of additional office facilities at the Economic Commission for Africa (ECA) in Addis Ababa and the United Nations Office in Nairobi.

The report excludes oversight activities of the Department of Peacekeeping Operations, Department of Field Support, and peacekeeping and special political missions, which will be presented to the Assembly in Part II of the report during its current session.

During the reporting period, OIOS issued 284 oversight reports, including 13 to the Assembly and 46 closure reports.  They included 807 recommendations to improve internal controls, accountability mechanisms and organizational efficiency and effectiveness, of which 65 were classified as critical to the Organization.  The recommendations had financial implications of approximately $4.7 million.  The financial implications of similar recommendations satisfactorily implemented during the period totalled some $2.5 million.

An addendum to the report (document A/67/297 (Part I)/Add.1) gives a detailed analysis of the status of implementing the recommendations and a breakdown of their financial implications.  It highlights critical recommendations whose implementation is overdue, together with management’s latest update on progress thus far.

The addendum is divided into four main sections (II-V).  Section II gives an overall assessment of the implementation of recommendations.  Using a consolidated ageing table, section III provides a closer look at outstanding recommendations by entity, including, where applicable, separate comments on the recommendations of concern.  Section IV lists critical recommendations whose implementation is past due.  Section V lists OIOS recommendations with financial implications in terms of loss and waster of resources, recovery, expenditure reduction, additional income and budget reduction.  Section VI presents the list of oversight reports issued by OIOS between 1 July 2011 and 30 June 2012.

Of the 908 recommendations OIOS issued to United Nations entities from 1 January 2011 to 31 December 2011, a total of 81, or 9 per cent, were deemed critical.  As of 31 December 2011, programme managers had implemented 403, or 59 per cent, of all recommendations, and 56, or 77 per cent, of all critical recommendations issued during that period.

The Secretary-General’s note transmitting the report of the Joint Inspection Unit (JIU) on the investigations function in the United Nations system (document A/67/140) reviews those functions and gives recommendations aimed at system-wide coherence and harmonization among the United Nations oversight mechanisms in discharging their investigation responsibilities.  It notes significant progress towards that end, but a fragmented approach and an uneven application of investigation standards within the Organization, with investigations being conducted by non-professional investigators and/or entities.  As in the past, internal oversight entities are not operationally independent from their executive heads because the heads are neither free to decide their own budgetary requirements nor able to exercise total control over their human resources.

JIU issues eight recommendations, mainly for the executive heads to implement.  Of particular note is the suggestion that the Secretary-General establish an inter-agency task force under the auspices of the United Nations System Chief Executives Board for Coordination (CEB) that would present options for creating a single United Nations system Investigation Unit by the end of 2013 for presentation to legislative bodies.  Consolidating investigation functions into one body would benefit small agencies without investigative capacity, harmonize business practices, lead to common investigative standards and procedures, resolve independence issues, lead to hiring only professional investigators, allow staff promotion opportunities and address difficult fragmentation issues.

The JIU also recommends that the legislative bodies of United Nations system organizations direct executive heads to ensure the internal oversight entities or investigation units are authorized to initiate investigations without the executive head’s prior approval.  Moreover, the legislative bodies should review the adequacy of resources and staffing on the investigations function on the basis of recommendations of the respective audit/oversight committees either annually or biennally depending on the organizations’ budget cycle.

The Secretary-General’s note (document A/67/140/Add.1) transmits his comments and those of CEB on the recommendations in the above-mentioned JIU report.  In general, United Nations system organizations welcome the JIU report and acknowledge that the conclusions will enhance the system’s effectiveness and the recommendations are aimed at ensuring the independence of the investigations’ functions in various organizations.  However, he notes that some recommendations are not applicable to small agencies that lack separate investigation units.  Additionally, the organizations call for further clarification in some areas of the report, such as in paragraphs 18 and 19, where it is suggested that personnel-related issues, such as performance, should not rise to the level of formal investigation.

Concerning the efficiency of the Organization’s administration and financial functioning, the Committee had before it the report on activities of the Independent Audit Advisory Committee for the period from 1 August 2011 to 31 July 2012 (document A/67/259 and Corr.1) issued by that body.  It gives an overview of that Advisory Committee’s activities, the status of its recommendations, its plans for 2013 and detailed comments, particularly concerning OIOS.  As of 30 June 2012, the Independent Audit Advisory Committee had made 103 recommendations, including 10 reiterated recommendations, on internal oversight and accountability.

Programme Planning

ERIC FRANCK SAIZONOU ( Benin) Chairman of the Committee for Programme and Coordination, introduced the report of the Committee for Programme and Coordination on its fifty-second session (document A/67/16) held from 4 to 29 June 2012.

The report sets out the Committee’s conclusions and recommendations on the Secretary-General’s report on the United Nations programme performance for the biennium 2010-2011; the proposed strategic framework for the period 2014-2015; coordination questions; and the report of OIOS on the triennial review of the recommendations the Committee made at its forty-ninth session when evaluating United Nations coordinating bodies, lessons learned concerning protocols and practices and United Nations support for least developed countries, landlocked developing countries, small island developing States and Africa.

Regarding the 2010-2011 programme performance, he said the Committee’s recommendations include, among others, that the General Assembly ask the Secretary-General to ensure that more in-depth enterprise risk management be undertaken before the introduction of new management tools, and to include information on how the reduction of printed documents has impacted the intergovernmental decision-making process in United Nations conferences and meetings.

He then turned to the proposed strategic framework for the period 2014-2015, which is composed of Part I, the plan outline; and Part II, the biennial programme plan.  The Committee recommended the approval of the eight priorities for the period 2014-2015, contained in paragraph 41 of the plan outline.  But, differences between Member States prompted the Committee to recommend that the Assembly review the plan outline at its sixty-seventh session, under the agenda item “Programme Planning”.  With regard to the individual programme plans of the proposed strategic framework 2014-2015, the Committee recommended that the Assembly approve 26 out of the 28 programme plans.

Turning to the three reports of OIOS, he said the Committee recommended that the Assembly ask the Secretary-General to take additional steps to develop a single, common definition of lessons learned and explore ways to capture, analyse and share the benefits of the lessons learned.

Mr. Saizonou then turned to coordination questions and the overview report of CEB for 2011/2012, saying that the Committee recommended that the Assembly bring to the Secretary-General’s attention the need for the Board to take actions that foster dialogue between the Board and Members States.  The Committee also recommended that the transparency of the CEB’s report be improved.

Finally, on United Nations system support for the New Partnership for African’s Development (NEPAD), the Committee recommended that the Assembly back the material contained in paragraphs 101 to 109 of the report.  He said that the body had also welcomed the appointment of the Under-Secretary-General and Special Adviser on Africa.  The Committee recommended that Assembly ask the Organizations of the United Nations system to keep coordinating its work with NEPAD, and called upon the United Nations system to keep weaving the special needs of Africa into all of its activities.

Next, JOHANNES HUISMAN, Director, Programme Planning and Budget Division, introduced the Secretary-General’s report on the proposed strategic framework for the biennium 2013-2014 (document A/67/6 (Part I)) and A/67/6 (Part II)).  He said the framework comprised a plan outline and a biennial programme plan.  The plan outline, which was prepared under the Secretary-General’s leadership with the full involvement of his senior management, focused on eight priority areas for the Organization’s work that were previously identified in Assembly resolution 65/262 and in the Secretary-General’s vision to respond to those challenges.

The present report had already been subjected to an intergovernmental review by relevant sectoral, functional and regional bodies.  In several cases, he said, the reviews took place before finalizing the framework and their outcomes had been incorporated in the proposals.  In others, the reviews occurred after the finalization of initial proposals and modifications provided by the Committee for Programme and Coordination (CPC) when it reviewed the framework in June.

Work would continue to ensure the programmes were updated as appropriate to reflect the impact of intergovernmental decisions made earlier this year after the proposed framework was prepared, he said.  Such change would be included in the introduction of the budget fascicles, if applicable, and submitted to the Programme Committee’s third session.  The proposed framework had benefitted from the experience gained since the inception in 2002 of the methodology to show the relationship among objectives, expected accomplishments and indicators of achievement.  In line with that Committee’s recommendations set forth in the report (A/65/16), the Secretariat worked in a coordinated way to improve the formulation of all elements of subprogramme logical frameworks to make them a more meaningful informational and management tool for Member States.

MARIO BAEZ, Chief Policy and Oversight Coordination Services, Office of the Under-Secretary-General for Management, Department of Management, introduced the Secretary-General’s report on the programme performance of the United Nations for the biennium 2010-2011 (document A/67/77).  The report was presented to the Committee for Programme and Coordination at its fifty-second session held from 4 to 29 June 2012.

He said the report was the seventeenth biennial programme performance report since it was first prepared in 1980 for the 1978-79 biennium.  It included a detailed recounting of the results posted by each of the 36 sections of the programme budget in implementing the 856 expected accomplishments.  It also covered more than 32,300 outputs implemented during the 2010-2011 biennium, Mr. Baez said.

Section II of the report highlighted the main results achieved by the Organization under its 10 programme elements, in order to give Member States the opportunity to assess the Secretariat’s performance at an aggregate level.  Section II referred to output implementation, which reached 90 per cent during the 2010-2011 biennium.  That, he continued, was higher than the 89 per cent implementation rate achieved during the 2008-2009 biennium.  Only three budget sections implemented at lower than the 80 per cent rate of their mandated outputs:  disarmament, 70 per cent; safety and security, 75 per cent; and United Nations Entity for Gender Equality and the Empowerment of Women (UN-Women), 77 per cent.

MOURAD BENMEHIDI (Algeria), speaking on behalf of the Group of 77 developing countries and China, placed high value on the programme Committee’s inputs, fully endorsed the recommendations and conclusions in the CPC report, and encouraged Member States to fully engage with that body.  He welcomed CPC’s guidance on the proposed strategic framework for the period 2014-2015.  Endorsing the outcome of the United Nations Conference on Sustainable Development, he said his delegation was fully committed to ensuring that the programme narrative on the environment of the proposed programme budget for the biennium 2014-2015 reflected the decisions taken at that Conference.

He stressed the importance of the Secretariat’s evaluation processes and expected that managers would diligently implement the CPC’s recommendations and conclusions on evaluation, as well as consult widely with Member States before presenting proposals on management reforms to the Assembly.  He welcomed ongoing efforts by the United Nations to support NEPAD and the Programme Committee’s debate on it.  He welcomed the appointment of Maged Abdelaziz as Under-Secretary-General and Special Advisor on Africa, and supported that official’s mandate.

CEB should play an important role in improving coordination in the United Nations system and enhancing its effectiveness, he said.  He urged the Secretary-General, as CEB Chairman, to continue taking steps to enhance the Board’s transparency and accountability to Member States in line with Assembly resolution 66/257, among others.  As CPC recommended, the Board should continue to act in line with its mandate on enhancing system-wide coordination and in conformity with the intergovernmental mandates of its member organizations.  He welcomed continued cooperation among CEB, the International Civil Service Commission (ICSC) and JIU, and he encouraged them to engage more effectively on matters of mutual interest.

HIROSHI ONUMA ( Japan) said that in May, for the first time since 2007, Japan had returned to CPC as a full member, and had subsequently participated in the body’s fifty-second session in June.  Japan’s decision to return had been based on its recognition of CPC’s significant role in preparing the Organization’s regular budget.  During its June session, CPC had fruitful discussions focused on each programme.  He welcomed adoption of the CPC report on that session’s work.  Japan would continue to participate actively in the body’s deliberations, he said, adding that his delegation was ready to constructively engage in the Fifth Committee’s discussions on programme planning and its review of the CPC report.

JORGE CUMBERBATCH ( Cuba) said programme planning was essential to the Organization’s functioning, as it allowed the legislative mandates of the various intergovernmental bodies and entities to become consensual, concrete activities.  He repeated his delegation’s concern over the lack of reports by the Joint Inspection Unit on the work of CPC.  That was contrary to the recommendation adopted at its forty-seventh session and endorsed by Assembly resolution 62/224.

Regarding CPC’s review of the proposed strategic framework for 2014-2015, he said Cuba believed the Secretariat should formulate the strategic frameworks in strict compliance with the legislative mandates and in a way that reflected the actions taken to implement them.  Cuba shared the Committee’s concerns with the continuous inclusion of concepts and terms that had not been approved by the relevant intergovernmental bodies.  That was frequently the view of just one part of the Organization’s membership, which questioned the impartiality and neutrality of those in the Secretariat who prepared the documents that were analysed.  The situation had led to disagreement among the Committee members relating to the presented plan outline of the proposed strategic framework.  Therefore, he questioned the validity of keeping the plan outline as part of the strategic framework, for its preparations had nothing to do with the status of the mandates approved by the various intergovernmental bodies.

Turning to the importance of the Secretariat to abide by Regulations and Rules Governing Programme Planning, he said those rules clearly provided that intergovernmental bodies should review their proposed strategic frameworks before their review by CPC.  For that reason, Cuba did not understand the reluctance to submit to the Human Rights Council the strategic framework prepared by the Office of the High Commissioner for Human Rights (OHCHR), considering the functions of that intergovernmental body.

Cuba also hoped that, in line with the recommendation of the General Assembly’s General Committee, reflected in paragraph 72 of the report A/67/250 and endorsed by the Assembly itself, the Main Committees would include in their respective programmes of work opportunities for a thorough analysis of the proposed strategic framework.  In this respect, he said that his delegation assumed negotiations in the Fifth Committee would not conclude until the Main Committees had all expressed their views.

Finally, on strengthening the culture of accountability and transparency, he said it was urgent to adopt measures to foster dialogue between CEB and Member States.

Office of Internal Oversight Services (OIOS)

DAVID KANJA, Assistant Secretary-General for Internal Oversight Services, introduced the annual report of the Office of Internal Oversight Services (OIOS) for the period from 1 July 2011 to 30 June 2012 (documents A/67/297 (Part I) and Add.1).  During that period, OIOS continued to make progress with various change management initiatives — among them the commission of quality reviews for each of its three divisions - aimed at increasing efficiency and effectiveness.

The review of the Internal Audit Division was concluded last year; the reviews of the Investigations Division and the Inspection and Evaluation Division were in the final stages.  He said that during the past year, OIOS developed a clear vision based on stakeholders’ expectations and it started to create strategies aimed at pooling resources and centralizing administrative functions.  The Office was in the process of repositioning its communications tools and activities to ensure effective outreach to stakeholders.

In the past two years, the OIOS vacancy rate had fallen by almost 12 per cent to 11 per cent in September, he said.  While that was a marked improvement, his Office would continue pursuing further reductions and it would periodically inform the Committee of its progress.  During the reporting period, OIOS had issued 284 reports with 807 recommendations, of which 65 were critical.  A year earlier, it issued 323 reports with 1,702 recommendations, of which 398 were critical.  The reduced number of recommendations was due to the introduction of overall audit ratings of “satisfactory”, “partially satisfactory” and “unsatisfactory”, and of audit recommendation categories of critical, important and opportunity for improvements.  OIOS was using the recommendation categories to ensure better follow-up based on the importance or criticality of deficiencies.  The use of ratings and categories had strengthened the overall audit review process and client relations.  OIOS clients also benefited since they now dealt with less volume and had more time to focus on important, critical issues.

As requested by Member States, his Office had conducted an internal audit risk trend analysis, he said.  Information technology management, especially in developing major systems such as Inspira and Umoja, was among the higher risk profiles for 2011.  In general, the highest risk areas in 2011 spanned all the Organization’s operational activities, including programme and project management, safety and security; procurement and contract administration; information technology; human resources management; and strategic management and governance.

ADRIAN STRACHAN, Vice-Chairman, Independent Audit Advisory Committee (IAAC), introduced the report of the Independent Audit Advisory Committee on its activities for the period from 1 August 2011 to 31 July 2012 (document A/67/259 and Corr.1).

The fifth annual report, he said, included a preliminary work plan of the Audit Committee for 2013.  Since its inception, IAAC had made 103 recommendations; 57 had already been implemented, 10 were reiterated from previous periods, 22 were either in progress or pending consideration and 14 recommendations from previous annual reports had been deferred for consideration by the Assembly to subsequent sessions.  IAAC would continue to closely monitor implementation of its recommendations.

He noted the improvement in the rates of implementation of oversight body recommendations and believed that that was a step in the right direction.  However, for that shift to translate into accountability, the Audit Advisory Committee believed such recommendations should be high quality, add value and be implemented in a timely manner.  IAAC continued to study the new initiative that OIOS had introduced in its treatment of recommendations issued to management.

Regarding risk management and the internal control framework, he said that IAAC had again emphasized that an organization of the size, complexity and importance of the United Nations should have a robust enterprise risk management programme directed from the highest level.  IAAC, therefore, welcomed the designation of the Management Committee to serve as the Enterprise Risk Management Committee.  In order to avoid the danger of each department operating in a silo, he said IAAC had reiterated the need for a Chief Risk Officer vested with appropriate authority and consistent with bench mark 6 of JIU’s report on enterprise risk management.

Turning to the long-standing issue of the high vacancy rate in OIOS, Mr. Strachan noted that while the overall rate had been declining, the vacancy rate in the agency’s Investigative Division, especially in the field, was too high.  IAAC also was reviewing the changes OIOS had begun concerning the manner in which its audit reports were prepared.  “While there are still areas that need to be addressed by OIOS, the Office appears to continue making progress with regard to the quality of its work,” he said.

Regarding financial reporting, he said IAAC was engaged with management on various reform initiatives, including the implementation of the International Public Sector Accounting Standards.  IAAC had reviewed and provided its comments on the International Public Sector Accounting Standards policy framework.

Mr. BENMEHIDI (Algeria), speaking on behalf of the Group of 77 and China, noted the OIOS’ various assignments and recommendations during the reporting period aimed at cost savings, recovery of overpayments, efficiency gains and other improvements to ensure that risks were managed consistently and systematically through focused control processes in the Organization.  He supported OIOS’ operational independence within the context of Assembly resolution 48/218 B.  He lauded OIOS’ continued regular coordination with other United Nations oversight entities, particularly the Board of Auditors and JIU, in the context of the tripartite and other arrangements that had improved delivery of the given mandate.

Continuing, he said his delegation was encouraged by the ongoing initiatives to strengthen the OIOS’ functions, notably its work processes and systems and cultivation of a professional workforce.  He encouraged timely completion of the OIOS’ process of compiling key oversight terms.  The delegation was further encouraged by the OIOS’ gradual progress in resolving long-standing vacancy issues.  He welcomed Mr. Kanja’s appointment, which would strengthen OIOS’ leadership and managerial functions.

However, while acknowledging the improvement in OIOS’ recruitment, especially at the senior level, he remained concerned over its high vacancy, which stood at 15 per cent.  He encouraged the Secretary-General to make every effort to fill vacancies in strict conformity with relevant Assembly resolutions, including on gender balances and equitable geographical distribution.  He noted the OIOS’ recommendations for the reporting period and their financial implications.  He encouraged the Office to focus on its work on the quality of recommendations.  In that regard, the Group of 77 and China would examine several issues and request specific clarification during the informal consultations.  OIOS must involve and agree with clients when introducing new initiatives or approaches.

He looked forward to discussing detailed findings on the oversight coverage on the Capital Master Plan and United Nations Compensation Commission, and construction of additional office facilities at the ECA in Addis Ababa and the United Nations Office in Nairobi.  He noted the IAAC’s concrete suggestions for enhancing the effectiveness, efficiency and impact of the audit activities and other OIOS oversight functions in conjunction with the review of OIOS’ reporting procedures and functions.

GERTON VAN DEN AKKER, delegation of the European Union to the United Nations, appreciated the OIOS’ clear reporting on its annual activities.  He welcomed its risk-assessment approach to prioritize its work and its continued endeavours to further improve the quality and effectiveness of its activities.  He noted with concern, however, that only 35 per cent of OIOS’ outstanding critical recommendations had be implemented by the end of the first quarter of 2012 and he called on all programme managers to increase their efforts towards that end.  He was aware that it was not always feasible to quantify the results of implementing the recommendations.  Still, he was interested in being informed about the results, when possible, and looked forward to discussing them during informal consultations.

He welcomed the measures outlined in the OIOS’ report on dissemination and distribution of audit reports, including their public dissemination.  The United Nations oversight bodies must continue close cooperation and coordination in order to avoid potential duplication and overlap and to enable discussion on mutual interest.  He concurred with the IAAC’s view that OIOS should expedite efforts to achieve a fully risk-based work plan.  He echoed IAAC in commending the Oversight Office’s recent efforts to reduce the number of vacant posts.  He lauded the IAAC’s work and its clear summary of activities in its report, and he agreed with its recommendation that the Secretary-General should finalize the long-awaited proposed terms of reference on the comprehensive review of investigations in the United Nations.

MATTHIAS DETTLING (Switzerland), also speaking on behalf of Liechtenstein, commended Under-Secretary-General Carman Lapointe for further progress in reducing the OIOS vacancy rate while developing strategies to centralize certain administrative functions, as appropriate.  He welcomed her initiatives to assess all three divisions by an external agency and looked forward to the results of those external reviews.  During the review period, OIOS had been very productive and conducted a sizeable number of audits.  In light of the impressive volume of work, it was necessary to not only look at individual audit reports and recommendations, but also at the patterns and trends of audit results.  OIOS’ internal risk trend analysis was a step in the right direction.  He encouraged OIOS to further refine its analysis of risk trend so that it became a relevant, effective tool for Member States to be better informed about areas of high risk and specific issues within high-risk areas in need of attention.  The trend analysis should allow OIOS to take a more strategic approach to determine which areas needed to be audited as a matter of priority.

He supported IAAC’s recommendations on enterprise risk management.  For several years, IAAC had consistently stated the need to strengthen the Secretariat’s enterprise risk management.  Many past problems — some with serious financial consequences — could have been avoided or at least mitigated, had a more systematic risk management approach been in place.  He encouraged the Secretary-General to expedite implementation of the risk management framework across the Secretariat and to dedicate the necessary support to it.  IAAC would be well placed to reflect upon the evolving relationship between OIOS and management.  He expected that with Assembly resolution 66/232 B, the Board of Auditors would increasingly emphasize performance audits, which had traditionally been the domain of the internal oversight function.  As JIU had been carrying out more evaluations of immediate relevance to the Secretariat, there was an increasing need for coordination among the three oversight bodies in question.  He would like to solicit IAAC’s advice on how to best ensure optimal coordination.

SHERYL SHUM ( Singapore) said her delegation believed in the value of strengthening the Organization’s accountability, fairness and oversight — the reason it had supported the establishment of OIOS in 1994.  She noted the agency’s progress in reducing its vacancy rate to 15 per cent at the end of the reporting period and urged the Secretary-General to make every effort to fill the remaining open posts.  She welcomed the addition of David Kanja, as Assistant Secretary-General, to help strengthen the agency’s leadership and hoped a better-staffed office would ensure its work plans were implemented on a timely basis.

Turning to IAAC, she said that Singapore believed the Advisory Committee had consistently provided valuable and useful insight on OIOS and reaffirmed the separate and distinct roles of internal and external oversight mechanisms.  Together, the various United Nations oversight bodies — OIOS, the Board of Auditors, IAAC and JIU — formed a mutually-reinforcing framework upon which a more efficient and stronger Organization was built, she said.

CHERITH NORMAN (United States), recalling the statement made at the Committee’s opening session, said his delegation was pleased that the Assembly would have an opportunity to advance transparency by approving the public disclosure of audits of the Secretariat, as proposed by the head of OIOS some time ago.  “We look forward to engaging colleagues on this important initiative and are hopeful that we will rise to the occasions and adopt this initiative,” he said.

While pleased with the significant efforts to improve the capacity and functions of OIOS in the audit, investigation, inspection and evaluation areas, the United States was concerned that key capacities were still underdeveloped and not performing to their full potential.  That placed the Organization at serious reputational and operational risk, he said.

The United States remained concerned about the Office’s investigative capacity, particularly its capability to investigate complex financial and procurement cases.  He noted the external review that had just been completed of the Investigative Division and other divisions.  “It is our hope that this will lead to concrete improvements in the way investigations are pursued and conducted,” he said.  He was concerned about the low number of investigations completed during the last reporting period, compared to previous years.  While hoping that the efforts to build a culture of ethical conduct had played a role in the decrease, those factors alone would not explain how a large organization would have so few cases to investigate, he said.

He commended Ms. Lapointe for her impressive efforts to reduce the vacancy rate, which had dropped from a high of 27 per cent to 12 per cent at the end of August.

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For information media • not an official record
For information media. Not an official record.