RESTRICTED  
  
WT/BFA/W/515  
 
12 March 2020  
(20-1946) Page: 1/16 
Committee on Budget, Finance and Administration    
 
 
OFFICE OF INTERNAL O VERSIGHT (OIO)  
 
REPORT TO THE CBFA  
ON THE REVIEW OF APPELLATE BODY MEMBERS' AND PANELISTS' COSTS  
 
 
1  INTRODUCTION  
1.1.  Upon request of the Director -General (DG), the Office of Internal Oversight (OIO ) conducted an 
internal audit of expenditures relating to Appellate Body Members (ABMs) and Panelists at the WTO.  
1.2.  The main purpose of the audit was to assist the DG in analysing the internal control of expenditures 
of ABMs and Panelists and identifying mit igating mechanisms that may be deemed necessary.  
1.3.  This internal audit was not intended to assess the efficiency and effectiveness of Panel and Appellate 
Body proceedings (e.g. duration of proceedings, quality of work deliverables, etc.), nor to determine 
whether the level of the current compensation of Panelists and ABMs is adequate, nor to analyse or reflect 
on the conduct or behaviour of specific current or former Panelists or ABMs. This audit was not an 
investigation into allegations of misconduct.  
1.4.  The sc ope of the audit covered ABMs' and Panelists' costs processed by the WTO between 
1 January  2017 and 31 October 2019.  
1.5.  The audit was carried out in accordance with the International Audit Standards prescribed by the 
Institute of Internal Auditors (IIA).1 
1.6.  In order to obtain a sound understanding of the manner in which ABMs' and Panelists' costs are 
managed and controlled at the WTO, the OIO reviewed relevant policies and procedures, analysed 
supporting documents, tested samples of transactions, and conducted i nterviews with concerned staff 
members from the Legal Affairs Division (LAD), the Rules Division (RULES), the Appellate Body Secretariat 
(ABS) and the Administration and General Services Division (AGSD).  
1.7.  The findings observed during the audit were discusse d with the concerned parties and management, 
in view of identifying the necessary mitigating internal controls and agreeing on the recommendations 
proposed in this report. The recommendations made in the audit report (OIO/IA/2020 -01) were accepted 
and endo rsed by the concerned parties and management.  
2  APPELLATE BODY MEMBE RS 
2.1.  The annual budget for the Appellate Body and its Secretariat in 2019 was CHF 7 ,579,900 
(zero nominal growth since at least 2016). Around 10% (i.e. CHF 791 ,000) of the annual budget of the  
Appellate Body and its Secretariat was assigned to cover ABMs' fees (see Table 1 – Budget and Actual 
Costs for ABM fees ). Also, the annual expenditures for ABMs' fees (actual costs) represented only 61% of 
the budget in 2019, 77% in 2018 and 94% in 2017. This is mainly due to the decrease in the number of 
ABMs, as a result of the freezing in the appointment of new ABMs since 2017.  
Table 1 Budget and Actual Costs for ABM fees  
Budget and Actual costs  (in CHF)  2015  2016  2017  2018  2019  
Annual budget for AB Members' fees  759,000 791,000 791,000 791,000 791,000 
Annual expenditures for AB Members' fees  790,530 753,200 743,785 611,975 480,165 
 
1 For more details: https://na.theiia.org/standards -guidance/mandatory -guidance/Pages/Standards.aspx . WT/BFA/W/515  
 
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  2.2.  The remuneration package for ABMs has been adopted by WTO Members in DSB Decision DSB/1.2 
Under the current terms of the employment Agreements signed by ABMs and the Director -General, 
the WTO shall pay to ABMs:3 
a. a retainer of CHF 9 ,085 per month;  
b. an allowa nce for administrative expenses of CHF 330 per month;  
c. a daily fee of CHF 783 per day for each day that the ABM is required to be in Geneva on official 
business of the AB and for every day that the ABM is required to work on an appeal in a place 
other than Geneva (on a basis of 8 hours per day);4 
d. a daily subsistence allowance (DSA), calculated in accordance with the United Nations rates 
(currently CHF 374), for each day that the ABM is required to be in Geneva on official business 
of the Appellate Body (AB) and for each day of travel that is necessary for the ABM to perform 
official business of the AB ;5 and 
e. a contribution to the cost of health insurance of CHF 211.20 per month (if applicable).  
2.3.  Furthermore, when ABMs are required to travel in order to perform official business for the AB or 
attend meetings in Geneva, their travel expenses (i.e. airline tickets, terminal expenses, etc.) are entirely 
covered by the WTO.6 
2.4.  The ABMs have the option to rent accommodation in Geneva for a minimum period of six (6) months 
(instead of staying in a hotel) and receive a monthly rental subsidy capped at CHF 3 ,000. In this case, 
they only receive 40% of the DSA when they are in Geneva on official business of the AB. Since 2017, 
ABMs have been required to spend mor e and more time in Geneva to attend AB meetings. With an average 
of 16 days per month spent in Geneva for official business, the rental subsidy option is more convenient 
for most ABMs and more economical for the WTO.7 In November 2019, three (3) out of the  four (4) ABMs 
(i.e. 75% of the ABMs) had opted for receiving rental subsidy (up to CHF 3 ,000 per month).  
2.5.  The remuneration package for ABMs, adopted in 1995, was established under the assumption that 
ABMs would work on a partial time basis for the WTO (i. e. depending on temporary needs of the AB). In 
order to ensure that ''high -calibre ABMs be available at all times '' and '' on a flexible basis '', and that they 
''stay abreast of dispute settlement activities '', the contracts offered to ABMs are based on a f ixed 
remuneration (i.e. retainer and administrative allowance) plus a variable remuneration (i.e. daily fees for 
actual days worked and contribution to health insurance). The fixed remuneration was primarily designed 
to cover the opportunity cost for ABMs of being available at all times – and upon short notice – for the 
AB.8 Since 2018, with the progressive reduction in the number of ABMs, the ABMs have been working for 
the AB on an almost full -time basis. When the Appellate Body was composed of seven (7) A BMs, they 
were assigned to every other appeal. Since 2018, the three (3) remaining ABMs have been assigned to 
all new appeals. As a result, the individual workload of ABMs drastically increased. In light of this, a 
revision of the ABM's remuneration packag e may need to be considered would this situation continue in 
the longer term.  
2.6.  The evolution of ABM's fees since 1995 is summarized in Table 2 – Evolution of fees since 1995 . The 
ABM's fees have remained unchanged since 2011.  
 
2 DSB/1 – Establishment of the Appellate Body , 10 February 1995.  
3 Para. 4 of t he ABM's Agreement. Also, according to Para. 8 of the Agreement, this remuneration is paid for 
the duration of the Agreement, which is normally four (4) years, or until such later date as the ABM is deemed to 
continue serving on the AB pursuant to Rule 15 of the Working Procedures for Appellate Review . 
4 For official business  in Geneva, the ABMs are entitled to claim a maximum of 8 hours per day (even if 
meetings  often last longer) . 
5 Pursuant to the Special Rules for WTO Travel Policy for Appellate Body Me mbers, ABMs are entitled to arrive 
up to three (3) days before an official meeting begins in order to prepare for that meeting. ABMs are also entitled to 
leave on the day after an official meeting ends. Whenever applicable, the ABMs receive DSA for the abo ve-mentioned 
days.  
6 ABMs are not entitled to book airline tickets themselves.  
7 The full DSA for 16 days (CHF 5,984) is higher than the maximum rental subsidy added to the reduced DSA 
for the same period (CHF 5,394). Furthermore, the actual amount of rent al subsidy paid to ABMs is lower than CHF 
3,000, ranging between CHF 2,300 and CHF 2,800.  
8 DSB/1 provides that the amount of the retainer '' would have to be large enough to offset [an ABM's] 
opportunity cost foregone because of potential conflicts of inte rest''. The retainer was also meant to account for '' the 
disruption of a Member's career due to the uncertain but limited length of the Appellate Body assignment' '. WT/BFA/W/515  
 
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  Table 2 Evolution of fees since 1995  
Element (in CHF)  1995  2005  2008  2009  2010  2011*  
Retainer Fee (Monthly)  7,000  7,780  8,558  8,986  9,031  9,085  
Administrative allowance (Monthly)  300 330 330 330 330 330 
Daily Fee (Daily)  600 673 737 774 778 783 
* As from 2010, fees have been linked to the Geneva Consumer Price Index based on WT/BFA/101.  
2.7.  As detailed in Table 3 – Estimated average salary of an ABM per month , the estimated remuneration 
of an ABM is CHF 265 ,776 per year (i.e. CHF 22 ,148 per month). This amount  does not include official 
travel costs (i.e. DSA and/or rental subsidy, airline tickets, terminal expenses, etc.).9  
Table 3 Estimated average salary of an ABM per month  
Current salary level  Currency  Amount  
Retainer  CHF 9,085.00  
Administrative allowance  CHF 330.00  
Daily Fee (783 CHF/day * 16 days)  CHF 12,528.00  
Health Insurance (205 .30 CHF/month)  CHF 205.30  
Monthly cost  CHF 22,148.30  
 
2.8.  The total annual costs of ABMs for the WTO decreased by 20% from 2015 (CHF 2 ,141,646) to 2018 
(CHF 1 ,710,936). For 2019, the amount was estimated at CHF 1 ,401,423 (i.e. 35% decrease when 
compared to 2015). The evolution of these annual costs is mainly explain ed by the reduction of the number 
of ABMs since 2017 and the completion of appeals by ABMs serving under Rule 15 of the Working 
Procedures for Appellate Review.10 This decrease is detailed in Graph 1 – Cumulated Total Expenditures 
(January 2015 – October 20 19). 
Graph 1 Cumulated Total Expenditures (January 2015 - October 2019)*  
 
*  Up to 31 October 2019  
 
9 The travel costs vary significantly from one ABM to another.  
10 WT/AB/WP/6, 16 August 201 0. Pursuant to Rule 15, '' a person who ceases to be a Member of the Appellate 
Body may, with the authorization of the Appellate Body and upon notification to the DSB, complete the disposition of 
any appeal to which that person was assigned while a Member, and that person shall, for this purpose only, be 
deemed to continue to be a Member of the Appellate Body'' . 
WT/BFA/W/515  
 
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  2.9.  Also, the total number of days worked by ABMs per month, whether at home/in transit or in Geneva, 
progressively decreased since June 2017. For example, in June 2017, the cumulated number of days 
worked by ABMs was 132. This number decreased to 118 in June 2018 and fell to 73 in June 2019.11 
Again, this evolution is mostly explained by the progressive reduction in the number of ABMs since 2017 
(i.e. seven (7) ABMs in June 2017 and four (4) in June 2019).12 
2.10.   While the number of ABMs decreased by 43% between January 2015 and October 2019 (i.e. moving 
from seven (7) to four (4) ABMs)  13, the total annual expenditures of ABMs decreased by on ly 35% in the 
same period. This is a clear sign that the workload of the remaining ABMs has progressively increased. 
With the decrease in the number of ABMs, the remaining ABMs have been involved in more appeal 
proceedings and their workload has increased (resulting in an increased number of days worked and 
remunerated by the WTO). When the AB consisted of seven (7) Members, each ABM roughly heard every 
second appeal; when the AB consisted of three (3) Members, these ABMs were involved in each new 
appeal.  
2.11.   In the same vein, the number of ABMs working under Rule 15 of the AB Working Procedures has 
significantly increased since 2015. While in 2015 no ABMs worked under Rule 15, the remunerations paid 
to ABMs completing appeals under Rule 15 assigned to them duri ng their term of office represented more 
than 28% of the total ABM remunerations in 2019.14 
2.12.   As shown in Graph 1, each year, the ABMs' fees (i.e. retainer, administrative and daily fees) 
represented approximativelly 85% of the total annual expenditure. The r emaining 15% of expenditures 
were mostly related to travel (and especially to air travel). The average annual air travel expenses between 
2015 and 2019 was CHF 36 ,362 per ABM (and per year). However, these expenses varied significantly 
from one ABM to anot her. In this regard, the OIO noted that the annual air travel expenses are higher for 
those ABMs who did not opt for rental subsidy. It appears that the rental subsidy did not only reduce the 
cost of DSA, but also had an impact on travel expenses, since AB Ms renting an appartment in Geneva and 
benefiting from rental subsidy flew less frequently to/from their home country.  
2.13.   Most steps of AB proceedings and meetings are conducted ''on -site'' in Geneva. To attend these 
meetings, the ABMs have to frequently comm ute between their home country and Switzerland. However, 
the OIO noted that some of these meetings may not necessarily require the physical presence of ABMs in 
Geneva and could be conducted ''off -site'' through video -conference. While most of the meetings require 
personal interaction and the physical presence of ABMs is Genera, some others could be organized via 
video -conference. More use of video -conference equipment would significantly reduce travel costs of 
ABMs, increase efficiency, accelerate certain s teps of the appeal process and improve the WTO's ecological 
footprint.15  
2.14.   The OIO prepared a detailed flowchart describing the process for controlling ABMs' costs at the WTO 
(see Annex 2 – Appellate Body Members' costs – Process Description ). The process de scription is 
summarized as follows:  
Fixed Remuneration (i.e. monthly retainer, rental subsidy, administrative fees and health insurance 
contribution):  
a. The HRD Staff Services Section calculates, each month, the different elements of the fixed 
remuneration of ABMs, including the monthly retainer, the rental subsidy (if applicable), the 
administrative fees and the health insurance contribution (if applicable). The calculations are 
made in accordance with the conditions defined in the agreements s igned by each ABM. Each 
year (in December), the ABS sends a Memorandum to HRD reconfirming the conditions set in 
the agreements signed by the ABMs. The Memorandum also specifies if the term of an ABM ends 
within the upcoming year.  
 
11 For the purpose of comparison, the OIO chose as reference the month of June (since the work of the 
Appellate Body is partially seasonal).  
12 In Jun e 2019, in addition to three (3) ABMs whose terms had not expired, one (1) ABM served under 
Rule 15.  
13 In October 2019, in addition to three (3) ABMs whose terms had not expired, one (1) ABM served under 
Rule 15.  
14 Pursuant to paragraph 8 of the employment agreement signed by each ABM and the Director -General, the 
remuneration (including the retainer) is paid for the duration of the agreement (which is 4 years) or until such date 
as the ABM is deemed to continue ser ving on the AB pursuant to Rule 15 of the AB Working Procedures.  
15 According to the ABS, conference calls and videoconferencing have been used in various appeals to deal 
with procedural issues, with preliminary rulings and in order to fine -tune the languag e of AB reports.  WT/BFA/W/515  
 
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  b. The AGSD Budget Unit revi ews the calculations made by HRD and approves the payments.  
c. The payments are processed at the end of each month by the AGSD Finance Unit.  
Variable Remuneration (i.e. daily fees):  
a. At the end of the month, each ABM submits a Statement of Accounts detailing the number of 
hours worked at home/in transit and in Geneva – and a description of the work done 
(e.g.:  reading panel reports, appeal submissions or written documents prepared by the ABS, 
drafting questions for the hearings, holding hearings, exc hanging views, revising the AB report, 
etc.) – during the month, to the ABS Officer.16 
b. The ABS Officer verifies the information declared in the Statements of Accounts.  
If inaccuracies or inconsistencies are identified in a Statement of Accounts declaration,  the ABS 
Officer requests additional information from the concerned ABM. Special attention is given to 
checking if the work declared by the ABM falls within the list of recognized appeal work activities 
for a specific appeal, and is in line with the sequen tial process steps in the AB schedule of work 
(e.g.: if the work declared is in line with what was expected, depending on the phases of the 
appeal proceedings the ABM is working on).  
The checks conducted by the ABS Officer and the ABS Director include, am ong others, the review 
of the categories of work activity that are recognized, the sequence of the work activity 
according to the set dates of the appeal process, the coherence between claims by ABMs hearing 
the same appeal, the coherence of claims over pr eceding and subsequent months, etc. The ABS 
Officer also reconciles the work claimed ''at home/in transit'' and ''in Geneva'' with the travel 
dates of the incumbent and the official AB meeting dates in Geneva. Also, ABMs are not entitled 
to declare more th an eight (8) hours of work per day when in Geneva.  
c. If the Statements of Accounts are considered to be complete and accurate, the ABS Officer 
prepares a table with the amounts received, which is inserted in a Memorandum for Payment. 
The Memorandum for Payme nt and the related Statements of Accounts are then submitted to 
the ABS Director for validation and approval.  
d. The ABS Director examines the details of the information contained in the Memorandum for 
Payment and the related Statements of Accounts. Whenever inaccuracies or inconsistencies are 
identified, the ABS Director liaises with the concerned ABM for clarification/additional 
information, justification and/or  correction. Once the information is deemed accurate and 
complete, the ABS Director approves and s igns the Memorandum of Payment as well as the 
related Statements of Accounts.  
e. An electronic copy of the signed documents is sent by the ABS Officer to the AGSD Budget and 
Finance Units for processing.  
f. The AGSD Finance Unit verifies the information containe d in the Memorandum (and the 
Statements of Account) and calculates the monthly fees to be paid to each ABM.  
g. The AGSD Budget cross checks the amount to ensure availability of approved funds.  
h. The payments are then processed by the AGSD Finance Unit.  
Travel C osts (i.e. DSA, Terminal expenses):  
a. At the end of each official travel, the ABM submits a Travel Claim to the ABS Officer, detailing 
the dates of the travel and the related travel/terminal expenses.  
b. The ABS Officer verifies the information declared in the  Travel Claim and checks, inter alia, if 
the travel dates reconcile with the schedule of official meetings of the AB in Geneva and any 
updates thereto.  
c. If inaccuracies or inconsistencies in the Travel Claim are identified, the ABS Officer requests for 
additional clarification/information from the concerned ABM. If the Travel Claim is complete and 
accurate, the ABS Officer submits it to the ABS Director for validation and approval.  
d. The ABS Director verifies the Travel Claim and reviews if the travel dates r econcile with the 
actual schedule of official meetings of the Appellate Body in Geneva. Whenever inaccuracies or 
inconsistencies are identified, clarification/additional information and/or correction is requested 
 
16 The OIO uses the generic title '' ABS Officer'' indifferently to the title of the concerned person (s). WT/BFA/W/515  
 
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  from the concerned ABM. Once the informatio n is deemed accurate and complete, the ABS 
Director approves and signs the Travel Claim.  
e. The signed Travel Claim is then sent by the ABS Officer to the AGSD Travel and Finance Units 
for processing.  
f. The AGSD Travel Unit verifies the travel dates (the Travel  Unit regularly receives updates on 
the AB working schedule of appeal meetings in order to make the necessary travel reservations 
for the ABMs).  
g. The AGSD Finance Unit verifies the information contained in the Travel Claim (e.g.: bank account 
of the benefic iary, travel dates, supporting travel documents, hotel bill, etc.) and calculates the 
Daily Subsistence Allowance (DSA) and terminal expenses to be paid to the ABM. The DSA is 
calculated in accordance with the Special Travel Rules for Appellate Body Member s, which 
specifies that ABMs are entitled to arrive up to three (3) days before an official meeting begins 
in order to prepare for it, and to depart one (1) day after the meeting. A reduced DSA (40%) is 
granted if the ABM chose to receive rental subsidy.  
h. The AGSD Budget Unit cross checks the amount to ensure availibility of approved funds.  
i. The payments are then processed by the AGSD Finance Unit.  
2.15.   The OIO also selected a sample of five (5) months between January 2017 and October 2019 (15% 
of the period). For  each of the selected months, and for each ABM, the OIO reviewed the accuracy of the 
amounts declared and paid to ABMs. As part of the test, the OIO verified the declared work hours/days 
(whether at home/in transit or in Geneva) and reconciled it with the schedule of official AB meetings in 
Geneva. The OIO also checked the elements of the fixed remuneration (i.e. retainer, administrative fees, 
rental subsidy and health insurance), the variable remuneration (i.e. daily fees), the DSA and the travel 
expenses.  
2.16.   Based on the process review and the sample testing, the OIO considers that the segregation of 
duties and the internal controls in place at the WTO for processing ABMs' costs are generaly adequate.  
2.17.   However, the following observations were made during the process review and sample testing:  
a. The WTO Official Travel Policy was revised in October 2019.17 Pursuant to Par agraph  9.2 of the 
revised Policy, ''[w]hen accommodation and breakfast are provided free of charge to the 
traveller by the organizer/f under, the DSA shall be reduced by 50 per cent. When 
accommodation is provided but breakfast is not, the traveller may submit a receipt in the 
expense report and the WTO will reimburse up to 10 per cent of the DSA. If lunch or dinner is 
provided, the DSA s hall be reduced by 15 per cent for each meal. Where accommodation and 
all meals are provided, the DSA shall be reduced by 80 per cent. In the event that the traveller 
incurs expenses for lunch or dinner on the date of departure from the mission place, an 
additional 15 per cent will be paid for each meal. On the same basis, 15 per cent will be deducted 
from the DSA for lunch and dinner not incurred by the traveller on the day of arrival at the 
destination'' . As a result of this, as from November 2019, the me thod for calculating the DSA 
entitlements has changed and it requires additional controls to be made by the Divisions.18 
b. A health insurance certificate is submitted by each ABM upon appointment (or, at the latest, 
when entering into office). However, the he alth insurance certificates are usualy valid for one 
year (or a shorter period of time) only and ABMs are not requested to submit insurance 
certificates every subsequent year.19 
c. Every month, when preparing the Memorandum for Payment, the time worked at home /in 
transit and in Geneva by each ABM is calculated by converting the number of hours worked 
(both at home/in transit and in Geneva) into days (on the basis of 8 hours per day). The rounding 
of the number of days sometimes creates minor discrepancies in th e report (i.e. when the 
rounding is done in the same direction for both the work at home/in transit and in Geneva). 
However, these discrepancies had no impact on the accuracy of final payments. The OIO 
confirmed that the daily fees paid to the beneficiarie s were correct.  
 
17 OFFICE(14)/66/Rev.1, 4 October 2019.  
18 The revised WTO Official Policy entered into force after the period covered by the scope of th is audit.  
19 The health insurance contracts are automatically reconducted every year. According to the ABS, the ABMs 
are requested to confirm, every year, that they continue to be insured.  WT/BFA/W/515  
 
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  d. The ABMs submit, every month, a Statement of Accounts detailing the number of hours worked 
– and the activities conducted – for the ABS. The ABMs also indicate if these hours were worked 
''at home/in transit'' or ''in Geneva''. The Statemen t of Accounts Form was designed when ABMs 
were in Geneva only when on official business for the AB. However, in recent years, the ABMs 
have been hearing an increasing number of appeals. As result, the majority of ABMs opted for 
the rental subsidy and often  stay in Geneva even if no official AB meetings are scheduled.  
Enhanced clarity could be obtained by modifying the Statement of Accounts Form in order to 
capture the work time as follows:  
i. ''at home'': number of hours/days worked from the ABM's home countr y; 
ii. ''in Geneva – without DSA'': number of hours/days worked while in Geneva but not in the 
framework of official AB meetings;  and 
iii. ''in Geneva – with DSA'': number of hours/days worked in Geneva in the framework of 
official AB meetings.  
e. In two (2) instances , the terminal expenses paid to the concerned ABMs were incorrect (i.e. the 
terminal expenses were paid twice). The amount paid in excess to the beneficiaries was, in both 
cases, limited to CHF 100.  
f. Finally, the OIO noted that, in one of the test samples, one ABM arrived in Geneva one week 
earlier than the scheduled official AB meeting. The incumbent received DSA – and 
reimbursement of his hotel expenses – for the entire period he stayed in Geneva, instead of 
only for the days he was in Geneva on official b usiness of the AB. The ABS Director submitted 
the related Travel Claim for review and decision to the AGSD Director and the Deputy Director -
General in charge of Administration, who analysed the situation and approved the Travel Claim 
on an exceptional basi s. The OIO welcomed the initiative of the ABS to draw the attention of 
the Deputy Director -General  to this travel claim (for DSA not directly related to scheduled AB 
meetings), and invited its Director to systematically follow this approach whenever simila r cases 
are observed . 
2.18.   In light of observations made during the audit, the following recommendations have been proposed 
to further improve the internal control mechanisms at the WTO:   
Recommendations:  Severity  
1. Taking into consideration the evolution of practices at the Appellate Body, the OIO invites 
the Director -General to consider bringing the need to revise the ABM's remuneration 
package to the attention of WTO Members.  Medium  
2. The ABS, with the support of the Information Technology Solutions Division (ITSD), 
should analyse the possibility of conducting certain procedural steps and AB meetings 
through videoconference without compromising the confidentiality of the appeal 
proceedings. The ABMs shou ld consider carrying out appeal process steps not requiring their 
physical presence in Geneva through videoconference in order to reduce costs.  Medium  
3. Relevant ABS staff members should be further informed of the additional controls required 
by the revi sed WTO Official Travel Policy and, in particular, on the additional elements of 
information to be captured in the revised Travel Claim Form.  Medium  
4. Each year, the ABS should collect copies of the most recent health insurance certificates 
from the ABMs. These documents should be systematically filed in a dedicated binder.  Low 
5. When converting the number of hours worked (both at home/in transit and in Geneva) 
into days (on the basis of 8 hours per day), only the total number of days should be roun ded 
to the nearest unit.  Low 
6. The Statement of Accounts Form should be modified to segregate more clearly (i) the 
time worked in Geneva for official AB meetings (with DSA entitlement) and (ii) the time 
worked in Geneva not in the framework of official A B meetings (without DSA entitlement). 
The ABMs, ABS staff and the Finance Unit should be properly informed of these 
modifications.  Medium  
7. The Finance Unit should ensure that terminal expenses paid to ABMs are always accurate.  Low 
  WT/BFA/W/515  
 
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  3  PANELISTS  
3.1.  The annual budget for Panelists' fees was CHF 790 ,000 in 2019. The annual actual costs for Panelists 
fees significantly exceeded the budget that year (132% of the budget). This was mainly due to the increase 
in the number of Disputes – and, therefore, in t he number of Panelists – in 2019 (see Graph 2 – Evolution 
of the number of Panelists ). The annual actual costs for Panelists' fees significantly increased in 2019, 
when compared to 2018 (86% increase). Similarly, the annual actual costs for Panelists' trav el drastically 
increased in 2019 (71% increase compared to 2018).  
Graph 2 Evolution of the number of Panelists  
 
3.2.  Also, as detailed in Table 4 – Budget and Actual Costs for Panelists' fees , with the exception of 2018, 
the annual actu al costs systematically exceeded the annual budgets for Panelists fees since 2015.  
Table 4 Budget and Actual Costs for Panelists' fees  
Budget and Actual costs  (in CHF)   2015  2016  2017  2018  2019  
Annual budget for Panelists' fees  340,000 690,000 690,000 790,000 790,000 
Annual costs for Panelists' fees  491,186 797,262 742,516 560,659 1,040,706 
Annual budget for Panelists' travel  730,000 730,000 730,000 730,000 730,000 
Annual costs for Panelists' travel 
(DSA, terminal expenses, tickets, 
other)  515,466 645,336 594,533 486,950 833,068 
Number of Disputes  14 23 24 17 33 
 
3.3.  Since 1 January 2016, all Panelists  (whether Governmental Officials or not) are entitled to 
compensation for the time spent working for a Panel. Panelists are entitled to receive compensation for 
time (a) spent in preparing Panel meetings ('' Preparation fees '') and (b) attending these Panel meetings 
(''Daily fees ''). 
3.4.  Panelists are entitled to claim compensation for each full day of work, with the understanding that a 
day of work is estimated at eight (8) hours. In terms of compensation, no distinction is made between a 
Panelist, a Panel  Chair, an Arbitrator or an Expert participating in a Panel. The remuneration for non -
Governmental Panelists is CHF 900 per full day of work. Panelists employed by a Government (or an 
International or Inter -Governmental Organization) are entitled to receiv e CHF 300 per day of work, as 
long as their Government/Employer authorizes them to receive such remuneration.  
3.5.  Panelists based outside Geneva are entitled to a Daily Subsistence Allowance (DSA – CHF 374 in 
November 2019) for the time spent in Geneva attendi ng Panel meetings. Panelists also receive terminal 
WT/BFA/W/515  
 
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  expenses (CHF 50 per transfer) whenever official transportation to/from the airport or train station is not 
provided by the WTO. Travel costs between the place of residence of the Panelists and Geneva (i.e . airline 
or train tickets) are usually paid directly by the WTO (or, on exceptional occasions, reimbursed to the 
Panelists).  
3.6.  Panelists are expected to spend around 15 working days in Geneva. A Panel proceeding is normally 
composed by three (3) separate 5 -day Panel meetings in Geneva (i.e. two panel hearings and one meeting 
for drafting the interim report). However, the number of days spent in Geneva may differ depending on 
the complexity of the issues covered by the Panel.  
3.7.  Based on the payments made by the  WTO to Panelists in 2015 -201920, the OIO noted that, on  
average, the Panelists spent almost the same time preparing for the Panels (Preparation fees, 49% of the 
cumulated fees in 2015 -2019) and attending Panel meetings (Daily fees, 51% of the cumulated fee s in 
2015-2019).  
3.8.  The work of Panelists (and related Preparation and Daily fees) is seasonnal. Their activity is usually 
intense in December and February/March but reduced in January and August/September each year. The 
cumulated monthly fees vary between CH F 0 (in January and August) and CHF 165 ,000 (i.e. in February 
and July). As shown in Graph 3 – Evolution of Panelists fees (cumulated value),  the moving average of 
the cumulated fees increased significantly since September 2018, confirming a rise of activi ty. 
Graph 3 Evolution of Panelists fees (cumulated value)  
 
 
3.9.  Based on the figures provided in Table 4 – Budget and Actual Costs for ABM fees , the OIO calculated 
the average cost per Panelist and per Dispute (see Table 5 – Actual costs per Dispute ). The average cost 
fluctuates between CHF 71 ,904 (2015) and CHF 55 ,710 (2017). In 2019, the average cost per Panelist 
and per Dispute was CHF 56 ,781, including Panelist fees (56%) and travel expenses (44%).  
 Table 5 Actual costs per Dispute  
Actual costs per Panelist per 
Dispute (in CHF)  2015  2016  2017  2018  2019  
Average cost for a Panelist's fees per 
Dispute  35,085 34,664 30,938 32,980 31,537 
Average cost for a Panelist's  travel 
per Dispute  36,819 28,058 24,772 28,644 25,244 
Total average cost per Panelist per 
Dispute  71,904 62,722 55,710 61,624 56,781 
 
20 From 1 January 2015 to 31 October 2019.  
0 CHF20,000 CHF40,000 CHF60,000 CHF80,000 CHF100,000 CHF120,000 CHF140,000 CHF160,000 CHF
12345678910111212345678910111212345678910111212345678910111212345678910
2015 2016 2017 2018 2019Panelists cumulated fees (2015 -2019)
(in CHF)
Legal Affairs
/ Rules
Appellate
Body
Moving
average
Legal Affairs
/ RulesWT/BFA/W/515  
 
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  3.10.   The OIO reviewed the entire process for controlling Panelists' costs at the WTO. The process used 
by the Legal Affairs Division and the Rules Division for controlling the costs of Panelists is summarized as 
follows:  
a. Once a Panelist has been appointed to a Panel, he/she receives a Welcome letter along with the 
Panelist Logistics Form.  
b. The Panelist returns his/her completed Logistics Forms, per the instructions received, to the 
concerned Division, therefore confirming if he/she is employed by a Government, an  
International Organization  or an Inter -Governmental Organization. The Preparation and Daily 
fees to be paid to the Panelist will depend on the information declared in the Logistics Form (i.e. 
CHF 300 per day for Governmental Officials instead of CHF 900 f or other Panelists, or CHF 0, 
depending on the policies of the employer of the concerned Panelist). The Logistics Form also 
provides details concerning the address and the bank account of the Panelist.  
c. Approximately three (3) months before each of the Pan el meetings, the Panelist receives a 
Special Service Agreement (SSA) for the working days in Geneva. The SSA details the terms 
and conditions for the services to be provided (including the fee, DSA and travel costs). The 
Panelist returns the signed SSA to the Administrative Assistant21 of the concerned Division. The 
signed SSA is then forwarded by email to the Travel Unit (for the reservation of tickets), to HRD 
(for calculation of fees payable) and to AGSD (for budget confirmation).  
d. The Panelist records th e time spent in preparing for the Panel meeting (at home). Once the 
meeting in Geneva is finished, the Panelist reviews, signs and submits his/her Travel Claim along 
with his/her Claim for Time Worked to the Administrative Assistant of the concerned Divisi on.  
e. The Administrative Assistant verifies both Claims (e.g.: work hours, travel and meeting dates, 
daily fees, DSA entitlement, travel/terminal expenses, etc.). He/she also verifies if the 
preparation days declared by the Panelist remain within the guidel ines indicated in the form.  
f. In case of discrepancies, the Administrative Assistant will request clarification from the Panelist 
and/or raise the issue with the Senior Lawyer in charge of the Panel as well as with the Director 
of the Division. Where the Cl aim for Time Worked is deemed to be justified by the complexity 
of the dispute and/or the requested preparation of the Panelist, the Director of the Division then 
approves it. Otherwhile, he/she requests further clarification from the Panelist.  
g. If no discr epancies are identified in the Claims, the Administrative Assistant prepares a 
Memorandum for Payment (with all supporting documents).  
h. The Memorandum for Payment (and supporting documents) is then submitted to the Director of 
the Division for review and si gnature.  
i. Once signed by the Director, the Memorandum for Payment (and supporting documents) is sent 
by email to HRD (Payroll Unit) and AGSD (Travel and Finance Units).  
j. HRD (Payroll Unit) verifies the Claim for Time Worked (e.g.: daily fees, number of hours /days 
declared, etc), calculates the total fees to be paid to the Panelist and enters the information in 
the Payroll system.  
k. AGSD (Finance Unit) checks the Travel Claim (e.g.: bank account, advance payments made, 
DSA rate used, travel/terminal expenses, et c.), calculates the DSA and travel/terminal expenses 
to be paid to the Panelist, and enters the information in the Accounting System.  
l. The Budget Unit verifies the information provided by the Payroll Unit (HRD) and Finance Unit 
(AGSD) and approves the payments.  
m. Finally, the Finance Unit processes the payment. The amounts are then transferred to the bank 
account of the beneficiary.  
3.11.   The detailed flowchart of this process is available in Annex 3 – Panelists' Costs – Process description . 
3.12.   Also, the OIO rand omly selected a sample of 30 payments made by the WTO to Panelists between 
January 2017 and October 2019. The OIO tested the compliance of each of the transactions included in 
the sample against relevant policies and procedures. As part of the test, the OI O verified the accuracy of 
the amounts paid to the Panelists (i.e. Preparation fees, Daily fees, DSA, Travel and Terminal Expenses).  
 
21 The OIO uses the generic  title ''Administrative Assistant '' indifferently of the title of the concerned persons.  WT/BFA/W/515  
 
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  3.13.   Based on the process review and the sample testing, the OIO considers that the segregation of 
duties and the internal cont rols in place at the WTO for processing Panelists' costs are generaly adequate.  
3.14.   However, the following observations were made during the process review and sample testing:  
a. The Claim for Time Worked Form provides to Panelists an indicative guide of the est imated 
amount of time that each phase of the Panel may involve. However, some Panelists received 
the Guidelines (and estimated time of work) only after the work for preparing and attending the 
Panel meeting had been completed.  
b. For 13 of the transactions te sted (i.e. 43% of the sample test), the number of preparation days 
declared by the Panelists exceeded the estimated number of days provided in the Guidelines for 
Time Worked (Claim for Time Worked Form). The Guidelines given to the Panelists are generic 
and not adjusted to each Dispute, despite the fact that Disputes may vary significantly in 
complexity and workload. For many of the Disputes, the number of days provided in the 
Guidelines seem to be underestimated and not representative of the actual time re quired for 
the Panelists to prepare for a meeting.  
c. As indicated above, the number of hours/days declared by Panelists sometimes exceeded the 
estimations provided in the Guidelines. In such cases, the Division has to assess if the declared 
time is deemed t o be justified by the complexity of the Dispute and/or the required preparation 
of the Panelist. However, this assessment was not always documented in the Memorandum of 
Payment.  
d. For four (4) out of the 30 transactions tested (i.e. 13% of the sample test),  the DSA amount 
paid to Panelists was not in line with the WTO Official Travel Policy.22 The Policy was not always 
properly or consistently understood and applied, since DSA was paid for days during which the 
Panelist was travelling back to his/her home cou ntry. Pursuant to par agraph  9.3 of the Policy, 
''DSA shall be paid in respect of the dates indicated in the Travel Authorization Form, except 
that no payment shall be made for night which the traveller is travelling to or from his/her duty 
station ''. 
e. In this regard, the OIO would like to highlight that the WTO Official Travel Policy was revised in 
October 201923 (see supra). As from October 2019, the method for calculating the DSA 
entitlements has changed, necessitating additional controls by the Divisi ons.24  
f. For one (1) of the transactions tested (i.e. 3% of the sample test), the terminal expenses were 
incorrect (i.e. the Panelist travelled by car, hence he was not entitled to terminal expenses but 
rather to reimbursement of road expenses).  
g. Also, f or one (1) of the transactions tested (i.e. 3% of the sample test), the hours/days paid to 
the Panelist differed from the actual hours/days worked (i.e. one (1) day difference).  
h. In one (1) of the 30 transactions tested (i.e. 3% of the sample test), the health  insurance cost 
of the Panelist was reimbursed by the WTO (approximately CHF 60) without any justification 
being recorded in the file.25  
i. Aside from the sample test, the OIO noted several instances in 2018 and 2019 where Panelists' 
payments have been made t o old bank accounts, despite new bank instructions having been 
given by the Panelist in the Logistics Form and/or the SSAs submitted to the Divisions and 
forwarded to AGSD.  
j. Finally, the Legal Affairs and the Rules Divisions requested the possibility of se nding travel -
related payment breakdowns to Panelists. Currently, Panelists do not receive the details of the 
travel -related payments and often face difficulties in reconciling Travel Claims with 
corresponding payments, and in determining correct amounts fo r their individual tax reporting 
obligations.  
 
22 OFFICE(14)/66, 13 November 2014.  
23 OFFICE(14)/66/Rev.1, 4 October 2019.  
24 As a result of the audit process, the Travel Unit was alerted by LAD and RULES of the neces sity to revise the 
Travel Claim form for Panelists. The form was immediately adapted and implemented taking into account the revised 
WTO Official Travel Policy for the calculation of DSA entitlements.  
25 According to Legal Affairs and Rules Divisions, incid ental costs incurred by Panelists, such as travel visa 
costs and the minimum Schengen medical insurance cover required for the visa, may be reimbursed in order to 
secure the Panelists' attendance at panel meetings. T he OIO invite d the Directors of the Lega l Affairs and the Rules 
Division s to ensure that  such reimbursements are properly  justified, approved and documented  in the file . WT/BFA/W/515  
 
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  3.15.   In light of observations made during the audit, the following recommendations have been proposed 
to further improve the internal control mechanisms at the WTO:  
Recommendations:  Severity  
8. The Legal Affairs Division should send a copy of the Claim for Time Worked (containing 
the Guidelines for preparation time worked) to the Panelist at the same time that the Special 
Service Agreement (SSA).  Low 
9. Whenever a Claim for Time Work in which  the number of hours declared by the Panelist 
exceeds the Guidelines provided in the Form is approved, the Director of the Division should 
systematically detail in the Memorandum of Payment the reasons of the approval. The 
Directors of the Legal Affairs Di vision and the Rules Division may consider establishing 
tolerance margins (for example: up to 20% above the expected time provided in the 
Guidelines) within which the excess time declared by the Panelist would remain acceptable 
(without justification).  Low 
10. The Legal Affairs and the Rules Divisions should review the Guidelines included in the 
Claim for Time Worked Form.  
Ideally, the number of days provided in the Guidelines should be indicative of the expected 
work time. Taking into consideration the unpredictable and complex nature of panel work, 
the Legal Affairs and the Rules Divisions may decide to adjust the Guidelin es and to 
determine the most adequate and reasonable numbers of days to be referenced in the 
Guidelines for each step of the Dispute, based on historical data.  Low 
11. Also, the Guidelines provided to Panelists should clearly request the latter to inform  the 
Director of the concerned Division, in writing, as soon as the actual days spent in preparation 
time exceeds the number of days provided in the Guidelines.  Low 
12. Relevant staff members of the Legal Affairs and the Rules Divisions should be further 
informed of the additional controls required by the revised WTO Official Travel Policy and, 
in particular, on the additional elements of information to be captured in the revised Travel 
Claim Form.  Medium  
13. Persons processing Panelists' payments should be properly trained and the bank 
accounts of the beneficiaries should be regularly and systematically checked.  Medium  
14. An analysis should be done by the AGSD  Budget and Finance Units to explore the 
possibility of systematically sending travel -related payment details to Panelists and ABMs.  Medium  
_______________  
  WT/BFA/W/515  
 
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  ANNEX 1 – LIST OF AC RONYMS  
 
AB  Appellate Body  
ABM  Appellate Body Member  
ABOF   Appellate Body Operating Fund  
ABS  Appellate Body Secretariat  
AGSD   Administration and General Services Division  
CBFA   Committee on Budget, Finance and Administration  
CHF  Swiss Franc (Currency)  
DDG  Deputy Director -General  
DG  Director -General  
DSA  Daily Subsistence Allowance  
DSB  Dispute Settlement Body  
DSU  Dispute Settlement Understanding  
HRD   Human Resources Division  
IIA  Institute of Internal Auditors  
ITSD   Information Technology Services Division  
ITTC   Institute for Train ing and Technical Cooperation  
LAD  Legal Affairs Division   
OIO  Office of Internal Oversight  
SSA  Special Service Agreement  
WTO   World Trade Organization   
  WT/BFA/W/515  
 
- 14 - ANNEX 2 – APPELLATE BODY MEMBERS COSTS – PROCESS DESCRIPTION  
 
 
 
 
  WT/BFA/W/515  
 
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  WT/BFA/W/515  
 
- 16 - ANNEX 3 – PANELISTS COSTS – PROCESS DESC RIPTION  
 
 
__________