RESTRICTED  
  
WT/BFA/W/ 455 
 
15 June 2018  
(18-3684) Page: 1/7 
Committee on Budget, Finance and Administration    
 
 
WT/BFA/W/422  
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STATUS OF THE  IMPLEMENTATION OF  EXTERNAL AUDIT  RECOMMENDATIONS  
1  BACKGROUND  
1.1.  This document presents to the Committee on Budget, Finance, and Administration the status 
update concerning t he findings of External Auditor  and the recommendations implemented by the 
Secretariat since 12th March 2018 . 
1.2.  This report is based on  the following : 
a. an interim audit that focused on the performance aspects conducted fro m the 26th of 
February to the 1st of March 2018 ; and.  
b. a detailed fi nancial and performance audit which was  conducted from the 9th of April to 
the 9th of May 2018. 
1.3.  Following each audi t session, the External Auditor  reviewed the previously issued 
recommendations and updated their status according to the following categories : 
a. Closed/Done: recommendation was implemented by the Secretariat.  
b. Work-in-Progress (W IP)/Ongoing: recommendation is accepted and under 
implementation by the Secretariat.  
c. Open: recommendation is newly assigned or still  under review/assessment  and to be 
addressed  by the Secretariat.  
1.4.  The full details of all recommendation s both closed and open  are included in the  report 
WT/BFA/W/ 454 of the External Auditor .  
2  SUMMARY OF RECOMMENDATIONS  
2.1.  The External Auditor, represented by the Supreme Audit Institution of Germany, began its 
assignment  in 2015 . Since then , it has issued a  total of 55 recommendations , 44 of which were in 
previous  reports and 11 of which were  issued in the audit report  for 2018. 
2.2.  Based on the supporting information provided to the External Auditor  by the  Secretariat , 
40 out of the 44 prior recommendations  have been suc cessfully closed . This corresponds to 91% 
of the external  audit recommendations  issued in the past reports . Specifically :  
 14 out of the 14 (100%) recommendations related to the first External Audit or's Report issued 
in June 2015  have been implemented;  
 15 out of the 17 (88%) recommendations related to the second External Audit or's Report 
issued in June 2016 have been implemented. The remaining two recommendations are still in 
progress and are followed closely by the Office of Internal Oversight and concern  IT 
confidentiality and  Home Leave.  
 11 out of the 13 (85%) recommendations related to the External Audit Repor t issued in June 
2017 have been implemented. The remaining two recommendations , whose implementation is  
ongoing, concern IT Security and physical security . 
2.3.  The current status of the audit recommendations is detailed in Annex 1 of this 
document  - Status of Audit recommendations ( June 2018). WT/BFA/W/455   
 
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  2.4.  The 2018 audit recommendations and those not yet  closed are detailed in Annex  2 – Newly 
issued and P ending  Audit Recommendations . 
 
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- 3 - ANNEX 1: STATUS OF AUDIT RECO MMENDATIONS ( JUNE 2018 ) 
STATUS OF PAST AUDIT RECOMMENDATIONS  
Audit Activity   Report 
year  Total number of 
recommendations  Implementation status as of 
01.06.20181 
Accepted  Closed  WIP Open  
Financial Audit of year end closed as of 31.12.2014  2015 7 7 7 0 0 
Performance audit on IT & Procurement  2015 7 7 7 0 0 
Financial Audit of year end closed as of 31.12.2015  2016 4 4 4 0 0 
Performance audit on Facility Management, Security and Stretegic Review Implementation  2016 13 13 11 2 0 
Financial Audit of year end closed as of 31.12.2016  2017 5 5 5 0 0 
Performance audit on Confidentiality and Ministerial Conference  2017 8 8 6 2 0 
Totals  - 44 33 91%  9% 0% 
       
STATUS OF NEW AUDIT RECOMMENDATIONS  
Audit Activity   Report 
year  Total number of 
recommendations    Status of New Recommendations 
issued in 2018  
Accepted  Closed  WIP Open  
Financial Audit of year end closed as of 31.12.2017  2018 2 2 0 0 2 
Performance audit on Travel and Consulting Services  2018 9 9 0 1 8 
Totals  - 11 11 0% 9% 91% 
  
                                                
1 Closed/Done: recommendation was implemented by the Secretariat ; 
  WIP/On -going: recommendation is accepted and under im plementation by the Secretariat;  
  Open: recommendation is newly assigned or still under review/assessment and to be addressed by the  Secretariat.  
   
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ANNEX 2: NEWLY ISSUE D AND PENDING AUDIT RECOMMENDATION S (JUNE 2018 ) 
 
Issue  Audit 
Category  Concerned 
Division  Recommendation  WTO´s Comment / Implementation  Status  Priority  
Home leave  Performance 
Report  HR  Regarding the finding (see para 25) 
in our sample check we additionally 
looked into the approved home leave 
(HL) in 2014 and 2015 with a total 
amount of CHF 2,873,352 and 
related p rocedures. In this context 
we filtered the HL of beneficiary staff 
from selected countries all over the 
world. The analysis of the lump sums 
showed a wide variation of home 
leave amounts paid even for the 
same country or town. I recommend 
reviewing the rul es for home leave. A 
benchmark with other international 
organizations could be helpful.  The OIO conducted an internal audit of Home 
Leave in 2017 and the External Auditor ha s 
received a copy of the internal audit report 
(report OIO/IA/2017 -01). HRD is curr ently 
drafting a new Home Leave policy, which will 
incorporate the recommendations contained 
in the internal audit report. The first follow -up 
of the recommendations will be conducted in 
Q4 this year.  ongoing  High 
Information 
confidentiality  Performance 
Report  IT In connection with the improvement 
of IT security governance, the 
Secretariat drafted a new 
“Information Classification Policy” 
with an accompanying “Technical 
Standard”. I appreciate the current 
approaches to update the WTO’s 
policy concerning i nformation 
confidentiality. However, 
documentation of the processes was 
not adequate to counteract the risks 
for confidentiality of data and 
information. I recommend providing 
the WTO staff with extended 
guidelines and appropriate 
procedures on how to deal  with 
confidential information.  The Secretariat agrees with this 
recommendation. The intranet information 
was updated and an on -line training for all 
WTO Staff is being to be prepared.  The draft 
of the Information Confidentiality 
Classification Policy has  been finalised by the 
ITSSC, and submitted for review and approval 
to the Joint Advisory Committee, as it affects 
staff roles and responsibilities. Review of the 
policy has been undertaken by the JAC and 
specific suggestions made to the originators 
of the  document and they will revise the 
proposed texts. Technical tools to support the 
policy and aid the users are planned for 
implementation (Public Key Infrastructure 
project approved for 2017) and study (Data 
Labelling / Data Leakage Prevention systems 
to be evaluated in 2017). The results of the 
information assets inventory / risk 
assessment (which map directly to the policy 
categories) would define further practical 
application measures of the policy. The policy 
will be included in the upcoming CBT InfoSec  ongoing  High  
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- 5 - Issue  Audit 
Category  Concerned 
Division  Recommendation  WTO´s Comment / Implementation  Status  Priority  
awareness course.  
Information 
confidentiality 
/ 
Organizational 
aspects  Performance 
Report  IT I encourage the WTO to complete the 
mentioned inventory as soon as 
possible. I suggest strengthening the 
capacity of the responsible unit, e.g. 
by temporary support, to achieve 
this and other aims in a more timely 
manner. The results should be taken 
as a basis to establish a transparent 
landscape of the needs  of the 
Secretariat concerning information 
confidentiality.  This recommendation can be incorpo rated in 
the implementation of the Information 
Confidentiality recommendation No. 26 
(4.2/2015). The related policy is currently on 
hold at the JAC (Joint Advisory Committee) 
for final approval.  ongoing  High 
Information 
confidentiality 
/ Aspects of 
physical 
security  Performance 
Report  AGSD/  
SECURITY  Executing the planned reassessment 
I recommend initially: to define a 
clear process with designation of the 
involved functions respectively 
individual WTO staff members; to set 
up comparable criteria of p rotection; 
to take relevant standards into 
account (e.g. EN 1047 regarding fire 
resistance, EN 1627/1630 regarding 
anti-burglar security, etc.); to 
document all relevant steps of the 
particular measures. The process of 
implementation of security measures 
should also consider existing and 
future policies regarding security, 
business continuity and disaster 
recovery.  The Secretariat agrees to explore 
implementing feasible aspects of this 
recommendation. In 2018 the Secretariat is 
going to implement a Security  Renovation 
Project that will cover the items 
recommended.  ongoing  Medium  
Action plan for 
growing 
outstanding 
contributions.  Financial 
Statements 
Report  AGSD/  
FINANCIAL 
MANAGEMENT  Outstanding contributions totaled 
CHF 33.8 million.  I recommend 
preparing an action plan for running 
the WTO with growing outstanding 
contributions.  The Secretariat agrees with the observation.  
Instead of an action plan, the Secretariat will 
be proposing appropriate steps to be taken in 
a dedicated paper to be presented to the 
CBFA in June 2018.  Newly 
Open High 
Provisions of 
invalidity 
cases  Financial 
Statements 
Report  AGSD/  
FINANCIAL 
MANAGEMENT  Provisions of invalidity totalled CHF 
4.53 million in 2017. If the monthly 
payments to both persons are 
accrued over the average Swiss  
(remaining) life expectancy, these 
provisions would have to be raised to 
about CHF 9.4 million in total, each 
provision would have to be more 
than doubled. I repeat and extend 
my recommendation in my report This recommendation is linked to the 
recommendation below 48. The Secretariat 
agrees with the observation and will 
investigate the feasibility of this suggestion 
relative to other options.  Newly 
Open Medium    
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- 6 - Issue  Audit 
Category  Concerned 
Division  Recommendation  WTO´s Comment / Implementation  Status  Priority  
last year to check and adapt all 
relevant WTO in validity cases.  
HR focal point 
/ contact 
person  Performance 
Report  HR  HR delivered documents delayed to 
the Auditor. I recommend HR should 
provide a focal point / person to 
channel and deal with audit requests 
regarding HR topics to avoid any 
future delay of providing i nformation 
to the Auditor.  The Secretariat agrees with the observation 
and will provide a HR focal point for the next 
audit.  Newly 
Open High 
Insurance 
Policy  Performance 
Report  AGSD/  
FINANCIAL 
MANAGEMENT  I suggest WTO to review whether it 
is economically advantageous to take 
out an insurance policy that covers 
the complete risk of invalidity instead 
of minor one -time lump sum 
payments only.  The Secretariat agrees with the observation 
and will investigate the feasibility of this 
suggestion relative to other  options  Newly 
Open Medium  
Delegation of 
Authority  Performance 
Report  HR/OIO  I recommend updating regularly the 
document "WTO Delegation of 
Authority". It should be noted that 
there is a delegation of authority to 
the Director of the AGSD for the 
adoption  of the Travel Policy.  The Secretariat agrees with the observation. 
There is an amended travel policy that is 
going through internally review process which 
will be signed as per the current delegation of 
authority  Newly 
Open Low 
Reimburseme
nts programs 
of airlines  Performance 
Report  AGSD/TRAVEL  WTO has not entered into any 
contracts with airlines to participate 
in such reimbursement programs. I 
recommend checking participating in 
reimbursement programs of airlines.  The Secretariat will evaluate the feasibility of 
the recommendation.  Newly 
Open Low 
Expending 
application 
MobileXpens e Performance 
Report  AGSD/TRAVEL  If the introductory phase has been 
successfully completed, I recommend 
that the WTO should check 
expending the application of 
MobileXpense to other categories of 
travelers.  The Secretariat agrees on the observation and 
will aim to implement it by the second quarter 
of 2019  Newly 
Open Medium  
Calculating 
advances  Performance 
Report  AGSD/TRAVEL  MobileXpense  often exceeded the 
reimbursable travel expenses. The 
travel service team then informed 
the employee in each individual case 
to process the repayment of the 
overpayment. This created additional 
work that can be avoided by 
complying with the travel policy. I 
recommend calculating advances in 
line with regulations.  The Secretariat agrees on the observation and 
will implement it by the second quarter of 
2019.  Newly 
Open Medium   
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- 7 - Issue  Audit 
Category  Concerned 
Division  Recommendation  WTO´s Comment / Implementation  Status  Priority  
Application for 
authorization  Performance 
Report  AGSD/TRAVEL  Application for author ization shall at 
least 10 working days before the 
start of official travel. I recommend 
travellers should request to make 
travel requests early as possible; if 
requested shortly before the start, he 
should justify this in the travel 
request.  The Secretaria t will reinforce the message of 
submit in duly time the travel request through 
a notification in the AGSD weekly news and in 
ad hoc messages if needed.  Newly 
Open Low 
Open Travel 
Expense 
Report  Performance 
Report  AGSD/TRAVEL  Travel expense reports in 
MobileXpense are considered "open". 
I recommend that you make a 
settlement as soon as possible, 
which means when cases are 
technically completed.  The Secretariat agrees on the observation and 
will implement it by the second quarter of 
2019.  Newly 
Open Low 
Recruiting 
process for 
Consultants  Performance 
Report  HR There are two different processes in 
the two responsible divisions for 
consultants. I recommend 
standardizing the recruiting -
processes for individual consultants 
similar to what is in the Procurement 
Manual and policy.  The Secretariat agrees on the observation and 
has already  started the revision process to 
issue a dedicated consultant guideline.  Newly 
Open High 
 
 
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