RESTRICTED  
  
WT/BFA/W/345  
 
17 November 2014  
(14-6716)  Page: 1/2  
Committee on Budget Fina nce and Administration   
 
 AUDIT COMMITTEE BACKGROUD INFORMATION 
1  INTRODUCTION 1.1.  Following the request of some Members of the Committee on Budget Finance and 
Administration (CBFA), this document aims to provide background information on the issue of 
establishing an Audit Committee at the WTO. 
2  INFORMATION ON ESTABL ISHING AN AUDIT COMMITTEE 
2.1.   The proposal to establish an Audit Commi ttee at the WTO was first discussed by the CBFA on 
its meeting on Wednesday, 2 July 2014 at the occa sion of the presentation of the Internal Audit 
Report for the year 2013. 
2.2.  An Audit Committee should be established acco rding the Head of the Office of Internal Audit 
(HOIA) for the following reasons: 
a. Existing in most International Organization (WIPO, UN, WMO; etc…)  
b. Recommended by the Institute of Internal Audit (IIA) Standard 1110 and 1100.A1  
i. The chief audit executive must report to a level within the organization that allows 
the internal audit activity to fulfil its resp onsibilities. The chief audit executive must 
confirm to the board, at least annually, the organizational independence of the 
internal audit activity. 
ii. The internal audit activity must be free from interference in determining the scope of 
internal auditing, performing work, and communicating results. 
c. Stated in the 2012 External Audit Report WT/BFA/W/303 in paragraphs 22 and 23: 
i. Creating an Audit Committee consisting of a few representatives of the Members, 
elected for example by the General Council, as well as a few experts who could be appointed by the Audit Committee on the proposal of the Secretariat
1; 
ii. Attributing broader responsibilities regarding internal audit to the CBFA, which could 
meet in special session on audit problems, a solution which would have the advantage of involving all Members. In this case, the CBFA could have recourse to 
experts appointed, for example, according to the methodology described below in the 
event of the creation of a Committee on Ri sks. This second hypothesis is more 
consistent with the WTO's desire to involve all Members in the various aspects of management. 
iii. The new powers accorded to the Committee thus selected should be modelled on 
those listed above in the already cited Institute of Internal Audit Standards (the chosen committee would be linked to the Office of Internal Audit, as is the 
Director-General; approval by the chosen committee of amendments to the Internal 
                                               
1 This Audit Committee would have other functions such as followi ng the reports of th e External Auditors 
and the register of risks. WT/BFA/W/345 
 
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  Audit Charter; approval of the internal au dit plans and approval of the appointment 
and possible removal of internal audit staff). 
d. Stated in the Internal Audit Annual Report for 2012: WT/BFA/W/300 paragraph 3.2 
i. Results of the review identified opportunities for improvement in the Office of 
Internal Audit including; amending the Internal Audit charter to give jurisdiction to a 
committee of the Organization (probably CBFA) to monitor internal audit matters; the establishment and revision of annual audit plans by reference to the risk 
management framework of the WTO and in coordination with the External Auditor; 
making long-term audit plans and officially revising them, if necessary; specifying in the annual audit plans the anticipated time duration for each audit activity and the planned completion date; establishing a quality control and improvement program 
including periodic internal and external evaluations to cover all aspects of the 
internal audit activity; establishing an annual training plan and publishing a list of courses actually followed each year by the auditors. 
e.  Stated in the Internal Audit Annual Re port for 2013: WT/BFA/W/327 paragraph 3.73  
i. Governance structure-This refers to the reporting relationships of the HOIA and 
governance processes within the Organization and the environment. […] As 
recommended by the External Auditor and promulgated by the Audit standards, 
consideration should be given to the establishment of an Audit Committee comprising members independent of the Organization's management and to which the audit function should have a reporting line in order to enhance its independence 
and strengthen the Organization's accountability.  
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