RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/BFA/W/155 
21 March 2007 
 
 (07-1188) 
Committee on Budget, Finance and Administration  
  
 
 
PROPOSED REVISIONS TO THE 
 
FINANCIAL RULES AND REGULATIONS OF THE WTO 
  
1. The External Auditor of the WTO, the Austrian Court of Audit, has brought to the 
Secretariat's attention certain inconsistencies in  the Financial Rules and Regulations of the WTO 
(WT/L/157 and WT/L/156/Rev.1, respectively).  These inconsistencies concern:  (i) the threshold amount of an intended purchase which calls for compe titive bidding;  and (ii) the audit of the WTO 
accounts in the context of the biennial system. 
Threshold amount for competitive bidding
 
 
2. Section X of the WTO Financial Rules (WT/L/ 157) stipulates that recourse to competitive 
bidding is mandatory whenever a single purchase of goods or services is likely to exceed CHF 30,000.  
This amount was increased to CHF 50,000 based on a co mment of the external auditors in their report 
on the 1999 Director-General's Budgetary an d Financial Report (WT/BFA/W/42) which was 
subsequently approved by the Genera l Council in December 2000 (WT/GC/M/61). 
3. It is therefore proposed that the change appr oved in 2000 be reflected in Section X, 10.3(a) 
and (b)WTO Financial Rules to the effect that  the amount of CHF 30,000 be amended to read 
CHF 50,000. 
Audit of the WTO accounts  
 
4. The inconsistencies concern the fact that, in view  of the stipulation that the biennium in the 
WTO consists "of two consecutive financial pe riods covering each year of the biennium," 
(WT/L/156/Rev.1), the current requirement in the Fi nancial Regulations that the accounts should be 
prepared for the biennium, and such accounts would thereupon be audited, is not feasible.  If the 
biennium in the WTO had consisted of one single fi nancial period covering two years, the regulations 
would have been consistent with th at fact.  As this is not the case, the regulations must be amended to 
bring them into harmony with the WTO approach to the biennium.  In the same context, reference to 
an "interim audit" (Regulation 39(a)) would be dr opped as financial period, i.e. each year, would be 
audited on its own.   
5. In the same sense, the require ment that a Budget Performance Report be prepared "at the end 
of the first financial period of the biennium" w ould not be necessary as this information would be 
provided in any event in the annual Director-Gener al's Budgetary and Financ ial Report, which would 
be audited and commented upon by the External Audito r.  It is therefore suggested that Regulation 
39(b) be amended to bring the pr esentation of the Budget Performance Report into line with the 
current practice,  i.e. prior to the end of the annua l financial period, either when (i) a revision to the 
second financial period or (ii) budget propo sals for the next biennium, is proposed. 
 WT/BFA/W/155 
Page 2  
 
  6. Annex 1 is a tracked version of the proposed changes to the WTO Financial Rules.  Annex 2 
is a tracked version of the WTO Financial Regulations. 
Proposed recommendation to the General Council
 
 
7. Having examined document WT/BFA/W/ 155, the Committee recommends to the 
General Council that the WTO Financial Rul es and the WTO Financial Regulations be 
amended to reflect the changes proposed in the documents WT/L/156/Rev.2 and 
WT/L/157/Rev.1 . 
 
_______________  
        WT/BFA/W/155 
Page 3 
 
 
  ANNEX 1  
 
   
 
DRAFT REVISION 
 
 
FINANCIAL RULES* 
OF THE 
WORLD TRADE ORGANIZATION  
 
 
                                                      
* WT/L/157. WT/BFA/W/155 
Page 4  
 
   
CONTENTS 
               Page
 
 
I. Authority an d Applicability   
 
 1.1 Reference .. ............................................................................................................... . 7  
 1.2 Applicability ............................................................................................................ . 7  
 1.3 Responsibility or  implementation .............................................................................  7 
 1.4 Additional instructions to be issued by the ...............................................................  7 
    Deputy Director-General in charge of Finance.......................................................  7 
 1.5 Responsibilities of th e Director of Finance and 
    General Services Division .......................................................................................  7  1.6 Approaches outside the WTO ...................................................................................  7  1.7 Responsibility for funds from external sources ........................................................  7 
 
II. Preparation of the Budget Estimates  
 
 2.1 Form of the budget estimates ....................................................................................  8  2.2 Responsibility for the preparation      of the budget estimates ............................................................................................  8 
 2.3 Furnishing of cost estimates ......................................................................................  8 
 
III. Collection of Contributions and Other Income  
 
 3.1 Responsibility for collection of contributions...........................................................  8 
 3.2 Accounting for receipts..............................................................................................  8 
 3.3 Miscellaneous income ...............................................................................................  9  3.4 Proceeds from the sale of equi pment, discounts or rebates......................................  9 
 3.5 Acceptance of moni es by officials ............................................................................  9 
 3.6 Furnishing of o fficial receipts ...................................................................................  9 
 IV. Appropriations and Allocations  
 
 4.1 Responsibility of the Deputy Director -General in charge of Finance for the  
     implementation of the approved budget  ...............................................................  9  4.2 Responsibility of the Director of  Finance and Genera l Services Division 
    to allocate appropriations in accordance with the Functional Budget ...................  10 
 4.3 Periodic review of th e expenditure position..............................................................  10 
 4.4 Transfers between items with in the approved regular budget..................................  10 
 
V. Control of Obligations  
  5.1 Obligations to be incurred only  by duly authorized  officials  .................................  10 
 5.2 Proposals or drafts having financia l and/or budgetary implications .......................  10 
 5.3 Control of obligations................................................................................................  11  5.4 Obligations to be incurred in conformity with the budget .......................................  11  5.5 Objection to pr oposed obligations.............................................................................  11 
 5.6 Adjustments of obligations........................................................................................  11 
  WT/BFA/W/155 
 Page 5 
 
 
  VI. Presentation and Audit of Claims  
 
 6.1 Payments to be made on the basis of claims.............................................................  12  6.2 Claims to be supported by a copy of the order .........................................................  12  6.3 Time-limits for the pr esentation of claims................................................................  12 
 6.4 Audit of claims...........................................................................................................  12 
 6.5 Claims to be accompanied by receiving reports .......................................................  13  6.6 Safeguards. ............................................................................................................... .  13 
 6.7 Objection to a claim...................................................................................................  13  
 VII. Payments  
 
 7.1 Vouchers to support payments ..................................................................................  13  7.2 Payments to be made to duly entitled persons ..........................................................  14  7.3 Officials authorized to make payments.....................................................................  14 
 7.4 Determination of rates of remuneration 
    and reimbursement...................................................................................................  14  7.5 Advance and progress payments...............................................................................  14  7.6 Time-limits for payments ..........................................................................................  15  7.7 Currencies of ac counting and currency  
    conversion rates .......................................................................................................  15 
 7.8 Responsibility for payments......................................................................................  16 
 7.9  Ex gratia payments....................................................................................................  16 
 
VIII. Management of Funds  
  8.1 Treasury management................................................................................................  16 
 8.2 Monies to be deposited in banks ...............................................................................  17  8.3 Operation of bank accounts.......................................................................................  17 
 8.4 Investment of funds ...................................................................................................  17  8.5 Loss of cash - cases of fraud......................................................................................  17  8.6 Exchange of currencies..............................................................................................  17 
 
IX. Designation of Cashi ers and Advances of Funds  
 
 9.1 Designation of cashiers..............................................................................................  17  9.2 Establishment of operati ng cash advances (including 
    Petty Cash advances) ...............................................................................................  17 
 9.3 Accounting for opera ting cash advances...................................................................  18 
 9.4 Other cash advances ..................................................................................................  18  
X. Procurement  
  10.1 Authorized contra cting officials................................................................................  18 
 10.2 Contracts Committee ................................................................................................  18  10.3 Competitive bidding and advertising ........................................................................  18  10.4 Exceptions to adve rtising require ments ....................................................................  19 
 10.5 Awarding of contracts................................................................................................  19 
 10.6 Purchase to be made in writing .................................................................................  19 
 10.7 Written findings .........................................................................................................  19 
 WT/BFA/W/155 
Page 6  
 
  XI. Property  
 
 11.1 Property records.........................................................................................................  20 
 11.2 Physical inventories ...................................................................................................  2 0 
 11.3 Use of property or services of the WTO ...................................................................  20 
 11.4 Treatment of cases of loss of assets, fraud or  
    unrecoverable debt...................................................................................................  20  11.5 Accounting for donated property ..............................................................................  21 
 11.6 Disposal of surplus property......................................................................................  21  XII. The Accounts  
 
 12.1 Responsibility for maintaining the accounts.............................................................  21  12.2 Principal accounts......................................................................................................  21 
 12.3 Subsidiary accounts ...................................................................................................  21  
 
 
Appendix 
 
  Decision of the General Council of 11 July 1995 (WT/GCM/5) on procedure  
  for decisions having financial implications  which may be taken by WTO Bodies .........................  22 
 
  WT/BFA/W/155 
 Page 7 
 
 
  I. AUTHORITY AND APPLICABILITY  
 
1.1 Reference  
  These Rules are established pursuant to Regulati on 3 of the Financial Regulations of the World 
Trade Organization (WTO). 
 1.2 Applicability
 
  These Rules shall apply to the regular budget of  the WTO and to all other funds placed at the 
disposal of the WTO, except in so far as the applicab ility of special regulations and rules for such other 
funds is recognised by the Deputy Dire ctor-General in charge of Finance. 
 1.3 Responsibility for implementation
 
 
 The Deputy Director-General in charge of Financ e is responsible to the Director-General for the 
application and implementati on of these Rules.  He may delegate any specific authority vested in him 
pursuant to these Rules, as appropria te, to other officials of the WTO. 
 1.4 Additional instructions to be issued by the Deputy Director-General in charge of Finance
 
 
 Within the framework of the Financial Regu lations and these Rules, the Deputy Director-
General in charge of Finance may issue such additional instructions or establish such procedures as shall be necessary to ensure effective internal financia l control, sound administ ration of funds, and the 
exercise of economy.  No changes in such instructions  or procedures shall be made without the approval 
of the Deputy Director-General in charge of Finance. 
 
1.5 Responsibilities of th e Director of Finance and General Services Division
 
  The Director of the Finance and General Se rvices Division is responsible to the Deputy 
Director-General in charge of Finance for the perfor mance and/or supervision of  all budgetary, financial 
and accounting operations.   
 
1.6 Approaches outside the WTO
 
  No approach shall be made outside the WTO or  within the WTO with a view to obtaining funds 
or resources, or exemptions from existing financial re gulations, rules or provisions of the WTO, except 
with the prior written authorization of the Director-General, the Deputy Director-General in charge of 
Finance or the Director of Financ e and General Services Division. 
 1.7 Responsibility for funds  from external sources
 
  No official may accept respons ibility for the handling or management of funds belonging to a 
government, or to any other body of an  official or quasi-offi cial nature with which he is associated by 
reason of his status as an WTO of ficial, unless he has been specifica lly authorized in advance to do so 
on the basis of a decision by the Director-General.  WT/BFA/W/155 
Page 8  
 
  II. PREPARATION OF THE BUDGET ESTIMATES  
 
2.1 Form of the budget estimates
 
  The budget estimates of the WTO shall be drawn up as prescribed in Regulations 5 to 9 of the 
Financial Regulations.  Presentation of the budget estimates shall be both in an overall form and, to the 
extent possible, broken down according to  divisions, i.e. in a functional format. 
 2.2 Responsibility for the prep aration of the budget estimates
 
 
 The Deputy Director-General in charge of Finance, with the assistance of the Director of 
Finance and General Services  Division, shall be responsible to the Director-General for the provision of 
advice on budget and financial policy and for the prepar ation of the estimates of income and expenditure 
included in the budget proposals and budget documents  for submission to the Committee on Budget, 
Finance and Administration and to the General Counc il.  For this purpose he shall establish such 
procedures, criteria and deadlines as may be required to assure th e timely presentation of sound and 
realistic budget estimates conformi ng to the Financial Regulations.  
 2.3 Furnishing of cost estimates
 
  The Finance and General Services Division shall be responsible for the pr eparation of all cost 
estimates that may be re quired in connection with the activities of the WTO including estimates of the 
cost of all projects, trust funds, meetings, staff salaries and missions .  No official shall issue cost 
estimates for use outside the WTO without prior written clearance of the estimates by the Director of the 
Finance and General Services Division. 
 
 
III. COLLECTION OF CONTRIBUTIONS  
AND OTHER INCOME  
 
3.1 Responsibility for collection of contributions
 
 
 The Director of the Finance and General Servic es Division shall be responsible to the Deputy 
Director-General in charge of Finance for co llecting and accounting for contributions due from 
Members, as prescribed in Regulations 12 to 17 of the Financial Regulations. 
 3.2 Accounting for receipts
 
 
 (a) All receipts shall be brought to account  with the shortest delay possible.  Assessed 
contributions received by the WTO shall be a ccounted as of the date of receipt in the 
WTO Bank Account. 
  (b) Voluntary contributions, gifts or donatio ns, which directly or indirectly involve 
additional financial liability for the WTO, sha ll be kept in a suspense account until their 
acceptance by the Committee on Budget, Finance and Administration has been authorized in accordance with Regul ation 19 of the Financial Regulations. 
  WT/BFA/W/155 
 Page 9 
 
 
  3.3 Miscellaneous income  
  Miscellaneous income consists of the followi ng categories of receipts  accruing to the WTO: 
  (a) receipts from the sale of publications and the provision of services; 
 (b) the difference between gains and losses on exchange; 
 (c) savings on previous ye ar's outstanding obligations; 
 (d) overhead on Trust Funds;  (e) receipts from the rental of  meeting rooms and office space; 
 (f) assessments from  Observer Countries; 
 (g) receipts of interest other than that requi red to be credited to the Working Capital Fund 
in accordance with Regulation 33 or to be cr edited to Members in respect of the Early 
Payment Encouragement Scheme; 
 (h) refunds of expenditure of prior financial periods;  (i) WTO  cheques remaining uncashed for a period of twelve months after the date drawn;  
 (j) other miscella neous cash receipts. 
 3.4 Proceeds from the sale of  equipment, discounts or rebates
 
  Proceeds from the sale of equipment may be set off against the purchase of replacements provided that the sale and purchase occur during the same financial period;  otherwise the proceeds shall 
be treated as miscellaneous income.  Proceeds fro m discounts or rebates shall be credited to the 
corresponding budgetary account in order to  offset expenditures of same nature. 
 3.5 Acceptance of monies by officials
 
 
 (a) Wherever possible payments to the credit of the WTO shall be directed to a WTO bank 
account. 
  (b) The Deputy Director-General in charge of Finance shall designate those officials who 
are authorised to accept mone y on behalf of the WTO and to  issue official receipts.  
 
 (c) Any other official receiving money on beha lf of the WTO must immediately remit it in 
full to an official authorized to accept money or, where this is not possible, deposit it in 
a WTO bank account.  Full details of such de posits shall be sent  immediately to the 
Director of Finance and Ge neral Services Division. 
 
3.6 Furnishing of official receipts
 
  An official receipt shall be given  for all monies received either in cash or by cheque.  Receipts 
shall be drawn up in duplicate, and a copy of the original shall be retained.  
  
IV. APPROPRIATIONS AND ALLOCATIONS  
 
4.1 Responsibility of the Deputy Director-General  in charge of Finance for the implementation of 
the approved budget  
 
 The Deputy Director-General in charge of Finance is responsible to the Director-General for 
ensuring that the expenditure of the WTO under the re gular budget remains within  the appropriations as 
voted and that such appropriations are used only for the purposes approved by the General Council. 
 WT/BFA/W/155 
Page 10  
 
  4.2 Responsibility of the Director of Fina nce and General Services Division to allocate 
appropriations in accordance  with the Functional Budget  
  The Director of Finance and General Services Division shall inform in writing the Directors of the amounts allocated to their divisions in accordance  with the Functional Budget with the constraints 
limiting the use of these appropriations. 
 4.3 Periodic review of the expenditure position
 
  (a) The Finance and Genera l Services Division shall monitor the extent to which 
allocations are used and prepare reports for the Director-General on amounts currently 
allocated, obligated and expended, and expected future expenditure, under the 
allocations. 
  (b) Divisional Directors shall be informed regularly of the expend itures and unliquidated 
obligations recorded against their own allocations provided under the Functional 
Budget. 
 4.4 Transfers between items within the approved budget
 
  Transfers between sections of the expenditure  budget shall be handled through the internal 
control system, subject to a report submitted by the Se cretariat to the General Council for approval at the 
end of the financial period.     
V. CONTROL OF OBLIGATIONS  
 
5.1 Obligations to be incurred only by duly authorized officials
 
  No contract shall be concluded and no order shal l be placed on behalf of the WTO except by an 
official to whom a formal authority to incur such obligations has been delegated by the Deputy Director-
General in charge of Finance. 
 
5.2 Proposals or drafts having fina ncial and/or budgetary implications
* 
  (a) Any draft paper for the General Council whic h contains a proposal likely to have direct 
or indirect financial or budgetary implications  shall be routed by th e originating unit, or 
the officer to whom it reports, to the Direct or of Finance and General Services Division 
for financial evaluation and clearance before  being submitted to the Deputy Director-
General in charge of Finance. 
  (b) Advance clearance and financial evaluation must be obtained before seeking the final 
approval on any document or communication having a direct or indirect financial 
implication. 
    
____________ 
 * See Also Appendix.  WT/BFA/W/155 
 Page 11 
 
 
  5.3 Control of obligations  
  (a) All contracts, a ppointments, mission orde rs, purchase orders, or other documents by 
which a financial obligation is to be incurred on behalf of the WTO must be submitted in advance to the Finance and General Serv ices Division for fina ncial clearance under 
Regulation 42 of the Financial Regulations  except as provided in subparagraph (d) 
below. 
  (b) An authorised official of the Finance and General Services Di vision shall review the 
obligating documents submitted in the light of  the applicable financial regulations and 
rules, the approved budget, and the available ba lances in the respecti ve allocations.  He 
shall also assure himself that the principl es of sound economy are maintained.  If the 
obligating document conforms with the above requirements, it shall be certified by an 
authorised official of the Finance and Genera l Services Division that  funds are available 
and have been reserved to meet the resulti ng expenditure.  Approved obligations shall 
be recorded by the Finance a nd General Services Division. 
  (c) No obligating document shall be released  outside the WTO without the certification by 
an authorised official of the Finance a nd General Services Division that funds are 
available. 
 
 (d) An authorised official of the Finance and General Services Division may issue lump-
sum certificates to cover minor routine purchases.  At the end of the period for which the certificate is issued, it sha ll be returned together with a record of the obligation 
incurred against it, and shall be supported  by copies of the corresponding obligating 
documents.  A lump-sum certificate shall be recorded in the accounts as a valid 
obligation, which shall be adjusted to actual obligations when the certificate is returned. 
 5.4 Obligations to be incurred in conformity with the budget
 
  Obligations shall be incurred onl y in strict conformity with th e relevant budget.  All obligating 
documents submitted for financial clearance shall be  accompanied by an indication of the appropriate 
accounting classifica tion.  In case of doubt, the correct classi fication against which any charge is to be 
made shall be determined by the Chief of the Budget and Control Section. 
 5.5 Objection to proposed obligations
 
 
 If the Director of Finance and General Serv ices Division cannot approve an obligating 
document submitted for certification he shall state his objections in writing.  If the requesting official does not agree with the objection, the matter shall be referred to the Deputy Director-General in charge 
of Finance for decision.  5.6 Adjustments of obligations
 
 
 If part or all of an amount recorded as an obligation is no longer required for the purpose 
originally foreseen the necessary adju stment shall be made immediately. 
  WT/BFA/W/155 
Page 12  
 
  VI. PRESENTATION AND AUDIT OF CLAIMS  
  
6.1 Payments to be made on the basis of claims
 
  (a) Except for the payment of salaries, wa ges, regularly established allowances and 
amounts due under external collaboration cont racts with individuals, no payment shall 
be effected unless cl aimed by the payee.  Payments due under external collaboration 
contracts with individuals shall be made on the basis of payment requests submitted by 
authorised officials;  such requests shall be treated in the same way as claims. 
 
 (b) For each claim submitted, the claimant shal l certify that the claim is fair and correct and 
that payment has not yet been received. 
  (c) Where special forms for claims exist, claims must be presented on these forms.  
6.2 Claims to be supported by a copy of the order
 
  Claims submitted for payment mu st normally be supported by a copy of the relevant order 
showing, where applicable, the registration number of the corresponding obligation. 
 6.3 Time-limits for the presentation of claims
 
 
 (a) Officials authorised to incur obligati ons shall ensure the presentation, within a 
reasonable period, of all claims payable. 
  (b) Particular care shall be exercised to prevent arrear claims being made after the close of 
the financial period. 
  (c) Claims in respect of officially authoris ed travel shall be submitted within one month 
after such travel has been completed. 
   (d) Claims for overtime should be submitted w ithin one week after such overtime has been 
completed. 
  (e) Claims involving discounts fo r prompt payment shall be flagged and shall be processed 
with the minimum delay possible. 
 
6.4 Audit of claims
 
  (a) The Certifying Officer shall subject each  claim to careful scrutiny before authorising 
payment, and shall maintain records of all claims processed for payment. 
  (b) No claim shall be authorised for payment unless its validity has been clearly 
established. 
  (c) Officials authorised to incur obligations shall supply the Certifying Officer with any 
information required in connecti on with the audit of claims. 
  WT/BFA/W/155 
 Page 13 
 
 
  6.5 Claims to be accompanied by receiving reports  
  (a) Claims based on the furnishing of goods or se rvices shall be submitted to the Certifying 
Officer together with a certified receiving report stating whether the goods or services 
have been furnished in accordance with the specifications of the order, and whether the 
claim is administratively approve d for payment.  In addition, the receiving officer shall 
certify that the goods received have been entere d in the register of stocks or inventory. 
  (b) The Deputy Director-General in charge of Finance may waive the requirement of 
receiving reports in the case of standard services such as publ ic utilities, etc. 
 
 (c) For goods delivered to a place outside  Geneva, payment may be authorized upon 
receipt of documents provided that the goods were dispatched appropriately insured to 
their destination.  A duly executed receivi ng report must be forwarded to the Finance 
and General Services Division i mmediately upon receipt of goods. 
 
 (d) In the case of Rule 6.5(c) the official forwarding the claim shall certify that the goods 
were dispatched with appropriate insurance coverage. 
 6.6 Safeguards
 
 
 (a) Officials authorised to incur obligatio ns and the Certifying Officer shall take all 
necessary steps to avoid duplicate payments of claims. 
  (b) Except where this is una voidable, no official shall be assigned simultaneously any two 
of the following functions: purchasing and/or  acceptance of goods or services, auditing 
or disbursing. 
 6.7 Objection to a claim
 
  (a) When the Director of Finance and General Services Division objects to the payment of 
a claim in full or in part, he shall communicate his objection  to the official presenting 
the claim.  If the of ficial does not agree with the ob jection, he may appeal through 
proper channels to the Deputy Director-General in charge of Finance. 
  (b) If the Deputy Director-General in charge of Finance decides that a claim is to be paid 
notwithstanding an objection by the Director of Finance and General Services Division, 
his decision shall be reported to the external auditor. 
  
VII. PAYMENTS  
 
7.1 Vouchers to support payments
 
 
 (a) No payments shall be effected without satisfactory  supporting documents.  Except for 
payments made from cash advances these doc uments must show that the payment has 
been approved by a duly authorised Certifying Officer. 
 
 (b) Whenever claims are received as a result of a written order by the WTO, a copy of the 
order shall be included with the supporting  document. 
  (c) No verbal authority shall be  accepted for making any payments. 
 WT/BFA/W/155 
Page 14  
 
  7.2 Payments to be made to duly entitled persons
 
  (a) Payments shall be made only to the pers ons to whom they are due, or to their legal 
representatives.  A payment shall normally be   made to a bank account in the name of 
the person to whom payment is due. 
 
 (b) The Director of Finance and General Services Division may refuse to effect payment of 
any salary, allowance or other payment to a third party claiming the payment on behalf of the person to whom it is due. If payments are made to such third party or a legal representative, the nature of the authorit y under which such payment has been made 
shall be stated on the supporting document. The cession or other authority shall either 
be attached to the supporting document, or the Director of Finance and General 
Services Division shall certify on the suppor ting document that a sufficient authority 
was produced. 
 
7.3 Officials authorized to make payments
 
  All payments shall be made by authorised officials of the Finance and General Services Division after approval by the Certifyi ng Officer, except for payments made by: 
  (a) members of the staff to whom cash is advanced for the purposes of the WTO; 
 
 (b) representatives of the United Nations Development Programme when acting as agents 
for the WTO; 
  (c) any other person specifically designated  for this purpose by the Deputy Director-
General in charge of Finance. 
 7.4 Determination of rates of remuneration and reimbursement
 
  (a) Salaries and wages shall be paid in accor dance with the relevant provisions of the Staff 
Regulation, or other applicable rules.  All amounts deducted from salaries shall be paid 
as soon as practicable to the accounts to which these amounts are due.  Contributions to 
the pension fund shall be transferred before  the end of the month for which they are 
due. 
  (b) Reimbursement for travel expenses and payment of any  allowances to members of the 
staff shall be effected in accordance with the Staff Regulations or other applicable rules. 
 7.5 Advance and progress payments
 
  The Director of Finance and General Services Di vision may authorise the inclusion in a contract 
of provision for such advance payments or partial paym ents for work in progress as may be required by 
normal commercial practice and the interests of the WTO.  Except for cases where specific provision of 
this nature has been included in a contract with the approval of the Director of Finance and General Services Division and for cases covered by Rules 6.5( c) and 6.5(d), payment may be made only after the 
services or goods have been received.  Claims for advance and progress payments shall be presented in 
accordance with Rule 6.5.  WT/BFA/W/155 
 Page 15 
 
 
  7.6 Time-limits for payments  
  (a) Once it has been ascertained that a payment is in order, it shall be made with reasonable 
dispatch. 
 
 (b) Proper attention shall be paid to claims  offering a cash discount for prompt payment. 
  (c) Payments made under the regular budget after the date set for the closing of the 
accounts of a given financial period are not al lowed as a charge against that financial 
period unless an outstanding obligation duly documented has been established. 
 
7.7 Currencies of accounting and currency conversion rates
 
  (a) The accounts of the WTO shall be maintained in Swiss francs ; however subsidiary 
accounting records may be mainta ined in other currencies.  
 
 (b) The conversion rates used for internal accounting purposes, call ed the WTO rate of 
exchange, shall be set by the Deputy Director-General in charge of Finance. 
  (c) Contributions received in a currency othe r than the Swiss franc shall be converted and 
credited at the bank rate of exchange at the time of receipt indicated by the value date 
and recorded at the WTO rate of exchange.  Differences in exchange shall be accounted 
for under (j) below. 
  (d) Salaries shall be paid in Swiss francs. The currencies in which the allowances of WTO 
officials may be paid (whatever the currency in terms of which the entitlement is 
expressed) shall be es tablished by the Deputy Director-General in charge of Finance. 
  (e) When allowances are paid in a currency ot her than that in which they are expressed, the 
rate of exchange used for the payment shall  be the WTO rate of exchange applicable at 
the time of payment. 
 
 (f) Advances relating to salaries, allowances (except with regard to Education Grants) and 
expenses of officials for which the entitlemen t is expressed in term s of a currency other 
than the Swiss franc, shall be recorded in Swiss francs at the WTO rate of exchange applicable at the time of the advance. 
 
 (g) Education Grants: 
 
(i)  Advances relating to Educ ation Grants and made in US dollars shall be recorded in 
Swiss francs at the WTO rate of exchange;   
 (ii)  except for (g) (i) above, all other advances made for Education Grants in 
currencies other than the Swiss franc shall be recorded in Swiss francs at the bank 
rate of exchange applicable at the time of the advances;   
 (iii) final settlement will be calculated as  to effect full recovery of the amount 
recorded. 
 WT/BFA/W/155 
Page 16  
 
   (h) When expenses incurred by officials or other persons to whom a payment is due from 
the WTO are reimbursed by the WTO in a currency other than that in which the expenses were incurred, the conversion rate  used for the purpose of the reimbursement 
shall be the WTO rate of exchange applicable on the date on which the expenses were incurred, except in the following circumstances:   
 
(i) in cases of trust funds where the coordinator had to purchase the currency himself 
at a given date and produces a bank s lip showing the rate at which it was 
obtained, the conversion shall be made at that rate;   
 
(ii) in cases of trust funds where a relate d advance has been made in a currency other 
than that in which the expenses are reimbursed by the WTO, the expenses incurred up to the amount of the advanc e shall be converted  at the rate of 
exchange at which the advance was secured. 
 
 (i) Where a third currency is involved, the local currency obtained by the conversion of the 
second currency shall be taken into account  at the WTO rate of exchange and any 
difference as a loss or gain on exchange.  Where an exchange rate for a third currency 
has not been established, it shall be calcu lated by applying the cross-rate with the 
second currency. 
 
 (j) Exchange gains and losses resulting from the revaluation of regular budget assets and 
liabilities held in currencies other than the Swiss franc shall be accounted under 
miscellaneous income. 
 7.8 Responsibility for payments
 
 
 An instruction from a superior official shall not relieve the Finance and General Services Division from responsibility for an irregular paym ent, unless the irregularity was pointed out by the 
Finance and General Division to the Director-General  in writing before the payment was made, and the 
objection overruled.  Any such overruling shall be given in writing and shall be reported to the external auditor. 
 
7.9 Ex gratia  payments
 
  The Director-General may, on an exceptional basis, authorise such ex gratia  payments as he 
deems to be necessary in the interests of the WTO.  A statement of such payments shall be submitted to 
the external auditor with the relevant accounts. 
 
 
VIII. MANAGEMENT OF FUNDS  
 
8.1 Treasury management
 
 
 The Director of Finance and General Services  Division shall be responsible to the Deputy 
Director-General in charge of Finance for the treasury management of all funds in the custody of the Director-General.   WT/BFA/W/155 
 Page 17 
 
 
  8.2 Monies to be deposited in banks  
  All monies not immediat ely required shall be placed in non- speculative accounts in such bank 
or banks of internationally recogni sed standing as the Deputy Director -General in charge of Finance  
may designate.  
 
8.3 Operation of bank accounts
 
  Bank accounts shall normally be operated jointly by two or more  officials to be designated by 
the Director-General.  
 
8.4 Investment of funds
 
  (a) Funds available under the regular budge t and the Working Capital Fund may be 
invested in accordance with Regulation 34 of the Financial Regulations. 
 
 (b) Other funds for which the Director-General is responsible shall be invested in 
accordance with any special regulations in force for such funds, or in the absence 
thereof, in similar manner to funds  available under the regular budget. 
 8.5 Loss of cash - cases of fraud
 
 
 Any loss of cash or negotiabl e instruments and any case of fraud, presumption of fraud or 
attempted fraud must be reported at once to the Depu ty Director-General in charge of Finance who will 
ensure that appropriate follow-up action is  taken in conformity with Rule 11.4. 
 
8.6 Exchange of currencies  
  Officials responsible for the operation of WT O bank accounts, or for holding WTO cash or 
negotiable instruments, are not aut horised to exchange one currency for another except to the extent 
required for the transaction of official business.  
 
IX. DESIGNATION OF CASHIERS AND ADVANCES OF FUNDS  
 
9.1 Designation of cashiers
 
 
 Officials who are to perform the function of ca shier shall be designated by the Director of 
Finance and General Servic es Division. The exact duties of each cashier shall be notified to him in 
writing by the designating official.  9.2 Establishment of operating cash adva nces (including Petty Cash advances)
 
 
 Operating cash advances (including petty cash a dvances) may be made to officials designated 
by the Director of Finance and General Services Division. The acc ounts for operating cash advances 
shall be maintained, normally on an imprest basis, in a form approved by the Director of Finance and General Services Division.  The person issuing an advance shall sp ecify in writing the amount of the 
advance and the purposes for which it may be used.  The amount of the advance shall be held to the 
minimum compatible with working requirements.  
 WT/BFA/W/155 
Page 18  
 
  9.3 Accounting for operating cash advances
 
  (a) Officials to whom operating cash advances  are issued under Rule 9.2 shall make use of 
such advances only for the purpose for which the advance was authorised and shall be 
personally responsible therefore. 
 
 (b) They shall render accounting as stipulated when the advance is made;  such accounting, 
unless otherwise specified, sh all be made not less frequently than once each month.  
They shall be in a position at all times to a ccount for the advances.  Cash and negotiable 
instruments shall be kept in safe custody. 
 
 (c) Operating cash advances shall be replenished upon presentation of a claim for 
replenishment.  These claims shall be made in the form prescribed by the Director of Finance and General Services Division or the person issuing the advance and shall list 
each expenditure made in sufficient detail to permit a proper classification and scrutiny 
of the expenses.  Except as may have been specified when the advance was issued, each 
expenditure listed must be s upported by a proper receipt. 
 9.4 Other cash advances
 
  In addition to the operating cash advances refe rred to in Rules 9.2 and 9.3, the Director of 
Finance and General Services Division may make such other cash advances as may be permitted by the 
Staff Regulations or administrative instructions.  
 
 
X. PROCUREMENT  
 
10.1 Authorized contracting officials
 
  Contracts for the purchase of goods  and services shall be entered into on behalf of the WTO by 
officials duly authorised by the Deputy Director-General in charge of Finance.  
10.2 Contracts Committee
 
  A Contracts Committee chaired by the Director of Finance and General Services Division will 
meet to consider purchases falling unde r the terms of Rule 10.3.  A repor t will be made for each meeting 
of the Committee. 
 
10.3 Competitive bidding and advertising
 
  (a) Except as provided in Rules 10.3(c) and 10.4, whenever a single purchase of goods or 
services is likely to exceed 3
 50,000 Swiss francs or the equivalent, tenders from at 
least three suppliers  shall be sought by invitati ons to bid or by newspaper 
advertisement. 
  (b) If a single purchase of goods or se rvices is not likely to exceed 3
 50,000 Swiss francs or 
the equivalent, such tenders may be sought;  alternatively, an assessment of competitive  
prices shall be made whenever possible. 
  WT/BFA/W/155 
 Page 19 
 
 
   (c) Rule 10.3(a) shall not apply to employment contracts or to external collaboration 
contracts with individuals or for supply of th e services of a particular individual.  The 
financial criteria and procedur es applicable to such contracts shall be approved by the 
Deputy Director-General in charge of Finance. 
 
10.4 Exceptions to advertising requirements  
  The Deputy Director-General in charge of Finance may waive the application of the Rule 10.3(a) in cases where he decides in the in terest of the WTO to do so, and in particular: 
 
 (a) when the prices or rates are fixed pursuant to legislati on or by public regulatory bodies 
or when for other reasons there is no co mpetitive market for the goods or services 
required; 
  (b) when the purchases fall within an approved  plan of standardisation of goods or supplies 
which renders competit ion impracticable; 
  (c) when the exigencies of the service do not permit the delay attendant upon the issue of 
invitations to bid; 
  (d) when the mandatory use of specific currencies renders this impracticable; 
 
 (e) when competitive bidding has failed to give satisfactory results;   (f) when the contract covers  research work to be carr ied out by a non-profit-making 
institution; 
  
 A record shall be maintained of all cases in which the application of Rule 10.3(a) has been 
waived.     10.5 Awarding of contracts
 
 
 Wherever tenders have been sought or an assessment of comp etitive prices has been made, 
contracts shall normally  be awarded to the supplier quoting the lowest price for an acceptable offer.  
However, when the interests of the WTO so require, any or all of the tenders may be rejected.  Where a 
tender is rejected, under the provisions of this rule , the reasons for such rejection shall be recorded.  
 
10.6 Purchase to be made in writing  
  (a) All purchases or contracts shall be made in writing, exce pt for direct cash purchases 
made in accordance with Rule 9.2. 
  (b) Where for any reason imme diate cash payment cannot be made for goods or services 
ordered verbally, the order must be confirmed in writing without delay.  
 10.7 Written findings
 
  Each determination or decision required of an authorised purchas ing official by the provisions 
of these rules shall be supported by the written findi ngs of such official.  The written findings shall be 
placed in the appropriate files.  WT/BFA/W/155 
Page 20  
 
  XI. PROPERTY 
 
11.1 Property records
 
  (a) Adequate records shall be maintained of  real property, non-expendable and expendable 
equipment, supplies and materials received, is sued, sold or otherwise disposed of, and 
remaining on hand.  The Deputy Director-Gener al in charge of Finance shall establish 
the nature and extent of the records to be  maintained for the purposes of this Rule. 
  (b) The records maintained in respect of su pplies and property accoun ts shall in all cases 
indicate the official accountable for each item.  
  (c) Control accounts shall be maintained re cording the total value of capital assets 
purchased and sold, or otherw ise acquired and disposed of. 
 
11.2 Physical inventories
 
  Physical inventories shall be taken of all suppl ies, equipment or other property of the WTO, or 
entrusted to the charge of the WTO, at such intervals as may be deemed necessary by the Deputy Director-General in charge of Finance to ensure adequate control over such property.  
11.3 Use of property or services of the WTO
 
  (a) The property or the services of the WTO shall not be used for private purposes except 
where specifically authorised in the interest of the WTO by the Director of Finance and General Services Division. 
 
 (b) The Director of Finance and General Services Division shall determine the amounts 
due to the WTO for the use of its property or services. 
  (c) Goods or services of the WTO may be provided to Members, the United Nations, other 
specialised agencies, or othe r organisations on such term s and conditions as may be 
appropriate in each case. 
 11.4 Treatment of cases of loss of  assets, fraud or unrecoverable debt
 
  (a) The Director of Finance and General Serv ices Division may authorise losses of cash, 
stores or other assets not exceeding the equiva lent of 5,000 Swiss francs in each case to 
be written off if in his judgement the cost  of recuperating the loss would exceed the 
amount to be written off, or if it is very un likely that action to recuperate the loss would 
be successful. The Deputy Director-General in charge of Finance may authorize the writing-off of losses exceeding th e equivalent of 5,000 Swiss francs. 
 
 (b) All losses which are written off shall be in cluded in the annual financial statements and 
submitted to the external auditor with the relevant accounts. 
  (c) The Deputy Director-General in charge of  Finance shall fix the responsibility for the 
loss, if any, attaching to any official of the WTO.  Such official may be required to 
reimburse the loss either partially or in full,  irrespective of whether the loss is covered 
by insurance or not.  WT/BFA/W/155 
 Page 21 
 
 
   (d) Any case of fraud, presumption of frau d or attempted fraud must be reported to the 
Director-General through the Deputy Dire ctor-General in charge of Finance. 
  (e) Amounts written off and subs equently recovered after the close of the financial period 
in which the writing-off occurred sha ll be treated as miscellaneous income. 
 
11.5 Accounting for donated property
 
  Goods received and accepted by the WTO as gifts or entrusted to the charge of the WTO, shall 
be accounted for in the same manner  as other goods acquired by the WTO. 
 
11.6 Disposal of surplus property
 
  Surplus property having residual commercial value shall be disposed of by sale after 
competitive bidding unless the Deputy Director-General in  charge of Finance in the interest of the WTO 
authorises a different method of disposal. 
  
XII. THE ACCOUNTS  
 
12.1 Responsibility for maintaining the accounts
 
 
 The accounts shall be maintained by the Finance and General Services Divi sion as prescribed in 
Chapter IX of the Financial Regulations.  12.2 Principal accounts
 
 
 The principal account s shall consist of: 
  (i) Statement of budgetary expenditure;   (ii) Income and expenditure account; 
 
 (iii) Surplus account;   (iv) Statement of assets and liabilities;  
 (vi) Separate accounts for the Working Cap ital Fund and for any trust funds or special 
accounts. 
 12.3 Subsidiary accounts
 
  The Director of Finance and General Services Division may arrange for subsidiary accounts to 
be maintained in other services as  required by day-to-day operations. WT/BFA/W/155 
Page 22  
 
   
Appendix  
 
  
Decision of the General Counc il of 11 July 1995 (WT/GCM/5) 
on the procedure for decisions having financial implications 
which may be taken by WTO Bodies 
 
 
 
 WTO Bodies shall, before a de cision is taken which may have fi nancial implications, inform the 
Chairman of the Committee on Budget, Finance and Administration, and identify, in so far as possible, 
areas in their sphere of competence where compensatory savings could be achieved.  On the basis of the analysis made by the Finance and General Services Division the Committee will then examine the 
financial implications and proposed funding, incl uding the identification of existing WTO activities 
where savings could be achieved for the first star t-up year and for the following on-going year(s), and 
forward such information to the General Council.  Wi th full knowledge of the financial implications and 
proposed funding, the General Council will then take a final decision. 
 
 
_______________ 
 
      WT/BFA/W/155 
Page 23 
 
 
   
ANNEX II  
 
  
 
  
DRAFT REVISION 
 
 
  
FINANCIAL REGULATIONS∗ 
OF THE 
WORLD TRADE ORGANIZATION 
 
 
                                                      
∗ WT/L/156/Rev.1. WT/BFA/W/155 
Page 24  
 
  CONTENTS
 
 Page  
 
CHAPTER I.    AUTHORI TY AND APPLICABILITY..................................................................25  
CHAPTER II.    PREPARATIO N OF THE BUDGET ESTIMATES............................................25  
CHAPTER III.    ADOPT ION OF THE BUDGET ..........................................................................26  
CHAPTER IV.    CO LLECTION OF FUNDS..................................................................................26  
 (a) Contributions From Members .........................................................................................26  
 (b) Other income ............................................................................................................... ......28  
 (c) Voluntary Contributions, Gifts or Donations .................................................................28  
CHAPTER V.   USE OF THE FUNDS ..............................................................................................29  
CHAPTER VI.    TH E SURPLUS ACCOUNT.................................................................................30  
CHAPTER VII.    THE WORKING CAPIT AL FUND...................................................................30  
CHAPTER VIII.    CUSTODY AN D INVESTMENT OF FUNDS.................................................31  
CHAPTER IX.   THE ACCOUNTS...................................................................................................32  
CHAPTER X.    INTERNAL CONTROL.........................................................................................33  
CHAPTER XI.    EXTERNAL AUDIT..............................................................................................34  
APPENDIX TO THE FINANCIAL REGULATIONS.....................................................................36  
 
  WT/BFA/W/155 
 Page 25 
 
 
  CHAPTER I.    AUTHORITY AND APPLICABILITY 
 
Regulation 1 
 
 These Regulations shall govern the financial ad ministration of the World Trade Organization 
(WTO). 
 
Regulation 2 
 
 The Director-General shall be responsible for the implementation of these Regulations.  He may 
delegate to other officers of the WTO such auth ority as he considers necessary for the effective 
implementation of these Regulations.    
Regulation 3 
 
 Rules made by the Director-General in order to  carry out the provisions of these Regulations 
shall be communicated to the General Council for approval.    
Regulation 4 
 
 These Regulations shall not be amended excep t by the General Council acting upon the advice 
of the Committee on Budget, Fi nance and Administration.   
  
CHAPTER II.    PREPARATION OF THE BUDGET ESTIMATES 
 
Regulation 5 
  The WTO biennium shall consist of two consecu tive financial periods covering each year of the 
biennium.  The financial period shall be from 1 January to 31 December.  
 
Regulation 6 
 
1. For each every
 financial period, the Director-General shall prepare budget proposals 
containing estimates of the income and expenditure of the WTO.  These proposals, as well as any 
Such  revisions for the second year of the biennium  as may be necessary will be presented to the 
Committee on Budget, Finance and Administration,  which will examine them and formulate a 
recommendation for consideration by the General Council.   
2. The estimates shall be expressed in Swiss francs. 
 
Regulation 7 
 1. The proposed expenditure estimate s shall be divided into parts and  sections. 
 
2. The proposed expenditure esti mates shall be accompanied by such information annexes and 
explanatory statements as may be re quested by or on behalf of the General Council, and such further 
annexes or statements as the Director-General may deem necessary and useful. WT/BFA/W/155 
Page 26  
 
  Regulation 8 
 1. Supplementary budget proposals for the curren t financial period may be submitted by the 
Director-General whenever necessary.  
2. The Director-General shall prepare supplement ary budget proposals in a form consistent with 
the approved budget.  These proposals shall follow the same examination and approval process as for 
the annual budget proposals.    
Regulation 9 
 
The income estimates for each fi nancial period shall consist of: 
  (a) a schedule of miscellaneous income showi ng for each item, in addition to the estimated 
amounts, the approved amount  for the preceding financial period; 
 
 (b) a draft scale of contributions to be assessed on Members, showing for each Member, 
the proposed assessment and the contributi on assessed for the preceding financial 
period.
1 
 
 
CHAPTER III.    ADOPTION OF THE BUDGET 
 
Regulation 10 
  The Director-General shall submit the budget estimates to the Commit tee on Budget, Finance 
and Administration in time for it  to be considered at its se ssion in the Autumn preceding  the biennium.  
At the same time, these budget estimates shall be transmitted to all Members of the WTO.  The same procedure shall be applied to any revision for the second financial period of the biennium which would 
be presented to the Committee on Budget, Finance a nd Administration in sufficient time for it to be 
considered at a session in the Autumn preced ing the second financial period of the biennium. 
 
Regulation 11 
  The Committee on Budget, Finance and Administ ration shall examine th e budget estimates and 
prepare a report thereon which shall be su bmitted to the General Council for adoption. 
 
 
CHAPTER IV.    COLLECTION OF FUNDS 
 
(a) Contributions From Members 
 
Regulation 12 
 
1. The expenses of the WTO shall be financed by contributions from Members and miscellaneous 
income.  The contributions shall be according to th e scale of assessments determined by the General 
Council.  
                                                     
 
1 The initial draft scale of contributions for the second financial period of the biennium will be 
indicative, pending (i) any revision which may be necessa ry for the second financial period and (ii) calculation 
of assessed contributions in accordance with Regulation 12.3(b).  WT/BFA/W/155 
 Page 27 
 
 
  2. The share to be contributed by each Member to the annual operating budget of the WTO shall 
be established on the basis of that country's (or sepa rate customs territory's) international trade (imports 
plus exports) in relation to  the total international trade of all WTO Members. 
 3. (a) Calculations of assessed contribu tions for the years 2001, 2002 and 2003 (which are 
prepared in the course of the respective previous year) shall be based on international 
trade statistics for the years 1996-1998, 1997-1999 and 1998-2000, respectively;  or, if these statistics are not available, for the last three years for which statistics are available.   
 
 (b) Calculations of assessed contributions for at least the following ten years, i.e.  2004, 
2005, 2006 to 2013, (which are prepared in the course of the respective previous year) 
shall be based on international trade sta tistics:  for the years 1997-2001, 1998-2002, 
1999-2003, etc.  respectively;  or if these stat istics are not availabl e, for the last five 
years for which statistics are available.  
 
4. The statistics used sha ll relate to trade in goods
2, services and intellectual property rights as 
reported in Balance of Payments statistics from the International Monetary Fund (IMF);  with regard to 
services, the statistics shall relate to the definiti on of commercial services as applied in the WTO. 
 5. Where IMF data deviate from IMF guidelines and include transactions not related to goods, 
services or intellectual property rights, adjustme nts provided to the WTO by the Central Bank or the 
National Statistical Office of a Member shall be taken into account  by the Secretaria t when adequately 
documented and justified.  6. If IMF data are not available, the WTO Secretariat shall use estimates based on the best other 
available sources. 
 7. A minimum contribution of 0.015 percent will be  applied to those members whose share in the 
total international trade of all WTO Members is less than 0.015 percent. 
 8. The contributions shall be asse ssed and paid in Swiss francs. 
 
Regulation 13 
 1. After the General Council has adopted the budget for each financial period, the Director-General shall: 
 
 (a) transmit the relevant documents to the Members;   (b) inform the Members of their commitments  in respect of contributions for the relevant 
financial period, and se nd a corresponding invoice; 
 
 (c) request the Members to remit their contributions. 
2. In accordance with Article VII, 4 of the Marrakesh Agreement Establishing The World Trade 
Organisation, Members have the obligation to cont ribute promptly to the WTO their share in the 
expenses of the WTO.  Contributions  shall be considered as due and payable in full upon receipt of 
the invoice or on 1 January of the financial period to which they relate, whiche ver is later.  As of 
1 January of the following calendar year the unpaid balance of such contributio ns shall be considered 
to be one year in arrears.  
                                                     
 
2 Excluding gold held as a store of value (deposit money banks).  WT/BFA/W/155 
Page 28  
 
  Regulation 14 
 
 The Director-General shall take appropriate action with a view to ensuring that Members pay their contributions promptly.  He shall report re gularly to the Committe e on Budget, Finance and 
Administration on the state of  payment of contributions. 
 
Regulation 15 
  States or separate customs te rritories having the status of Observers may only accede to the 
WTO if their financial obligations as Observers ha ve been fully discharged.  New Members shall be 
required to make a pro rata  contribution for the year in which they  become Members, after any relevant 
deduction of their assessment as Observer  which shall also be calculated on a pro rata basis for that 
year.  New Members shall also be required to prov ide their proportion of the total advances to the 
Working Capital Fund;  this advance shall be carried  to the credit of the rele vant Member.  Payments 
made by a Member shall be credited first to the Wo rking Capital Fund and then to the contributions due. 
 
Regulation 16 
 
 Any payment in respect of contributions made  by a Member which has not paid in full its 
contribution for previous calendar years shall, unless the General Council decides otherwise, be credited 
against the earliest date of such arrears. 
 
Regulation 17 
  A Provision for contributions in  arrears shall be maintained.  It shall be funded through the 
Surplus Account. 
 
(b) Other income 
 
Regulation 18 
 1. Except in so far as the General Council may decide otherwise, all income other than 
(a) contributions payable by Member s, (b) interest earned by inves ting contributions received by the 
Secretariat and not required immediately, (c) income  derived from investments of the Working Capital 
Fund and, (d) direct refunds of prior year's expe nditure received during th e current financial period,  shall 
be classed as miscel laneous income.   
 
2. For each full payment of an annual co ntribution between 1988 and 1994, any Member with 
pre-1988 arrears and assessed at the minimum cont ribution in 1988 may cancel an equal number of 
assessments for 1987 and earlier years upon pa yment of the 1989 minimum contribution of 
Sw F 19,137.  The difference between an outstandi ng contribution for pre-1988 and the amount of 
Sw F 19,137 shall be funded by miscellaneous income.  
(c) Voluntary Contributions, Gifts or Donations 
 
Regulation 19 
 
1.   Voluntary contributions, gifts or donations may be accepted by the Director-General provided 
that the purposes for which the c ontributions are made are consiste nt with the policies, aims and 
activities of the WTO, and provided that the accep tance of such contributi ons which directly or 
indirectly involve additional financial liability for the WTO shall require the consent of the Committee 
on Budget, Finance a nd Administration. 
  WT/BFA/W/155 
 Page 29 
 
 
  2. Moneys accepted for purposes specified by the donor  shall be treated as trust funds or special 
accounts.  3. Moneys accepted in respect of which no purpose is specified shall be treated as miscellaneous 
income and reported as "gifts" in the accounts of the financial period.   
 
4. Money received by a staff Member as honoria in his/her official capacity shall be remitted to the 
Organization and be credited to the WTO Staff Assistance Fund. 
 5. Unless otherwise provided, such voluntar y contributions, gifts or donations shall be 
administered in accordance with the present Financial Regulations. 
  
CHAPTER V.   USE OF THE FUNDS 
 
Regulation 20 
  The adoption of a budget by the General Coun cil shall constitute an authorization to the 
Director-General to incur obligations and make payments for the purposes for which the appropriations were voted and up to th e amounts so voted.   
 
Regulation 21 
  Appropriations shall be availabl e for obligation during the financial period to which they relate. 
 
Regulation 22 
 
 Appropriations shall remain available for twelve 12
 months following the end of the financial 
period to which they relate to the extent that they are required to discharge obligations in respect of 
goods supplied and services re ndered in the financial period and to  liquidate any other outstanding legal 
obligation of the financial period.  The balance of th e appropriations shall be surrendered by transfer to 
the Surplus Account. 
 
Regulation 23 
  At the end of the twelve-month period provide d in Regulation 22 above, the then remaining 
balance of any appropriations  retained shall be transferred to mi scellaneous income.  Any unliquidated 
obligations of the financial period in question shall, at that time, be cancelled or, where the obligation 
remains a valid charge, transferred as an  obligation against current appropriations. 
 
Regulation 24 
  At the end of the financial period the Director-General shall report on the transfers of credits 
between sections of the expenditure budget to the Gene ral Council for approval.  For items so identified 
by the Committee on Budget, Finance and Administrati on at the time of budget finalization, transfer 
shall not be permitted.  WT/BFA/W/155 
Page 30  
 
  Regulation 25 
  The Director-General may enter into commitment s for future financial periods, provided that 
such commitments:  
 (a)  are for activities which have been approved by the General Council and are expected to 
continue beyond the end of the current financial period;  or 
  (b) are authorized by specific decisions of the General Council.  
 
 
CHAPTER VI.    THE SURPLUS ACCOUNT 
 
Regulation 26 
 
1. Budgetary surpluses shall be transferred to  the Surplus Account pending decision by the 
General Council on their use.  2. Increases and decreases of the provision for contributions in arre ars shall be effected by means 
of the Surplus Account.  
3. If at the end of a financial period the biennium
 the Surplus Account shows a credit balance , 
the Director-General shall make proposals to th e Committee on Budget, Finance and Administration 
with regard to its use which may be:   (i) application as income against the budget fo r the second financial period following that 
in which the surplus occurs, thereby reducing Member's contributions; 
  (ii) transfer to the Working Capital Fund;  or   (iii) use for any other purpose decided upon by the General Council. 
 
4. A  deficit in the Surplus Account at the end of a financial period biennium
 shall be covered, to 
the extent possible, by transfer from the Working Ca pital Fund.  Any part of the deficit left uncovered 
after transfer from the Working Capital Fund shall be included as an appropriate credit in the budget for 
the next earliest possible financial period.    
 
CHAPTER VII.    THE WORKING CAPITAL FUND 
 
Regulation 27 
  The Working Capital Fund shall be constituted by: 
 
 (a) assessed advances made by Members.  Such sums shall be carried to the credit of the 
Members which have paid them; 
  (b) any sums which the General Council may cause to be paid into it from time to time.  
Such sums shall be carried to the credit of the organization. 
  WT/BFA/W/155 
 Page 31 
 
 
  Regulation 28 
  Any government acceding to the WTO shall make an advance to the Fund in acco rdance with 
the scale of contributions applicab le to the budget for the year of its accession.  The minimum advance 
to the Working Capital Fund amounts to 0.5 percent of the principal of the Fund for countries or 
separate customs territories whose share of the total trade of Members is 0.5 percent or less. 
 
Regulation 29 
  The Director-General is authorized to advance from the Working Capital Fund: 
 
 (a) such sums as may be necessary to fi nance budgetary appropriations pending receipt of 
contributions; 
  (b) in exceptional circumstances and subject to prior authorization of the General  Council, 
such sums as may be necessary to finance commitments relating to extraordinary 
expenditure. 
 
Regulation 30 
  Sums advanced under Regulation 29(a) above shal l be reimbursed to the Working Capital Fund 
as soon as receipts from contributions are av ailable for the purpose.  Sums advanced under 
Regulation 29(b) shall be reimbursed to the Working Capital Fund by including an appropriate credit in 
the budget for the next earliest possible financial period.    
Regulation 31 
 
 The General Council may liberate all or part of  the sums constituting the Working Capital Fund, 
and the sums so liberated in so far as they  are derived from monies placed in the Fund under 
Regulation 27(a) shall be returned in  Swiss francs to the Members whic h have contributed to the Fund in 
proportion to their respective shares in the Fund.  
Regulation 32 
  Subject to a decision of the General Council, c ountries or separate cust oms territories which for 
any reason cease to be Members of the WTO shall be  entitled to the reimbursement of the total Swiss 
franc amount of their shares in the Wo rking Capital Fund under Regulation 27(a). 
 
Regulation 33 
  Interest accrued on the Working Capital Fund sh all be added to the Working Capital Fund and 
carried to the credit of the Organi zation under Regulation 27(b) above. 
 
 
CHAPTER VIII.    CUSTODY AND INVESTMENT OF FUNDS 
 
Regulation 34 
 
1. The Director-General shall designate the bank or  banks in which the funds of the WTO shall be 
kept.  WT/BFA/W/155 
Page 32  
 
  2. The Director-General may make non-speculative short-term investments of monies not needed 
for immediate requ irements.  The invest ments of monies standing to the credit of any trust funds, 
reserve or special account shall be subject to  any directives of the appropriate authority. 
 3. The Director-General shall include in the fina ncial statements submitted to the General Council 
a statement of the investments currently held. 
 4. Income from investments shall be  credited as provided in the rule s or agreement relating to each 
fund or account.  
 
CHAPTER IX.    THE ACCOUNTS 
 
Regulation 35 
 
1. The Director-General shall maintain such ac counts as are necessary and shall prepare final 
accounts for the financial period biennium
  on an accrual basis showing: 
  (a) the income and expenditure of all funds;   (b) the status of all appropriations, including: 
 
  (i) the original budget appropriations;     (ii) any supplementary appropriations;   (iii) the appropriations as  modified by any transfers; 
  (iv) credits, if any, other than the a ppropriations voted by the General Council;   
  (v) the amounts charged against the appropriations;  and 
  (vi) the amounts charged against any other credit. 
  (c) statements of assets and liabilities at the close of the financial period. biennium
  
  He shall also give such other information as may be appropriate to indicate  the current financial 
position of the WTO. 
 
Regulation 36 
 
 Appropriate separate accounts sh all be maintained in respect of  all trust funds, reserves and 
special accounts. 
 
Regulation 37 
  The final accounts of the WTO shall be presented in Swiss francs.  The accounting records may, 
however, be kept in such currency or currencies as the Director-General may deem necessary.   
 
Regulation 38 
  The final accounts shall be submitt ed to the external auditor as soon as practicable following the 
end of the financial period biennium
 to which they relate. 
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  Regulation 39 
  The Director-General shall:  
(a) submit the final accounts and a financial report for the financial period biennium
  and 
the external auditor's report thereon to  the General Council as soon as practicable 
following the close of the financial period; biennium ;.An interim audit shall be made 
after the first  financial period of the biennium on th e basis of terms of reference to be 
agreed upon by the Committee on Budget, Finance and Administration;   
(b) present before at the end of each the first financial period of the biennium, a Budget 
Performance Report, providing information in  line with the financial report provided 
in Regulation 39(a) . on the rate of expenditure during that financial period. 
Regulation 40 
  The final audited accounts shall be submit ted to the General Council for approval. 
  
CHAPTER X.    INTERNAL CONTROL 
 
Regulation 41 
 
 The Director-General shall: 
  (a) establish detailed financial rules and procedures in order to ensure effective financial 
administration and the exercise of economy;   
 
 (b) cause all payments to be made on the basis of appropriate s upporting documents and 
other documents which ensure that the servic es or goods have been received and that 
payments have not previously been made; 
  (c) designate the officers who may receive monies, incur obligations and make payments 
on behalf of the WTO; 
 
 (d) maintain an internal financial control which shall provide for an effective current 
examination and/or review  of financial transactions in order to ensure: 
   (i) the regularity of the receipt, cust ody and disposal of all funds and other 
financial resources of the WTO; 
  (ii) the conformity of obligations and expenditures with the appropriations or other 
financial provisions voted by the General Council, or with the purposes and rules relating to trust f unds and special accounts; 
  (iii)  the economic use of the resources of the WTO.  
Regulation 42 
  Commitments or obligations shall not be incurr ed and payments shall not be made unless an 
appropriate authorization has been made unde r the authority of the Director-General. 
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  Regulation 43 
  The Director-General may, on an exceptional basis, make such  ex gratia  payments as he deems 
to be necessary in the interests of the WTO.  A stat ement of such payments shall be submitted with the 
final accounts. 
 
Regulation 44 
  The Director-General may, after full investigati on, authorize the writing-off of losses of cash, 
supplies, equipment and othe r assets, other than arrears of contribu tions.  A statement of  all such losses 
written off during the financial period shall be submitte d to the external auditor with the final accounts.   
 
Regulation 45 
 
 The Director-General shall establish rules for the procurement of equipment, supplies and other 
requirements, including rules govern ing the invitation of tenders.   
 
 
CHAPTER XI.    EXTERNAL AUDIT 
 
Regulation 46 
 
1. The General Council shall appoint  an external auditor to perform the audit of the accounts of the 
WTO.  2. The external auditor shall be the Auditor-Gener al (or officer holding the equivalent title) of a 
Member of the WTO or another person of high competence. 
 3. The external auditor shall not be removed dur ing his tenure of office except by the General 
Council.  
Regulation 47 
 
1. The audit shall be conducted in conformity with generally ac cepted common auditing standards 
and, subject to any special directiv es of the General Council, in accord ance with the additional terms of 
reference set out in the Appendix to these Regulations.  
2. The external auditor may make observations w ith respect to the efficiency of the financial 
procedures, the accounting system, the internal financia l controls and, in genera l, the administration and 
management of the WTO.    3. The external auditor shall be completely inde pendent and solely responsible for the conduct of 
the audit. 
 
4. The General Council may request the external au ditor to perform certain specific examinations 
and issue separate reports on the results.  
Regulation 48 
 
1. The Director-General shall provide the external auditor with the facilities he may require in the 
performance of the audit.   WT/BFA/W/155 
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  2. For the purpose of making a local or special examination or of effecting economies of audit 
cost, the external auditor may in consultation with the Director-General engage the services of any 
national Auditor-General (or office r holding the equivalent title) or  commercial public auditors of 
known repute or any other pe rson or firm who, in the opinion of th e external auditor, is technically 
qualified. 
 
Regulation 49 
 1. The external auditor shall issue a report on the audit of the financial statements and relevant schedules reflecting the position of the final accounts for the biennium which shall include such 
information as he deems necessary in regard to matter s referred to in Regulati on 47, paragraph 2, and in 
the additional terms of reference.  2. The external auditor's report shall be submit ted to the General Council, through the Committee 
on Budget, Finance and Administration,  together with the audited fina ncial statements.  The Committee 
on Budget, Finance and Administration shall examine the financial statements and the auditor's report 
and shall forward them to the General Council with such comments as it deems appropriate. 
  
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  APPENDIX TO THE FINANCIAL REGULATIONS 
 
Additional terms of reference governing external audit  
 
 
1. The external auditor shall perform such aud it of the accounts of the WTO, including all trust 
funds and special accounts, as  he deems necessary in orde r to satisfy himself that: 
  (a) the financial statements  are in accord with the books and records of the WTO; 
 
 (b) the financial transactions reflected in the statements have been in accordance with the 
rules and regulations, the budgetary provi sions and other applicable directives; 
  (c) the securities and moneys on deposit a nd on hand have been verified by certificate 
received direct from the WTO's depositories or by actual count; 
 
 (d) the internal controls are adequate;   (e) procedures satisfactory to the external aud itor have been applied to the recording of all 
assets, liabilities, surpluses and deficits. 
 
2. The external auditor shall be the sole judge as to  acceptance in whole or in part of certifications 
and representations by the Director-General and may proceed to such detailed examination and verification as he chooses of all financial records, including those relating to supplies and equipment. 
 3. The external auditor and his staff shall have free access at all conv enient times to all books, 
records and other documentation which are, in the op inion of the external auditor, necessary for the 
performance of the audit.  Informati on classified as confidential shall be made available on application.  
The external auditor and his staff shall respect the confidential nature of any information so classified which has been made available and shall not make  use of it except in direct connection with the 
performance of the audit.  
4. The external auditor shall have no power to di sallow items in the accounts but shall draw to the 
attention of the Director-General for appropriate action any transaction concerning which he entertains doubts as to legality or propriety.  Audit objections, to  these or any other transactions, arising during the 
examination of the accounts shall be immediat ely communicated to the Director-General. 
 
5. The external auditor shall express and sign an opinion in the following terms:  "I have examined 
the financial statements numbered ...  to ...  and re levant schedules of the WT O for the financial period 
ended 31 December ....  My examination included a general review of the accounting procedures and 
such tests of the accounting records and other supporting evidence as I considered necessary in the circumstances."  The external auditor's opinion shall state, as appropriate, whether:  
 (a) the financial statements present fairly th e financial position as at the end of the period 
and the results of the operations for the period; 
  (b) the financial statements were prepared in accordance with the stated accounting 
principles; 
 
 (c) the accounting principles we re applied on a basis consistent  with that of the preceding 
financial period; 
  WT/BFA/W/155 
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   (d) transactions were in accordance with  the Financial Regula tions and legislative 
authority. 
 6. The report of the external auditor to the Ge neral Council on the financial operations of the 
period should mention: 
 
 (a) the type and scope of his examination;   (b) matters affecting the completeness or  accuracy of the accounts, including where 
appropriate: 
 
  (i) information necessary to the co rrect interpretation of the accounts; 
  (ii) any amounts which ought to have be en received but which have not been 
brought to account; 
  (iii) any amounts for which a legal or c ontingent obligation ex ists and which have 
not been recorded or reflected in the financial statements; 
  (iv) expenditures not properly substantiated; 
  (v) whether proper books of accounts have been kept;   (vi) any deviations of a material nature in the presentation of financial statements 
from generally accepted accounting princi ples applied on a consistent basis; 
 
 (c) other matters should be brought to the notice of the General Council, such as: 
   (i) cases of fraud or presumptive fraud;   (ii) wasteful or improper expenditure  of the WTO's money or other assets 
(notwithstanding the accounting for the transaction may be correct); 
  (iii) expenditure likely to commit the WTO to further outlay on a large scale; 
  (iv) any defect in the general system or detailed re gulations governing the control 
of receipts and disbursements or of supplies and equipment; 
  (v) expenditure not in accordance with the intention of the General Council after 
making allowance for duly authoriz ed transfers within the budget; 
  (vi) expenditure in excess of appropr iations as amended by duly authorized 
transfers within the budget; 
  (vii) expenditure not in conformity  with the authority which governs it; 
  (d) the accuracy or otherwise of the supplie s and equipment records as determined by 
stocktaking and examination of the records; 
 
 (e) where appropriate, transa ctions accounted for in a previ ous financial period concerning 
which further information has been obtained or  transactions in a later financial period 
concerning which it seems desirable that the General Council should have early 
knowledge. 
 
7. The external auditor may make such observatio ns with respect to his findings resulting from the 
audit and such comments on the Director-General's fi nancial report as he d eems appropriate to the 
General Council and to the Director-General.  8. Whenever the external auditor's scope of audit is restricted, or he is unable to obtain sufficient 
evidence, he shall refer to the matter in his opinion and report, making clear in his report the reasons for 
his comments and the effect on the financial position and the financial transactions as recorded.  WT/BFA/W/155 
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  9. In no case shall the external auditor include cr iticism in his report without first affording the 
Director-General an adequate opportunity of  explanation on the matter under observation. 
 10. The external auditor is not required to mention an y matter referred to in the foregoing which, in 
his opinion, is not material. 
 
 
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