RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/BFA/112 
9 October 2009 
 (09-4941) 
Committee on Budget, Finance and Administration  
 
  
 
REPORT OF THE MEETING HELD ON 8 OCTOBER 2009 
  
1. The WTO Committee on Budget, Finance and Ad ministration met on 8 October 2009 under 
the chairmanship of Ambassador Marie-Claire Swär d Capra (Sweden).  The terms of reference and 
composition of the Committee are set out in document WT/L/44/Rev.1.  The agenda contained in 
document WTO/AIR/3431 was adopted. 
I. ADMINISTRATIVE UP-DATES AND PROGRESS REPORTS AS AT 
30 SEPTEMBER 2009 
A. WTO
 BUDGET AND FINANCE REPORT (CRP(09)16) 
2. A member of the Secretariat presented the situation regarding Members' contributions as at 
30 September 2009 showing that CHF 136 million of the assessed CHF 183 million had been received 
and that 91 Members or 59 per cent of the Member ship had no outstanding balance.  Payments 
received from Observers represented 57 per cent of the total assessment of CHF 0.8 million.  With 
respect to Members under Administrative Measures, it was reported that 20 Members were currently 
under Administrative Measures, comprising two in Category II, three in Category III and 15 Members 
in Category IV (Inactive).  Since the last report, two Members, Paraguay and Zimbabwe who had 
previously been in Category III, paid up thei r arrears.  Senegal moved from Category IV to 
Category III. 
3. The cash situation showed that the WTO held  CHF 70 million on its bank accounts, including 
the working capital fund and extra-budgetary funds.  It could be considered as adequate if the 
expected contributions from three large contribut ors would be received by the end of the year. 
4. The budget performance as at 30 September 2009 was generally on track.  Actual staff costs 
were slightly below budget.  The higher implem entation rates in selected budget sections could be 
explained by the specific commitment approach used to capture the related expenditure.  However, the 
last quarter would put more pressure on the resour ces with the first major office move following the 
renovation of the first sector of the CWR building and the Ministerial Conference at the end of 
November. 
B. EXTRA -BUDGETARY FUNDS REPORT (CRP(09)17) 
5. The Committee was informed that, as at 30 September 2009, total funds in the Doha 
Development Agenda Global Trust Fund  (DDAGT F) stood at CHF 25.9 million, which represented 
CHF 1.9 million more than the target set at CH F 24 million for 2009.  This balance plus further 
contributions to be received in the last quarter should help to build the 25 per cent reserve required 
towards the following year's spending.  It was a dded that the expenses recorded so far for the 
implementation of the DDAGTF technical assistance activities amounted to CHF 20 million, which represented 83 per cent of the level of planned activ ities.  This left an uncommitted balance of 
CHF 5.9 million. WT/BFA/112 
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  C. H
UMAN RESOURCES REPORT (CRP(09)18) 
6. The Committee was presented with an update on the level of temporary assistance contracts 
within the Organization.  It was added that there were currently 8 external vacancies, one L post and 
one internal vacancy at various stages of the recruitment process. 
7. Some Members enquired why it took so much time to fill vacancies.  Some other Members 
suggested providing for broader diversification with  respect to nationality in the recruitment process 
and suggested that specific measures be taken to that  end such as to give preference to Members of 
under-represented countries, to reorganize the statisti cs of staff composition so as to demonstrate the 
improvement of diversification and to ask the Secr etariat to report to the CBFA annually on any such 
improvement.  One Member expressed his concern with  respect to eventual legal obligations due to 
long-term temporary assistance contracts. 
8. The Secretariat explained that the recruitment process had been shortened to 2-3 months due 
to the introduction of e-recruitment.  With respect to the diversification of staff, it was pointed out that  
recruitment in the WTO was based on merit, but that the Secretariat was aware of the importance of ensuring diversification of staff adequately re flecting the membership.  Regarding long-term 
temporary assistance contracts, it was confirmed that Senior Management was working on how to 
resolve this issue as part of the next budget exercise. 
D. WTO
 PENSION PLAN REPORT (CRP(09)19) 
9. The Secretary to the WTO Pension Plan reporte d that the Management Board had continued 
its review of the Plan's investment strategy a nd that the next steps would be the selection and 
weighting of asset classes, the choice of the manage ment style and the procedure for the selection of 
managers.  The Management Board had also contin ued to examine the possibility of outsourcing the 
funding and/or administration of the death and disab ility coverage.  It was a dded that the annual report 
for 2008 had been approved by the Management Board and would be submitted to the General 
Council, Plan participants and beneficiaries. 
E. BUILDING PROJECT REPORT  
10. The Committee was informed  that the works on the first renovated area in the South Wing of 
the CWR building had been completed on time at the beginning of October and that the works in the 
next area would start end October.  The construc tion permit for the intra-muros project had been 
requested in July and was now pending due to a request to have the CWR listed as an historic 
monument.  The Monuments and Sites Commission would examine the request on 27 October.  The funds for the intra-muros works (CHF 20 million) were scheduled to be voted by the Federal 
Chambers on 9 December 2009. 
11. With regard to the referendum on the de-classif ication of land for the new building, a positive 
result had been achieved with an approval rate of 62  per cent.  However, a law suit had been filed in 
the Cantonal Administrative Tribunal requesting the cancellation of the referendum.  The outcome 
should be known by mid-November.  In the meantime,  architects and WTO staff continued to work on 
the details of the project, keeping in mind the strict ceiling of CHF 40 million.  WT/BFA/112 
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  12. Furthermore, a Construction Project Committee had been created in the WTO to oversee the 
total project (budget, architecture, procurement, legal issues).  It was added that, as managing a 
construction project of this size was not part of the 'normal' business and expertise of the WTO, it 
would be necessary to recruit outside experts. 
II. FINANCIAL MATTERS 
A. D
IRECTOR -GENERAL 'S BUDGETARY AND FINANCIAL REPORT FOR 2008   (WT/BFA/W/181)   
B. DIRECTOR GENERAL 'S REPORT ON EXTRA -BUDGETARY FUNDS FOR 2008   (WT/BFA/W/182) 
13. The Director-General presented the budgetary and financial reports for the regular budget as 
well as extra-budgetary funds and informed the Comm ittee that the financial year 2008 had ended 
with an overall surplus of CHF 2.8 million.  This  surplus had been rea lized despite two major 
unforeseen projects and activities costing some CHF 5 million: (i) the removal of some 300 Secretariat staff to the temporary premises at 'C hemin des Mines' for which the building had to be 
adapted to the Organization's needs, and (ii) th e special consultations of the Trade Negotiation 
Committee held for more than 10 days in July 2008.  In order to meet this unforeseen expenditure, the 
Secretariat had reduced expenditure in other areas.   Due to the vigorous monitoring of expenditure, a 
saving of CHF 1.1 million had been achieved.  The re maining part of the surplus was due to an excess 
in miscellaneous income.  The Director-General further pointed out that the draft budget for 2010-
2011 would include a proposal to use the 2008 surplu s in the same way as for the surpluses in 2006 
and 2007, i.e. to reduce Members' contributions. 
14. It was also pointed out that the financial stat ements had been adapted as a preparation for the 
adoption of the new public sector accounting standard s (IPSAS) in 2012.  It was added that, for the 
budgetary and financial report 2009, the reports on regular and on extra-budgetary funds would be 
regrouped in one document.  In the coming year , the introduction of activity based budgeting would 
provide a different view on the activities of the Organization. 
15. The Committee took note of the reports and recommends to the General Council the 
approval of  the transfers between budgetary secti ons as outlined in paragraphs 36 and 41 of 
document WT/BFA/W/181.  The Committee furt her recommends that the General Council 
approve the audited accounts for 2008.  
C. REPORT OF THE EXTERNAL AUDITOR FOR THE YEAR ENDED 31 DECEMBER 2008   
(WT/BFA/W/188) 
16. The First President of the French Court of A udit addressed the Committee, pointing out that it 
was the first time that the accounts had been audited by  the French Court of Audit.  He confirmed that 
the accounts of the regular WTO budget as well as the extra-budgetary funds showed a clear and true 
picture of the financial situation and could be certified without any reservation.  However, some 
recommendations had been made on the three audite d areas: (i) financial situation, (ii) human 
resources and (iii) building project. 
17. With respect to the financial situation of the Organization, the auditors recommended the 
adoption of IPSAS, including in particular the re form of the Pension Plan according to IPSAS, the 
integration of the extra-budgetary funds in the financ ial statements of the WTO, the adjustment of the 
provision for outstanding member contributions, the establishment of a provision for outstanding 
contributions from Observers, the establishment of a payment plan for Observers in arrears, the 
reimbursement of US taxes according to the decisi on of the ILO tribunal, a policy on treasury as well 
as a better management and disclosure of leasing contracts. WT/BFA/112 
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  18. With regard to the human resources, the First Pr esident of the Court of Audit highlighted the 
need for increasing staff mobility, the establishmen t of a career planning policy according to staff 
competences, the finalisation of the post classification exercise, the revision of the bonus system and a 
biennial staff training plan. 
19. For the building project of the Organization, the external auditor focussed on the risk of 
another referendum at the cantonal level delaying the construction project and the difficulty of 
managing the intra-muros and extra-muros projects by the Secretariat.  Since the Secretariat did not 
have the experience of managing a project of that  scale, it was recommended to outsource part of the 
responsibility to a 'maître d'ouvrage délégué' or at le ast to recruit a consultant specialised in Swiss 
construction law. 
20. The Director-General thanked the President of th e Court of Audit and the audit team for their 
excellent report and assured them that the Secret ariat would continue to strive for further  
improvements in the running of the Organization in th e future.  With respect to the leasing contract, 
the Director-General explained that the security project financed through  a lease had had to be 
temporarily stopped due to the renovation works, but that as at end of November the whole operation 
would have been completed.  Regarding arrears in contributions, the majority of the arrears were due 
by developing or least developed countries.  He would welcome ideas to resolve this issue.  With 
respect to the building project, the Director-General  expressed his agreement with the President of the 
Court of Audit that the Secretariat did not have th e necessary specialized skills  and that it would be 
necessary either to outsource the activ ity or to recruit external cons ultants.  The Director-General 
further added, that the Secretariat had been work ing on the 36 recommendations and that almost half 
had already been implemented.   
21. Members thanked the auditors for their professi onal report.  Several Members appreciated the 
refund of the surplus of CHF 2.8 million against their 2010 contributions.  One Member indicated that 
a working group with respect to arrears had been es tablished in order to redu ce them in the future.  
With respect to the reimbursement of US-taxes, one  Member highlighted the need for streamlining the 
process.  The Member of the US delegation replied that the United States to ok their responsibility 
seriously and that great progress had already been  made.  Several Members suggested an audit on 
publications and extra-budgetary funds.  Certai n Members asked who had taken the decision and 
expressed their concerns regarding joint reports pr epared and published by the WTO Secretariat in 
cooperation with other internati onal organizations, with one Member asking how the issue of 
financing for such reports was handled by the CBFA.  
22. The President of the French Court of Audit re plied that the intermediate audit in 2009 
focussed on publications and extra-budgetary funds and that generally, extra-budgetary funds were 
treated in the same way than regular budget funds.  With respect to the publication of joint reports, the 
Director-General explained that research analysis could be done at the request of the Members or on the Secretariat's initiative.  However, he was aware of the Members' concerns. 
III. TRUST FUND FOR THE PARTICIPATION OF LEAST-DEVELOPED COUNTRIES 
IN THE SEVENTH MINISTERIAL CONFERENCE  (WT/BFA/W/187)  
23. A member of the Secretariat recalled that it had become customary to facilitate the 
participation of LDC delegates at WTO Ministeria l Conferences through the establishment of a trust 
fund for this purpose.  Provision was made for th e estimated costs of air travel, accommodation and 
per diem  allowances for one minister and two official s, based on Business Cla ss for the minister and 
Economy Class for the two other members of the delegation.   
24. The estimated needs amounted to CHF 1.5 million for WTO Members and Observers.  Since 
CHF 750,000 remained available from the trust fund  set up for the same purpose at the Hong Kong  WT/BFA/112 
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  Ministerial Conference, a balance amounting to CH F 750,000 would be required.  It was added that 
Chinese Taipei, Switzerland and Norway had confirmed a contribution to the fund. 
25. The Committee recommends to the General Co uncil that it urge interested donors to 
indicate to the Secretariat as soon as possible the level of financial support they are prepared to 
provide . 
 
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