Annual Financial Report
and Financial Statements
Year to December 31, 2022

World Intellectual Property Organization
Annual Financial Report and Financial Statements
Year to December 31, 2022

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

CONTENTSANNUAL FINANCIAL REPORT ................................................................................ 4
INTRODUCTION .................................................................................................................................. 4
FINANCIAL STATEMENT DISCUSSION AND ANALYSIS.................................................................. 4
Operations and Environment ............................................................................................................................ 4
Financial Objectives and Strategies ................................................................................................................. 5
Risk Management ............................................................................................................................................ 5
Sustainability .................................................................................................................................................... 5
COVID-19 Pandemic ........................................................................................................................................ 6
Economic Conditions 2022 ............................................................................................................................... 6
Financial Performance 2022 ............................................................................................................................. 7
Financial Position 2022 .................................................................................................................................. 13
Cash Flow 2022 ............................................................................................................................................. 15

STATEMENT ON INTERNAL CONTROL 2022 ....................................................... 16
INDEPENDENT AUDITOR’S REPORT ................................................................... 21
FINANCIAL STATEMENTS ..................................................................................... 23
STATEMENT I: STATEMENT OF FINANCIAL POSITION ............................................................................ 23
STATEMENT II: STATEMENT OF FINANCIAL PERFORMANCE .................................................................. 24
STATEMENT III: STATEMENT OF CHANGES IN NET ASSETS .................................................................. 25
STATEMENT IV: STATEMENT OF CASH FLOW ...................................................................................... 26
STATEMENT V: STATEMENT OF COMPARISON - BUDGET AND ACTUAL AMOUNTS REVENUE .................. 27
STATEMENT V: STATEMENT OF COMPARISON - BUDGET AND ACTUAL AMOUNTS EXPENSES ................. 28
NOTES TO THE FINANCIAL STATEMENTS .................................................................................... 29
Note 1: Objectives and Budget of the Organization ........................................................................................ 29
Note 2: Significant Accounting Policies .......................................................................................................... 29
Note 3: Cash and Cash Equivalents ............................................................................................................... 34
Note 4: Investments........................................................................................................................................ 34
Note 5: Receivables ....................................................................................................................................... 35
Note 6: Intangible Assets................................................................................................................................ 36
Note 7: Property, Plant and Equipment .......................................................................................................... 37
Note 8: Payables and Accruals ...................................................................................................................... 39
Note 9: Employee Benefits ............................................................................................................................. 39
Note 10: Transfers Payable ............................................................................................................................ 43
Note 11: Advance Receipts ............................................................................................................................ 43
Note 12: Provisions ........................................................................................................................................ 44
Note 13: Contingent Assets and Liabilities ..................................................................................................... 44
Note 14: Leases ............................................................................................................................................. 45
Note 15: Related Party Transactions .............................................................................................................. 46
Note 16: Reconciliation of Statement V and Statement II ............................................................................... 47
Note 17: Expenses ......................................................................................................................................... 48
Note 18: Investment Gains/(Losses) .............................................................................................................. 49
Note 19: Financial Instruments ....................................................................................................................... 49
Note 20: Events After the Reporting Date ...................................................................................................... 52
Note 21: Segment Reporting .......................................................................................................................... 52

ANNEX – EX GRATIA PAYMENTS (AUDITED INFORMATION) ........................... 54

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

ANNUAL FINANCIAL REPORTINTRODUCTION
The financial statements of the World Intellectual Property Organization (WIPO) for the year ended December 31,
2022, are submitted to the Assemblies of the Member States of WIPO (“WIPO Assemblies”) as required byRegulation 4.3 of the WIPO Financial Regulations and Rules (FRR). The financial statements have been preparedin accordance with International Public Sector Accounting Standards (IPSAS), developed and approved by theInternational Public Sector Accounting Standards Board (IPSASB), as required by Regulation 4.2 of the FRR.
The report of the External Auditor on the audit of the 2022 financial statements, together with his opinion on thefinancial statements, are also submitted to the WIPO Assemblies as prescribed under Regulation 6.12 and Annex
II of the FRR.
The annual financial report, including financial statement discussion and analysis, is presented in this document
alongside the financial statements and the annual statement on internal control.

FINANCIAL STATEMENT DISCUSSION AND ANALYSISThe following financial statement discussion and analysis includes an overview of the Organization’s operations
and environment, financial objectives and strategies, risk management strategy, financial performance and financial
position during the year ended December 31, 2022. The discussion and analysis has been prepared in accordancewith IPSASB Recommended Practice Guideline 2, and is intended to provide an explanation of the significant items,
transactions, and events presented in the financial statements and the factors that influenced them. This discussion
and analysis is not part of WIPO’s financial statements; however it should be read together with WIPO’s financial
statements.

Operations and Environment
WIPO is the global forum for intellectual property services, policy, information and cooperation. It is anintergovernmental organization and specialized agency of the United Nations, with 193 Member States. The
Organization’s mission is to lead the development of a balanced and effective global intellectual property ecosystem
to promote innovation and creativity for a better and more sustainable future. The Organization’s mandate,governing bodies and procedures are set out in the WIPO Convention of 1967, which established WIPO.
WIPO’s Member States determine the direction, budget and activities of the Organization through the decisionmaking bodies. The main policy and decision-making bodies of WIPO are the General Assembly, the Conference
and the Coordination Committee. The General Assembly consists of States party to the WIPO Convention which
are members of any of the Unions administered by WIPO. The General Assembly constituted the Program andBudget Committee to consider matters relating to program, budget, premises and finance. The Conference iscomposed of the States party to the WIPO Convention whether or not they are members of any of the Unions, andis, inter alia, the competent body for adopting amendments to the Convention. The Coordination Committee consistsof elected members of the Executive Committees of the Paris or the Berne Unions, or both, one-fourth of the States
party to the WIPO Convention which are not members of any of the Unions, and Switzerland, as the State on whose
territory the Organization has its headquarters.
The General Assembly appoints the WIPO Director General upon nomination by the Coordination Committee. The
current Director General, Mr. Daren Tang, was appointed on May 8, 2020, and began his six-year term on October 1,
2020. The Director General is the chief executive of the Organization. The Director General is assisted by the Sector
Leads (consisting of the Deputy Directors General and the Assistant Directors General) in providing the strategic
direction of WIPO’s programs and in managing their respective Sectors to ensure the delivery of results in line with
the Organization’s strategic goals and the Program and Budget.
WIPO generates most of its revenue from fees that are paid by users of its intellectual property services for patents,
trademarks and industrial designs. These services are provided through the Patent Cooperation Treaty (PCT),
Madrid and Hague systems. In 2022, fees from these activities represented 94.9 per cent of the Organization’s total
revenue, with PCT system fees alone representing 76.4 per cent. The driver for revenue from these fee-based
services is the international demand for intellectual property titles. Other external factors that may influence theOrganization’s revenue from its fee-based services include research and development investment levels,
technological confidence levels, and exchange rate fluctuations.

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Financial Objectives and Strategies
The financial activities of WIPO are governed by its Financial Regulations, which are approved by the General
Assembly. Financial Rules are established by the Director General in accordance with the provisions of the Financial
Regulations. WIPO Member States are informed of any modification of the Financial Rules. The Financial Rules
govern all the financial management activities of the Organization. Authority and responsibility for the
implementation of the Financial Regulations and Rules are delegated by the Director General to the Controller.
Every two years, the Director General presents a Program of Work and Budget to Member States for approval. It
details expected results, performance measures and budgetary planning for all proposed activities. The Program ofWork and Budget for the 2022/23 biennium was approved by the Assemblies of the Member States of WIPO in
October 2021. The Program of Work and Budget provides the planning for the biennium within the overall strategic
context of the Medium-Term Strategic Plan.
The Organization uses a Results-Based Management system to ensure that resources are budgeted and utilized
in line with organizational results and priorities. Organizational performance is measured and analyzed on a regularbasis through performance indicators, targets and baselines. The WIPO Performance Report provides fullprogrammatic reporting, including detailed performance indicator evaluations, for the year or biennium. Under thissystem, both the Program of Work and Budget and the Medium-Term Strategic Plan form part of WIPO’s planning
framework, along with annual work plans and individual staff objectives.
The Organization manages the levels of its reserves in accordance with its Policy on Reserves. WIPO’s reserves
are accounted for as the net assets of the Organization, and serve to minimize the impact of income shortfalls andto maximize the probability that the Organization can meet its obligations in the short term and maintain financial
stability. One core element of the policy is the mechanism for establishing the required level of reserves as apercentage of the estimated biennial expenditure of the Unions administered by the Organization. The policy alsoestablishes the principles and approval mechanism for the use of reserves for one-time projects for capital
improvements and exceptional circumstances.
The Organization manages its investments in accordance with its Policy on Investments. The policy states that the
primary objectives of the Organization’s investment management, in order of importance, shall be: (i) preservationof capital; (ii) liquidity, and (iii) within the constraints of (i) and (ii), the rate of return. The Organization aims to achievea market rate of return whenever appropriate and possible for both operating and core cash. Strategic cash is to beinvested over the long-term in order to achieve capital growth and thus an overall positive return over time.

Risk Management
WIPO’s Risk Management Policy sets out the Organization’s approach to managing risks and internal controls in aconsistent and business-oriented manner, in order to support the achievement of its strategic goals and expected
results. It is complemented by WIPO’s Risk and Internal Control Management Manual, which covers the day-to-day
operational details of risk and internal control management. The policy and the manual, together with theorganizational arrangements, the establishment of roles and responsibilities, processes and activities for the
management of risks and internal controls represent WIPO’s Risk Management Framework.
Under the guiding principles of WIPO’s Risk Management Policy, risk management is considered an organizationwide responsibility. Organizational level risks are identified and reviewed by WIPO’s Risk Management Group,
which is chaired by the Director General. Risk management is performed as an integral part of the Organization’s
Results-Based Management cycle. WIPO’s Risk Management Framework is guided by the risk appetite noted byits Member States in WIPO’s Risk Appetite Statement.

Sustainability
2022 was a significant year in respect of environmental responsibility, as the WIPO High-Level Policy on
Environmental Responsibility was issued. WIPO is working on the implementation of an Environmental
Management System (EMS) that will translate the policy into specific objectives, baselines and targets, actions andmonitoring, for all WIPO activities at HQ and worldwide, to be deployed for the years to come.
WIPO ensures the preservation of biodiversity on its campus, which is considered a landmark park, with a numberof species of trees and various plantations. An environment criterion has been introduced and systematically applied
as one of several criteria for assessing and implementing renovations and maintenance of premises and technicalfacilities on the WIPO campus. This is clearly illustrated by a number of projects which are an integral part of theannual program of work: 100 per cent local hydroelectricity provision, LED light fixtures and presence detection to
reduce electricity consumption, cooling using the Lake Geneva water system, waste management system withsorting and recycling of various materials, and water consumption management.

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

As part of its procurement processes, WIPO asks potential suppliers to confirm their significant commitment tosustainability. In most of the formal tender processes (invitation to bid and request for proposals), the technicalevaluation includes a criterion on sustainability. WIPO has continued its active participation in the 2050Today
initiative aimed at achieving zero emissions in the Canton of Geneva by 2050. The initiative operates under the
auspices of the host country at the federal and cantonal levels, and includes a number of international
intergovernmental organizations, local public and private sectors, and non-governmental organizations.
It is recalled that, since 2010, WIPO has been actively participating in the Greening the Blue initiative of the United
Nations Environment Programme (UNEP). Through this, WIPO participates in the collection of carbon emissions
and other environmental data along with over fifty UN agencies and programs. From 2014 WIPO has compensated
its remaining unavoidable emissions by purchasing credits through the UN-wide mechanism managed by the United
Nations Framework Convention on Climate Change (UNFCCC). WIPO is also continuing its active involvement in
the local Cantonal Geneva 2050Today Initiative. This is aimed at reducing GHG emissions by 50 per cent by 2030
in the Canton of Geneva, with the ultimate goal of net zero emissions by 2050. Geneva-based International
Organizations, Member State Permanent Missions as well as local Swiss public and private sector stakeholders
participate in this initiative.

COVID-19 Pandemic
The outbreak of the COVID-19 coronavirus was first declared a public health emergency of international concern(PHEIC) by the World Health Organization on January 30, 2020, and was subsequently declared a pandemic on
March 11, 2020. In its 2019 financial statements, WIPO disclosed the outbreak as a non-adjusting event after thereporting date, in accordance with IPSAS 14. In its 2020 and 2021 financial statements, the Organization provided
an overview of the effects of the pandemic on its operations and financial results as part of the financial statement
discussion and analysis.
At the start of 2022, the COVID-19 pandemic was still affecting WIPO’s operations. The Swiss Government had reintroduced the requirement to work from home on December 17, 2021, and WIPO had reinstated mandatory
teleworking. However, as the epidemiological situation continued to improve and high levels of immunity wereachieved, the Swiss Government decided to lift most COVID-19 containment measures, including therecommendation to work from home, from February 17, 2022. Following this, WIPO ended pandemic-related
teleworking from March 7, 2022. On May 7, 2022, the Organization lifted many of its mandatory COVID-19
containment measures, including distancing, mask wearing, and contact tracing.

Economic Conditions 2022
During 2022, global economic activity experienced a broad-based slowdown, with inflation higher than seen inseveral decades. Despite the challenging economic conditions, businesses continued to invest in innovation. PCT
application filings in 2022 reached an estimated 278,100 applications, a new record figure. This represented a slightincrease of 0.3 per cent compared to the 2021 figure of 277,182. Demand for the protection of industrial designs
via the Hague system experienced double-digit growth, with the number of designs in applications rising by 11.2
per cent compared to the prior year. This was in large part driven by China’s 2022 accession to the Hague system.
Following exceptional growth of 15.0 per cent in 2021, use of the Madrid system declined by 6.1 per cent in 2022.
International trademark applications in 2022 totaled an estimated 69,000, lower than the 2021 figure of 73,500 but
still higher than the 2020 figure of 63,893. The economic disruptions caused by the COVID-19 pandemic in 2021
prompted firms to introduce new goods and services which helped fuel the exceptional growth in international
trademark protection in that year. WIPO’s revenue from fees charged for applications under the PCT, Madrid andHague systems is recognized at the date of publication of the application, in accordance with the requirements of
IPSAS. WIPO’s fee revenue on this basis continued to grow in 2022, reaching 473.3 million Swiss francs comparedto 450.5 million Swiss francs in 2021.
The Organization reported net investment losses of 88.0 million Swiss francs in 2022, generated by the unrealized
decreases in the fair value of its investments. Extreme economic uncertainty during 2022 created some of thetoughest investment conditions recorded in the last thirty years. The previous decade (between 2010 and 2021) of
highly accommodating monetary policies had driven bond yields to historic lows and supported valuation expansions
in many financial markets. In 2022, higher inflation forced the reversal of many central banks’ policies and resulted
in unprecedented price declines in many markets, particularly in fixed income. High quality bonds experienced amajor decline in the financial markets and had their worst year in recorded history, while the Swiss real estatemarket recorded a 15.1 per cent decline, the worst year on record. Equity returns were negative for all regions. It
should be emphasized that WIPO's investment strategies aim to achieve a medium term objective of positive returns
over a five-year rolling period for core cash and a long-term objective of a 2 per cent rate of return to reach 100 per
cent funding of WIPO’s long-term employee benefits over a 20 year period for strategic cash. The core and strategic
cash portfolios are designed to withstand short-term volatilities in the financial markets. The amounts invested havebeen drawn from surpluses generated by the Organization in 2022 and previous years and their investment in thetwo portfolios has had no detrimental impact on the liquidity levels required to meet operational requirements. Thissituation in the financial markets also significantly impacted the actuarial valuations of the Organization’s long-term
employee benefit liabilities, particularly After-Service Health Insurance (ASHI). The discount rate for ASHI is
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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

determined using AA corporate bond yield curves, and the 2022 increase in the discount rate was the driving factor
in the net decrease in the ASHI liability of 105.1 million Swiss francs compared to 2021. This decrease was recorded
despite the impact of actuarial losses arising from medical cost increases.

Financial Performance 2022
The Organization’s results for 2022 showed a surplus for the year of 7.7 million Swiss francs, with total revenue of
498.5 million Swiss francs, total expenses of 402.8 million Swiss francs, and investment losses of 88.0 million Swiss
francs. This can be compared to a surplus of 108.9 million Swiss francs in 2021, with total revenue of 475.1 million
Swiss francs, total expenses of 388.9 million Swiss francs, and investment gains of 22.7 million Swiss francs.
Removing the impact of the investment losses and gains recorded in 2022 and 2021 respectively reveals that theOrganization actually increased its operating surplus by 11 per cent over 2022 (operating surplus of 95.7 million
Swiss francs in 2022 compared with an operating surplus of 86.2 million Swiss francs in 2021). The Program ofWork and Budget result for 2022 prepared on a modified accrual basis (i.e. not including all IPSAS adjustments)
was a surplus of 46.9 million Swiss francs. The 2022 result for the Organization under IPSAS includes Special
Accounts, Projects financed from reserves, and the impact of adjustments related to full accrual accounting inaccordance with IPSAS:
Program andBudgetSpecial
Accounts

Projects
FinancedfromReserves

IPSAS
Adjustments

Total

Total

2022

2022

2022

2022

2022

2021

(in millions of Swiss francs)
Total revenue

491.9

8.4

-

-1.8

498.5

475.1

Total expenses-357.0

-7.2

-11.9

-26.7

-402.8-388.9Operating surplus/(deficit)

134.9

1.2

-11.9

-28.5

95.7

86.2

Investment gains/(losses)

-88.0

-

-

-

-88.0

22.7

Total surplus/(deficit)

46.9

1.2

-11.9

-28.5

7.7

108.9

The chart below summarizes the principal differences between the Program of Work and Budget surplus of 46.9
million Swiss francs, and the surplus for the whole Organization prepared on an IPSAS basis of 7.7 million Swiss
francs:Movement from budget result to IPSAS result 2022

46.9

millions of Swiss francs

-10.2

+5.3
+1.2

-11.9

-23.2

7.7

BUDGETRESULT

Modifiedaccrual basis

Projects
financed fromreserves

Special
Accounts

Capitalization/
disposal of
fixed assets

Entity differences

Changes in
employeebenefitliabilities

-9.6

-1.0

Depreciation
andamortization

Other
adjustments

Accounting basis differences

7

IPSAS RESULTPER FINANCIAL
STATEMENTS

Full accrualbasis

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

The WIPO financial statements as prepared in accordance with IPSAS include all areas and activities of the whole
Organization. The inclusion of the results before IPSAS adjustments of Projects financed from reserves (deficit of
11.9 million Swiss francs) and Special Accounts (surplus of 1.2 million Swiss francs) represent ‘entity differences’
between the budget result and the surplus per the IPSAS financial statements. The application of full accrual basis
accounting in accordance with IPSAS leads to a number of ‘accounting basis differences’ which impact the result
for the year. The net impact of these adjustments is a 28.5 million Swiss francs reduction in the surplus. The principal
accounting differences include:•
the depreciation expense of buildings and equipment and the amortization expense of intangible assets as thecost of these assets is spread over their useful lives;•
adjustments to reflect movements in employee benefit liabilities based on IPSAS compliant calculations,
including those prepared by external actuaries;•
the capitalization of costs relating to the improvement or acquisition of fixed assets, along with losses from thedisposal or write-off of fixed assets.

Revenue
Composition of 2022 revenue on an IPSAS basis(in millions of Swiss francs)

Madrid system fees
85.3
(17.1%)

Assessedcontributions
17.7
Voluntary(3.6%)
contributions
7.2(1.4%)
Hague system fees
7.2
(1.4%)

PCT system fees
380.8
(76.4%)

Other revenue
0.3(0.1%)

Total revenue of the Organization for 2022 was 498.5 million Swiss francs, representing an increase of 4.9 per centcompared to the 2021 total revenue of 475.1 million Swiss francs. The largest source of revenue during 2022 was
PCT system fees, accounting for 76.4 per cent of total revenue. Revenue from PCT system fees rose by 5.3 percent compared to 2021.
Madrid system fees were the second largest source of revenue during the year 2022, representing 17.1 per cent of
total revenue. Revenue from Madrid system fees increased by 3.5 per cent compared to 2021. Hague system fees,
Lisbon system fees, assessed contributions, voluntary contributions (contributions by donors to Special Accounts)
and other revenue (publications, arbitration and mediation and other/miscellaneous revenue) comprise theremaining 6.5 per cent of the Organization’s total revenue. The table on the following page provides a summary of
the changes by revenue type compared to the prior year:

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Revenue variance 2021-2022
2022

2021

Net Change

Net Change%(in millions of Swiss francs)
Revenue
Assessed contributions

17.7

17.4

0.3

1.7

Voluntary contributions

7.2

6.7

0.5

7.5

Publications revenue

0.4

0.4

-

-

PCT system

380.8

361.8

19.0

5.3

Madrid system

85.3

82.4

2.9

3.5

Hague system

7.2

6.2

1.0

16.1

Lisbon system

-

0.1

-0.1

-95.8

473.3

450.5

22.8

5.1

2.9

2.5

0.4

16.0

-

Fees

Sub-total fees
Arbitration and Mediation
Other/miscellaneous revenue
Total revenue

-3.0

-2.4

-0.6

25.0

498.5

475.1

23.4

4.9

PCT revenue is principally comprised of international filing fees (the basic fee, plus supplementary page fees, lessreductions for e-filings and least developed countries). The total PCT system fees revenue figure also comprises
other fees (including handling and transfer fees) and foreign exchange gains and losses:
Detail of PCT system fees – 2018-2022
2022

2021

2020

2019

2018

(in millions of Swiss francs)
International filing fees

382.6

363.1

366.9

335.6

315.4

Other fees

3.0

3.1

3.2

3.4

3.6

Exchange gain/(loss) on fees received

-7.2

-3.3

-8.6

-2.6

1.7

Other exchange gain/(loss)

2.4

-1.1

-2.9

1.7

0.7

Total PCT system fees

380.8

361.8

358.6

338.1

321.4

Revenue from PCT system fees on an IPSAS basis increased by 5.3 per cent compared to 2021. In the financial
statements prepared under IPSAS, revenue for international filing fees from PCT applications is recognized only on
publication of the application. In 2022 there were 272,313 publications compared to 263,280 in 2021. When looking
at revenue from PCT international filing fees as recognized in accordance with IPSAS, the following graph shows
how annual revenue has moved in line with the number of published applications in the year:
PCT - International filing fees and publications 2018-2022

300,000

400.0
350.0

Number of publications

300.0

200,000

250.0

150,000

200.0
150.0

100,000

100.0
50,000

50.0

0

0.0

2018
2019
Number of publications

2020
2021
2022
International fees for published applications

9

Revenue (millions of Swiss
francs)250,000

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Madrid system fees principally comprise basic fees received from applications for registrations or renewals and fees
for subsequent designations:
Detail of Madrid system fees – 2018-2022
2022

2021

2020

2019

2018

(in millions of Swiss francs)
Basic fees (registrations and renewals)

72.4

70.0

64.7

64.2

62.4

Subsequent designations

6.4

6.3

6.0

6.4

5.8

Other fees

6.5

6.1

5.5

6.2

6.1

Total Madrid system fees

85.3

82.4

76.2

76.8

74.3

In accordance with IPSAS, revenue from Madrid fees for registrations, renewals and subsequent designations is
recognized in the financial statements upon publication. Revenue from registrations and renewals as recognized inaccordance with IPSAS has moved in line with the number of registrations and renewals in the year. Between 2021
and 2022, the number of registrations increased slightly from 68,265 to 68,589. In the same period the number ofrenewals also rose from 34,218 to 38,265:

120,000

80.0
70.0

100,000

60.0
80,00050.0

60,00040.0
30.0

40,00020.0
20,00010.0

0Revenue (millions of Swiss francs)

Number of registrations and renewals

Madrid - Basic fees and registrations/renewals 2018-2022

0.0
2018

2019

2020

Registrations and renewals

2021

2022

Fees for published registrations and renewals

Revenue from Hague system fees totaled 7.2 million Swiss francs for 2022, representing an increase of 16.1 percent compared to the 2021 figure of 6.2 million Swiss francs. Registrations under the Hague system rose from 6,106
in 2021 to 7,725 in 2022. Lisbon system fees totaled 3,000 Swiss francs in 2022, compared to 71,000 Swiss francs
in 2021. The higher amount in 2021 was due to the coming into force of individual fees payable to Cambodia andSamoa following their accession to the Geneva Act of the Lisbon Agreement.
Revenue from assessed contributions of 17.7 million Swiss francs in 2022 represents 3.6 per cent of total revenue,
while revenue from voluntary contributions of 7.2 million Swiss francs in 2022 represents 1.4 per cent of total
revenue. Revenue from voluntary contributions is recognized as work is performed and expense incurred in linewith the relevant agreement. The actual receipt of voluntary contributions in 2022 was 8.4 million Swiss francs,
compared to 8.1 million Swiss francs in 2021.
Arbitration and mediation revenue of 2.9 million Swiss francs was up by 0.4 million Swiss francs on the prior year,
while publications revenue of 0.4 million Swiss francs was in line with the 2021 figure. Other/miscellaneous revenue
totaled -3.0 million Swiss francs in 2022, compared to -2.4 million Swiss francs in 2021. The Organization includes
exchange gains/losses as part of other/miscellaneous revenue, and in 2022 recognized net losses of 5.3 million
Swiss francs, compared to net losses of 3.8 million Swiss francs in 2021. These exchange losses correspond to therevaluation of bank accounts and operating cash short-term investments held in currencies other than Swiss francs.

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

ExpensesComposition of 2022 expenses on an IPSAS basis(in millions of Swiss francs)

Operating expenses
25.3(6.3%)

Contractual services
99.2(24.6%)

Depreciation andamortization
9.6(2.4%)
Personnel expenditure
249.6(62.0%)

Travel, training
and grants
8.3(2.0%)

Other expenses
3.1(0.8%)

Interns and WIPO
fellowships
7.7(1.9%)

Detailed breakdown of 2022 expenses(in millions of Swiss francs)
Personnel
expenditure
249.6

Posts

Contractual
services
99.2

Operatingexpenses
25.3

241.3

Temporary staff

8.7

Other staff costs-0.4

Conferences

3.6

Individual contractual services

16.9

Other contractual services

78.7

Premises and maintenance

22.9

Communication

0.8

Representation & other operating expenses

0.8

United Nations joint services

0.8

Buildings depreciation
Depreciation
and amortization Equipment depreciation
9.6
Intangible assets amortization

8.7

Travel, training and Staff missions
grantsThird-party travel
8.3
Training and related travel grants

2.1

Interns and WIPO Internships
fellowships
WIPO fellowships
7.7

0.4

Other expenses
3.1

Euipment and supplies

2.8

Finance costs

0.3

0.4
0.5

5.1
1.1

7.3

Total expenses of the Organization for 2022 were 402.8 million Swiss francs, representing an increase of 3.6 percent compared to 2021 total expenses of 388.9 million Swiss francs. The largest expense for the Organization was
personnel expenditure of 249.6 million Swiss francs, representing 62.0 per cent of total expenses. Contractual
services of 99.2 million Swiss francs were the second largest expense for the Organization, followed by operating
expenses of 25.3 million Swiss francs. The following table provides a summary of the changes by expense typecompared to the prior year:
Expenses variance 2021-2022
2022

2021

Net Change(in millions of Swiss francs)

Net Change%

Expenses
Personnel expenditure
Internships and WIPO fellowships

249.6

244.7

4.9

2.0

7.7

5.7

2.0

35.1

Travel, training and grants

8.3

1.5

6.8

453.3

Contractual services

99.2

99.8

-0.6

-0.6

Operating expenses

25.3

24.0

1.3

5.4

Equipment and supplies

2.8

3.4

-0.6

-17.6

Depreciation and amortization

9.6

9.6

-

-

Finance costs

0.3

0.2

0.1

50.0

Total expenses

402.8

388.9

13.9

3.6

11

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Personnel expenditure comprises principally net base salary and post adjustments for staff in posts or temporary
positions. Combined these represent 147.5 million Swiss francs, 59.1 per cent of total personnel expenditure for2022. Total personnel expenditure in 2022 of 249.6 million Swiss francs has increased by 2.0 per cent compared
to total personnel expenditure of 244.7 million Swiss francs in 2021. This increase is primarily due to the impacts ofmovements in long-term employee benefit liabilities recognized through personnel expenditure. The cost ofinternships and WIPO fellowships, which is not included as part of personnel expenditure, also increased
significantly compared to 2021, rising by 35.1 per cent to 7.7 million Swiss francs. Notably the Organization launched
its Young Experts Program at the end of 2021, with eleven young professionals joining in 2022.
Travel, training and grants increased from 1.5 million Swiss francs in 2021, to 8.3 million Swiss francs in 2022.
Despite this increase, expenditure in this area was still well below the 2019 figure of 17.5 million Swiss francs prior
to the impact of the COVID-19 pandemic. The significant reduction seen across 2020 and 2021 was a directconsequence of the effects of the pandemic on the Organization’s activities, with restrictions over movement andmass gatherings hugely reducing travel for missions and physical participation in conferences and meetings.
Contractual services in 2022 totaled 99.2 million Swiss francs. These expenses decreased slightly by 0.6 million
Swiss francs compared to the 2021 figure. Contractual services in the year 2022 concern primarily commercial
translation services (31.1 million Swiss francs), IT commercial services (20.6 million Swiss francs), individual
contractual services (15.9 million Swiss francs), and International Computing Centre services (12.0 million Swiss
francs).
Operating expenses in 2022 totaled 25.3 million Swiss francs, an increase of 5.4 per cent compared to the 2021
total of 24.0 million Swiss francs. The main area of increase concerned premises and maintenance costs, whichrose by 1.6 million Swiss francs. Expenses for equipment and supplies fell from 3.4 million Swiss francs in 2021 to
2.8 million Swiss francs in 2022, while depreciation and amortization of capitalized fixed assets was in line with theprior year, again totaling 9.6 million Swiss francs.

Investment gains/(losses)
In 2022 the Organization reported net investment losses of 88.0 million Swiss francs. Economic conditions andhigher inflation in 2022 resulted in unprecedented price declines in many markets, particularly in fixed income. It is
important to note that 2022 investment losses represent the unrealized decreases in the fair value of theOrganization’s investments. WIPO’s Policy on Investments includes specific investment policies for core cash andstrategic cash. Core cash balances are invested with the objective of generating a positive return over rolling fiveyear periods, whilst strategic cash balances are invested over the long term. The policies are designed to withstandshort-term volatilities in the financial markets. WIPO’s total core cash and strategic cash investments balance hasgrown from 268.3 million Swiss francs at the end of 2017, to 874.5 million Swiss francs at the end of 2022, principally
due to additional investments made during the period. The table below summarizes the Organization’s investment
gains and losses during the same period:
Investment gains/(losses) 2017-2022

millions of Swiss francs

+22.7
+33.4

+42.1

+4.3
-88.0
-15.3
2017

2018

2019

2020

12

2021

2022

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Financial Position 2022
As at December 31, 2022, the Organization had net assets of 560.0 million Swiss francs, with total assets of 1,621.1
million Swiss francs and total liabilities of 1,061.1 million Swiss francs. During 2022, the Organization’s net assets
increased by 151.5 million Swiss francs. This was mainly due to significant actuarial gains related to WIPO’s liability
for ASHI, which totaled 143.8 million Swiss francs and were recognized through net assets, along with the surplus
for the year of 7.7 million Swiss francs:
Movement in net assets 2020-2022+143.8560.0+108.9millions of Swiss francs

+7.7
-87.5

408.5

Actuarial losses
through net
assetsNet assets
December 31,
2021

387.1

Net assets
December 31,
2020

Surplus on an
IPSAS basis
2021

Surplus on an
IPSAS basis
2022

Actuarial gains
through net
assetsNet assets
December 31,
2022

The following chart provides a summary of the Statement of Financial Position of WIPO as at December 31, 2022.
Total assets of 1,621.1 million Swiss francs are composed primarily of cash, cash equivalents, investments andfixed assets. Total liabilities of 1,061.1 million Swiss francs are principally employee benefits, and payables andadvance receipts:
Summary of assets and liabilities December 31, 2022
1,621.1

millions of Swiss francs

Net assets
560.0

Cash & cash
equivalents
and investments
1,170.8

1,061.1

Employee benefits
504.9

Fixed assets
371.1

Payables andadvance receipts
470.5

Other 79.2

Other 85.7

AssetsLiabilities

13

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

AssetsAt the end of 2022, the Organization held cash, cash equivalents and investment balances of 1,170.8 million Swiss
francs, representing 72.2 per cent of total assets. This included amounts totaling 219.3 million Swiss francs
classified as restricted, and amounts totaling 219.7 million Swiss francs representing strategic cash andinvestments. The total balance of 1,170.8 million Swiss francs was 56.3 million Swiss francs higher than the balanceof 1,114.5 million Swiss francs at the end of 2021.
The Organization holds significant fixed assets (land, buildings, intangible assets and equipment) with a total net
book value of 371.1 million Swiss francs. During 2022, costs totaling 5.4 million Swiss francs were capitalized for
additions and improvements to fixed assets. The total depreciation and amortization charge against all fixed assets
was 9.6 million Swiss francs for 2022. Other assets of the Organization totaling 79.2 million Swiss francs included
accounts receivable and advance payments. Within this, the most significant balance was PCT debtors totaling 60.1
million Swiss francs. At any point during the year, a significant number of PCT applications have been filed withreceiving Offices and possibly received by WIPO, for which no corresponding fee payment has yet been received
by the Organization. The balance of PCT debtors decreased compared to the prior year, when it totaled 62.3 million
Swiss francs.

Liabilities
Employee benefit liabilities of 504.9 million Swiss francs were mainly comprised of the ASHI liability of 468.6 million
Swiss francs, representing 92.8 per cent of the total employee benefits liability as at December 31, 2022. The ASHI
liability decreased by 105.1 million Swiss francs compared to the 2021 balance of 573.7 million Swiss francs. The
calculation of the ASHI liability is performed by an independent actuary. In accordance with IPSAS requirements,
the ASHI liability recognized in the financial statements represents the present value of all expected future benefits
to existing retirees and their dependents, and all accrued post-employment benefits of active staff. On average,
medical costs increase with age, so the most significant expected medical costs remain to be paid in the future. To
manage the cost and risk of its collective medical insurance plan, WIPO has secured an insurance contract thatallows a level per person premium to be paid for existing retirees and active staff, thus reducing the cash paid on
behalf of older retirees relative to their incurred medical cost.
The ASHI liability calculation incorporates a number of actuarial assumptions. These include the discount rate,
medical cost trend rates, annual medical claims cost, retirement rates and mortality rates. Changes to theseassumptions year on year lead to actuarial gains and losses which are recognized as part of the liability in theStatement of Financial Position. A breakdown of the movement in the liability due to actuarial gains and losses isprovided in Note 9 of these financial statements. The decrease in the liability in 2022 was due to an increase in the
discount rate, which moved from 0.50 per cent to 2.50 per cent. The discount rate was determined using AA
corporate bond yield curves. The decrease resulting from the discount rate change was partly offset by the impactsof an increase in the medical cost trend rate from 2.50 per cent to 2.80 per cent, along with a 9.20 per cent higher
medical claims cost assumption at each age. The following graph shows how the ASHI liability has developed since
2018, and includes actuarial forecasts for 2023-2026 (applying the same assumptions as for the 2022 calculation).
The graph also shows how discount rates and medical cost trend rates have changed since 2018:
800.0

6.00

Movement in ASHI liability 2018-2026 (December 31)
700.0

5.00

4.00

500.0
400.0

3.00

300.0

per cent

millions of Swiss francs

600.0

2.00
2023 -2026 actuarial forecast

200.0

1.00

100.0
0.0

0.00

2018

2019
Benefit obligation

2020

2021

2022
Discount rate

2023

2024

2025

2026

Medical cost trend rate

The projections of the ASHI liability for 2023-2026 do not consider gains or losses from possible future changes in
actuarial assumptions, which could significantly impact calculations in subsequent years. The projected increase in
the liability for 2023-2026 reflects the demographic make-up of participants in WIPO’s collective medical insurance

14

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

plan. Projected additional ASHI benefits accrued by active staff (which increase the ASHI liability) outweighprojected medical costs paid to retirees (which reduce the ASHI liability).
As at December 31, 2022, payables and advance receipts totaled 470.5 million Swiss francs, and mainly included
deferred revenue for the processing of international applications (under the PCT, Madrid and Hague systems) for
302.5 million Swiss francs. This deferred revenue balance principally concerns PCT system fees of 298.6 million
Swiss francs. Revenue from fees relating to the processing of international applications is deferred until the related
application is published. At any given time during the year, a number of PCT applications will have been filed witheither receiving Offices or WIPO which have yet to be published. As at December 31, 2022, for applications with a
2021 or 2022 filing date, it is estimated that approximately 209,967 applications were unpublished. At the end of theprior year 2021, approximately 212,197 applications filed in 2020 or 2021 were unpublished and the deferred
revenue balance for PCT system fees was 299.1 million Swiss francs.

Cash Flow 2022
The Organization’s cash, cash equivalents and investments balance has continually increased since 2011. A further
increase of 56.3 million Swiss francs was achieved in 2022. This was despite significant fair value reductions of
70.0 million Swiss francs on the Organization’s medium-term investment portfolio, and 27.2 million Swiss francs on
the Organization’s long-term investment portfolio. The principal cash inflows to the Organization are payments of
PCT system fees. Monthly cash inflows from PCT system fees averaged 31.9 million Swiss francs during the year
2022 compared to 30.4 million Swiss francs during the year 2021. The Organization generally holds its cash deposits
in instant access bank accounts. During 2022, the Organization continued to hold balances in term deposit accounts(for periods up to 12 months). This has allowed the Organization to reduce the level of charges on certain instantaccess bank accounts following the introduction of negative interest rates during 2015.
As at December 31, 2022, WIPO’s medium-term investment portfolio (core cash investments) had a fair value of
662.6 million Swiss francs, and the long-term investment portfolio (strategic cash investments) had a fair value of
211.9 million Swiss francs. WIPO’s non-current investments are held at fair value in the Statement of Financial
Position. Fair value decreases in these investment portfolio assets during 2022, as noted above, reflect short-term
market volatility. Core cash balances are invested with the objective of generating a positive return over rolling
five-year periods, and strategic cash balances are invested over the long term. WIPO’s investments generated
dividends of 6.5 million Swiss francs during 2022.
Cash, cash equivalents and investments can be presented separately between unrestricted, restricted and strategic
cash balances. There are several elements of cash and cash equivalents which are classified as restricted.
Restricted cash includes current accounts held for third parties (applicants under the PCT, Madrid and Hague
systems, and also certain contracting parties), fees collected on behalf of contracting parties, deposits received inconnection with pending procedures related to trademarks, and Special Accounts held on behalf of donors ofvoluntary contributions. Strategic cash represents the funds held by the Organization which have been allocated forthe future financing of after-service employee benefit liabilities, including ASHI. The balance of strategic cash was
219.7 million Swiss francs as at December 31, 2022. This comprised the long-term investment portfolio (including
unrealized gains and losses) of 211.9 million Swiss francs, and cash balances yet to be invested of 7.8 million Swiss
francs. These balances included an additional 9.1 million Swiss francs generated in 2022 from the Program of Workand Budget charge applied to the cost of posts for the funding of after-service employee benefit liabilities.
Unrestricted, restricted and strategic cash 2016-2022
1,200.0

Total
1,114.5

Total
1,170.8
219.7

millions of Swiss francs

1,000.0

Total
932.0

Total
754.1

800.0

600.0

Total
542.3

Total
544.7

108.6

124.4

400.0

Total
616.0

190.2

237.2
219.3

211.2
211.1
186.0

125.8
179.7
182.8

161.8

666.2

174.9

731.8

534.8
200.0
271.9

245.4

384.2

307.4

0.0
2016

2017

2018

Unrestricted cash/investments

2019

Restricted cash

15

2020

2021

Strategic cash/investments

2022

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT ON INTERNAL CONTROL 2022
Scope of responsibility
As Director General of the World Intellectual Property Organization (WIPO), I am accountable, in accordance withthe responsibility assigned to me, in particular, by Regulation 5.8 (d) of the Financial Regulations and Rules (FRRs)
as applicable in 2022, for maintaining a system of internal financial control that ensures:(i) the regularity of the receipt, custody and disposal of all funds and other financial resources of theOrganization;(ii) the conformity of obligations and expenditures with appropriations or other financial provisions approvedby the General Assembly or with the purposes and rules relating to specific trust funds; and(iii) the effective, efficient and economic use of the resources of the Organization.
In signing this statement, I rely in particular on assurance provided to me in the form of Management Representation
Letters (MRLs) by my Sector Leads. I rely also on the Organization’s assurance functions, electronic systems andinformation provided to me in the WIPO Assurance Summary.

Purpose of the system of internal control
Our system of internal control is a process, effected by the Governing Bodies, the Director General, senior
management and other personnel, designed to provide reasonable assurance of the Organization's ability to reachits strategic objectives and Expected Results. The aim of this system of internal control is to manage risk to atolerable level rather than to eliminate it entirely. As such, it sets out to provide reasonable assurance over thefollowing three areas:•••

Reliability of financial reporting - transactions authorized and properly recorded and material errors or
irregularities either prevented or detected in a timely manner;
Effectiveness and efficiency of business processes, the safeguarding of assets and the exercise of
economy; andCompliance with WIPO's regulatory framework.

This statement is presented in line with the seven components of WIPO's Accountability Framework(WO/PBC/29/4), which itself is aligned to the COSO1 Internal Control framework, and Three Lines Model2.
My current statement on WIPO's internal control processes, as described above, applies for the year ended
December 31, 2022, and as at the date of the approval of the Organization's 2022 financial statements.

1. Results based planning
Resource needs are driven by the substantive work program planned for implementation during a biennium, in
accordance with the Medium Term Strategic Plan (MTSP). Member States’ approval of the 2022/23 Program ofWork and Budget sets the implementation parameters for the biennium, and control processes centered on the
WIPO FRRs ensured that WIPO Programs were implemented in accordance with those approvals.
Annual workplanning, implementation and monitoring are controlled via a suite of enterprise resource management
tools and appropriate work processes throughout the biennium.

2. Performance and risk management
The 2022/23 Program of Work and Budget was developed with the assumption that there was a high risk of
disruption to health, travel and business operations. In reality, there were relatively few such difficulties. However,
economic and financial uncertainties took over, resulting in significant impact on investments, and potential impact
on revenue. At the Organizational level, I chaired the Risk Management Group that oversees the management ofrisk at WIPO, where I invite the Director, IOD to attend as an observer to strengthen transparency about key risks.
Member States reviewed the Organization’s updated WIPO Risk Appetite Statement in 2022, which sets out thetarget level of risk by Expected Result, linking performance and risk management more closely in the Program of
1 Committee of Sponsoring Organizations of the Treadway Commission
2 https://www.theiia.org/globalassets/site/about-us/advocacy/three-lines-model-updated.pdf

16

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Work and Budget. These guardrails allow managers to take risk-based decisions in line with the appetite for theirarea of work, and will permit a more nuanced review of risks that are higher than desirable. Critical risks andappropriate responses were reviewed regularly. These include the following key risks that the Organization faced
in 2022 and beyond:

Key Risk

Risk Description

Control and Mitigation

Delivery Risk

The global geopolitical, economic, financial
or health contexts worsen adversely
affecting WIPO’s delivery of services tostakeholders, clients, and Member States,
and the ability to generate and utilize
available resources effectively.

WIPO undertakes continual all-hazard risk
monitoring overseen by the Risk Management
Group. The Organization has built resilient
infrastructure, work processes and culture
allowing rapid adaptation to evolving external
contexts.

Cyber Risk

WIPO and its external service providers
are exposed to the risk of a breach of
security, cyber crime or cyber insecurity
leading to the accidental or unlawfuldestruction, loss, alteration, unauthorized
disclosure of, or access to, confidential
and/or personal data that is transmitted,
stored or otherwise processed by theOrganization.

The implementation of our comprehensive
information security strategy, including
provisions for awareness-raising, monitoringand surveillance, enhanced oversight ofexternal service providers, and independent
security testing, responds to the risk of data
breaches.

Sustainability
Risk

In the context of global economic
uncertainty, a reduction in filings forrevenue generating activities, owing to an
economic downturn, inflation or otherreasons reduces the biennial income
received in real terms that thus threatens
the Organization’s financial sustainability.

Member States set our Reserves level atapproximately 25% of biennial budget. We
undertake prudent financial management andmonitoring as well as rolling economic andfiling forecasts, placing the Organization in asound financial position with the ability torecognize and respond in an agile manner tochanges.

Political Risk

Confidence in intellectual property (IP)frameworks declines or the engagement ofMember States or stakeholders diminishes
reducing WIPO’s role, credibility or
influence.

We demonstrate the value of IP in a pragmaticand impactful manner by supporting
innovators and creators, and showing how IP
can contribute to enterprise and economic
growth. We proactively engage andcommunicate about IP beyond a technicalaudience to the general public and emerging
stakeholders, such as youth, about therelevance and importance of IP. We facilitate
and actively support a conducive and efficientenvironment for Member State deliberations
and activities about areas of IP work relevantto them.

17

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

3. Monitoring, Oversight, Complaints and Response Mechanisms
As Director General of WIPO, I am ultimately accountable for the effectiveness of the system of internal controls.
My assertion, structured by the “Three Lines” below, is supported and informed byFirst Line

Second Line

Third Line

Sector Leads, and their teams,
in pursuit of the Organization’s
Expected Results have signed
MRLs from which I derive
assurance. These lettersrecognize their responsibility
for having and maintaining, in
the Sectors for which they
were responsible, wellfunctioning systems and amechanism for internal control
aimed at preventing and/or
detecting instances of fraud
and major errors.

Management’s role is to address
enterprise risks, including
compliance with our regulatory
framework, ethical behavior,internal control, information andtechnology security,
sustainability, and quality
assurance. In the future, thesecond line will also use data
analytics to efficiently monitor
the control activities that are
initiated in the first line.

Internal Oversight Division (IOD), on
whose assurance and advisory
services I rely, through the annual
report by the Director of IOD, reports ofinternal audit and evaluation as well as
management implication reports
resulting from investigations. IOD’s
assessment is that there were no
significant risks or breakdown ofgovernance and internal controls, while
they did identify some areas forcontinuous improvement.

Having Chaired the Risk
Management Group (RMG)
throughout the year, whose
purpose is to promote a cultureof responsible risk management
in WIPO, reviews and monitors
WIPO’s financial situation, thekey risks to the achievement of
Expected Results and thispresent Statement together withthe evidence that supports it, I
am confident our ‘second line’approach is robust.

Internal Audit reports issued by IOD
during 2022 included an Audit on
Enterprise Risk Management, andAudit of Individual Contractor Services
and Temporary Employment Agencies
and Audit of the Management of
Assets, Supplies and Materials. The
reports identified many positive
aspects, and no significant risks to theOrganization were identified. I commit
that management will implement theagreed recommendations in areas thatneed improvement.

I also take into account thecommitment that each officer
with delegated financial
authority (“Alternate”) formally
makes when accepting thatdesignation. Taking theseelements into account, I
conclude the ‘first line’ issound.

My assertion is also supported and informed by:

GOVERNANCE
External Auditor
The External Auditor’s audit aims
to provide independent
assurance to Member States, to
add value to WIPO's financial
management and governance,
and to support its objectives
through the external audit
process.
I take into account the External
Auditor’s recommendations, andam assured by their work.

Independent Advisory
Oversight Committee(IAOC)

Joint Inspection Unitof the United Nations
System (JIU)

Governing Bodies’ observations arecomplemented throughout the year
through oversight provided by the
IAOC. Its mandate includes thepromotion of risk management andinternal controls, reviewing theeffectiveness and operational
independence of the internal
oversight function and reviewing
and advising on the ethics function.

The JIU is mandated to
conduct evaluations,inspections and investigations
system-wide. WIPO preparesan analysis on theimplementation of JIU
recommendations, which ispresented to Member States at
the Program and Budget
Committee.

I further ensure that feedback mechanisms are in place for Member States and that customer complaint resolution
services are in place for clients.

18

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

4. Control Activities
A comprehensive framework of management controls is recorded to ensure the effective and efficient functioningof end-to-end business processes in compliance with the Organization’s regulatory framework. Control
assessments are undertaken annually and reported in the WIPO Assurance Summary to the RMG and the IAOC.
In line with an External Auditor
Recommendation
from
2021
that
encouraged WIPO to “review its approach
to documenting, assessing and validatingprocess level controls to focus on those key
controls of most significance and materiality
to the Organization,” a significant
consolidation has been undertaken,
particularly in the area of Human Resources
and Procurement controls records. This
has reduced the overall number of control
records by 32 per cent from 437 to 297.
This consolidation does not weaken thecontrol operations themselves, but rather
streamlines and rationalizes them byreducing the level of granularity of some
control records.

Reduction in controls following consolidation
450
400

32%

350
300
250
200
150

37%

100
50
0
Overall Controls

Key Controls

The control assessment also took a fresh review of “key controls”, aiming to identify as “key” those top layer ofcontrols that – if they were to fail – could likely cause a critical risk to occur. However although many controls weremoved from key to non-key, others took the opposite route and, together with the consolidation, the overall
percentages did not significantly shift. It did, however, reduce the number of key controls by 37 per cent from 117
to 74. These 74 key controls will be reviewed in detail on an annual basis as part of the control self-assessment
process..

5. Information and Communication
The RMG is kept informed of risks and controls through access to our business intelligence system. Quarterly risk
reports and annual risk management reports allow the RMG to take stock of the evolving risk landscape.
A robust Information and Data Governance Framework is in place reflecting its importance to WIPO. A Master DataManagement Policy provides a directive control for managing critical data and provides an authoritative point ofreference for integration into the enterprise architecture. An information security classification and handling policy
provides a preventive control raising understanding and application of levels of information confidentiality.
The portfolio of Enterprise Resource Planning (ERP) solutions provide a high level of control, including transactional
level system controls and data analytics. The Enterprise Risk Management solution ensures that controls are
systematically owned, assessed and linked to risks, as appropriate. The annual WIPO Performance Reportpresented to Member States includes a review of the evolution and impact of risks on the delivery of Expected
Results for each Program.

6. Ethical Standards and Integrity
The Ethics Office was established in 2010, to serve WIPO’s international workforce in Geneva headquarters andWIPO external offices. The office is headed by a Chief Ethics Officer who reports to the Director General and enjoys
functional and operational independence in the exercise of their function. The office supports the Director Generalin helping to ensure that all WIPO personnel perform their functions consistent with the highest standards of ethics
and integrity required by the Convention establishing WIPO, the WIPO Staff Regulations and Rules, the Standardsof Conduct for the International Civil Service, the WIPO Code of Ethics and other relevant policies and procedures.
The activities of the office aim to promote an organizational culture of ethics based on shared values of
independence, loyalty, impartiality, integrity, accountability, and respect for human rights. The office has specificresponsibility for:(i) providing confidential advice and guidance to personnel on ethical issues;(ii) raising awareness and developing training on ethics issues;(iii) developing standards and policy advocacy; and(iv) managing and administering policies assigned to the office.
19

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

The fully independent whistleblower protection role of the Ethics Office contributes to an environment of trust andenhances the capacity for WIPO to respond to wrongdoing. The Ethics Office also administers WIPO’s Policy on
Financial Disclosure and Declaration of Interests, which aims to: (i) promote transparency and accountability; (ii)enhance internal and external public trust in the integrity of the Organization; and (iii) assist the Organization to
manage the risk of actual, potential and perceived conflicts of interest through disclosure, mitigation and prevention.
WIPO has in place anti-fraud controls, in accordance with good practices and applicable international standards,
based on risk assessments. Appropriate fraud prevention, detection, response and data collection procedures andprocesses exist in the Organization, reflecting WIPO’s comprehensive anti-fraud governance framework.

7. Control Environment
A set of Entity Level Controls represents the overarching controls that help define the Organization’s culture, andits commitment to ethical values, competence and accountability.
The Organization’s regulatory framework is kept under review, as external and internal factors change, and in thisregard, a revision of the FRRs was approved by the Program and Budget Committee in 2022. In addition, a newinternal regulatory framework was introduced with the purpose of further enhancing clarity and access to the internal
policies, frameworks and procedures. WIPO’s procurement policy and procedures include a robust delegation
model for procurement authority as well as additional controls and reporting. The WIPO Vendor Sanctions policy
and the Code of Conduct for Staff Involved in Procurement actions represent important control processes and formal
and informal conflict resolution mechanisms are in place for personnel.
WIPO’s Core Values are expressed as “Shaping the Future”, “Acting Responsibly”, “Delivering Excellence” and“Working as One”, and all contribute to fostering a culture of accountability and strong ethical values.

Conclusion
Based on the contents of this statement and the evidence that underpins it, I conclude that, to the best of myknowledge and belief, and based upon the information I have, there have been no material weaknesses that would
affect the reliability of the Organization’s financial statements, nor are there significant matters that would need to
be raised in the present document for the reporting period.

Daren Tang
Director General
May 11, 2023

20

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

INDEPENDENT AUDITOR’S REPORTto the World Intellectual Property Organization
Opinion on financial statements
I have audited the financial statements of the World Intellectual Property Organization for the year ended 31
December 2022, which comprise the Statement of Financial Position, Statement of Financial Performance,
Statement of Changes in Net Assets, Cash Flow Statement, Statement of Comparison of Budget and Actual
Amounts for the year then ended, and the related notes, including the significant accounting policies.
In my opinion, the accompanying financial statements present fairly, in all material respects the financial position of
the World Intellectual Property Organization as at 31 December 2022 and its financial performance and its cash
flows for the year then ended in accordance with International Public Sector Accounting Standards.

Opinion on regularity
In my opinion, in all material respects, the revenue and expenses have been applied to the purposes intended by
the General Assembly of the World Intellectual Property Organization and the financial transactions conform to theOrganization’s Financial Regulations.

Basis for opinions
I conducted my audit in accordance with International Standards on Auditing (ISAs) and the World Intellectual
Property Organization’s Financial Regulations. My audit of regularity was undertaken in accordance with the WorldIntellectual Property Organization’s Financial Regulations. My responsibilities under these standards are further
described in the Auditor’s responsibilities for the Audit of the Financial Statements section of my report.
I am independent of the World Intellectual Property Organization in accordance with the ethical requirements thatare relevant to my audit of the financial statements in the United Kingdom, namely the Financial Reporting Council’s
Ethical Standards 2019 as applicable to listed entities. My staff and I have fulfilled our other ethical responsibilities
in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate
to provide a basis for my opinions.

Other Information
Management is responsible for the other information. The other information comprises information included in the
Annual Financial Report and Statement on Internal Control. My opinion on the financial statements does not cover
the other information and I do not express any form of assurance conclusion thereon. In connection with my auditof the financial statements, my responsibility is to read the other information and, in doing so, consider whether theother information is materially inconsistent with the financial statements or my knowledge obtained in the audit orotherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is amaterial misstatement of this other information, I am required to report that fact. I have nothing to report in thisregard.

Responsibilities of Management and Those Charged with Governance for the financial
statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with
International Public Sector Accounting Standards, and for such internal control as management determines isnecessary to enable the preparation of financial statements that are free from material misstatement, whether due
to fraud or error.
In preparing the financial statements, management is responsible for assessing World Intellectual Property
Organization’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the WorldIntellectual Property Organization or to cease operations, or has no realistic alternative but to do so.
Those Charged with Governance are responsible for overseeing World Intellectual Property Organization’s financial
reporting process.

21

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Auditor’s Responsibilities for the Audit of the Financial Statements
My responsibilities are to obtain reasonable assurance about whether the financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordancewith ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error andare considered material if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, I exercise professional judgment and maintain professional scepticism
throughout the audit. I also:•

identify the risks of material misstatement of the financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentionalomissions, misrepresentations, or the override of internal control.

•

obtain an understanding of internal control relevant to the audit to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness ofthe World Intellectual Property Organization’s internal control.

•

evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimatesand related disclosures made by management.

•

conclude on the appropriateness of management’s use of the going concern basis of accounting and,based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the World Intellectual Property Organization’s ability to continue as agoing concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’sreport to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report.
However, future events or conditions may cause the World Intellectual Property Organization to cease tocontinue as a going concern.

•

evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions and events in amanner that achieves fair presentation.

In addition, I am required to obtain evidence sufficient to give reasonable assurance that the revenue and expenses
reported in the financial statements have been applied to the purposes intended by the General Assembly and thefinancial transactions confirm to the Financial Regulations which govern them.
I communicate with those charged with governance regarding, among other matters, the planned scope and timingof the audit and significant audit findings, including any significant deficiencies in internal control that I identify during
my audit.

ReportI have also issued a long-form audit report on the results of my audit.

(signed) Gareth Davies
Comptroller and Auditor General
National Audit Office157-197 Buckingham Palace Road
Victoria
London. SW1W 9SP
United Kingdom

Date: 17 May 2023

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

FINANCIAL STATEMENTS
STATEMENT I: Statement of Financial Position
as at December 31, 2022
(in thousands of Swiss francs)

Note

December 31, 2022

December 31, 2021

ASSETS
Current assets
Cash and cash equivalents

3

242,638

147,507

Investments

4

53,64869,463Contributions receivable

5

1,981

1,441

Exchange transactions receivable

577,18986,016375,456

304,427
897,497

Non-current assets
Investments

4874,493

Intangible assets

6

24,98524,125

Property, plant, and equipment

7346,126

351,255

Other non-current assets-

TOTAL ASSETS-

1,245,604

1,272,877

1,621,060

1,577,304

19,546

LIABILITIESCurrent liabilities
Payables and accruals

8

18,077

Employee benefits

9

16,52316,009Transfers payable

10

115,095

107,411

Advance receipts

11

333,800

335,597

Finance lease

14

139

129

Provisions

12

571

492

84,84385,936

569,048565,120599,785

Current accounts
Non-current liabilities
Employee benefits

9488,356

Finance lease

14

171

324

Advance receipts

11

3,519

3,578

492,046

603,687

TOTAL LIABILITIES

1,061,094

1,168,807

Accumulated Surpluses

678,987

667,854

Special Projects Reserve

31,366

34,834

Revaluation Reserve Surplus

20,36820,368-177,097-320,901

6,342

6,342

559,966

408,497

Actuarial gains/(losses) through Net Assets
Working Capital Funds
NET ASSETS

The accompanying notes form an integral part of these financial statements
Director General

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT II: Statement of Financial Performancefor the year ended December 31, 2022
(in thousands of Swiss francs)
2022

2021

Assessed contributions

17,675

17,439Voluntary contributions

7,240

6,708

Publications revenue

398

413

PCT system

380,786

361,775

Madrid system

85,28982,429Hague system

7,206

6,185

Lisbon system3

71473,284

450,460

Arbitration and Mediation

2,944

2,465

Other/miscellaneous revenue-3,008-2,386

498,533

475,099

Note
REVENUEFees

Sub-total fees

TOTAL REVENUE
EXPENSES

17

Personnel expenditure

249,636

244,631

Internships and WIPO fellowships

7,756

5,696

Travel, training and grants

8,282

1,464

Contractual services

99,22699,827

Operating expenses

25,312

24,003Equipment and supplies

2,788

3,429

Depreciation and amortization

9,557

9,604

256

244

TOTAL EXPENSES

402,813

388,898

OPERATING SURPLUS/(DEFICIT)

95,72086,201-88,055

22,713

7,665

108,914

Finance costs

Investment gains/(losses)

18

TOTAL SURPLUS/(DEFICIT) FOR THE PERIOD

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT III: Statement of Changes in Net Assets
for the year ended December 31, 2022
(in thousands of Swiss francs)

Accumulated
Surpluses

SpecialProjects
Reserve

Actuarial
Revaluation gains/(losses)
Working
Reservethrough Net
Capital Funds
Surplus
AssetsNet Assets at December 31, 2020

565,601

28,173

20,368

Surplus/(deficit) for the year 2021

118,996-10,082-

Transfer to/from Special Projects
Reserve-18,733

18,733

1,990-233,421

Net Assets
Total

6,342

387,063--

108,914

-

-

-

-

-1,990

-

-

-

-

-

-

-

-87,480--87,480

Net Assets at December 31, 2021

667,854

34,834

20,368-320,901

6,342

408,497

Surplus/(deficit) for the year 2022

15,498-7,833

-

-

-

7,665

Transfer to/from Special Projects
Reserve-8,504

8,504

-

-

-

-

Adjustment to Accumulated Surpluses

4,139-4,139

-

-

-

-

-

-

-

143,804-

143,804

678,987

31,366

20,368-177,097

6,342

559,966

Adjustment to Accumulated Surpluses

Actuarial gains/(losses)

Actuarial gains/(losses)

Net Assets at December 31, 2022

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT IV: Statement of Cash Flowfor the year ended December 31, 2022
(in thousands of Swiss francs)

Note

2022

2021

Cash flows from operating activities
Surplus (deficit) for the period

Statement II

7,665

108,914

Depreciation and amortization

6&7

9,557

9,604

5

8,287

-19,118(Increase) decrease in receivables(Increase) decrease in other assets

-

7,995

11

-1,856

17,697

Increase (decrease) in payables and accruals

8-1,4694,015

Increase (decrease) in transfers payable

10

7,684

9,183

Increase (decrease) in provisions

12

79

-494

Increase (decrease) in current accounts-1,093

14,229Movement in employee benefits (1)Interest, dividends, investment and exchange
gains/losses (2)32,88932,973

95,821-16,545

Net cash flows from operating activities

157,564

168,453-1,748

Increase (decrease) in advance receipts

Cash flows from investing activities
Additions to property, plant, and equipment

7-4,023

Disposals of property, plant, and equipment

7

117

-

(Increase) decrease in intangible assets

6-1,382-717(Increase) decrease in investments

438,819-178,500

Increase (decrease) in fair value of investments

4-97,285

14,644

Dividends and interest on investments

18

6,530

5,459

-57,224-160,862

-143

-66

-143

-66

Effect of exchange rate changes on cash andcash equivalents-5,066-3,558Net increase (decrease) in cash and cash
equivalents

95,131

3,967

Net cash flows from investing activities
Cash flows from financing activities
Increase (decrease) in finance lease obligations

14

Net cash flows from financing activities

Cash and cash equivalents at beginning of year3

147,507

143,540

Cash and cash equivalents at end of year3

242,638

147,507(1) Includes the effect of recognition of actuarial gains/losses through net assets;(2) Interest earned, dividends received, the effect of exchange rate changes on cash and cash equivalents, and gains/losses oninvestments.

26

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT V: Statement of Comparison - Budget and Actual Amounts
Revenuefor the year ended December 31, 2022
(in thousands of Swiss francs)
Original Budget
2022

Updated Budget
2022

(1)

(2)

17,49817,49817,605

107

PCT system

362,434

377,290

380,786

3,496

Madrid system
Hague system

78,451
5,833

85,2106,440

85,2897,206

766

Lisbon system

75

75

3

-72

446,793

469,015473,284

4,269

1,600

1,600

2,944

1,344

Assessed contributions

Actual Revenue on
comparable basis 2022

Difference
2022
(3)

Fees

Sub-total fees
Arbitration and Mediation
Publications

79

490

490

398

-92

Other/miscellaneous

1,544

1,544

-2,285-3,829TOTAL REVENUE

467,925

490,147

491,946

1,799(1) Original Budget represents the first year of the approved Program of Work and Budget for the 2022/23 biennium. The biennial
revenue amounts to 951.8 million Swiss francs, and was approved by the Assemblies of Member States of WIPO in October 2021.
(2) Updated Budget includes updated revenue estimates for the PCT, Madrid and Hague systems as per the October 2022
Forecast from the Department for Economics and Data Analytics.
(3) Represents the difference between the Updated Budget 2022 and Actual Revenue on a comparable basis for the year ended
December 31, 2022.

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WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

STATEMENT V: Statement of Comparison - Budget and Actual Amounts
Expenses
for the year ended December 31, 2022
(in thousands of Swiss francs)
Original Budget
2022

Budget after
Transfers 2022

Actual Expense
on a comparable
basis
2022

Difference
2022

(1)

(2)

SectorPatents and Technology

114,955

109,973

103,525

6,448

Brands and Designs

40,06339,23937,596

1,643

Copyright and Creative Industries

15,813

16,294

14,843

1,451

Regional and National Development

34,47534,94731,322

3,625

Infrastructure and Platforms

18,747

18,10916,767

1,342

Global Challenges and Partnerships

12,694

12,452

11,656796

IP and Innovation Ecosystems

21,80821,506

20,531975

Administration, Finance and Management

131,132

128,394

120,731

7,663

5,973

4,850

-

4,850

395,660

385,764

356,971

28,793---88,055-88,055

72,265

104,383

46,920-57,463

Unallocated
TOTAL EXPENSESINVESTMENT GAINS/(LOSSES) (4)NET SURPLUS/(DEFICIT)(3)

IPSAS adjustments to surplus (5)-28,535

Special Accounts and Projects financed from reserves-10,720ADJUSTED NET SURPLUS PER IPSAS

7,665(1) Original Budget represents the budget of the first year of the approved Program of Work and Budget for the 2022/23 biennium.
The biennial budget amounts to 793.8 million Swiss francs, and was approved by the Assemblies of the Member States of WIPO
in October 2021.
(2) Budget after Transfers includes budgetary transfers as at December 31, 2022.
(3) Represents the difference between Budget after Transfers 2022 and Actual Expense on a comparable basis for the year ended
December 31, 2022.
(4) Investment gains/(losses) estimates were excluded from the Program of Work and Budget 2022/23.
(5) The IPSAS adjustments to the surplus are detailed in Note 16 of these financial statements.

28

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

NOTES TO THE FINANCIAL STATEMENTS
Note 1: Objectives and Budget of the Organization
WIPO functions in accordance with the WIPO Convention, signed in Stockholm on July 14, 1967 and as amended
on September 28, 1979. WIPO was recognized as a specialized agency of the United Nations in 1974. WIPO isbased in Geneva, Switzerland, and enjoys privileges and immunities as granted under the 1947 Convention on thePrivileges and Immunities of the Specialized Agencies of the United Nations and the 1970 Headquarters Agreementwith the Swiss Federal Council, notably being exempt from paying most forms of direct and indirect taxation. WIPO
also has external offices in Abuja, Algiers, Beijing, Moscow, Rio de Janeiro, Singapore and Tokyo, along with acoordination office in New York.
WIPO’s vision is to help create a world where innovation and creativity from anywhere is supported by intellectual
property for the good of everyone. To this end, WIPO leads the development of a balanced and inclusive global
intellectual property ecosystem. WIPO works with Member States and other stakeholders to ensure that intellectual
property is seen as a tool for every Member State to create jobs, attract investments, drive enterprise growth, andultimately develop economies and societies for a better and more sustainable future.
WIPO is funded from fees derived from services provided by the Organization, assessed contributions paid by its
Member States, and voluntary contributions from Member States and other donors. The Organization operates
within the framework of a biennial program of work and budget that provides the appropriations that constitute thebudgetary expenditure authorizations approved by the Assemblies for the financial period. The approval of theappropriations provides the authority for the Director General to commit and authorize expenses and to makepayments for the purposes assigned within the limits of the appropriations.

Note 2: Significant Accounting Policies
Basis of Preparation
These financial statements have been prepared in accordance with and comply with International Public Sector
Accounting Standards (IPSAS). The financial statements are presented in Swiss francs, which is the reporting andfunctional currency of WIPO, and all values are rounded to the nearest thousand. The accounting policies havebeen applied consistently to all years presented.
The financial statements have been prepared on the basis of historical cost, unless stated otherwise. The Statementof Cash Flow is prepared using the indirect method. The financial statements are prepared on an accrual and goingconcern basis.
IPSAS 42 Social Benefits, was published in January 2019 with an original implementation date of January 1, 2022,
subsequently deferred to January 1, 2023 due to the COVID-19 pandemic. This standard does not impact theOrganization’s financial statements.
IPSAS 43 Leases, was published in January 2022 with an implementation date of January 1, 2025. WIPO iscurrently analyzing the impacts of this standard.
IPSAS 44 Non-Current Assets Held for Sale and Discontinued Operations, was published in May 2022 with an
implementation date of January 1, 2025. It is not expected that this standard will impact the Organization’s financial
statements.

Cash and Cash Equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, deposits held up to 90 days andother short-term highly liquid investments that are readily convertible to cash and subject to insignificant risk ofchanges in value.

Investments
Investments are classified as current or non-current assets according to the time horizon of the investment
objectives. If the time horizon is less than or equal to one year, they are classified as current assets, and if it is morethan one year, they are classified as non-current assets.

29

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Foreign Currency Transactions
The functional currency of WIPO is the Swiss franc. All transactions occurring in other currencies are translated into
Swiss francs using the United Nations Operational Rates of Exchange (UNORE), or an equivalent comparable
benchmark from the financial market, which represent those prevailing at the date of the transactions. Both realized
and unrealized gains and losses resulting from the settlement of such transactions and from the translation at thereporting date of assets and liabilities denominated in currencies other than WIPO’s functional currency arerecognized in the Statement of Financial Performance.

Revenue Recognition
Revenue from exchange transactions comprising the fees charged for applications under the Patent Cooperation
Treaty (PCT) system, the Madrid system and the Hague system is recognized at the date of publication. Revenue
from fees received for applications not published at the reporting date is deferred until publication has been
completed. The portion of the PCT application fee covering the costs of translation of non-English language
patentability reports received after publication is also deferred until the translation is completed. All other fees under
the PCT, Madrid and Hague systems are recognized when the services covered by the fee have been provided.
Revenue from publications is recognized upon full delivery of the goods. Revenue from Arbitration and Mediation
services is recognized upon delivery of the services related to the submission of a request covered by the fee
received. Credit card charges incurred on payments received for exchange transactions are recognized throughother/miscellaneous revenue.
Revenue from non-exchange transactions such as voluntary contributions to Special Accounts supported byenforceable agreements is recognized as revenue at the time the agreement becomes binding unless theagreement includes conditions related to specific performance or the return of unexpended balances. Suchagreements require initial recognition of a liability to defer revenue recognition and then revenue is recognized as
the liability is discharged through performance of the specific conditions included in the agreement.
Assessed contributions are recognized as revenue at the beginning of each year of the budget period to which theassessment relates.

Expense Recognition
Expenses are recognized as goods are received and as services are delivered.

Receivables
Receivables from exchange transactions include fees which are charged to users of WIPO’s intellectual property
services through the PCT, Madrid and Hague systems. These are measured at the fair value of the consideration
receivable for PCT, Madrid and Hague system fees once the international application has been filed.
Receivables from non-exchange transactions include uncollected assessed contributions. These are measured at
the fair value of the consideration receivable. An allowance for non-recoverable receivables is recorded equal tothe assessed contributions frozen by action of the General Assembly in 1989 and 1991, plus contributions
receivable from Member States that have lost the right to vote in accordance with Article 11, paragraph 5 of the
WIPO Convention.

Property, Plant, and Equipment
Equipment is valued at cost less accumulated depreciation and impairment. Equipment is recognized as an asset
if it has a cost of 10,000 Swiss francs or more per unit. Gains and losses on disposal are determined by comparing
the proceeds with the carrying amount of the asset and are included in the Statement of Financial Performance.
Heritage assets including donated works of art are not valued in the financial statements.
Land is carried at fair value as determined by an independent valuation in accordance with International Valuation
Standards. Changes in fair value are recognized directly in net assets through the Revaluation Reserve Surplus.
Buildings and constructions in use are valued at the cost of construction when new plus the cost of subsequent
improvements, less accumulated depreciation. For the initial recognition of buildings in use as at January 1, 2010,
the date of transition to IPSAS, the value when new was determined by reference to a deemed cost calculated by
an external consultant and representing the value of each component at construction plus improvements existingat the initial recognition, less accumulated depreciation based upon the remaining useful life of each component.
Subsequent costs of major renovations and improvements to buildings and constructions that increase or extend
the future economic benefits or service potential are valued at cost.
Depreciation is charged so as to write off the full cost of property, plant, and equipment over its estimated usefullife using the straight-line method. Where property, plant, and equipment is only in use for part of the year (due to30

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

acquisition, disposal or retirement during the year), depreciation is charged only for the months during which theasset was in use. The following ranges of useful lives are applied to the different classes and components ofproperty, plant, and equipment:
Class/Component

Estimated useful life

Equipment
Communications and IT equipment

5-10 years

Vehicles15 years

Furniture and furnishings

10 years

Buildings
StructureFaçade50-100 years
50 years

Perimeter bollards/walls

20-80 years

Land Improvements

40-50 years

Roof

50-60 years

Floors, walls, stairways

50 years

Flooring, wall coverings

20-40 years

Specialist fittings

15-40 years

Heating and ventilation

25-30 years

Sanitary facilities
Electrical installations
Elevators

40 years
25-50 years
40 years

The carrying values of property, plant, and equipment are reviewed for impairment if events or changes incircumstances indicate that the book value of the asset may not be recoverable. If such an indication exists, therecoverable amount of the asset is estimated in order to determine the extent of impairment loss, if any. Any
impairment loss is recognized in the Statement of Financial Performance.

Intangible Assets
Intangible assets are carried at cost less accumulated amortization and impairment. Amortization is provided on astraight-line basis on all intangible assets of finite life, at rates that will write off the cost or value of the assets overtheir useful lives. The useful lives of major classes of intangible assets have been estimated as follows:
Class
Software externally acquired
Software internally developed
Licenses and rights

Estimated useful life
5 years
5 years
Period of licence/right

Acquired computer software licenses are capitalized based on costs incurred to acquire and bring to use the specificsoftware. Software or software licenses purchased externally are recognized as an asset if they have a cost of
20,000 Swiss francs or more per unit. Costs that are directly associated with the internal development of softwarefor use by WIPO are capitalized as intangible assets only if the recognition criteria under IPSAS 31 are met. Direct
costs include the software development employee costs.
The rights to use property in the Canton of Geneva acquired by the Organization through purchase have beenrecognized at historic cost and are amortized over the remaining period of the grant. The rights to use property
granted by the Canton of Geneva acquired without cost, that revert back to the Canton at the end of the grant, arenot valued in the financial statements.

Financial Assets
Financial assets are recognized initially at fair value, normally being the transaction price. The subsequent
measurement of financial assets depends on their classification. WIPO classifies its financial assets as either
measured at amortized cost or measured at fair value through surplus or deficit. The classification depends on
WIPO’s management model for the financial assets and the contractual cash flow characteristics of the financial
assets. WIPO assesses on a forward-looking basis the expected credit losses associated with its financial assets
classified as measured at amortized cost.
31

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Financial Liabilities
WIPO initially recognizes its financial liabilities at fair value. After initial recognition, financial liabilities aresubsequently measured at amortized cost.

Derivative Financial Instruments
WIPO uses derivative financial instruments such as forward currency contracts to hedge its foreign currency risks.
These financial instruments are initially recognized at fair value on the date on which the derivative contract isentered into and are subsequently re-measured at fair value.

Employee Benefits
Liabilities are established for After-Service Health Insurance (ASHI), repatriation grants and travel, and long-term
accumulated annual leave as determined by an independent actuary on an annual basis utilizing the projected unit
credit methodology of valuation. For the ASHI liability, actuarial gains and losses are recognized in net assets. In
addition, liabilities are established for the value of short-term accumulated annual leave, home leave not taken,
overtime earned but unpaid, separation benefits, performance rewards, and for education grants payable at thereporting date that have not been included in current expenditure.
WIPO is a member organization participating in the United Nations Joint Staff Pension Fund (the Fund), which wasestablished by the United Nations General Assembly to provide retirement, death, disability and related benefits toemployees. The Fund is a funded, multi-employer defined benefit plan. As specified in Article 3(b) of the Regulationsof the Fund, membership in the Fund shall be open to the specialized agencies and to any other international,
intergovernmental organization which participates in the common system of salaries, allowances and otherconditions of service of the United Nations and the specialized agencies.
The Fund exposes participating organizations to actuarial risks associated with the current and former employeesof other organizations participating in the Fund, with the result that there is no consistent and reliable basis forallocating the obligation, plan assets, and costs to individual organizations participating in the Fund. WIPO and theFund, in line with the other participating organizations in the Fund, are not in a position to identify WIPO’s
proportionate share of the defined benefit obligation, the plan assets and the costs associated with the plan with
sufficient reliability for accounting purposes. Hence WIPO has treated this plan as if it were a defined contribution
plan in line with the requirements of IPSAS 39 Employee Benefits. WIPO’s contributions to the Fund during thefinancial period are recognized as expenses in the Statement of Financial Performance.

LeasesFinance leases are recognized as assets and liabilities in the statement of financial position at the lower of the fairvalue of the leased item or the present value of the minimum lease payments at the commencement of the lease
term. The finance charge is charged to surplus or deficit over the lease period so as to produce a constant periodic
rate of interest on the remaining balance of the liability. The amount recognized as an asset is depreciated over its
useful life.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.

Provisions
Provisions are recognized when the Organization has a legal or constructive obligation as a result of a past event,whereby it is probable that an outflow of resources will be required to settle the obligation and where a reliable
estimate of the amount of the obligation can be made.

Net Assets
The Organization’s net assets represent the balance of its reserves, which include its Reserves (Accumulated
Surpluses, Special Projects Reserve and Revaluation Reserve Surplus) and Working Capital Funds. The
Organization also recognizes actuarial gains and losses directly through net assets. The Organization manages thelevel of its reserves in accordance with its Policy on Reserves.
The Accumulated Surpluses of the Organization represent the accumulated net result of operations in the reporting
year and prior periods after the impact of IPSAS. WIPO’s Policy on Reserves establishes the principles and approvalmechanism for the use of reserves for one-time projects for capital improvements and exceptional circumstances.
The Special Projects Reserve contains the appropriations to these projects financed from reserves, lessaccumulated expenditure. The Revaluation Reserve Surplus includes the cumulative results of revaluations of theland owned by the Organization on which the New Building has been constructed. The Working Capital Funds are
established for providing advances to finance appropriations should there be a temporary liquidity shortfall, and for
32

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

such other purposes as the Assemblies of Member States and of the Unions shall decide. The Working CapitalFunds are financed by contributions and are held in trust by WIPO for the Member States of the respective Unions.

Segment Reporting
Segment reporting is based upon the Unions that form WIPO. Revenue and expenses incurred by the Organization
are allocated among the Unions in accordance with an allocation methodology approved by the WIPO Assembly(Program of Work and Budget 2022/23, Annex IV). The methodology allocates revenue and expenses to eachprogram and then to each Union based on a combination of direct revenue and expense, staff head count and each
Union’s “capacity to pay”. Direct Union expenses are allocated to Unions either fully or on the basis of estimates by
Program Managers. Direct administrative expenses are allocated to the Unions based on relative headcount shares.
Indirect Union expenses and indirect administrative expenses are allocated to the Unions based on the “capacityto-pay” principle. If the Union has a reserve level above its reserve target, it is deemed to be able to support indirect
activities not directly linked to the Union. The “capacity to pay” is calculated as the difference between a Union’s
projected biennial income and its direct Union and direct administrative expenses. The extent to which this support
can be provided by each Union is calculated by considering the relative extent to which the Union’s income exceeds
its direct expenditure. The only inter-segment charge represents the costs of program support incurred by theUnions in support of Special Accounts. Program support costs are charged to the Special Accounts based on apercentage of total direct expenditure specified in the agreement with the donor making the voluntary contribution.
WIPO’s assets and liabilities are not allocated to individual segments, since ownership rests with the Organization
as a whole, however, each Union’s share of the Organization’s net assets including Reserves and Working CapitalFunds is recognized by segment.

Use of Estimates
The financial statements necessarily include amounts based on estimates and assumptions by management.
Estimates include, but are not limited to: ASHI, repatriation grants and travel, and long-term accumulated annual
leave liabilities (the value of which are calculated by an independent actuary), other employee benefit liabilities,
provisions for litigation, financial risk on accounts receivable, accrued charges and the degree of impairment of
fixed assets. Actual results could differ from these estimates. Changes in estimates are reflected in the period inwhich they become known.
All balances are presented in thousands of Swiss francs, as a result small rounding differences may occur.

33

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 3: Cash and Cash Equivalents
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Cash on hand35

41

Deposits with banks

87,71347,718Term deposits less than 3 months

127,746

66,404

Notice accounts

19,361

17,756

Total operating and core cash

234,855

131,919

Deposits with banks

7,783

15,588

Total strategic cash

7,783

15,588242,638

147,507

December 31,
2022

December 31,
2021

Total cash and cash equivalents

Note 4: Investments(in thousands of Swiss francs)

Term deposits more than 3 months (operating cash)

51,31966,288Derivative financial instruments

2,329

3,175

Current investments

53,64869,463Medium term Investment portfolio (core cash)

662,560

675,881Long term Investment portfolio (strategic cash)

211,933

221,616

Non-current investments

874,493

897,497

Total investments

928,141

966,960

Derivative financial instruments are forward foreign exchange contracts. The movement in the value of operating
cash, core cash, and strategic cash investments during the year ended December 31, 2022 is as follows:
Operating cash
investmentsCore cash
investments

Strategic cash
investments(in thousands of Swiss francs)
Investments fair value at January 1, 2022

66,288675,881

221,616Additional investments made-52,32016,663

Dividends on investments invested

-

2,949

1,294
-1,100

Disposal of investments-14,969-

Forex gains/(losses) on investments

-

1,453

702

Fair value increase/(decrease)--70,043-27,242

51,319662,560

211,933

Investments fair value at December 31, 2022

34

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 5: Receivables
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Assessed contributions

1,981

Voluntary contributions-

2

Contributions receivable

1,981

1,441

PCT debtors

60,09262,283Madrid debtors

213

130

Other receivables

10,892

9,752

Advances and prepayments

5,992

5,738

Loan to FIPOI

1,439

-

8,113

Exchange transactions receivable

77,18986,016

Total accounts receivable

79,17087,457

Other receivables include USA taxes reimbursable, Swiss taxes reimbursable, UPOV expenditure reimbursable,credit card debtors and other debtors. Advances and prepayments include staff advances for education grants,
funds advanced to the United Nations Development Program and other prepaid expenditure.
On January 25, 2022, the Organization received in full the remaining balance of 8.1 million Swiss francs of its loan
to the Foundation for Buildings for International Organizations (FIPOI). This repayment was due to WIPO following
termination of WIPO’s lease of the building on rue des Morillons in Geneva, Switzerland.

35

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 6: Intangible Assets
Movement 2022

Land surface
rightsSoftwareexternallyacquired

Softwareinternallydeveloped

Intangible
assets underdevelopment

Total(in thousands of Swiss francs)
January 1, 2022
Gross carrying amount

34,290

772

4,419

1,078

40,559

Accumulated amortization-11,357-733-4,344--16,434

22,933

39

75

1,078

24,125Additions

-

-

-

1,382

1,382

Transfers

-

-

-

-

-

Disposals

-

-

-

-

-

Disposals amortization

-

-

-

-

-

-439

-8

-75

-

-522

-439

-8

-75

1,382

860

Net carrying amount
Movements in 2022

Amortization
Total movements in 2022
December 31, 2022
Gross carrying amount

34,290

772

4,419

2,460

41,941

Accumulated amortization-11,796-741-4,419--16,956

22,494

31

-

2,460

24,985Land surface
rightsSoftwareexternallyacquired

Softwareinternallydeveloped

Intangible
assets underdevelopment

Total

Net carrying amount

Movement 2021

(in thousands of Swiss francs)
January 1, 2021
Gross carrying amount

34,290

733

4,950

-

39,973

Accumulated amortization-10,917-733-4,295--15,945

23,373-655-

24,028Additions

-

39

-

1,078

1,117

Transfers

-

-

-

-

-

Disposals

-

-

-531

-

-531

Net carrying amount
Movements in 2021

Disposals amortization
Amortization
Total movements in 2021

-

-

131

-

131

-440

-

-180

-

-620

-440

39

-580

1,078

97

December 31, 2021
Gross carrying amount

34,290

772

4,419

1,078

40,559

Accumulated amortization-11,357-733-4,344--16,434

22,933

39

75

1,078

24,125

Net carrying amountLand surface rights to parcel 4008 in Petit-Saconnex in the City of Geneva were acquired from the World
Meteorological Organization (WMO) in 1996. These had been granted to WMO by the Republic and Canton of
Geneva. At the date of purchase the original rights had a remaining period of 78 years expiring in 2073, unlessrenewed by the Canton. WIPO has been granted surface rights by the Republic and Canton of Geneva to the landon which the Árpád Bogsch and Georg Bodenhausen buildings are located. These surface rights were acquired by
the Organization at no cost and no value has been recognized in the financial statements as the Organization does
not have the right to dispose of the rights.

36

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 7: Property, Plant and Equipment
Movement 2022

Buildings

Land

Equipment

Total(in thousands of Swiss francs)

January 1, 2022
Gross carrying amount404,280

33,922

6,697

Accumulated depreciation-88,671--4,973-93,644

315,60933,922

1,724

351,255

3,875

-

148

4,023

-

-

-

-

-3,162--865-4,027

Disposals depreciation

3,094

-

816

3,910

Depreciation-8,644--391-9,035-4,837--292-5,129Gross carrying amount

404,993

33,922

5,980

444,895

Accumulated depreciation-94,221--4,548-98,769

310,772

33,922

1,432

346,126

Buildings

Land

Equipment

Total

Net carrying amount

444,899

Movements in 2022
Additions
Revaluation
Disposals

Total movements in 2022
December 31, 2022

Net carrying amount

Movement 2021

(in thousands of Swiss francs)

January 1, 2021
Gross carrying amount
Accumulated depreciation
Net carrying amount402,745

33,922

6,688

443,355-80,154--4,710-84,864

322,591

33,922

1,978

358,491

1,748

Movements in 2021
Additions

1,535

-

213

Revaluation

-

-

-

-

Disposals

-

-

-204

-204

Disposals depreciation

-

-

204

204

-8,517--467-8,984-6,982--254-7,236Gross carrying amount404,280

33,922

6,697

444,899

Accumulated depreciation-88,671--4,973-93,644

315,60933,922

1,724

351,255

Depreciation
Total movements in 2021
December 31, 2021

Net carrying amount

WIPO holds fully depreciated equipment which is still in use for a gross carrying amount of 2.7 million Swiss francs.
The land upon which the New Building was constructed was initially acquired by the Organization at a cost of 13.6
million Swiss francs in 1998, but is held at fair value based on International Valuation Standards as determined byan independent appraiser. The net result of all periodic revaluations totalling 20.4 million Swiss francs is includedin the Revaluation Reserve Surplus which forms part of WIPO’s net assets. The most recent valuation of the land
was performed by an independent appraiser at December 31, 2020. Market value was estimated by capitalizing at
an appropriate investment yield the future potential income stream from the property. The potential income wasbased on comparable rentals in the market, taking into account the quality of the spaces as well as the location.
The yield was selected by reference to the perceived quality and duration of the income and the potential for further

37

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

rental growth and was cross-referenced by the evidence provided by comparable sales. For 2022 a review was
performed of available market data, including Geneva office rentals, to ensure that an update of the 2020 valuation
would not result in a material change in the fair value of the land.
WIPO holds heritage assets, referred to as works of art, representing items donated or loaned to the Organization
by representatives or officials of Member States or other public or private entities or individuals. The works of art
held by WIPO include paintings, sculptures, decorative objects, historical documents and other items. As at
December 31, 2022, the Organization held a total of 740 items classified as works of art. WIPO has elected not torecognize works of art as assets in the Statement of Financial Position, in accordance with IPSAS 17. The 740
items are classified as follows:
Number of Works of Art

2022

2021

Framed artwork

193

188

Decorative objects

113

103

Sculptures

82

76

Other commemorative objects

60

49

Furniture38

38

Tapestries/carpets

35

34

Ceramic/porcelain

26

22

Primitive arts

23

23

Silverware

20

20

Other works of art

150

132

Total

740

685

Under the WIPO Policy on Property Management and the related Property Management Manual, the Organization
has established processes and procedures for the management of works of art, including the final determination as
to whether an item is deemed to be a work of art. Works of art are held in controlled access storage until such time
as a decision is taken in relation to the placement of an item. Most of the small and fragile works of art are stored
in closed cabinets. The dedicated storage has been improved to enhance protection from humidity and dust, andmeasures are under consideration for further protection from possible water damage. In addition, works of art placedin lobbies, offices and on office floors in WIPO’s buildings benefit from existing security measures. All works of art
are recorded in the Asset Management Module of WIPO’s ERP system, and are included in the Organization’sannual physical inventory process. Formal confirmations that works of art are held by WIPO are provided to donors
upon request.

38

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 8: Payables and Accruals
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Trade creditors - accounts payable

16,126

18,383

Miscellaneous transitory liabilities

1,019

656

932

507

18,077

19,546

Other trade creditors
Total payables and accruals

Payables and accruals include invoices received from suppliers not yet settled including the revaluation of invoices
payable in currencies other than the Swiss franc.

Note 9: Employee Benefits
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Accumulated leave (posts)

1,234

1,594

Accumulated leave (temporary staff)

378

417

Separation benefits

410

380

Closed Pension Fund

351

315

Repatriation grant and travel

2,515

2,515

Home leave

812

1,544

Overtime and credit hours

46

31

2,160

2,080

Education grant
Performance rewards
After-Service Health Insurance
Other employee benefits
Total current employee benefit liabilities
Closed Pension Fund

640

427

7,874

6,706

103

-

16,52316,009994

2,332

Accumulated leave (posts)

15,797

18,698Repatriation grant and travel

10,805

11,738After-Service Health Insurance

460,760

567,017

Total non-current employee benefit liabilities

488,356

599,785

Total employee benefit liabilities

504,879

615,794

Long-term employee benefits include After-Service Health Insurance (ASHI), repatriation grant and travel, andaccumulated leave (posts):
ASHI: Staff members (and their spouses, dependent children and survivors) retiring from service are eligible for
After-Service Health Insurance (ASHI) coverage if they continue to participate in the collective medical insurance
plan after separation from service. In accordance with WIPO’s SRR, a share of 65 per cent of the monthly medical
insurance premium is paid by the Organization. From January 1, 2023, monthly medical premiums amount to 656.10
Swiss francs for adults and 291.25 Swiss francs for children.
Repatriation grant and travel: The Organization has a contractual obligation to provide benefits such as
repatriation grants, travel and removal for certain internationally recruited staff members at the time of theirseparation from service
Accumulated leave (posts): Accumulated annual leave is classified as a long-term employee benefit for staff
members holding permanent, continuing or fixed term contracts. Staff in posts may accrue up to 15 days of annual
leave in a given year, and a total accumulated balance of 60 days. On separation from service, staff in posts who

39

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

have accumulated annual leave can receive a payment in lieu of an amount equivalent to their salary for the periodof accumulated annual leave, up to a maximum of 60 days.
Employee benefit liabilities for ASHI, repatriation grant and travel, and accumulated leave (posts) are calculated byan independent actuary. Actuarial assumptions have a significant effect on the amounts calculated for employee
benefit liabilities. A description of the factors which impact the size of the ASHI liability is included in the financial
statement discussion and analysis which precedes these financial statements. The principal actuarial assumptions
applied in determining these liabilities are detailed below. Discount rates were determined using AA corporate bondyield curves:
December 31, 2022

December 31, 2021

After-Service Health Insurance
Discount rate
Discount rate currency

2.50%

0.50%

CHF, EUR, USD (weighted)

CHF, EUR, USD (weighted)

Medical cost trend rate

2.80%

2.50%

Claims cost CHF

Claims cost CHF

50

5,556

5,088

55

6,195

5,673

60

7,250

6,639

65

9,610

8,800

70

11,343

10,38775

12,397

11,35380

16,72815,31985

17,233

15,781

5.10%

2.60%

Annual medical claims cost (by age):

Repatriation Grant and Travel
Discount rate
Discount rate currency

USD

USD

Rate of s alary increase

2.88%

2.70%

2.10%

0.20%

Accumulated leave (posts)
Discount rate
Discount rate currency
Rate of s alary increase

CHF
Comprised of:

CHF
Comprised of:Inflation

1.20%

Inflation

Productivity

0.50%

Productivity

0.50%

Merit scale

0.97%-6.07%

Merit scale

0.97%-6.07%

0.90%

The present value of the defined benefit obligations for ASHI is determined using the projected unit credit method
including discounting the estimated future cash outflows. In accordance with IPSAS the Organization’s ASHI liability
is considered as unfunded as no plan assets are held in a legally separate entity or fund, and therefore no plan
assets are deducted from the liability as recognized in the Statement of Financial Position. However, it should be
noted that the Organization has established separate funds (strategic cash) for the future financing of after-service
employee benefit liabilities. The table below details the expense for ASHI recognized in the Statement of Financial
Performance:
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Interest cost

2,852

1,351

Current service cost
Expense recognized in the Statement of Financial
Performance

40,211

36,15443,06337,50540

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

The table below details the changes in the ASHI defined benefit obligation, including the impact of actuarial
gains/(losses):
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Defined benefit obligation at beginning of year

573,723452,755

Interest cost

2,852

1,351

Current service cost

40,211

36,154Contribution paid

-4,348-4,017

Experience (gain)/loss-3,748-4,430

Medical cost trend rate

42,902-54,819-239,904-25,997

Actuarial (gain)/loss on obligation:

Discount rate
Other

1,780

-

(Gain)/loss on change in financial assumptions-195,222-80,816

Medical claims cost

54,317

179,579

Other demographic assumptions

849-6,853(Gain)/loss on change in demographic assumptions

55,166

172,726

Defined benefit obligation recognized at end of year

468,634

573,723

As can be seen in the table above, the most significant movement in the 2022 ASHI liability was the result of
actuarial gains due to an increase in the discount rate, which moved from 0.50 per cent to 2.50 per cent. Actuarial
losses were incurred due to an increase in the medical cost trend rate, along with a higher medical claims cost
assumption. For the 2021 liability calculation, the independent actuary performed a detailed analysis of claims cost
data to establish medical claims cost at each age. Following a review of 2021 and 2022 claims cost data, an increaseof 9.20 per cent was applied to this cost assumption for each age.
Contributions, representing the premium share paid by the Organization for ASHI, totaled 4.3 million Swiss francs
for 2022 (4.0 million Swiss francs in 2021). Expected contributions to ASHI in 2023, representing medical claims
costs, are 7.9 million Swiss francs. The weighted average duration of the defined benefit obligation as at December
31, 2022, was 19 years. The following table details the present value of the defined benefit obligation and experience
adjustments on the ASHI liability for 2022 and the previous four years.
2022

2021

468,634

573,723-3,748-4,430

2020

2019

2018

452,755

313,694

303,128

2,400-37,983-3,092(in thousands of Swiss francs)
Defined benefit obligation
Experience (gain)/loss adjustments on plan liability

The following sensitivity analysis shows how the defined benefit obligation would have been affected by changes
in significant actuarial assumptions, the discount rate and the medical cost trend rate. The per cent changes usedin the analysis are considered reasonable based on historical movements:
1 per cent decrease indiscount rate
1.50%
Defined benefit obligation as at
December 31, 2022
Per cent variation

Defined benefit obligation as at
December 31, 2022
Per cent variation

571,887

Discount rate as
applied2.50%(in thousands of Swiss francs)
468,634

1 per cent increase indiscount rate
3.50%
389,498

22.0%-16.9%

1 per cent decrease in
medical cost trend rate
1.80%

Medical cost trend
1 per cent increase inrate as applied
medical cost trend rate
2.80%
3.80%
(in thousands of Swiss francs)

391,855-16.4%

41

468,634

566,508
20.9%

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

United Nations Joint Staff Pension Fund
The Fund’s Regulations state that the Pension Board shall have an actuarial valuation made of the Fund at least
once every three years by the Consulting Actuary. The practice of the Pension Board has been to carry out anactuarial valuation every two years using the Open Group Aggregate Method. The primary purpose of the actuarial
valuation is to determine whether the current and estimated future assets of the Fund will be sufficient to meet its
liabilities.
WIPO’s financial obligation to the Fund consists of its mandated contribution, at the rate established by the United
Nations General Assembly (currently at 7.9 per cent for participants and 15.8 per cent for member organizations)
together with any share of any actuarial deficiency payments under Article 26 of the Regulations of the Fund. Such
deficiency payments are only payable if and when the United Nations General Assembly has invoked the provisionof Article 26, following determination that there is a requirement for deficiency payments based on an assessmentof the actuarial sufficiency of the Fund as of the valuation date. Each member organization shall contribute to thisdeficiency an amount proportionate to the total contributions which each paid during the three years preceding thevaluation date.
The latest actuarial valuation for the Fund was completed as at December 31, 2021, and a roll forward of theparticipation data as at December 31, 2021 to December 31, 2022 will be used by the Fund for its 2022 financial
statements.
The actuarial valuation as of December 31, 2021 resulted in a funded ratio of actuarial assets to actuarial liabilitiesof 117.0 per cent (107.1 per cent in the 2019 valuation). The funded ratio was 158.2 per cent (144.4 per cent in the2019 valuation) when the current system of pension adjustments was not taken into account.
After assessing the actuarial sufficiency of the Fund, the Consulting Actuary concluded that there was norequirement, as at December 31, 2021, for deficiency payments under Article 26 of the Regulations of the Fund as
the actuarial value of assets exceeded the actuarial value of all accrued liabilities under the plan. In addition, themarket value of assets also exceeded the actuarial value of all accrued liabilities as of the valuation date. At thetime of this report, the General Assembly has not invoked the provision of Article 26.
Should Article 26 be invoked due to an actuarial deficiency, either during the ongoing operation or due to thetermination of the Fund, deficiency payments required from each member organization would be based upon the
proportion of that member organization’s contributions to the total contributions paid to the Fund during the three
years preceding the valuation date. Total contributions paid to the Fund during the preceding three years (2019,2020 and 2021) amounted to 8,505.27 million US dollars, of which 1.64 per cent was contributed by WIPO (including
participants and Organization contributions).
During 2022, WIPO contributions (including Organization contributions only) paid to the Fund amounted to 30.4
million Swiss francs (28.9 million Swiss francs in 2021). Expected contributions due in 2023 are approximately 30.6
million Swiss francs.
Membership of the Fund may be terminated by decision of the United Nations General Assembly, upon theaffirmative recommendation of the Pension Board. A proportionate share of the total assets of the Fund at the dateof termination shall be paid to the former member organization for the exclusive benefit of its staff who wereparticipants in the Fund at that date, pursuant to an arrangement mutually agreed between the organization andthe Fund. The amount is determined by the Pension Board based on an actuarial valuation of the assets andliabilities of the Fund on the date of termination; no part of the assets which are in excess of the liabilities is includedin the amount.
The United Nations Board of Auditors carries out an annual audit of the Fund and reports to the Pension Board andto the United Nations General Assembly on the audit every year. The Fund publishes quarterly reports on its
investments and these can be viewed by visiting the Fund at www.unjspf.org.

42

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 10: Transfers Payable
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Madrid Union fees

71,64564,575Madrid Union deposits

28,15032,708

Hague Union distribution

1,079

847

Madrid and Hague Union repartition fees

10,0275,256

AMC deposits

1,797

1,730

PCT International Searching Authorities

1,654

1,782

RO search fees due to International Searching Authorities

732

497

Lisbon Union fees

11

16

115,095

107,411

Total transfers payable

The Organization collects fees on behalf of the contracting parties of the Madrid Agreement and Protocol and theCommon Regulations of the Hague Agreement. The Organization’s PCT International Bureau collects funds fromapplicants to cover the cost of payments of International Searching Authorities. In addition, the Organization collects
fees to be paid directly to mediators, arbitrators or panelists for cases treated through the Arbitration and Mediation
Centre. The Organization holds these funds on a temporary basis until they are transferred to the final beneficiaryin accordance with the various treaties and agreements administered by the Organization.

Note 11: Advance Receipts
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Madrid Union deposits

7,393

8,632

Industrial design deposits

2,475

2,560

Lisbon Union deposits

436

395

PCT/IBRO deposits

303

721

Advance payment of contributions

3,442

4,992

PCT system deferred revenue

298,614299,149

Madrid system deferred revenue

3,121

2,661

Hague system deferred revenue

793

452

Non-exchange deferred revenue

17,164

15,967

59

59

FIPOI deferred revenue
Other deferred revenue-

9

333,800

335,597FIPOI deferred revenue

3,519

3,578

Total non-current advance receipts

3,519

3,578

337,319

339,175

Total current advance receipts

Total advance receipts

43

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 12: Provisions(in thousands of Swiss francs)
Balance as at December 31, 2020

986

Movements in 2021
Additional provisions made167

Amounts used

-487

Unused amounts reversed-174

Balance as at December 31, 2021

492

Movements in 2022
Additional provisions made214

Amounts used-1

Unused amounts reversed-134

Balance as at December 31, 2022

571

Provisions at December 31, 2022, include cases where WIPO personnel are in dispute with the Organization, before
the WIPO Appeal Board (WAB) and the ILO Administrative Tribunal (ILOAT).

Note 13: Contingent Assets and Liabilities
The estimated value of contingent liabilities for possible payments by the Organization for claims arising from cases
before the WIPO Appeal Board (WAB) and the ILO Administrative Tribunal (ILOAT) is 101,500 Swiss francs at thereporting date.
The International Computing Centre (ICC) was established in January 1971 pursuant to Resolution 2741 (XXV) of
the United Nations General Assembly. ICC provides Information Technology and Communications services toPartners and Users in the United Nations System. As a Partner bound by the Mandate of the ICC, WIPO would be
proportionately responsible for any third party claim or liability arising from or related to service activities of the ICC
as specified in the ICC Mandate. At 31 December 2022, there are no known claims that impact WIPO. Ownershipof assets is with ICC until dissolution. Upon dissolution, the division of all assets and liabilities amongst Partner
Organizations shall be agreed by the Management Committee by a formula defined at that time.

44

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 14: Leases
WIPO as Lessee
The Organization leases depots and storage facilities, office space, cars and printing and photocopying equipment
under operating lease arrangements. The total amount of lease payments under these arrangements recognized
as an expense was 1.1 million Swiss francs in 2022 (1.7 million Swiss francs in 2021). The value of future minimum
lease payments under non-cancellable operating leases is shown in the table below:
Operating leases

December 31,
2022

December 31,
2021(in thousands of Swiss francs)
410

480

Later than one year and not later than five years-

169

Later than five years

-

-

410

649

Not later than one year

Total minimum lease payments

The Organization also leases equipment under a finance lease arrangement. At the reporting date the net carrying
amount of this equipment was 0.3 million Swiss francs, and the depreciation charge for the year was 0.1 million
Swiss francs. The total value of future minimum lease payments under finance leases, and their present value, areshown in the table below:
Finance leases

December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Not later than one year

169

177

Later than one year and not later than five years

183

368

Later than five years
Total minimum lease payments

-

-

352

545

Future interest expense

-42

-92

Present value of minimum lease payments

310

453

WIPO as Lessor
The Organization has entered into a number of agreements whereby it leases space in or on its headquarters
buildings to third parties. These leases are all cancellable by WIPO subject to notification periods specified in theagreements. The total amount of rental income from these arrangements was 0.6 million Swiss francs in 2022 (0.6
million Swiss francs in 2021).
Operating leases

December 31,
2022

December 31,
2021(in thousands of Swiss francs)
337

359

Later than one year and not later than five years-

57

Later than five years

-

-

337

416

Not later than one year

Total minimum lease payments

45

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 15: Related Party Transactions
2022

2021

Number of
Individuals

Aggregate
remuneration

Number of
Individuals

Aggregate
remuneration(full-time
equivalent basis)(in thousands of
Swiss francs)(full-time
equivalent basis)(in thousands of
Swiss francs)

Director General, Deputies and Assistants

9.00

3,351

9.00

3,349

Senior Officers

11.25

3,552

11.25

3,574

WIPO is governed by the WIPO General Assembly composed of representatives of Member States party to the
WIPO Convention which are members of any of the Unions. These representatives do not receive remunerationfrom WIPO. WIPO is managed by a Director General and by Deputy and Assistant Directors General and officers(key management personnel) who are remunerated by the Organization. The aggregate remuneration paid to key
management personnel includes salaries, allowances, statutory travel and other entitlements paid in accordancewith the Staff Regulations and Rules, and applicable to all staff. In addition, the Director General, Deputy Directors
General and Assistant Directors General receive representation allowances. Key management personnel are
members of the UNJSPF to which the personnel and WIPO contribute and are also eligible for participation in thecollective medical insurance plan. Key management personnel and their aggregate remuneration are detailed in
the table above. There were no loans to key management personnel or to their close family members which were
not available to other categories of staff. There was no other remuneration or compensation to key management
personnel or to their close family members.
WIPO has no controlled entities and no interests in other entities which would require disclosure under IPSAS 3438. WIPO is a member of the UNJSPF and certain of its former staff are members of WIPO’s CROMPI. WIPO hasa relationship with the International Union for the Protection of New Varieties of Plants (UPOV) whereby the Director
General of WIPO serves as Secretary General of UPOV. The office of UPOV exercises its functions in complete
independence of WIPO. WIPO is responsible for providing space, personnel administration, financial administration,
procurement services and other administrative support to UPOV in accordance with the terms of an agreement
between WIPO and UPOV dated November 26, 1982. UPOV reimburses WIPO for the cost of such services inaccordance with the terms of said agreement. In 2022 WIPO received 618 thousand Swiss francs from UPOV tocover the cost of these services. In addition, WIPO receives reimbursement of funds disbursed on behalf of UPOV.

46

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 16: Reconciliation of Statement V and Statement II
The WIPO Program of Work and Budget is established on a modified accrual basis in accordance with the Financial
Regulations and Rules, and is approved by the Assemblies of the Member States. WIPO’s budget is adopted by
the Assemblies on a biennial basis, however, separate estimates are prepared for each of the two annual periods.
The Program of Work and Budget for the 2022/23 Biennium established a budget for the biennium of expenditureof 793.8 million Swiss francs. The WIPO Performance Report for 2022 provides an explanation of both the changes
between the original and final budget after transfers, and the material differences between the budget and the actual
amounts. WIPO’s budget and financial accounts are prepared using two different bases. The Statement of Financial
Position, Statement of Financial Performance, Statement of Changes in Net Assets and Statement of Cash Flow
are prepared on a full accrual basis, whereas the Statement of Comparison of Budget and Actual Amounts(Statement V) is prepared on a modified accrual basis. As required by IPSAS 24, reconciliation is provided between
the actual amounts on a comparable basis as presented in Statement V and the actual amounts in the financial
accounts identifying separately any basis, timing and entity differences.
Reconciliation for the year 2022
Operating

Investing

FinancingTotal(in thousands of Swiss francs)
Actual amount on comparable basis (Statement V)

46,920--46,920Depreciation and amortization-9,557---9,557

Capitalization/disposal PPE and intangible assets

-

5,288

-

5,288

Finance lease adjustments

-

-

143

143

-23,267---23,267

Changes in employee benefit liabilities
Change in allowance for receivables

70

-

-

70

Special Accounts revenue recognition-1,212---1,212

Total Basis differences-33,966

5,288

143

-28,535

Projects financed from reserves-11,962---11,962

1,242

-

-

1,242

-10,720---10,720

2,234

5,288

143

7,665

Special Accounts
Total Entity differences
Actual amount in the Statement of Financial
Performance (Statement II)

47

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 17: Expenses

2022

2021

(in thousands of Swiss francs)

Posts

241,272

235,231

Temporary staff

8,718

8,862

Other staff costs

-354

538

249,636

244,631

Total Personnel expenditure
Internships

459

388

WIPO fellowships

7,297

5,308

Total Interns and WIPO fellowships

7,756

5,696

Staff missions

2,078

68

Third-party travel

5,118

661

Training and related travel grants

1,086

735

Total Travel, training and grants

8,282

1,464

Conferences

3,567

2,269

Publishing

4

15

Individual contractual services

16,92816,243

Other contractual services

78,72781,300Total Contractual services

99,22699,827

Premises and maintenance

22,892

21,320Communication

828

1,098

Representation and other operating expenses

769

1,096

United Nations joint services

823

489

Total Operating expenses

25,312

24,003

Supplies and materials

2,740

3,247

Furniture and equipment

48

182

Equipment and supplies

2,788

3,429

Depreciation and amortization

9,557

9,604

256

244

402,813

388,898

Finance costs
Total expenses

48

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 18: Investment Gains/(Losses)
2022

2021

(in thousands of Swiss francs)
Fair value increase/(decrease) on investments
Dividends
Interest on current accounts and deposits-97,285

14,644

6,530

5,464

241

-19

Interest on investments--5

Investment management and administration cost

-577

-572

Exchange gain (loss) on investments

2,155

4,004

Exchange gain (loss) on derivative financial instruments
Total investment gains/(losses)

881

-803

-88,055

22,713

The fair value decrease on investments of 97.3 million Swiss francs represents movements in the valuation of theOrganization’s core cash and strategic cash portfolio assets at the reporting dates.

Note 19: Financial Instruments
Financial Instruments Overview
Financial instruments are categorized as follows:
Financial Assets and Liabilities

Category

Cash and cash equivalents

Amortized cost

Receivables

Amortized cost

Loans

Amortized cost

Payables and accruals

Amortized cost

Transfers payable

Amortized cost

Current accounts

Amortized cost

Derivative assets and liabilities

Fair value through surplus and deficit

Short-term investments arising from operating cash

Fair value through surplus and deficit

Held to maturity investments arising from operating cash

Amortized cost

Investments arising from core and strategic cash

Fair value through surplus and deficit

The carrying amounts of the categories of financial assets and liabilities are as follows:
December 31,
2022

December 31,
2021(in thousands of Swiss francs)
Financial assets
Amortized cost

367,135

295,514

Fair value through surplus and deficit

876,822900,672

1,243,957

1,196,186

Amortized cost

218,325

213,346

Total carrying value

218,325

213,346

Total carrying value

Financial liabilities

49

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

The Organization is exposed to certain foreign currency exchange, credit, interest rate, price and liquidity risks
which arise in the normal course of its operations. This note presents information about the Organization’s exposure
to each of the above risks and the policies and processes for measuring and managing risk.
The Organization manages its investments in accordance with its Policy on Investments. The policy contains two
specific investment policies, one covering operating and core cash and a second one covering strategic cash.
Operating cash is the cash required by the Organization to meet daily payment requirements and to ensure that an
amount equivalent to the target reserves is available in liquid assets. Core cash is the balance of cash remaining
once operating and strategic cash have been deducted. Strategic cash is the cash which has been set aside tofinance after-service employee benefit liabilities, including ASHI.
Fair Values
The fair value of the financial assets and liabilities are included at the amount at which the instrument could beexchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The following
methods and assumptions were used to estimate the fair values:••••

Cash and short-term deposits, receivables from exchange transactions, accounts payable and other current
liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments;
Quoted investments (in investment funds which are publicly traded) are based on price quotations at thereporting date;
Derivative financial instruments are based on quoted prices, adjusted for the UNORE at reporting date;
Loans and receivables are evaluated by the Organization based on parameters such as interest rates and risk
characteristics.

For WIPO’s financial assets and liabilities at the reporting date, the carrying amount is equivalent to the fair value.
Fair Value Hierarchy
For those instruments categorized as fair value through surplus or deficit, fair values are classified according to thefollowing hierarchy:•••

Quoted prices (unadjusted) in active markets for identical assets and liabilities (Level 1);
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly (Level 2);
Inputs for the asset or liability that are not based on observable market data (Level 3).
Financial Assets and Liabilities

Fair Value Hierarchy

Cash and cash equivalents

Level 1

Derivative assets and liabilities

Level 2

Investments arising from core and strategic cash

Level 1Credit Risk
Credit risk is the risk of financial loss to the Organization if counterparties to financial instruments fail to meet theircontractual obligations, and it arises principally from the Organization’s loans, receivables, cash and cash
equivalents, and investments. The carrying amount of financial assets represents the maximum credit exposure.
For the purposes of financial reporting, WIPO calculates expected credit losses allowances associated with its
financial assets.
The Organization’s receivables from non-exchange transactions are almost exclusively from its Member States
representing sovereign governments, and therefore risks related to credit are considered minor. An allowance has
been established against the asset value of accounts receivable to reflect receivables for which payment is not
anticipated in the short-term. The allowance covers amounts due from Member States that have lost the right tovote under Article 11, paragraph 5 of the WIPO Convention and contributions from least developed countries whichhave been frozen by action of the Assemblies in 1989 and 1991.
In accordance with the Organization’s Policy on Investments, deposits may only be held with institutions with aminimum short-term credit rating of A-2/P-2 or a minimum long-term credit rating of A/A2. Money market
investments, bonds, notes or other obligations and other fixed income products purchased directly by WIPO may
only be held with institutions with a minimum short-term credit rating of A-3/P-3 or a minimum long-term credit ratingof BBB-/Baa3. Where these are acquired as shares in pooled market traded funds, at least 65 per cent of theportfolio holdings must be in Investment Grade (AAA/Aaa to BBB-/Baa3), while the balance of up to 35 per cent
may be held in high yield bonds (BB+/Ba1 to C/Ca). The credit ratings attached to cash and cash equivalents andinvestments as at December 31, 2022, are as follows:

50

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Short-Term Credit Rating

A-1+

December 31, 2022

Cash and cash equivalents
Investments

Per cent

A-1

A-2/P-2

Unrated(1)

Total(in thousands of Swiss francs)

448

142,288

99,84953

242,638-

51,319-874,493925,812448

193,607

99,849874,546

1,168,450

0.0%

16.7%

8.5%

74.8%

100.0%(1) Unrated balances include cash on hand and non-current investments. Non-current investments held by WIPO are in investment funds which are
not rated by credit rating agencies, but in which the underlying investments are made in accordance with WIPO’s Policy on Investments.

Liquidity Risk
Liquidity risk is the risk of the Organization not being able to meet its obligations as they fall due.
The Organization does not have significant exposure to liquidity risk as it has substantial unrestricted cash
resources which are replenished from the results of its operations. The Organization’s Policy on Investments
requires that operating and core cash are invested in such a way to ensure the liquidity necessary to meet theOrganization’s cash flow requirements. Operating cash balances are invested over the short term (periods notexceeding twelve months to maturity) in low-risk asset classes which are easily liquidated at little or no cost. Core
cash balances are invested with the objective of generating a positive return over rolling five-year periods. Core
cash balances are invested ideally in such a way that occasional access to a portion of the cash is possible.
Strategic cash balances are invested over the long term, and currently have no short or medium term liquidity
requirements.
Currency Risk
The Organization receives revenue from fees in currencies and incurs expenses in currencies other than its
functional currency, the Swiss franc, and is exposed to foreign currency exchange risk arising from fluctuations ofcurrency exchange rates. For PCT international filing fees, WIPO establishes equivalent amounts in currencies
other than the Swiss franc, which can be reset during the year if the exchange rate between the other currency andSwiss franc is 5.0 per cent or more for more than four consecutive Fridays. The Organization is also exposed to
exchange risk arising from the currency differences between amounts payable to International Searching Authorities(ISAs) pursuant to the Regulations under the Patent Cooperation Treaty and amounts received by national patentoffices for international search fees from applicants for international patents. The Organization also operates theWIPO Fee Transfer Service, a netting structure that reduces the exposure of PCT fee income to movements incurrency exchange rates with regard to search fees.
Where investments are held in currencies other than the Swiss franc, the Organization may use derivative financial
instruments to minimize the risk arising from the fluctuation of the currency of the investment against the Swiss
franc. Investment in derivatives for speculative purposes is not permitted. As at December 31, 2022, theOrganization held US dollar and Euro investments totaling 137.5 million Swiss francs and 39.3 million Swiss francs
respectively. The sensitivity of these investments to exchange rate fluctuations is monitored, and derivative financial
instruments are used to minimize this risk.
The Organization’s contributions to the UNJSPF and its payments to ICC are made in US dollars. The Organization
has a further exposure to exchange risk in connection with the cost of pensions for staff previously enrolled in the
Closed Pension Fund who are now members of the UNJSPF. In addition, the Organization has external offices inAlgeria, Brazil, China, Japan, Nigeria, Russia and Singapore, and a coordination office in the USA, with limited
assets in local currency.
Market Risk
Market risk is the risk of changes in market prices, including interest rates, affecting the Organization’s income or
the value of its financial instrument holdings. Investment revenue is excluded from the Organization’s income
estimates for the 2022/23 Program of Work and Budget. The Organization does not currently use financial
instruments to hedge interest rate risk. WIPO’s medium-term investment portfolio (core cash) and long-term
investment portfolio (strategic cash) are subject to the risk of movements in market prices of the underlying
investment funds. Based on historical experience for the investment strategies applied to these portfolios, theexpected volatility for core cash and strategic cash is 4.90 per cent and 6.50 per cent respectively.

51

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

Note 20: Events After the Reporting Date
WIPO’s reporting date is December 31, 2022 and its financial statements were authorized for issue on the samedate as the External Auditor’s opinion.
On March 19, 2023, it was announced that UBS bank would acquire Credit Suisse bank. The Swiss Federal
Department of Finance, the Swiss National Bank and FINMA (the Swiss Financial Market Supervisory Authority)
endorsed the acquisition and subject to customary closing conditions, the transaction is expected to be completed
by the end of 2023.
Both UBS and Credit Suisse are key banking partners for WIPO. Both banks provide services including cash
management, banking, investments and currency exchange to WIPO. In addition, Credit Suisse is WIPO’s global
custody and master record keeper for investments.
WIPO does not anticipate any disruption to its banking operations related to this acquisition. Furthermore, theOrganization does not expect any financial impairment related to this transaction. With the acquisition of Credit
Suisse, WIPO will pursue a strategy to develop a stronger relationship with an alternative bank in order to bolster
diversification in its portfolio of banking service providers
There have been no other material events, favourable or unfavourable, that occurred between the reporting date
and the date when the financial statements were authorized for issue that would have had a material impact onthese financial statements.

Note 21: Segment Reporting
Segment reporting is presented in a format which represents the various Unions as the segments that make up
WIPO. The Unions were created by the various treaties administered by WIPO.
The segment reporting table is shown on the next page and should be read in conjunction with the following
explanatory notes:
•

•

•

•

•

Note 1: The Madrid Union has assumed the financing of the Hague Union’s contribution of 3 million Swiss
francs to the IT Modernization Program of the Madrid and Hague international registration systems. The amountwill be reimbursed by the Hague Union to the Madrid Union as soon as the level of reserves of the Hague
Union Reserve Fund so allows.
Note 2: In accordance with the decision of the Assemblies of the Member States of WIPO at their 55th Seriesof Meetings in 2015, the Contribution-financed Unions have assumed the financing of the deficit of the Lisbon
Union in the biennium 2016/17 amounting to 56,157 Swiss francs. The amount will be reimbursed by the Lisbon
Union to the Contribution-financed Unions as soon as the level of reserves of the Lisbon Union so allows.
Note 3: In accordance with the decision of the Assemblies of the Member States of WIPO at their 57th Seriesof Meetings in 2017: a) the Contribution-financed Unions have assumed the financing of the deficit of the Lisbon
Union in the biennium 2018/19 amounting to 1,662,315 Swiss francs; and b) the PCT Union has assumed thefinancing of the deficit of the Hague Union amounting to 18,135,044 Swiss francs. The amounts will bereimbursed by the Lisbon Union and the Hague Union, respectively, as soon as the level of reserves of theUnions so allow.
Note 4: In accordance with the decision of the Assemblies of the Member States of WIPO at their 59th Seriesof Meetings in 2019: a) as the Contribution-financed Unions do not have sufficient reserves above the target
to cover the deficit of the Lisbon Union amounting to 3,509,153 Swiss francs in 2020/21 and 1,543,632 Swiss
francs in 2022, the PCT Union has assumed the financing of the deficit of the Lisbon Union in 2020/21 and in
2022; b) the PCT Union has assumed the financing of the deficit of the Hague Union amounting to 23,667,978
Swiss francs in 2020/21 and 10,343,010 Swiss francs in 2022. The amounts will be reimbursed by the Lisbon
Union and the Hague Union to the PCT Union, as soon as the level of reserves of the Unions so allow.
Note 5: Actuarial gains/(losses) as at December 31, 2022 have been allocated based on the relative share ofheadcounts for 2022.

52

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

UNIONS

Sector Title

Contribution
Financed

PCT

MadridHague

Special
Accounts

LisbonTotal(in thousands of Swiss francs)
REVENUE
Contributions
Fees
Publications

17,605

-

-

-

-

8,439

26,044-

380,786

85,289

7,206

3

-

473,284

2

396

-

-

-

-

398

Other/miscellaneous

142-3,682

759

256

240

-

-2,285

Arbitration and Mediation

530

501

1,354

559

-

-

2,944

18,279378,001

87,402

8,021

243

8,439

500,385

-

9

1

-

-

-

10

70

-

-

-

-

-1,932-1,862

18,349378,01087,403

8,021

243

6,507

498,533

Patents and Technology

149

103,235

141

-

-

-

103,525

Brands and Designs

530-

28,628

7,590

848

-

37,596

Copyright and Creative Industries

8,539

5,325

979

-

-

-

14,843

Regional and National Development

160

25,267

4,914

791

190

-

31,322

Infrastructure and Platforms

319

12,686

3,309

453

-

-

16,767

Global Challenges and Partnerships

3,479

7,095

1,082

-

-

-

11,656IP and Innovation Ecosystems

1,223

13,074

4,943

1,291

-

-

20,531

Administration, Finance and Management

5,911

78,64729,011

6,558

604

-

120,731

Sub-total expenses on budgetary basis

20,310245,32973,007

16,683

1,642-

356,971

45

8,906

1,927

1,094

-

-

11,972

20,355254,235

74,934

17,777

1,642-

368,943

-

-

-

-

-

7,197

7,197

IPSAS adjustments to budgetary expenses and special
accounts

1,788

21,689

6,433

1,468

144

-720

30,802IPSAS adjustments to projects financed from reserves-25-2,922

-301

-881

-

-

-4,129TOTAL EXPENSES

22,118273,002

81,066

18,364

1,786

6,477

402,813

Investment gains/(losses)-1,999-79,734-6,322----88,055

SURPLUS/(DEFICIT) FOR THE YEAR

-5,76825,27415-10,343-1,54330

7,665

Net Assets as at December 31, 2021 - Actuarial
Gains/(losses) excluded

26,091

678,309

98,359-67,236-6,20075

729,398

Actuarial Gains/(Losses) as at December 31, 2021

-14,826-228,273-62,684-13,855-1,263--320,901

Net Assets as at December 31, 2021

11,265450,036

35,675-81,091-7,463

75

408,4972022 surplus/(deficit)-5,76825,27415-10,343-1,54330

7,665

Net Assets as at December 31, 2022 - Actuarial
Gains/(losses) excluded

20,323

703,583

98,374-77,579-7,743

105

737,063

Actuarial Gains/(Losses) as at December 31, 2022

-8,042-124,958-35,479-7,908-710--177,097

Net Assets as at December 31, 2022

12,281

578,625

62,895-85,487-8,453

105

559,966

Sub-total revenue excluding Reserve revenue and IPSAS
adjustments
Miscellaneous revenue projects financed from reserves
IPSAS adjustments to revenue
TOTAL REVENUE
EXPENSES

Expenses on projects financed from reserves
Sub-total expenses on budgetary basis including reserve
expensesSpecial Accounts

53

WIPO ANNUAL FINANCIAL REPORT AND FINANCIAL STATEMENTS 2022

ANNEX – EX GRATIA PAYMENTS (AUDITED INFORMATION)
Financial Regulation 3.21 states that a summary statement of ex gratia payments for the calendar year shall be
included in the annual financial statements of the Organization. There were no such payments made during 2022
and therefore no summary statement is required.

54

wipo.int© WIPO, 2023

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The CC license does not apply
to non-WIPO content inthis publication.
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WIPO Reference RN2023–24EN
DOI: 10.34667/tind.48360