Inter-organization financial reporting

(A)     General

(A1)      At its 50th session (March 1979) CCAQ considered the implications of a decision by the Preparatory Committee of ACC that CCAQ should take responsibility for certain aspects of the compilation of financial information on system-wide expenditures in given programme areas. CCAQ saw a distinction between the problems involved in defining the boundaries of such areas and those involved in assembling the relevant financial information; it questioned whether it could or should undertake to gather, analyse and report information required by central UN bodies. It believed that the most appropriate place for handling the requests might be the UN Office of Programme Planning and Co-ordination, although CCAQ could provide advice on financial problems involved (ACC/1979/R.11, paras. 13-18).

(A2)      At the 51st session (September 1979) CCAQ noted that matters relating to system-wide reporting of expenditures to intergovernmental bodies were under consideration in other parts of the ACC subsidiary machinery. It emphasized the need to avoid dispersion and duplication in this domain (ACC/1979/R.69, para. 8).

(A3)      At the 60th session (March 1984), in connection with a suggestion by CCSQ(OPS) concerning a review of financial and other reporting requirements (see para. D.1 below) the Committee examined a list of expenditure reports to central intergovernmental bodies. It agreed that costs should not be incurred for further such reports until their usefulness was evident. It would be preferable for all expenditure reporting to be on a biennial basis, and the collection of data should be simplified, harmonized and, if possible, consolidated (ACC/1984/10, paras. 16-20).

(A4)      Pursuant to a decision taken a year previously, CCAQ at its 69th session (September 1988) considered and took note of information on the main recurring reports for which system-wide financial data were required. It urged organizations and inter-organization secretariats to channel non-recurrent requests for inter-organization financial data through the CCAQ secretariat wherever possible so that use could be made of information already in CCAQ files. The Committee also believed that ACABQ might wish to include absolute dollar figures in its annual scale of assessments table (ACC/1988/13, paras. 34-36).

(A5)      At its 80th session (February - March 1994), CCAQ(FB) was informed of a suggestion, formulated by CCPOQ at its second regular session of 1993, that CCAQ(FB) should review data definition needs in the area of financial reporting. It concluded that there would be merit in the establishment and publication by CCAQ(FB), on behalf of ACC, of system-wide guidelines for financial reporting in the United Nations system. It requested its secretariat, taking account of the work in progress on expenditure reporting under the JIU formula, of the reporting conventions already developed for inter-organization reports prepared under the auspices of ACC, and of an analysis of data requirements for other financial reports prepared in the system, to submit suggestions for appropriate action for consideration at an early session of CCAQ(FB) (ACC/1994/5, paras. 34-36).

(A6)      At its February 2004 meeting (CEB/2004/HLCM/12/Rev.1, para. 26) the FB Network noted with appreciation a presentation by UNDG on Joint Programming. All organizations had received a letter from UNDG requesting organizations to comply with the enclosed revised Guidance Note on Joint Programming. The Network requested all organizations to share guidance on the accounting and financial aspects of Joint Programming by forwarding the appropriate documents to the CEB secretariat for posting on the FB Network website.

(A7)     At its July 2005 meeting (CEB/2005/HLCM/26, paras. 86-93) the FB Network reviewed progress of the Working Group on Inter-Agency Reporting. The discussion was introduced by UNFPA as a follow-up to the December 2004 meeting of the Task Force on Accounting Standards, held in Paris, which concluded that the revised format from the UNDG group should be circulated to the Task force with a view to the adoption of a common report group on Inter-Agency implementation projects. Current processes required a full mapping of input level accounts between the "funding" agency and the "expending" agency. Many organizations had designed customized reporting systems to report to each other. As ERP systems were being put in place, these old reporting systems were fading away. The UNDG Financial Policies Group had established a level of detailed reporting which lay somewhere between detailed reporting and fully consolidated reporting. The Network agreed that two alternative scenarios would be used as a basis going forward: 1. Organizations would continue to allow for full detailed reporting between agencies but individual agencies would be allowed to agree bilaterally to simplify reporting between themselves as a "pair". 2. At the same time, building on the UNDG framework, UNFPA would propose a breakdown of reporting lines for joint programming for review and eventual adoption by all member organizations. In order to develop the common framework, UNFPA would collect and compare organizations’ budgetary clusters and consolidate them in a consistent grouping.

(A9) At its seventh session (CEB/2007/HLCM/FB/10 23, para. 143), the FB Network urged its members to urgently address the issue of timeliness and reliability of financial reporting by implementing partners in such inter-agency programmes, given the recent attention of External Auditors to the quality of financial information included in UN system organizations’ financial statements in connection with inter-agency programmes (CERF, UNFIP, Mine Action programme, etc.).

(A10) At its tenth session (CEB/2009/HLCM/FB/4, paras.33-34), the FB Network took note of the observations and proposals for transparency of budgeting and reporting for security expenditures and decided to discuss and address the subject more extensively at its second 2009 session.

(A11) At its thirteenth session (CEB/2010/HLCM/FB/30, paras.50-55), the FB Network acknowledged the progress of the WG on Financial Reporting and approved harmonised expense categories for interagency reporting effective 1 January 2012. Currently the main interagency reporting standards were set by MDTF/UN CERF, UN Secretariat and UNDP. Existing September 2006 “Harmonized Financial Reporting to Donors” (MDTF) expense categories were used in joint programmes and for UN CERF financed interagency projects, however, these categories did not meet requirements of all organisations and had some inconsistencies in mappings. The survey and interviews resulted in agreeing the “7+1” revised interagency harmonised expense categories.
The Network mandated the WG to prepare a guidance note and transition arrangements for implementation of the revised expense categories; and to continue working on harmonizing donor reporting.

(A12) At its twentieth session (CEB/2010/5, paras.100-113), the Committee endorsed the FB Network decision to approve harmonised inter-agency reporting expense categories to take effect as of 1 January 2012, and encouraged the Network to look into possibility to also achieve greater harmonization in donor reporting.

(B)     ACC report on expenditures of the United Nations system in relation to programmes

(B1)      The 41st session of ECOSOC requested ACC to provide annually a report on expenditures of the UN system in relation to programmes. After a series of ad hoc meetings of senior financial and budget officers, a format was agreed and used as the basis for the 1967 report to the Council (E/4351). In the Council there was some criticism of the format, and the 29th session of CCAQ, which by March 1968 was again formally dealing with financial and budgetary matters, agreed on a revision (CO-ORDINATION/R.679, para. 6 and annex II) which was used for the 1968 report (E/4501).

(B2)      For the development of the classification of programmes by sector and sub-sector which is used in the report, see Section 16.5.

(B3)      At its 33rd session (March 1971: CO-ORDINATION/R.864 paras. 26-30 and annex C) CCAQ took decisions on a number of details of the format of the report, including retention of part III (Other budgetary provisions), the scope of the 1971 report and a CPC request for data.

(B4)      At the 45th and 46th sessions (September 1976 and March 1977), the Committee gave further consideration to the purpose and coverage of the report. It agreed that the report should present the most complete possible picture of the expenditures of the system, including the full range of the expenditures of the specialized agencies. The list of bodies to be specifically identified would be reviewed by CCAQ from time to time. While the international financial institutions would not be covered, the UNDP-financed expenditures of IBRD would be included. The expenditures of ITC would be incorporated in the UN figures and identified in footnotes. UNEP expenditures not channelled through the system would also be shown (CO-ORDINATION/R.1174, para. 9; CO-ORDINATION/R.1211, paras. 21 and 22).

(B5)      The CCAQ Working Party on Programme Planning, Budgeting and Evaluation at its 3rd session, in February 1979, considered the form of the ACC report and made several suggestions on the presentation of future reports. At its 50th session (March 1979) CCAQ agreed that the newly-revised "classification A" of programmes should be used for the 1979 report; that the scope of the report should not be changed; that the 1979 report should cover only the biennium 1978-1979 but that future reports should cover two biennia; that subject to ECOSOC agreement the report should be submitted every two years, starting in 1980; that all expenditures for items not falling under one of the headings, except expenditures for policy-making organs, should be distributed to the headings; that the detailed tables should follow the form suggested by the Working Party (ACC/1979/R.11, annex III, para. 20(d)); that figures should be in millions of dollars, to one decimal place; and that the explanatory notes should be simplified in the 1979 report and subsequently - if ECOSOC agreed - eliminated (ACC/1979/R.11, paras. 10 and 11 and annex III).

(B6)      At the 51st session (September 1979) CCAQ reviewed the preparation of the 1979 report and, in addition to matters relating to the programme classification, again considered the coverage of the report. It confirmed that the only expenditures of the system to be omitted should be those corresponding to non-project activities of the international financial institutions, including IFAD. GATT was to be asked to contribute. UNEP figures were to be included in those of UN, and a separate column was to be added for UNFPA (ACC/1979/R.64, paras. 6 and 8).

(B7)      At the 52nd session (March 1980) the Committee noted that ECOSOC had decided on 5 February 1980 that the ACC reports on expenditures should from that year onwards be submitted to it on a biennial basis. It was agreed that organizations not in a position to provide approved budget figures for the whole of a current biennium should provide provisional or preliminary estimates, identifying them as such. The Committee was also informed that GATT, which had been invited to contribute to the report on expenditures, did not feel able to do so (ACC/1980/16, paras. 11 and 12).

(B8)      At the 62nd session (March 1985) it was further agreed that in the report on expenditures:

     (a)      Non-programme expenditures of UNEP, covered by the regular budget provisions of UN for the Environment Programme, should continue to be included under the appropriate substantive headings in the figures reported by UN;

     (b)      Expenditures under the biennial budget of UNDP should be reported as global figures and mentioned in footnotes to the principal tables in the report;

     (c)      Expenditures under the biennial budget of UNFPA should be included in the amounts reported by it under "Population" (ACC/1985/7, para. 25).

(B9)      In May 1991 it was agreed in CPC that the new biennial report on programmes and resources of the system (see Section C below) would henceforth replace the ACC report on expenditures in relation to programmes (E/46/16, para. 456). The last such report was the 20th, covering expenditures for 1988-1989 and estimated expenditures for 1990-1991 (E/1990/79, of 25 June 1990).

(C)     ACC report on programmes and resources of organizations of the United Nations system

(C1)      At the 73rd session (September 1990), in response to requests from Member States in CPC and subsequent action by ACC, the Committee had before it a draft prototype prepared by the CCAQ secretariat of a new report by ACC to CPC, designed to set out comprehensive information on the programmes and resources of organizations according to the ACC programme classification, as well as parallel information on some cross-sectoral areas of special concern. The draft prototype and related material would be examined by a joint working group of CCSQ(PROG) and CCAQ(FB) following the latter's session, and a revised version would then be reviewed by the joint meeting of CPC and ACC in October; a complete presentation would be placed before CPC at its 31st session (spring 1991) (ACC/1990/12, paras. 22-24). The revised prototype was approved at the joint meeting of CPC and ACC and the final presentation duly submitted to CPC (E/1991/42/Add.1). Welcoming the report, CPC also asked ACC to continue to study the feasibility of a system-wide data base on programmes and resources. It suggested a number of improvements to the report, and agreed that a revised programme classification (see section 16.5 above) would lead to greater transparency in the description of activities. The report should henceforth be prepared biennially and should replace the ACC report on expenditures in relation to programmes (A/46/16, paras 455, 456).

(C2)      At its 80th session (February - March 1994), CCAQ(FB) noted that the third report was due for submission in 1995. Bearing in mind the relevant past discussions in CCSQ(PROG), CCAQ(FB) and the Organizational Committee, as well as the substantive nature of the report and its function as an information document for central intergovernmental bodies, the Committee recommended that the appropriate institutional location for such work would be in the United Nations and so recommended to ACC, on the understanding that the inter-organization committees concerned would supply advice in respect of its presentation and of the programme framework and financial reporting conventions to be followed (ACC/1994/5, paras. 9 - 11).

(C3)      At the request of the Organizational Committee, CCAQ(FB) considered, at its 83rd session (August - September 1995), the need for and feasibility of an overall review of the ACC standard classification. It requested that CCPOQ, when carrying out the review, should bear in mind that a change in the coding structure of subsectors involved organizations in considerable manual work in recoding existing programmes and projects in order to provide comparable data from one period to another (ACC/1995/20, paras. 14 and 15).

(C4)      At its 89th session (February 1999: ACC/1999/6, para. 31) the Committee was reminded that resumption of the ACC report on programmes and resources of the United Nations system after a hiatus of several years was in response to a General Assembly request for such data to be included in a report by the Secretary-General. Although the secretariat of CCPOQ had assumed responsibility for preparation of the report, CCAQ(FB) participants would probably wish to liaise with their counterparts in CCPOQ, given the financial statistics incorporated in the reporting. Some participants raised the issue of the amount of work involved in the preparation of this and other statistical reports and expressed the opinion that the need for such reports should be reviewed by the Committee on a regular basis. Automatic production of such reports should be avoided wherever possible.

(D)     ACC statistical report on the budgetary and financial situation of organizations of the United Nations system

(D1)      At the 74th session (March 1991), CCAQ(FB) was informed in a preliminary manner of developments in the area of administration and budgetary coordination which might affect its future work (ACC/1991/6, para. 61). In particular, the Committee was advised that ACABQ planned to discontinue production of the annual statistical data that had previously been included in its reports to the GA on administrative and budgetary coordination of the United Nations with the specialized agencies and IAEA; it was suggested that such material should henceforth be produced under the auspices of ACC. Following the session it was agreed that CCAQ(FB) should take responsibility for the tables, in a slightly modified form. They would be submitted annually to the GA in the form of a statistical report by ACC.

(D2)      At the 76th session (March 1992) the Committee had an opportunity to review in detail the first report in the new series, which had not been considered by the GA at its 46th session as originally scheduled, in view of the biennialization of the relevant agenda item. The Committee agreed to some amendments to the first report and to other changes affecting the tables in future submissions in the same series; at a later session it would review the content of the tables and consider the most suitable time to collect the data and issue the report (ACC/1992/11, paras. 25-27).

(D3)      At the 78th session (March 1993) the Committee noted that the first two issues of the report (A/47/593 and Corr.1 and A/47/786), had been submitted at the 47th session of the GA, where they had been well received. In decisions 47/449, of 22 December 1992, the GA had requested the Secretary-General to submit such reports every two years, starting with the 49th session, and to add information on assessed and voluntary contributions paid by Member and non-Member States in each of the two prior calendar years. The Committee reviewed suggestions on changes in the report to respond to this request and requested its secretariat to explore possible arrangements for the submission of inputs and dissemination of the report by electronic means (ACC/1993/7, paras. 42-44).

(D4)      At its 80th session (February - March 1994), CCAQ(FB) reviewed and approved draft layouts for the tables contained in this report which incorporated the requests for additions made at the GA=s forty-seventh session (ACC/1994/5, para. 32).

(D5)      At its 81st session (August -September 1994), CCAQ(FB) examined and approved draft tables for the above report which would presented to the forty-ninth session of the GA (ACC/1994/15, para.25).

(E)     Reports on operational activities

(E1)      At its 52nd session (March 1980) the Committee was apprised of a proposal by CCSQ(OPS) that a joint working party of the two committees should be convened to examine questions relating to reports to central intergovernmental bodies on expenditures of the UN system for operational activities. The Committee accepted this proposal. It approved revised terms of reference for the working party and arrangements for its meeting, which was to take place in December 1980 (ACC/1980/16, paras. 5-8). At the 53rd session (September 1980) the Committee reached agreements on further procedural matters concerning the working party's meeting (ACC/1980/32, para. 52).

(E2)      The report of the Joint Working Party of CCSQ(OPS) and CCAQ(FB) on Expenditure Reporting was considered at the 54th session (March 1981). The Working Party had made the following recommendations:

     (a)      Both to reduce the reporting burden imposed on organizations and to achieve consistency among expenditure reports, there should be, in principle, a single collection of the data required to respond to the requests of intergovernmental bodies for cross-organizational expenditure reports.

     (b)      Such centrally-collected data should form the basis of a computerized data base which would not be in addition to IOB's Common Register of Development Activities (CORE/1).

     (c)      The collection of data should be undertaken annually around the time of the closing of the year-end accounts.

     (d)      Purely for the purposes of cross-organizational expenditure reporting, the expenditures of the system should be classified by broad type of activity, by source of funds, by programme area and by level, in accordance with the schema and definitions adopted by the Working Party.

     (e)      A new category should be added to the ACC programme classification for management and support expenditures.

     (f)      The proposed reporting arrangements should apply to all the organizations and programmes of the system covered by the present individual reports.

     (g)      The intergovernmental bodies concerned should be invited to examine the question of expenditure reporting, with a view to rationalizing, on the one hand, those reports intended to provide a general budgetary overview (such as the ACC report on expenditures) and, on the other hand, those relating to operational activities (such as the report of the UN Director-General for Development and International Economic Co-operation on operational activities for development of the UN system, and the report of the Administrator of UNDP containing information on UN system regular and extrabudgetary technical co-operation expenditures financed from sources other than UNDP).

     (h)      Following decisions by ACC on the above proposals, further inter-organization consultations should be undertaken to work out the detailed arrangements necessary to implement those decisions.

(E3)      The Committee agreed that complete consolidation of the expenditure reports produced for central intergovernmental bodies was probably not feasible. It expressed interest in the collection of expenditure data at a single point, through a single questionnaire, and for a single data base, but thought that some questions would have to be studied in greater detail before the merits of this proposal could be ascertained. This should be done by a CCAQ working party meeting in July 1981 (ACC/1981/19, paras. 5-7). This working party was also to take account of the views expressed in the Committee on the details of the recommendations quoted above (ibid., para. 8).

(E4)      At the 55th session (September 1981) CCAQ noted that events since its last session, notably a decision of ACC concerning the future of IOB, which was responsible for one of the existing expenditure reports (CORE/1), action by ECOSOC relating to the co-ordination of information systems and recognition by CCSQ(OPS) of the impossibility of discussing expenditure reporting pending the adoption of arrangements for future inter-organization work in this field, had made it necessary to reconsider the convening of the CCAQ working party. It was suggested that the CORE/1 project represented the central data-collection system envisaged, in so far as the organizations were able to comply fully with these arrangements, but that the crucial problem lay in their ability to report expenditures for technical co-operation activities as a separate category, since this was essential for at least one of the existing reports (that of UNDP on UN system regular and extrabudgetary technical co-operation activities financed from sources other than UNDP). The Committee decided to return to these matters when the related decisions were known (ACC/1981/30, paras. 4-6).

(E5)      At the 57th session (September 1982) the Committee noted that ACC's report to ECOSOC on the strengthening of information systems contained observations on means of preparing and presenting comparable financial information on the organizations' development activities and on the need for improved inter-organization budget and expenditure reporting. CCAQ looked forward to continued involvement in work concerning financial reporting and considered that the cost aspects of developing and maintaining any system-wide data base for this purpose would have to be kept under careful review (ACC/1982/25, paras. 17 and 18).

(E6)      At the 59th session (September 1983) the Committee noted that General Assembly resolution 37/226 reverted to the question of harmonization of administrative, financial, planning and procurement procedures pertaining to operational activities for development and requested ACC to report on specific action taken in its annual overview report for 1984. The Committee requested its secretariat to prepare the necessary material (subsequently published in paras. 121-138 of E/1984/66). It also noted material prepared by the Director-General for Development and International Economic Co-operation on the harmonization of procedures in the area of operational activities (ACC/1983/21, paras. 60 and 61).

(E7)      At the 60th session (March 1984) CCAQ considered action to be taken on an observation by CCSQ(OPS) that it should review, in consultation with the latter as and when appropriate, financial and other reporting requirements. The Committee noted that ACCIS now planned a new Register of Development activities, and emphasized the importance of full involvement of financial officers; it expressed concern about the potential cost of the undertaking, whose purpose, scope and benefits remained to be defined. The possibility of convening a new working party on expenditure reporting was to be kept in mind for the future (ACC/1984/10, paras. 16-20).

(F)     Other reports to central intergovernmental bodies

(F1)      At the 50th session (March 1971), as an exception to the general position mentioned in paragraph 1 above, CCAQ agreed to prepare a paper requested by CPC on system-wide expenditures on public information activities (ACC/1979/R.11, para. 18). Developments concerning this report were reviewed at the 52nd session (March 1980), by which time a revised version had been requested for submission to CPC (ACC/1980/16, para. 13). This revised version was subsequently noted by CPC (A/35/38, paras. 223-227).

(G)     CCAQ reports on approved regular budget levels and assessed contributions payable

(G1)      At the 47th session (CO-ORDINATION/R.1238, para. 18) the Committee agreed that the CCAQ secretariat should collect and circulate data twice a year on the approved regular budgets of the organizations, for information. These arrangements were to be put into effect for one year on a trial basis.

(G2)      At the 48th session (March 1978) CCAQ considered the data referred to above; it agreed that the next such presentation should be supplemented by a table showing Member States' total net assessed contributions payable to approved regular budgets over the same 10-year span (CO-ORDINATION/R.1279, para. 20). At the 49th session (September 1978) the Committee agreed that the collection and circulation of these data should continue; tables would be prepared every six months and would cover 10 years on a rolling basis (CO-ORDINATION/R.1307, paras. 12 and 13).

(G3)      Guidelines for compiling the data on approved regular budget levels and assessed contributions payable were laid down by CCAQ at its 50th session (March 1979: ACC/1979/R.11, paras. 23 and 24).

(G4)      At the 53rd session (September 1980) CCAQ agreed that data on organizations' approved regular budget levels and assessed contributions payable should continue to be prepared and updated every six months, but that they should no longer be considered at sessions of the Committee (ACC/1980/32, para. 6). This agreement was reconfirmed at the 57th session (September 1982: ACC/1982/25, para. 7). When, in 1991, ACC assumed responsibility for the production of the statistical data previously included in reports of ACABQ on administrative and budgetary co-ordination of the United Nations with the specialized agencies and IAEA (see section D above), information on approved regular budget levels and assessed contributions payable was maintained in these reports in the same form, but its production as a separate CCAQ report was disc

(H)     CCAQ reports on the collection of assessed and voluntary contributions

(H1)      Tables showing the payment of assessed contributions, the unpaid assessed contributions of large contributors and the payment of voluntary contributions were developed in September 1982 for use in the revised version of an ACC statement on problems of cash flow and liquidity in the UN system (ACC/1982/25, paras. 41-42 and annex V; A/C.5/37/30).

(H2)      At the 58th session (March 1983) CCAQ noted the reference to the problem of delays in the payment of contributions in General Assembly resolution 37/128, which invited the governing bodies of the specialized agencies and IAEA to encourage Member States to make timely payments, and reviewed follow-up action in individual organizations. It was agreed that the tables in the ACC statement should be updated on the basis of information at 30 June 1983 (ACC/1983/11, para. 41). Having considered these tables at the 59th session (September 1983) the Committee agreed that they should be updated and resubmitted in a year's time, together with a new table dealing with accumulated arrears of assessed contributions at the beginning of each of the years covered (ACC/1983/21, para. 35).

(H3)      This material was reviewed at the 61st session (September 1984), at which time it was agreed that such tables, which might also be of interest to ACABQ in connection with its reports on administrative and budgetary co-ordination, should continue to be updated and submitted each year (ACC/1984/17, paras. 48 and 49).

(H4)      During the review of the submission made at the 63rd session (September 1985), the CCAQ secretariat was requested to contact the Executive Secretary of ACABQ to explore the possibility of arranging for a single collection of such information for reports produced by the two bodies. (Subsequent discussions between the two secretariats led to the conclusion that differences in the timing of the reports prepared by them made a single collection of data impracticable; ACABQ, however, used information collected for CCAQ purposes wherever possible.)

(H5)           In the context of its regular review of the current financial difficulties of the organizations, CCAQ decided at the 70th session (March 1989) to revise the format of its annual tables on the collection of contributions. Absolute and not just percentage figures would be shown, at 30 June and 31 December, and for assessed contributions the tables would provide individual figures for a group of major contributors, pending the later preparation of figures on all Member States (ACC/1989/7, paras. 43-47). At the 71st session (September 1989) the Committee confirmed its interest in the tables and made further refinements to them (ACC/1989/15, paras. 52-54).