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        General Assembly
2 July 1999

Original: English

Fifty-fourth session
Item 118 of the preliminary list*
Financial reports and audited financial statements,
and reports of the Board of Auditors

Note by the Secretary-General

The Secretary-General has the honour to transmit to the General Assembly a letter dated 29 June 1999 from the Chairman of the Board of Auditors transmitting the report of the Board on implementation of its recommendations, submitted in accordance with General Assembly resolution 52/212 B of 31 March 1998.

Letter dated 29 June 1999 from the Chairman of the Board of Auditors addressed to the Secretary-General

(Signed) Osei Tutu Prempeh
Auditor General of Ghana
and Chairman
United Nations Board of Auditors


Report of the Board of Auditors on implementation of its recommendations


II. General comments by the Board of Auditors

5. The Board examined the extent to which organizations had complied with the provisions of resolution 52/212 B as set out below.

1. The need for specification of timetables for implementation of recommendations

6. Out of the 13 organizations reporting on the implementation of the Board’s recommendations, 10 had generally included timetables (the United Nations, the International Trade Centre (ITC), the United Nations University (UNU), the United Nations Development Programme (UNDP), the United Nations Children's Fund (UNICEF), the United Nations Environment Programme (UNEP), the United Nations Population Fund (UNFPA), the United Nations Centre for Human Settlements (Habitat), the United Nations International Drug Control Programme (UNDCP) and the United Nations Office for Projects Services). Three organizations did not include timetables for the implementation of the majority of the recommendations, or, in some cases any of the recommendations made by the Board (the United Nations Children's Fund (UNICEF), the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), the United Nations Institute for Training and Research (UNITAR) and the United Nations Joint Staff Pension Fund).


F. United Nations Relief and Works Agency for Palestine Refugees in the Near East (A/53/5/Add. 3, chap. II) 1/

Recommendations partially implemented

28. The Board notes that action is ongoing by UNRWA in respect of the following recommendations. The Board has included comments, where appropriate:

(a) Recommendation, paragraph 8 (a). Allotments for specific purposes should only be issued after sufficient contributions have been received from donors;

(b) Recommendation, paragraph 8 (d). The Agency should review its fund-raising strategies and closely monitor its donor agreements and contract award procedures;

Comment. The Board acknowledges the efforts of the Administration towards the reduction of operating and overhead costs while concurrently soliciting the support of donors to provide services to the Palestinian refugees. The Board will, in its future audits, review the effectiveness of the ongoing review of the contract award procedures.

(c) Recommendation, paragraph 8 (e). The Project Monitoring Unit should be equipped with the required resources for more effective monitoring of UNRWA projects;

(d) Recommendation, paragraph 8 (f). Take steps to recover the amounts outstanding from donors and reimburse the General Fund from the amount of $11.2 million spent on the Gaza Hospital project;

(e) Recommendation, paragraph 41. The Administration should comply fully with the established instruction that before projects are accepted the necessary land permits should be obtained;

(f) Recommendation, paragraph 57. The selection and award of contract procedures should be refined by constantly updating the vendor register to ensure that only competent contractors are considered for UNRWA projects. Also, the Administration should closely supervise its contracts to ensure that contractors’ work meets the required standards, that cost and time over-runs are avoided and that the clause on liquidation damages is strictly enforced;

(g) Recommendation, paragraph 61. A decision should be made by the Provident Fund on investments with the countries that do not grant tax exemption to the Fund. Also, more effective measures should be undertaken to recover the outstanding taxes withheld from the Fund;

(h) Recommendation, paragraph 63. The Audit Manual should be revised to take account of the changes in the Agency’s operations;

Comment. The Board notes that the revision of the Audit Manual is in progress and trusts that this will be completed without delay.

(i) Recommendation, paragraph 66. In order to improve the efficiency of the Internal Audit, UNRWA should make budgetary provision for enhancing training of its Internal Audit staff;

(j) Recommendation, paragraph 69. Ensure that all systems are tested for year 2000 compliance, with sufficient lead-time to address any deficiencies.

Comment. The Board encourages UNRWA to ensure that its systems are year 2000 compliant and fully tested before the end of 1999 and to develop appropriate contingency plans for continuing its operations in the event of systems breakdown.

29. The Board will continue to monitor the progress of implementation of these recommendations.

* A/54/50.


1/ Official Records of the General Assembly, Fifty-third Session, Supplement No. 5C (A/53/5/Add.3), chap. II.

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