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Financial report

31 décembre 2006 Organisation mondiale de la santé

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A59/28 Page 1

Contents page Director-General's report ............................................................................................................................ 3 Audited financial statements, notes to the accounts and schedules .............................................................................................................................................10 Certification of financial statements .....................................................................................................11 Letter of transmittal ..............................................................................................................................12 Opinion of the External Auditor ...........................................................................................................13 Statements Consolidated statement of income and expenditure and changes in fund balances: all sources of funds ............................ Statement I......................................14 Other WHO funds .................................................................................. Statement I.1...................................16 Trust funds – inter-organization arrangements ...................................... Statement I.2...................................18 Trust funds – WHO programme activities ............................................ Statement I.3...................................20 Other trust funds and associated entities ............................................... Statement I.4...................................22 Transfers between funds ........................................................................ Statement I, Annex 1 ......................24 Eliminations ........................................................................................... Statement I, Annex 2 ......................25 Statement of assets, liabilities, and fund balances ................................. Statement II ....................................26 Statement of cash flow .......................................................................... Statement III ...................................27 Statement of appropriations ................................................................... Statement IV...................................28 Notes to the accounts ...................................................................................................................................29

Schedules Cash, deposits and securities ................................................................. Schedule 1 ......................................46 Cash, deposits and securities by sources of funds ................................. Schedule 2 ......................................47 Income and expenditure for the effective working regular budget ..................................................................................... Schedule 3 ......................................48 Assessed contributions – 2004-2005 and prior financial periods . ................................................................................ Schedule 4 ......................................49 Working Capital Fund & internal borrowing ........................................ Schedule 5 ......................................55 Miscellaneous Income Account ............................................................ Schedule 6 ......................................56

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All extrabudgetary funds Summary of 2004-2005 income and expenditure ..................................Schedule 7...................................... 57 Special Account for Servicing Costs .....................................................Schedule 8...................................... 58 Real Estate Fund ....................................................................................Schedule 9...................................... 59 Terminal Payments Account ..................................................................Schedule 10.................................... 60 Supply services funds (trust funds) ........................................................Schedule 11.................................... 61

Tables Financial implementation of WHO’s programme budget for 2004-2005 ................................................................................................................................................. 62 Budget and expenditure summary Regular budget by organizational level and total other sources .......................................................................................Table 1 ........................................... 64 Budget and expenditure summary by area of work - all offices ..........................................................................................Table 2 ........................................... 65 Budget and expenditure summary – by office .......................................Table 3 ........................................... 66 Budget and expenditure summary by area of work - by office: ...........................................................................................Table 4 ........................................... 69 Global (Headquarters) .......................................................................................................................... 69 Regional Office for Africa ................................................................................................................... 70 Regional Office for the Americas ........................................................................................................ 72 Regional Office for South-East Asia ................................................................................................... 74 Regional Office for Europe .................................................................................................................. 76 Regional Office for the Eastern Mediterranean ................................................................................... 78 Regional Office for the Western Pacific .............................................................................................. 80 Expenditure by sources of funds ............................................................Table 5 ........................................... 82 Financial implementation by category of expenditure and sources of funds ...........................................................................Table 6 ........................................... 83

Glossary Glossary of budgetary and financial terms .................................................................................................... 84 Report of the External Auditor to the World Health Assembly .............................................................. 86

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Director-General's report I. Introduction I am pleased to present the Financial Report of WHO for the period 2004-2005. The Report is submitted in accordance with article 34 of the Constitution and with WHO's Financial Regulations. The Financial Report for the biennium 2004-2005 has been prepared in accordance with United Nations System Accounting Standards and WHO's Financial Regulations and Financial Rules. It covers the regular budget as adopted by the Health Assembly1/ and expenditure financed from other sources, as noted by the Executive Board2/. Implementation of the programme budget is presented in the same format as the proposed programme budget 2004-2005 submitted to the Health Assembly3/ which includes the budget for other sources, thus showing the total financial position in respect of each area of work. Preparation of this Financial Report continues the process of improving the transparency and accessibility of financial information presented by the Organization. The Financial Report of WHO is an important element in the overall framework of accountability and financial integrity of the Organization. It enables Member States and other partners and collaborators to see how their funds have been used. The assets and liabilities of the Organization are also detailed, and the cash-flow analysed, to enable readers to understand the financial status of the Organization. The statutory components of the Financial Report have been audited by the Organization's External Auditor, whose opinion is included. The long-form report of the External Auditor is also included as part of this Report.

II. Financial highlights Financial highlights (US$ millions)

2004-2005

2002-2003

Budget Regular budget: 2004-2005 effective working budget was appropriated by Resolution WHA56.32 2004-2005 Other Sources, as noted by the Executive Board Total budget a/

880 1 944 2 824

856 1 380 2 236

Income Regular budget Other sources Voluntary Fund for Health Promotion WHO trust funds and United Nations programmes Total income WHO programme activities Non-WHO programme activities b/ Total income 860 1 723 401 2 984 540 3 524 853 1 030 290 2 173 434 2 607

Expenditure Regular budget Other sources Voluntary Fund for Health Promotion WHO trust funds and United Nations programmes Total expenditure WHO programme activities Non-WHO programme activities b/ Total expenditure a/ b/

871 1 623 235 2 729 628 3 357

830 1 017 201 2 048 425 2 473

See document EB113/2004/REC/2, Section 2. Non-WHO programme activities include trust funds of various programmes and entities, such as the Trust Fund for the Joint United Nations Programme on HIV/AIDS (UNAIDS); International Agency for Research on Cancer (IARC); the Global Fund to Fight AIDS, Tuberculosis and Malaria; the International Computing Centre; and Staff Health Insurance.

1/ 2/ 3/

Resolution WHA56.32. See document EB113/2004/REC/2, Section 2. Document PB/2004-2005.

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The increase in income from other sources reflects the continually changing pattern of funding the Organization. In 2004-2005 the regular budget represents 31% of the total budget, compared with 38% in 2002-2003, and only 29% of the actual total income in 2004-2005, compared to 39% in 2002-2003. Total income in 2004-2005 for WHO programme activities was US$ 2,984 million, which represents a 37% increase on US$ 2,173 million income for 2002-2003. The higher level of income has enabled WHO to meet the significantly increased programmatic activity that was planned for the 2004-2005 biennium. The rise in the United States dollar value of other sources by 61% has contributed to this growth. The trend of rising income and expenditure/implementation highlighted in Figure 1 below are welcome in view of the increasing demands being made on the Organization. Figure 1. WHO programme activities Income (US$ million)

Expenditure (US$ million)

3500 2984 3000 2371 2500 1837 2000 1528 1500 1000 500 843 1998-1999 843 2000-2001 853 2002-2003 860 2004-2005 994 1320 2173 2124 Other sources Regular budget Total

3500 3000 2500 2000 1500 874 1000 500 812 1998-1999 820 2000-2001 830 2002-2003 871 2004-2005 1686 1280 1218 2100 2048 1858 2729

Total Other sources Regular budget

Expenditure of US$ 2,729 million was incurred in achieving the expected results for the biennium 2004-2005 against a total budget for WHO programme activities of US$ 2,824 million resulting in an overall financial implementation rate of 97%. Within this figure, the implementation rate for the regular budget was 99%. This is the highest rate achievable given the need to withhold some of the budget as a contingency in view of the possibility of non-payment of assessed contributions by some Member States, and in respect of which it was not prudent to increase borrowing. For other sources the rate achieved was 96%. The continuing growth in funding for the Organization is most encouraging and the budget implementation rate achieved is excellent.

III. Financing the budget Total programme income has increased by 37%. Other sources increased by 61%, which has helped to offset the almost static regular budget. This has fundamentally shifted the overall funding structure of the Organization (see Figure 2 below). Figure 2. Assessments and other sources 2002-2005 Total Other sources Assessed contributions

3200 2800 US$ millions

2400 2000 1600 1200 800 400 0 2004-2005 2002-2003

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During the biennium, the evolution of other sources income has not always been consistent. Timing of receipt of large contributions and significant shifts in income from certain United Nations trust funds can cause availability of resources to be uneven in terms of both timing and alignment with the approved programme budget. A full analysis of other sources for 2004-2005 is contained in the Annex to the Audited Financial Report for the biennium 2004-2005.1/ Member States are the most important source of other sources funds, representing approximately 63% or US$ 1,268 million of all other sources income during the biennium 2004-2005, compared to approximately 58% or US$ 789 million during 2002-2003, as illustrated in Figures 3 and 4 below. Figure 3. Other sources for WHO programme activities 2004-2005 United Nations and intergovernmental organizations 16.0%

Member States 62.7%

Private sector 1.1% Foundations 9.4% Interest income 1.3% Supply services funds 4.8% Nongovernmental organizations 2.9% Oil for Food 0.4% Local governments, cities, institutions 1.4%

Figure 4. Other sources for WHO programme activities 2002-2003 United Nations and intergovernmental organizations 9.0% Private sector 5.1% Member States 57.8% Foundations 9.0% Nongovernmental organizations 3.7% Interest income 3.9% Oil for Food 7.1% Local governments, cities, institutions 1.5%

Supply services funds 2.9%

Document A59/28 Add.1.

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Combining regular budget and other sources, Member States provided 71% of the total income in 2004-2005, compared to 76% in 2002-2003. Total contributions from Member States, including both regular budget assessments and other sources for the biennium 2004-2005 and for the biennium 2002-2003 are shown in Figures 5 and 6 below. These charts indicate that the Organization continues to rely heavily on a relatively small number of Member States as a major source of financing of the budget.

Figure 5. Assessments and other sources from Member States 2004-2005 450 400 350 US$ millions Assessments Other sources

300 250 200 150 100 50 0 tat es of Un Am ite d K erica ing do m 1/ Ja pa n Ca na da No rw ay Sw ed en Fr an ce Ge rm an y I Ne taly the rla nd s Au str a li a Sp ain Ot De he rM nm ar em k be rS tat es Other sources

Un ite dS

Figure 6. Assessments and other sources from Member States 2002-2003 400 350 300 US$ millions Assessments

250 200 150 100 50 0 of Am Un ite d K erica ing do m 1/ Ja pa n Ca na da Ne the rla nd s Ge rm an y No rw ay Sp ain Au str Me mb alia er St ate s Ot he r Fr an ce Sw ed en De nm ar k Ita ly

United Kingdom of Great Britain and Northern Ireland.

Un ite dS tat es

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The regular budget is financed by assessed contributions and Miscellaneous Income. Net assessments in 2004-2005 were US$ 863 million, of which US$ 810 million was collected during the biennium, a collection rate of 94%, which is consistent with recent bienniums. In order to achieve the regular budget implementation rate of 99%, the Working Capital Fund of US$ 31 million was fully drawn down and was supplemented by US$ 13 million of internal borrowing. Although the overall implementation rate of 97% is an excellent achievement, it was reached only by resorting to borrowing, and it is a concern that in 2004-2005 US$ 53 million, or 6% of assessed contributions, were not paid. Total unpaid assessed contributions, including amounts due for previous financial periods, are US$ 146 million. Within this figure, long-term arrears stand at US$ 93 million, having increased from US$ 88 million at the end of the biennium 2002-2003. Discussions are under way with a number of the concerned Member States to resolve these longstanding arrears through repayment plans that are submitted to the Health Assembly for approval. I am pleased to note that a number of such repayment plans were approved during the biennium, and that as a result some Member States with longstanding arrears have recently resumed payments. I take this opportunity to encourage those Members States which experience difficulty in paying their arrears to discuss payment arrangements with the Secretariat so that their proposals may be submitted to the Health Assembly for its consideration. Miscellaneous Income is used to finance the regular budget by reducing the amount payable on assessed contributions. For 2004-2005, US$ 36 million was budgeted to finance in part the regular budget and to meet the requirements of the adjustment mechanism and the financial incentive scheme.

IV. Expenditure During 2004-2005, country and regional offices accounted for 62% of expenditure, and headquarters for 38%. This compares with 56% for country and regional offices and 44% for headquarters in 2002-2003. Figure 7 below shows, as a percentage, expenditure from all sources of funds by office, i.e. headquarters and each regional office (including country offices) for 2004-2005 and for 2002-2003. The biennium 2004-2005 shows a welcome reversal of the rising trend of expenditure by headquarters evidenced in 2002-2003. Figure 7. Expenditure all sources of funds, regional offices and global (headquarters) 2004-2005 and 2002-2003 (percentage) 2004-2005 Europe Western Pacific 5% 6% 3%

2002-2003 Europe Western Pacific

The Americas Eastern Mediterranean

5% 6% 4% Headquarters

The Americas Eastern Mediterranean

Headquarters 38%

13%

10% 9%

44% 10%

Africa 25%

South-East Asia

Africa

22%

South-East Asia

Detailed information by area of work and by office is shown in the section Financial Implementation of WHO's Programme Budget 2004-2005, Tables 1 to 4 of this Report. Table 2 summarizes expenditure by area of work for all offices by regular budget and by other sources. The areas of work with the biggest expenditures are immunization and vaccine development (which includes eradication of poliomyelitis); emergency preparedness and response, and information technology and infrastructure services. Implementation rates for areas of work for 2004-2005 vary from 208% for emergency preparedness and response to 57% for women's health. Such variations stem largely from the uneven patterns of income noted above.

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Financial implementation by category of expenditure for 2004-2005 and 2002-2003 is shown in Figure 8 below.

Figure 8. Financial implementation by major category of expenditure 2004-2005 and 2002-2003 (US dollars thousands)

2004-2005 Category of expenditure Staff costs Supplies, materials, communications, contributions in kind Local cost-subsidies Contracts, translations, printing, data processing Consultants/temporary advisers Furniture and equipment, including information technology Travel on official business Fellowships and other educational activities Research contracts US$ 1 222 532 427 332 113 105 92 69 55 % 40 17 14 11 4 4 3 2 2

2002-2003 US$ 934 382 317 251 117 140 73 66 55 % 40 16 14 11 5 6 3 2 2

The most significant category is staff costs, reflecting the fact that WHO is a technical organization. The recent creation of the knowledge management programme, and considerable investments in staff development, staff security and other initiatives related to human resources help to ensure that the personnel receive appropriate support. Expenditure on local cost-subsidies, supplies, materials, telecommunications and fellowships helps to support much of WHO's work in countries. More detailed information on financial implementation by category of expenditure and by type of fund for 2004-2005 is contained in the section on Financial Implementation, Table 6 of this Report.

V. Liquidity management The financial stability of the Organization depends not only upon timely receipt of income but also on effective management of liquidity and foreign-exchange risk, and on appropriate investment and foreignexchange policies. In this regard, I receive advice from an expert advisory committee that regularly reviews performance and makes recommendations on the strategy to adopt in the light of market conditions, and given the paramount importance of preserving capital. Investment management operations Total cash and investments for the Organization at 31 December 2005 were US$ 1,797 million, the investment of which is summarized in Schedule 1 of this Report. These investments represent cash and investment assets for fund balances which total US$ 1,442 million, as shown in Statement I. The balance of US$ 355 million represents mainly funds for unliquidated obligations, and Member States advance payment of assessed contributions for 2006. The investments are primarily short term, being held in respect of programmes financed under the regular budget, and other resources, for which cash has yet to be expended. A total of US$ 370 million are held for longer term funds, primarily the Staff Health Insurance Fund and the Terminal Payments Account, and a total of US$ 325 million is invested on behalf of non-WHO entities.

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Foreign currency hedging operations The value of certain non-dollar regular budget expenditures has been protected from the impact of the declining value of the United States dollar during the biennium. Protection is effected by entering forward currency and option contracts. A total of US$ 30 million was credited against regular budget expenditures in 2004-2005, resulting from the cash flow of these operations. Hedging operations, however, can only protect the Organization from the exchange-rate fluctuations during the current biennium. For the biennium 2006-2007, it is expected that the weaker dollar will have a significant impact on the purchasing power of that budget, particularly in relation to disbursements in Swiss francs, euros and Danish kroner. Compared with 2004-2005, it is estimated that the dollar cost of non-dollar expenditures may be approximately US$ 50 million higher in 2006-2007. Comparing 2002-2003 with 2004-2005, the difference due to the weaker dollar is approximately US$ 100 million. VI. Conclusion I have noted the comments made by the External Auditor in his long-form report to the Health Assembly included in this Report. All the matters raised will be considered promptly by the Secretariat and appropriate action will be taken. The growth in financial resources and increasing complexity of the demands being made upon the Organization pose challenges for future financial management. Many of the policies and procedures that underpin accountability and financial integrity were developed for a centralized Organization and are supported by information technology systems that reflect this centralized approach. With the creation of the global management system, modern financial-management policies and practices are being established on the basis of the best practice followed in the public and private sectors. These new policies will be implemented in 2006-2007 and will lead to greater simplification and clarity in WHO's financial reporting.

LEE Jong-Wook Director-General

Geneva, 04 April 2006

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Audited financial statements, notes to the accounts and schedules 2004-2005

This part of the Financial Report presents the overall financial position of the Organization as at 31 December 2005. The audited statements, notes and supporting schedules have been prepared in compliance with the Organization’s Financial Regulations, Financial Rules and the United Nations System Accounting Standards. The notes to the accounts are an integral part of the financial statements; the schedules provide further details and explanations in support of individual funds and special accounts administered by the Organization. Where appropriate, comparative figures have been provided in respect of the previous biennium.

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Certification of financial statements

The attached statements, numbered I to IV, notes to the accounts and schedules 1 to 11, are approved.

Nicholas R. Jeffreys Comptroller

LEE Jong-Wook Director-General

04 April 2006

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5th April, 2006

LETTER OF TRANSMITTAL

The President of the World Health Assembly World Health Organization CH-1211 Geneva 27 Switzerland

Dear Sir/Madam

I have the honour to present to the Fifty-ninth World Health Assembly my Report and Opinion on the Financial Statements of the World Health Organization for the financial period 1 January 2004 to 31 December 2005. In transmitting my Report I wish to advise that, in accordance with the World Health Organization's Financial Regulations, I have given the Director-General the opportunity to comment on my Report and it is issued on the basis of the assurance that he does not have any significant comment.

Yours sincerely

Vijayendra N. Kaul Comptroller and Auditor-General of India External Auditor

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Opinion of the External Auditor

To the World Health Assembly We have audited the accompanying financial statements, comprising Statements I to IV, Schedules 1 to 11 and the supporting Notes of the World Health Organization for the financial period ended 31 December 2005. These financial statements are the responsibility of the Director-General. My responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Common Auditing Standards of the Panel of External Auditors of the United Nations, the specialized agencies and the International Atomic Energy Agency and conforming with International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, and as considered by the auditor to be necessary in the circumstances, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the Director-General, as well as evaluating the overall financial statement presentation. I believe that our audit provides a reasonable basis for the audit opinion. In my opinion, these financial statements present fairly, in all respects, the financial position of the World Health Organization as at 31 December 2005 and the results of operations and cash flows for the period then ended in accordance with the stated accounting policies set out in the Statement of Accounting Policies, which were applied on a basis consistent with that of the preceding financial period. Further, in my opinion, the transactions of the World Health Organization which we have tested as part of our audit have, in all significant respects, been in accordance with the Financial Regulations and Legislative Authority. In accordance with Regulation XIV of the Financial Regulations, I have also issued a long-form report on my audit of the World Health Organization's financial statements.

Vijayendra N. Kaul Comptroller and Auditor-General of India External Auditor New Delhi, India 5th April 2006

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Statement I Consolidated statement of income and expenditure and changes in fund balances: all sources of funds Financial period 2004-2005 (in thousands of US dollars) Regular a/ Budget (Schedules 4,5,6) Voluntary Fund for Health Promotion (A59/28 Add.1) Other WHO funds (Statement I.1) Trust funds (Statement I.2, I.3, I.4)

Reference

Income: Assessed contributions: For the effective working budget (2004-2005) Adjustment mechanism Financial incentive scheme New and formerly inactive Members Total assessed contributions Voluntary contributions: WHO programme activities Non-WHO programme activities Other income: Assessment relief forgone by Member States Revenue-producing activities Funds under inter-organization arrangements Income from services rendered Interest income: - interest -shared exchange differential Gains (losses) on hedging operations Other Total income Expenditure: WHO programme activities Non-WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Provision for delays in the collection of assessed contributions Payment of assessed contributions of prior periods' Savings on prior periods' unliquidated obligations Increase in Capital Assets Transfers between funds Adjustment to fund balances Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005 Note 9 Note 5 Note 13 Note 6 Note 4

858 475 (12 364) (1 574) 844 537

4 626

1 698 786

269 228 535 951

8 160 164 818 15 972 320 56 790 844 537 1 723 432 250 686

49 29 306 27 435

24 646 Note 7

174 624 1 036 593

871 163 871 163 (26 626)

1 623 160 1 623 160 100 272

237 100 32 385 269 485 (18 799)

300 612 622 796 923 408 113 185

Note 10

(52 981) 32 744

12 204 5 992 (2 310) 97 962 455 885 553 847 (35 574) (36 177) 215 903 179 726

20 854 2 310 6 031 142 380 506 633 649 013

Annex 1

35 574 (11 289) (1 744) (13 033)

Statement III Statement II Statement II

The accompanying notes and schedules are an integral part of the financial statements. a/

Includes Working Capital Fund.

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Statement I (continued)

Members' Equity in capital assets

Sub-totals

Eliminations (Statement I, Annex 2)

Totals 2004-2005 2002-2003

Income: 863 101 (12 364) (1 574) 849 163 863 101 (12 364) (1 574) 849 163 795 193 (22 695) 4 772 502 Assessed contributions: For the effective working budget (2004-2005) Adjustment mechanism Financial incentive scheme New and formerly inactive Members Total assessed contributions Voluntary contributions: 1 968 014 535 951 (32 150) 1 935 864 535 951 1 143 130 388 861 WHO programme activities Non-WHO programme activities Other income: 8 209 29 306 164 818 68 053 320 231 414 3 855 248 8 209 29 306 (164 818) 68 053 320 (133 736) (330 704) 97 678 3 524 544 83 974 (859) 2 972 69 845 2 607 504 5 477 7 302 134 300 Assessment relief forgone by Member States Revenue-producing activities Funds under inter-organization arrangements Income from services rendered Interest income: - interest - shared exchange differential Gains (losses) on hedging operations Other Total income Expenditure: 3 032 035 655 181 3 687 216 168 032 (303 365) (27 339) (330 704) 2 728 670 627 842 3 356 512 168 032 2 047 634 424 925 2 472 559 WHO programme activities Non-WHO programme activities

Total expenditure Excess (shortfall) of income 134 945 over expenditure Provision for delays in the collection of assessed contributions Payment of assessed contributions of prior periods' Savings on prior periods' unliquidated obligations Increase in Capital Assets Transfers between funds Adjustment to fund balances

4 987

(52 981) 44 948 26 846 4 987 6 031

(52 981) 44 948 26 846 4 987 6 031 197 863 1 243 804 1 441 667

(49 908) 59 045 26 245 239

4 987 67 127 72 114

197 863 1 243 804 1 441 667

170 566 Total changes in fund balances 1 073 238 Fund balances - 1 January 2004 1 243 804 Fund balances - 31 December 2005

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Statement I.1 Other WHO funds Financial period 2004-2005 (in thousands of US dollars)

Reference

Miscellaneous income (Schedule 6; Note 8)

Casual income appropriated for priority programmes

Real Estate Fund (Schedule 9)

Security Fund (Note 34)

Other Funds (Note 28)

Income: Assessed contributions: For the effective working budget (2004-2005) New and formerly inactive Members Total assessed contributions Other income: Assessment relief forgone by Member States Revenue-producing activities Income from services rendered Interest income: - interest - shared exchange differential Gains (losses) on hedging operations Other Total income Expenditure: WHO programme activities Non-WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Payment of assessed contributions of prior periods' Savings on prior periods' unliquidated obligations Transfers between funds Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005 Note 10 Annex 1 Statement I Statement II Statement II Note 9 Note 5 Note 6

698 7 645 320 2 045 10 010 44 44 159 156

1 443 138

5 820 6 677

8 910 9 066

10 271 11 852

(14) 6 573 (14) 6 573

10 303 10 303

7 536 2 801 10 337

10 010 12 204 5 992 (35 574) (7 368) 9 800 2 432

104

(1 237)

1 515

58 (58)

104 1 038 1 142

(1 237) 1 466 229

1 515 4 441 5 956

The accompanying notes and schedules are an integral part of the financial statements.

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Statement I.1 (continued)

Revolving Sales Fund (Note 11)

Information Technology Fund (Note 35)

Special Account for Servicing Costs (Schedule 8)

Tax Terminal Equalization Payments Fund Account Totals (Note 3) (Schedule 10) 2004-2005 2002-2003

Income: Assessed contributions: 4 626 4 626 4 626 4 626 2 667 4 2 671 For the effective working budget (2004-2005) New and formerly inactive Members Total assessed contributions Other income: 6 019 919 149 698 4 675 15 120 2 280 8 160 164 818 15 972 320 56 790 154 373 4 626 17 400 250 686 5 478 6 621 134 032 27 162 (859) 2 972 15 730 193 807 Assessment relief forgone by Member States Revenue-producing activities Income from services rendered Interest income: - interest - shared exchange differential Gains (losses) on hedging operations Other Total income Expenditure: 7 843 7 843 13 223 13 223 198 209 9 109 198 209 9 109 13 902 13 902 237 100 32 385 269 485 139 535 25 079 164 614 WHO programme activities Non-WHO programme activities Total expenditure Excess (shortfall) of income over expenditure

29 700 6 019 30 619

(1 824)

17 396

(43 836)

(4 483)

3 498

(18 799) 12 204 5 992 (35 574)

29 193

3 416 Payment of assessed contributions of prior periods' 8 705 Savings on prior periods' unliquidated obligations (77 736) Transfers between funds (36 422) Total changes in fund balances 252 325 Fund balances - 1 January 2004 215 903 Fund balances - 31 December 2005

(1 824) 6 475 4 651

17 396 1 950 19 346

(43 836) 136 103 92 267

(4 483) 1 777 (2 706)

3 498 52 911 56 409

(36 177) 215 903 179 726

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Statement I.2 Trust funds – inter-organization arrangements Financial period 2004-2005 (in thousands of US dollars)

Technical cooperation UN Development Programme UN Population Fund UN Environment Programme UN Drug Control Programme

Reference

Income: Other income: Funds under inter-organization arrangements Interest income Other Total income Expenditure: WHO Programme activities Note 9 Note 13

632 8 640

8 532 8 8 540

771

207

771

207

1 441

9 893

771

Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds Adjustment to fund balances Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005 Note 33 Statement I

1 441 (801) 25

9 893 (1 353) 67

771

37 170 20

5 500 4 724 (2 704) (1 286) (1 703) 20 190 (170)

Statement II

2 020

(2 989)

The accompanying notes and schedules are an integral part of the financial statements.

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Statement I.2 (continued)

Technical cooperation UN Iraq Programme SCR 986 Other UN funds

Supply services Other UN organizations Totals 2004-2005 2002-2003

Income: Other income: 8 796 32 (224) 8 604 2 130 8 238 2 130 8 238 29 306 32 (208) 29 130 134 300 1 606 (1 329) 134 577 Funds under inter-organization arrangements Interest income Other Total income Expenditure: 1 444 2 270 11 067 26 923 150 544 WHO programme activities

1 444 7 160 6 145

2 270 (140) 78 (1 444)

11 067 (2 829)

26 923 2 207 6 335 (1 444) 5 500

150 544 (15 967) 506 552

Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds Adjustment to fund balances

13 305 (13 305)

(1 506) 2 340

(2 829) 4 546

12 598 (10 976)

(14 909) Total changes in fund balances 3 933 Fund balances - 1 January 2004 (10 976) Fund balances - 31 December 2005

834

1 717

1 622

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Statement I.3 Trust funds – WHO programme activities Financial period 2004-2005 (in thousands of US dollars)

Global Programme Reference on AIDS

Technical cooperation African Onchocerciasis Programme for Control Onchocerciasis a/ a/ Control Programme

Sasakawa Health a/ Trust Fund

TDR

a/ b/

Income: Voluntary contributions: WHO programme activities Other income: Revenue-producing activities Interest income Other Total income Expenditure: WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005 Annex 1 Statement I Note 9 Note 5

22 470

5 304

63 009

5 6 83 18 6 106 398 144 23 012 5 708 404 982 (679) 63 312

26 159 26 159 6 106 311 (291) (285) 285 417 1 851 1 545 2 278 (3 147) 4 692

9 311 9 311 (3 603) 482

65 699 65 699 (2 387) 1 594 2 280

(3 121) 10 131

1 487 17 309

Statement II

2 268

3 823

7 010

18 796

The accompanying notes and schedules are an integral part of the financial statements.

See Annex (doc A59/28 Add.1) for detailed financial statements. TDR: Trust Fund for the UNICEF/UNDP/World Bank/WHO Special Programme for Research and Training in Tropical Diseases. c/ HRP: Trust Fund for the UNDP/UNFPA/WHO/World Bank Special Programme of Research, Development and Research Training in Human Reproduction. b/

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Statement I.3 (continued)

Technical cooperation Associate Professional HRP a/c/

Other technical cooperation funds

Supply services National health services and institutions

Totals 2004-2005 2002-2003

Officers

Income: Voluntary contributions: 20 696 6 468 61 540 89 741 269 228 183 791 WHO programme activities Other income: 44 279 (9) 21 010 6 513 61 546 89 741 45 6 49 2 203 (526) 270 954 681 4 108 (39) 188 541 Revenue-producing activities Interest income Other Total income Expenditure: 26 113 26 113 (5 103) 761 852 (3 490) 8 122 (71) 3 295 6 251 23 848 5 213 2 879 6 584 6 584 (71) 55 295 55 295 6 251 84 528 84 528 5 213 273 689 273 689 (2 735) 7 840 2 841 7 946 69 998 77 944 180 720 180 720 7 821 11 356 1 104 WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds

20 281 Total changes in fund balances 49 717 Fund balances - 1 January 2004 69 998 Fund balances - 31 December 2005

4 632

3 224

30 099

8 092

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Statement I.4 Other trust funds and associated entities Financial period 2004-2005 (in thousands of US dollars)

Reference

Trust Fund for the Joint United International Nations Programme Agency for on HIV/AIDS Research on (UNAIDS) Cancer (Note 14) (Note 14)

International Computing Centre (Note 14)

Staff Health Insurance (Notes 14, 15)

Income: Voluntary contributions: Non-WHO programme activities Other income: Interest income Other Total income Expenditure: Non-WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds Adjustment to fund balances Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005 Annex 1 Note 36 Statement I Note 9

369 564

60 635

5 812 1 339 376 715 60 635 62 950 62 950

19 124 111 069 130 193

315 853 315 853 60 862 3 274 914

60 102 60 102 533 286 531

55 849 55 849 7 101 343

87 109 87 109 43 084

65 050 134 102 199 152

1 350 22 596 23 946

7 444 3 073 10 517

43 084 267 616 310 700

Statement II Statement II

The accompanying notes and schedules are an integral part of the financial statements.

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Statement I.4 (continued)

The Global Fund to fight AIDS, Tuberculosis and Malaria (Note 14)

Other funds (Note 16)

Totals Foundations (Note 17) 2004-2005 2002-2003

Income: Voluntary contributions: 100 000 4 454 1 298 535 951 388 861 Non-WHO programme activities Other income: 151 113 25 200 175 358 100 000 4 605 1 411 736 509 31 006 126 260 546 127 Interest income Other Total income Expenditure: 100 117 100 117 (117) 2 776 3 625 3 625 980 141 141 1 270 622 796 622 796 113 713 6 679 914 531 2 659 12 798 15 457 980 5 253 6 233 1 270 2 172 3 442 121 837 447 610 569 447 136 189 311 421 447 610 415 615 415 615 130 512 5 677 Non-WHO programme activities Total expenditure Excess (shortfall) of income over expenditure Savings on prior periods' unliquidated obligations Transfers between funds Adjustment to fund balances Total changes in fund balances Fund balances - 1 January 2004 Fund balances - 31 December 2005

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Statement I, Annex 1 Transfers between funds a/ (in thousands of US dollars)

Funds

Appropriated for the effective working budget, 2004-2005 (Financial Regulation 6.5 and Resolution WHA56.32)

Other Programme Transfers

Total

Regular Budget and Working Capital Fund Miscellaneous Income Voluntary Fund for Health Promotion TDR HRP b/

(35 574) 35 574 852 (1 444) 623 2 280 (2 280) (852) 291 (291) 1 444 (623)

(35 574) 35 574 2 310 (2 280) (852) 291 (914) 1 444 -

Global Programme on AIDS UNAIDS UNICEF Trust Fund Net transfers

These transfers between funds were made to implement decisions by the Health Assembly, and other programme transfers are in accordance with established accounting practices. b/ Trust Fund for the UNICEF/UNDP/World Bank/WHO Special Programme of Research and Training in Tropical Diseases. c/ Trust Fund for the UNDP/UNFPA/WHO/World Bank Special Programme of Research, Development and Research Training in Human Reproduction.

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Statement I, Annex 2 Eliminations (in thousands of US dollars)

Originating Fund Regular Budget

Expenditure

Receiving Fund TDR a/ African Programme for Onchocersiasis Control Real Estate Fund Security Fund Information Technology Fund HRP b/ Special Account for Servicing Costs TDR a/ Special Account for Servicing Costs Special Account for Servicing Costs Special Account for Servicing Costs

Income

2 009 50 5 820 2 910 9 700 3 180 2 393 1 190 300 3 740 2 069

United Nations Population Fund TDR a/

African Programme for Onchocerciasis Control

Supply Services - Iraq Trust Fund The Global Fund to fight AIDS, Tuberculosis and Malaria Voluntary Fund for Health Promotion UNAIDS

222 505 24 993 3 501 863 15 120 79 083 10 224 6 000 20 000

TDR a/ HRP b/ Voluntary Fund for Health Promotion Special Account for Servicing Costs Special Account for Servicing Costs Terminal Payments Account Staff Health Insurance Staff Development Security Fund Information Technology Fund

222 505 24 993 3 501 863 15 120 79 083 10 224 6 000 20 000

International Computing Centre All funds

Special Account for Servicing Costs

Voluntary Fund for Health Promotion and other funds - Programme Support Costs

136 832

Special Account for Servicing Costs

136 832

Total elimination of expenditure

330 704

Total elimination of income

330 704

a/ b/

Trust Fund for the UNICEF/UNDP/World Bank/WHO Special Programme for Research and Training in Tropical Diseases. Trust Fund for the UNDP/UNFPA/WHO/World Bank Special Programme of Research, Development and Research Training in Human Reproduction.

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Statement II Statement of assets, liabilities, and fund balances as at 31 December 2005 (in thousands of US dollars) Reference 2005 2003

Assets Cash at banks, in transit and on hand Deposits and securities Accounts receivable Assessed contributions receivable from Member States Less : Provision for delays in the collection of assessed contributions Net assessed contributions Sundry debtors Total accounts receivable Prepaid expenses Interest receivable Construction in progress Capital assets

Schedule 1, Note 18 Schedule 1

96 186 1 701 251

119 128 1 342 530

Schedule 4

145 559 (145 559) 63 955 63 955

137 526 (137 526) 56 266 56 266 1 365 4 929 2 890 67 127

Note 20

Note 21 Note 18 Note 27 Note 22

16 623 17 718 26 510 76 307

Total assets

1 998 550

1 594 235

Liabilities and fund balances Liabilities Members' contributions received in advance Unliquidated obligations Accounts payable Loan repayable Total liabilities Fund Balances Trust funds Voluntary Fund for Health Promotion Regular Budget and Working Capital Fund Other WHO funds Members' equity in capital assets Total fund balances

Note 24 Note 25 Note 26 Notes 27, 32

50 328 434 209 42 517 29 829 556 883

46 686 247 250 53 663 2 832 350 431

Statements I.2,I.3,I.4 Statement I Statement I Statement I.1 Statement I

649 013 553 847 (13 033) 179 726 72 114 1 441 667

506 633 455 885 (1 744) 215 903 67 127 1 243 804

Total liabilities and fund balances

1 998 550

1 594 235

The accompanying notes and schedules are an integral part of the financial statements.

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Statement III Statement of cash flow Financial period 2004-2005 (in thousands of US dollars)

2002-2003 2004-2005 (re-stated, note 37)

Cash flows from operating activities Total changes in fund balances (Statement I) (Increase)/decrease in accounts receivable - sundry debtors (Increase)/decrease in prepaid expenses Increase/(decrease) in contributions received in advance Increase/(decrease) in unliquidated obligations Increase/(decrease) in accounts payable Less : Interest income included in fund balances Net cash flows from operating activities Cash flows from investing and financing activities (Increase)/decrease in deposits and securities Increase/(decrease) in loan payable Plus : Interest income included in fund balances Less : Interest receivable Net cash flows from investing and financing activities Cash flows from other sources (Increase)/decrease in land and buildings (Increase)/decrease in construction in progress Net cash flows from other sources Net increase/(decrease) in cash Cash as at 1 January 2004 and 2002 Cash as at 31 December 2005 and 2003 (9 180) (23 620) (32 800) (22 942) 119 128 96 186 (240) (2 890) (3 130) (11 054) 130 182 119 128 (358 721) 26 997 68 373 (12 789) (276 140) (59 066) 2 832 83 115 11 461 38 342 197 863 (7 689) (15 258) 3 642 186 959 (11 146) (68 373) 285 998 123 994 (10 705) 250 11 517 (103 298) 15 091 (83 115) (46 266)

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Statement IV Statement of appropriations Financial period 2004-2005 (in thousands of US dollars)

Appropriation section 1. Communicable diseases 2. Noncommunicable diseases and mental health 3. Family and community health 4. Sustainable development and healthy environments 5. Health technology and pharmaceuticals 6. Evidence and information for policy 7. External relations and governing bodies 8. General management 9. Director-General, Regional Directors and independent functions 10. WHO's presence in countries 11. Miscellaneous Effective working budget 12. Transfer to Tax Equalization Fund Total

Amounts Transfers Transfers between approved by sections made by the between sections Effective resolution Director-General as % of approved appropriations appropriations WHA56.32 (Note 38)

Expenditure (Note 38)

Unobligated balance of appropriations (Note 38)

93 025 69 616 60 340 81 802 49 728 175 451 44 055 139 294 21 670 111 130 34 000 880 111 80 000 960 111

957 (4 010) (6 034) (5 370) (3 776) (4 537) (854) (2 616) 2 670 24 250 (680)

1.03 (5.76) (10.00) (6.56) (7.59) (2.59) (1.94) (1.88) 12.32 21.82 (2.00)

93 982 65 606 54 306 76 432 45 952 170 914 43 201 136 678 24 340 135 380 33 320 880 111 80 000 960 111

92 734 64 973 53 701 75 553 45 627 169 258 42 811 135 168 24 092 134 266 32 980 871 163 80 000 951 163

1 248 633 605 879 325 1 656 390 1 510 248 1 114 340 8 948

8 948

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Notes to the accounts

Statement of objectives 1.1 The objective of the World Health Organization, contained in Article 1 of the Constitution, is the "attainment by all peoples of the highest possible level of health". 1.2 In order to achieve this objective, the functions of the Organization have been established and are contained in Article 2 of the Constitution. 1.3 The General Programme of Work 2002-2005, approved by World Health Assembly resolution WHA54.1 provides the policy framework for the Programme Budget 2004-2005. 1.4 The Fifty-sixth World Health Assembly in May 2003 (WHA56.32) resolved to appropriate an Effective Working Budget of $ 880.1 million for the financial period 2004-2005. The Health Assembly also noted estimated expenditure of $ 1 825 million to be financed from other sources. This figure was subsequently revised upwards to $ 1 944 million as noted by the 113th Session of the Executive Board in January 2004.

Statement of accounting policies 2.1 General accounting policies The accounting policies and financial reporting practices applied are based upon the WHO Financial Regulations and Financial Rules. Where the Regulations and Rules do not provide explicit provisions, the requirements of the United Nations System Accounting Standards (UNAS) apply. The financial statements, accompanying notes and schedules are in accordance with the UNAS and are drawn up on the basis of the formats defined therein. 2.2 Presentation of financial statements The financial statements, notes, schedules and accompanying tables are presented in US dollars. All assets and liabilities, including accounts receivable and payable, are pooled within the Organization’s books of account. 2.3 Foreign currency translation Translation into US dollars of transactions expressed in other currencies is effected at the prevailing United Nations accounting rate of exchange, as applicable at the date of the transaction. However, imprest account expenditure transactions are accounted for at the accounting rate of exchange in effect at the date expenditures are recorded in the main accounts. Assets and liabilities held in other currencies at the end of the year are also translated into US dollars at the United Nations accounting rate of exchange prevailing for the month of December of the closing year. However, when significant changes occur in the exchange rates at the end of the year, the rates used “as at 31 December” are those in force on 1 January of the subsequent year. In the current financial period, no substantial change occurred between the exchange rates in force at the end of 2005 and those in force on 1 January 2006. 2.4 Accounting for exchange differential Exchange rate gains and losses on the purchase and sale of currencies, revaluation of cash book balances, and all other exchange differences are adjusted against the funds and accounts participating in the apportionment of interest under the WHO general investment plan.

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2.5 Assessed contributions Income from contributions from Members and Associate Members for the effective working budget 20042005 is recorded on the basis of assessments approved by the World Health Assembly. In accordance with Financial Regulation 7.1, pending receipt of assessed contributions, implementation of the regular budget may be financed from the Working Capital Fund and thereafter by internal borrowing against available cash reserves of the Organization, excluding Trust Funds. A provision is established for delays in collection of contributions amounting to 100% of the assessed contributions outstanding at 31 December 2005. The total amount of the provision is shown in Schedule 4. When outstanding assessed contributions are paid, the amounts are credited first against any outstanding internal borrowing and then against any borrowing from the Working Capital Fund. In accordance with Financial Regulation 8.1 (h), any payments of arrears of contributions due from Member States that are not required to repay borrowings from internal borrowing and from the Working Capital Fund are credited to Miscellaneous Income. 2.6 New and formerly inactive Members Income from assessed contributions from new and formerly inactive Members is subject to Financial Regulation 6.12. Such income is recorded on a cash basis (i.e. as received) and is credited to Miscellaneous Income. 2.7 Tax Equalization Fund In accordance with Health Assembly resolution WHA21.10, under which the Tax Equalization Fund was established, the assessed contributions of all Members are reduced by the income generated by the staff assessment plan. In determining the reduction of assessed contributions to be applied to the Members concerned, the Tax Equalization Fund is credited with the revenue from the staff assessment plan, the credits being recorded in the name of individual Members, in proportion to their assessments for the relevant financial period. For those Members that levy income tax on emoluments received from the Organization by their nationals or others liable to such taxes, the credit from the staff assessment plan is charged with the estimated amount to be levied by those Member States. Those amounts which have been charged are, in turn, used by the Organization to reimburse income tax paid by the staff concerned. 2.8 Voluntary contributions Voluntary contributions for WHO programme activities are recorded on a cash basis. Contributions in kind or in services received by WHO are recorded upon receipt. They are treated both as income and expenditure in the Voluntary Fund for Health Promotion where they are recorded at a fair value based on estimates provided by the donor. 2.9 Letters of credit The funds available from donors under these facilities are recorded as income in the accounts of the Organization when actually drawn down, according to programme requirements. 2.10 Other trust funds WHO administers other trust funds and entities that do not form part of WHO’s programme activities; contributions for these trust funds and entities are also recorded on a cash basis. 2.11 Revenue-producing activities Income is recorded on a cash basis. 2.12 Interest income Interest earned on funds and accounts invested on a pooled basis is apportioned monthly in proportion to their capital at the end of each month. Earnings on investments made for specific funds are credited directly to the funds concerned. Interest is adjusted by the exchange differential arising from currency and revaluation operations. Interest earned and apportioned during the financial period to specific WHO accounts, trust funds and the Voluntary Fund for Health Promotion, is retained for use within those accounts and funds.

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2.13 Expenditure Expenditure (obligations) under all funds administered by WHO for technical assistance, supply services and other WHO programmes is recorded on an accrual basis. With the exception of some activities financed under interagency arrangements (e.g. United Nations Development Programme, United Nations Population Fund and other United Nations organizations for which WHO is executing agency) expenditure is established in accordance with Financial Regulation IV and Financial Rule VI. Where expenditure against the aforementioned funds is provided under interagency arrangements, such expenditure is established and maintained in accordance with the financial regulations of the respective funding agencies. For other trust funds and entities administered by WHO and which do not form part of WHO programme activities, expenditure is recorded on an accrual basis. That part of an obligation which has not yet been paid (i.e. an outstanding liability) is shown in the balance sheet as an unliquidated obligation. 2.14 Savings on prior periods’ unliquidated obligations Unliquidated obligations relating to prior financial periods are settled during the current financial period in accordance with Financial Regulation 4.5. Variances on settlement are debited/credited to the relevant fund. 2.15 Eliminations The accounts of the Organization incorporate programme activities under the regular budget and those under extrabudgetary sources of financing, other WHO funds and associated entities. In order to preserve fund integrity and for transparency, income and expenditure are recorded separately for each individual fund. Income can be transferred from one fund to another fund in which case the amount is recorded as expenditure in the originating fund and as income in the receiving fund. However, income and expenditure are also consolidated in the Organization’s accounts and financial statements to give an overall picture of the costs of WHO programme activities and of other entities administered by WHO. In such circumstances, consolidation produces a duplication of income and expenditure which must be eliminated in order to reflect the net costs of programme delivery. Programme support costs (PSC) are recorded both as income and expenditure through the accounting for extrabudgetary funds and the Special Account for Servicing Costs giving rise to duplication on consolidation which must also be eliminated. 2.16 Cash at banks and in transit and on hand Imprest account balances only reflect disbursements recorded up to 30 November 2005 in order to ensure a consistent cut off throughout the Organization. Disbursements that have not been accounted for in December 2005 will be accounted for against the liquidation of the relevant expenditure (obligations) and bank balances in 2006. 2.17 Deposits and securities Funds in currencies other than US dollars are accounted at their US dollar equivalent based on the United Nations accounting rate of exchange. Securities are accounted for at current market value. Market values are determined using the market price for a particular security on the last business day of the year. In accordance with Financial Regulation 11.1, funds not required for immediate use may be invested. All investments are carried out within the framework of investment policies approved by the Director-General. These policies are regularly reviewed by the Advisory Investment Committee, which includes external investment specialists. The Committee makes recommendations to the Director-General as and when the Committee considers it appropriate. The Investment Policy reflects the nature of the WHO funds, which may be held for the shortterm, pending programme implementation, or for the longer term in order to meet liabilities under the Staff Health Insurance Fund and other long-term funds of the Organization. Investments are recorded at current market value and investment income is recorded on an accrual basis. However, for the structured investment products of which the calculation of interest rate will not be made until the end of the interest period, the income is recognized on a cash basis and the accrued interest is not recorded.

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2.18 Capital assets and Members’ equity in capital assets The value of capital assets represents the cost at the time of acquisition or construction or, in the case of donated properties, the value as advised by the donor. No adjustment is made for depreciation. In certain regional office locations, WHO occupies premises made available to it by the host country concerned, either at no cost or on a rental basis. The costs of improvements or extensions to such premises which have been borne by WHO are not recorded as capital assets in the accounts of the Organization but are charged to expenditure. 2.19 Non-expendable equipment In accordance with established accounting policy, non-expendable equipment (including furniture, computers and other office equipment and motor vehicles) is charged to expenditure at cost. An inventory of nonexpendable equipment is maintained and the value disclosed in these notes. For reporting purposes, only those items with a cost value of $ 2 500 and above are included, whereas in previous biennia all items with a cost value of $ 500 and above were included. 2.20 Working Capital Fund and internal borrowing Pending the receipt of assessed contributions, implementation of the regular budget may be financed from the Working Capital Fund and thereafter by internal borrowing against available cash reserves of the Organization, excluding trust funds. Amounts borrowed are repaid from the collection of arrears of assessed contributions which are credited first against any internal borrowing outstanding and then against any borrowing outstanding from the Working Capital Fund. 2.21 Foreign exchange hedging In accordance with Financial Regulation 4.4, foreign exchange hedging seeks to maintain the level of the budget, irrespective of the effect of any fluctuation of currencies against the US dollar. The amounts available for hedging are approved by the World Health Assembly for the financial period concerned. The exact method of hedging is determined in accordance with the investment policy, which specifies permitted hedging instruments: namely forward foreign exchange and option contracts. The exchange rate to be protected and prevailing market conditions are also taken into account. Costs associated with the purchase of foreign currency options are recorded at the time of purchase and are expensed in the biennium to which they relate. Gains (losses) on forward contracts and any gains on option contracts are taken to income (or expenditure) when the contracts mature.

Tax Equalization Fund In 2004-2005, income credited to the Tax Equalization Fund is derived as follows: 2004-2005 (US dollars) 2002-2003 (US dollars)

Staff Assessment (Statement IV, Appropriation Section 12) Less: Credits to Members Total

80 000 000 75 374 110 4 625 890

80 000 000 77 333 220 2 666 780

Contribution in kind or in services Voluntary contributions include contributions in kind or in services amounting to $ 51.7 million for 2004-2005 ($ 80.8 million in 2002-2003).

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Revenue-producing activities Revenues comprise the following: rental from staff accommodation credited to the Real Estate Fund; rentals from concessionaires at Headquarters credited to the Special Account for Operation of Concessions; sale of WHO publications and other promotional material; income from rights and royalties credited to the Revolving Sales Fund; and revenue derived from patent policy credited to the Special Account for Income Derived from Patent Policy.

Income from services rendered This item refers to income from programme support costs levied against programme expenditure under extrabudgetary financed activities and fees received from the provision of administrative services to other entities. Income earned is credited to the Special Account for Servicing Costs. Transfers to the Terminal Payments Account are also shown under this heading.

Foreign exchange hedging transactions arising in 2004-2005 Exchange gains on foreign exchange hedging contracts in 2004-2005 amounted to $ 29.6 million ($ 40.9 million in 2002-2003) all of which have been recorded in the regular budget. Summary of outstanding options as at 31 December 2005 (in relation to 2006-2007 hedging contracts) WHO has the option to sell: USD USD USD USD 75 000 000 180 000 000 70 000 000 15 000 000 and buy CHF if the market rate is lower than and buy CHF if the market rate is lower than and buy EUR if the market rate is more than and buy EUR if the market rate is more than 1.3000 1.1750 1.3000 1.1850 at USD 1.00 = at USD 1.00 = at USD 1.30 = at USD 1.185 = CHF 1.30 CHF 1.175 EUR 1.00 EUR 1.00

WHO has the obligation to sell: USD USD USD 60 000 000 25 000 000 60 000 000 and buy CHF if the market rate is more than and buy CHF if the market rate is more than and buy CHF if the market rate is more than 1.2750 1.3505 1.4050 at USD 1.00 = at USD 1.00 = at USD 1.00 = CHF 1.275 CHF 1.30 CHF 1.275

Forward contracts as at 31 December 2005 (in relation to 2006-2007 hedging contracts) In addition WHO has forward contracts to sell USD 120 million and buy CHF at the rate USD 1.00 = CHF 1.271 and to sell USD 30 million and buy EUR at the rate of USD 1.213= EUR 1.00 The above option contracts wherein WHO may be obliged to sell represents an either/or scenario with the contracts wherein WHO has the option to sell. That is, on the expiry date of the above contracts, either WHO will exercise its option or will be obliged to sell, depending on the market rate. Net premiums paid on these contracts amounting to $ 16.1 million have been recorded as prepaid expenses as at 31 December 2005 ($ 1.0 million at 31 December 2003). Unrealized net losses on these contracts amounted to USD 3 020 327 as at 31 December 2005 (unrealized net gains $ 13.1 million at 31 December 2003). Realized gains or losses on these contracts will be recorded on maturity of the contracts and applied during 2006-2007.

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Miscellaneous income - other This includes: 2004-2005 (US dollars) 2002-2003 (US dollars)

Refunds and rebates Exchange differential Sale of equipment and material Revenue from the Swiss postal authorities Underground parking operations Settlement of Casual Income appropriated for priority programmes Total

602 211 988 231 167 120 307 637 (20 151) 2 045 048

850 387 1 214 372 254 519 23 781 937 3 101 238

Expenditure Expenditure for WHO programme activities includes technical cooperation and supply services. Expenditure for non-WHO programme activities relates to funds or entities for which the Organization has administrative responsibility or some other interaction.

10. Payment of assessed contributions of prior years Arrears of assessed contributions collected in 2004-2005 in respect of the prior financial periods have been applied as follows: 2004-2005 (US dollars) 2002-2003 (US dollars)

Repayments on internal borrowing outstanding as at 1 January 2004 and 2002 Repayments of Working Capital Fund outstanding as at 1 January 2004 and 2002 Total repayments of borrowings Credited to Miscellaneous Income Total arrears of assessed contributions collected

1 743 968 31 000 000 32 743 968 12 203 848 44 947 816

24 628 307 31 000 000 55 628 307 3 416 473 59 044 780

11. Revolving Sales Fund In accordance with Health Assembly resolutions WHA22.8 and WHA55.9, this fund is credited with proceeds from the sale of publications, international certificates of vaccination, films, videos, DVD's and other information material. The related costs of production and printing are charged to the fund.

12. Special Account for Operation of Concessions at Headquarters Established by the Director-General under the terms of the Financial Regulations, this account is credited with all amounts paid by concessionaires for space, equipment and other facilities made available by the Organization. The cost of repairs, utilities, maintenance work and replacement of equipment are charged against the account.

13. Funds under inter-organization arrangements These represent cash drawings from the United Nations Development Programme, the United Nations Population Fund, the UN Iraq Programme under Security Council resolution 986, and other organizations and bodies of the United Nations system. Such drawings are made in order to finance activities funded by those agencies for which WHO is the executing or associated agency.

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14. Trust funds not part of WHO's programme activities In accordance with the Financial Regulations, the Director-General has established trust funds to record the financial operations of various programmes and entities that are not considered part of WHO's programme activities. The funds included are: Trust fund for the Joint United Nations Programme on HIV/AIDS (UNAIDS) International Agency for Research on Cancer (IARC)

- International Computing Centre (ICC) For each of these funds, detailed financial reports are issued and are subject to audit by the WHO External Auditor. Trust funds not part of WHO's programme activities also include the WHO Staff Health Insurance (SHI) and the Global Fund to Fight AIDS, Tuberculosis and Malaria (GFTAM).

15. Staff Health Insurance The income of the Staff Health Insurance Fund consists of contributions received in respect of both active and retired staff (of which one-third is paid by the participants and two-thirds by the Organization) as well as interest earned on investments. In order to ensure the adequate funding of future claims from retired staff, a fixed percentage (currently 25%) of active staff contributions is set aside each year. The remaining 75% of contributions are required to meet current claims from active staff. The balance of the fund at 31 December 2005, $ 310.7 million, is held to satisfy statutory reserves as follows: 31 December 2005 (US dollars) 31 December 2003 (US dollars)

Settlement of outstanding claims (SHI rule 470.1) Future costs of retired staff (SHI rule 470.2)a/ Reserve for major claims and cost of reinsurance (SHI rule 470.3) Total

14 676 678 272 031 000 23 992 623 310 700 301

11 441 025 218 020 000 38 154 842 267 615 867

16. Other trust funds Special Fund for Compensation This fund was set up by the Director-General under the Financial Regulations for the payment of periodic benefits awarded to staff members under WHO compensation rules for service-incurred accidents and illnesses. It is financed by funds allocated to cover the cost of employing the staff member in question; by the credit of benefits received from the commercial accident and illness insurance policy established for this purpose, and by any interest earned. Due to Estates of Deceased Staff Members These funds reflect balances due on accounts of deceased staff members, pending the conclusion of legal and other succession-related formalities. Other Trust Funds held by WHO These funds relate to balances held on behalf of interagency and other entities for which WHO has responsibility as trustee.

The most recent actuarial valuation of the future cost of retired staff, dated July 2004, estimates an Accumulated Post-retirement Benefit Obligation (APBO) for retirees of $ 370.0 million ($ 224.5 million in June 2000).

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17. Foundations This comprises foundations for which WHO holds funds in trust and is responsible for financial and administrative management. At 31 December 2005, the foundations were as follows: Darling Foundation Down Syndrome Research Prize in the Eastern Mediterranean Region Dr A.T. Shousha Foundation Dr Comlan A.A. Quenum Prize Ihsan Dogramaci Family Health Foundation Jacques Parisot Foundation Léon Bernard Foundation Professor Francesco Pocchiari Fellowship Prize State of Kuwait Prize for the Control of Cancer, Cardiovascular Diseases and Diabetes in the Eastern Mediterranean Region State of Kuwait Prize for Research in Health Promotion United Arab Emirates Health Foundation

18. Cash, deposits and securities Cash, deposits and securities are held on behalf of the Organization, including the Voluntary Fund for Health Promotion, its special accounts and trust funds and the various foundations and entities administered by WHO. Cash at banks, in transit and on hand This represents the aggregation of all the Organization's liquid resources (including cash, bank accounts, and funds in transit) and amount to $ 96.2 million at 31 December 2005 ($ 119.1 million at 31 December 2003). Within this figure, imprest account disbursements which have not been accounted for in the financial period, amount to $ 58.3 million ($41.6 million at 31 December 2003). These disbursements will be accounted for against the liquidation of the appropriate unliquidated obligations and bank balances in 2006. Short-term fixed income in US dollars These are invested in cash and high quality, short dated, government, agency, and corporate bonds as defined in the approved investment policy. Long-term fixed income in US dollars These are invested in high quality, medium and long dated, government, agency, and corporate bonds. They represent funds managed for the Staff Health Insurance Fund and the Terminal Payments Account as defined in the approved investment policy. Equity investments in US dollars In accordance with approved investment policy, this portfolio represents funds managed for the Staff Health Insurance Fund. Total cash, deposits and securities as at 31 December 2005 This figure includes $ 636.1 million ($ 478.2 million at 31 December 2003) held by WHO on behalf of UNAIDS, International Agency for Research on Cancer, International Computing Centre, Staff Health Insurance, The Global Fund to fight AIDS, Tuberculosis and Malaria, and Foundations. Interest receivable shown in Statement II is the amount of accrued interest from the Organization's direct investments, mainly time deposits. The total earnings from cash, deposits and securities for 2004-2005 was $ 68.1 million ($ 84.0 million in 2002-2003) after taking into account an exchange differential loss of $ 8.1 million. $ 8.0 million of total earnings ($ 9.2 million in 2002-2003) related to the Regular Budget and was credited to Miscellaneous Income.

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19. Letters of credit At 31 December 2005, in addition to actual cash resources on hand, undrawn balances under letters of credit received from the United States of America, amounted to $ 139.7 million ($ 111.7 million at 31 December 2003). These relate to the following activities: 31 December 2005 (US dollars) 31 December 2003 (US dollars)

The US Agency for International Development Voluntary Fund for Health Promotion Trust Fund for the Joint United Nations Programme on HIV/AIDS (UNAIDS) The US Environment Protection Agency Voluntary Fund for Health Promotion Total 1 567 169 139 656 990 2 761 238 111 732 402 125 939 821 12 150 000 99 131 164 9 840 000

20. Sundry debtors Sundry debtors, detailed below, comprise payments due from other international organizations, advances made to staff members in accordance with the regulations and rules of the Organization, guarantee deposit accounts and other debtors. This item includes certain expenses that will be charged against corresponding reserves for unliquidated obligations, or other appropriate accounts in 2006. 31 December 2005 (US dollars) 31 December 2003 (US dollars)

Personal accounts of WHO staff - advances Due from other United Nations organizations and agencies, institutions, governments and ministries, firms, corporations and other entities, for goods and services provided Clearance accounts WHO/UNAIDS service clearance accounts with UNDP Other debtors Guarantee deposits Total

24 264 672

17 976 211

15 164 082 5 512 012 17 124 102 1 635 088 254 707 63 954 663

25 119 689 12 526 707 507 596 135 412 56 265 615

21. Prepaid expenses The amount of $ 16.6 million ($ 1.4 million at 31 December 2003) represents disbursements made in respect of obligations against the next financial period and will be charged as expenditure in that period.

22. Capital assets These assets represent WHO and other trust fund properties at headquarters and in regional office locations. The properties have either been purchased, constructed or received as donations. The land upon which buildings have been erected is either owned by the Organization /trust fund or has been made available by the host country concerned, at no cost or at a nominal annual ground rent.

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The cost of land and buildings at each location comprises the following: 31 December 2003 (US dollars) 31 December 2005 (US dollars)

2004-2005 Additions 761 168 521 232 521 232 Disposals

WHO offices Headquarters Regional Office for Africa Regional Office Africa Region - other Total: Regional Office for Africa Regional Office for South-East Asia Regional Office for the Eastern Mediterranean Regional Office for the Western Pacific Total WHO IARC - Lyon (Note 36) Total 67 126 944 7 012 106 1 249 634 8 261 740 1 483 295 12 088 203 3 696 336 67 126 944 3 704 422 4 986 822 4 193 504 9 180 326 7 533 338 1 249 634 8 782 972 1 483 295 12 088 203 7 400 758 72 113 766 4 193 504 76 307 270 41 597 370 42 358 538

23. Non-expendable equipment The total value at cost at 31 December 2005 amounted to $ 80.1 million ($ 125.7 million at 31 December 2003).

24. Members’ contributions received in advance At 31 December 2005 some Members had, either in full or in part, made advance payments against their regular budget contributions for 2006 and future years. In addition, certain Members had received credits against assessed contributions for the current biennium, which will be offset against future assessments. In total, contributions received in advance at 31 December 2005 amounted to $ 50.3 million ($ 46.7 million at 31 December 2003).

25. Unliquidated obligations 31 December 2005 (US dollars) 31 December 2003 (re-stated, note 37) (US dollars)

Programme activities WHO Programme Activities Regular Budget Other WHO funds Voluntary Fund for Health Promotion Inter-organization arrangements Trust funds Total unliquidated obligations - WHO programme activities Non-WHO Programme Activities Trust Fund for the Joint United Nations Programme on HIV/AIDS International Computing Centre The Global Fund to fight AIDS, Tuberculosis and Malaria Trust funds, Foundations and other funds Total unliquidated obligations - Non-WHO programme activities Total

43 539 187 18 605 709 205 574 509 7 659 237 87 933 150 363 311 792 39 926 284 2 574 389 23 463 929 4 932 109 70 896 711 434 208 503

50 862 686 11 876 268 107 219 907 11 626 302 35 026 978 216 612 141 15 937 264 2 494 776 11 846 657 359 404 30 638 101 247 250 242

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26. Accounts payable 31 December 2005 (US dollars) 31 December 2003 (US dollars)

Accounts payable Personal accounts of WHO staff – proceeds of claims and other amounts due Due to other United Nations organizations and agencies, institutions, government ministries, firms, corporations and other entities, for goods and services received Due to United Nations Joint Staff Pension Fund for contributions and other payments outstanding UNAIDS/UNDP Operating Fund Clearance accounts Total 4 280 693 3 522 304

10 138 489 17 354 328 5 652 834 5 090 885 42 517 229

5 479 403 1 063 607 12 514 964 31 082 541 53 662 819

27. Construction in progress and loan from the Swiss Confederation The World Health Assembly, in resolutions WHA55.8 and WHA56.13, authorized the Director-General to proceed with the construction of a new building at headquarters for WHO and UNAIDS at a cost estimated at CHF 66 000 000, of which WHO's share was estimated at CHF 33 000 000. The Swiss Confederation has agreed to provide an interest-free loan to WHO and UNAIDS of CHF 59 800 000 of which WHO’s share is CHF 29 900 000. The Health Assembly also approved the use of the Real Estate Fund for the repayment over a 50-year period of WHO's share of the interest-free loan provided by the Swiss Confederation with effect from the first year of the completion of the building. The amount of construction in progress reflects expenditure incurred on the building up to 31 December 2005 and the loan repayable at 31 December 2005 represents the amount of the loan received from the Swiss Confederation on that date.

28. Other WHO funds 31 December 2005 (US dollars) 31 December 2003 (US dollars)

Revolving Fund for Teaching and Laboratory Equipment Special Account for Concessions at Headquarters Special Account for Income Derived from Patent Policy Staff Development Fund Total

400 000 2 817 591 4 060 2 734 721 5 956 372

400 000 4 036 186 3 910 4 440 096

29. United Nations Joint Staff Pension Fund WHO is a member organization participating in the United Nations Joint Staff Pension Fund (UNJSPF) which was established by the United Nations General Assembly to provide retirement, death, disability and related benefits. The Pension Fund is a funded defined benefit plan. The financial obligation of the Organization to the UNJSPF consists of its mandated contribution at the rate established by the United Nations General Assembly 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 provision of Article 26, following determination that there is a requirement for deficiency payments based on an assessment of the actuarial sufficiency of the Fund as of the valuation date. At the time of this report the United Nations General Assembly had not invoked this provision.

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30. Administrative waivers, amounts written-off, cases of fraud, ex-gratia payments During 2004-2005, there was one administrative waiver for $ 14 488; twenty-one cases of amounts written-off totalling $ 3 203 886 which includes $ 2 803 358 relating to war and civil disturbances in Afghanistan, Iraq and Liberia; four cases of proven fraud for $ 358 400; three cases of presumptive fraud for $ 16 336; and two ex-gratia payments for $ 171 563. In addition, further cases have been reported and these are being investigated.

31. Contingent liabilities At 31 December 2005, there were pending legal proceedings against the Organization concerning: one accident involving a WHO vehicle; a rental issue at one WHO office; two alleged contractual obligations; one issue concerning alleged fraudulent fuel trafficking; and cases of alleged unlawful dismissal by 28 former staff members. In addition, there are several claims that are currently being processed; they involve four alleged contractual obligations, an alleged obligation due to one former staff member and one case relating to alleged ecological damage caused by the construction of the WHO/UNAIDS building. These claims are not deemed to be of material significance. Finally, there were outstanding personnel matters before the ILO Administrative Tribunal. These are currently being contested by the Organization. The legal proceedings have not progressed sufficiently to determine the extent of any liability of the Organization with any degree of certainty.

32. Agreement with Compass Group (Suisse) SA In November 2000, the Organization entered into an agreement with Compass Group (Suisse) SA (Compass Group) to extend and modify restaurant accommodation at Headquarters in Geneva. Under the terms of this agreement, Compass Group financed the cost of the extension to the Organization by CHF 1.2 million ($ 1.1 million) in the form of a loan to WHO. Under the terms of the loan provided by Compass Group, interest was charged at 4%. The loan, originally scheduled to be repaid over a nine year period which started in 2001 has been fully repaid in 2005. The payments of interest and principal were charged to the Special Account for Concessions at Headquarters. At 31 December 2005, the balance of the loan was zero. The capital expenditure portion of the extension amounted to $ 0.8 million and is included in the capital assets of the Organization.

33. United Nations Development Fund - adjustment to fund balance At country level, WHO and UNAIDS use the United Nations Development Programme (UNDP) to make payments and to provide services and administrative support. To finance these activities, WHO transfers money to UNDP on a monthly basis. In previous years, WHO and UNAIDS activities were included in the fund balances on Statement I.2. To provide more transparency, the balances on the WHO and UNAIDS service clearance accounts with UNDP are now shown under sundry debtors and accounts payable and the figures under UNDP on Statement I.2 relate solely to programme activities undertaken by WHO as executing agency.

34. Security Fund In view of the increased importance attached to the provision of security for WHO staff, the Director-General established a Security Fund, under Financial Regulation 9.3, to record the income and expenditure related to provision of security coordination both through reimbursement of WHO's share of the United Nations systems' costs and those pertaining to the Secretariat. This fund may be financed by way of appropriation from the regular budget and from other sources including the Special Account for Servicing Costs. Costs pertain to the provision of security services for staff in all locations who are engaged in work that is funded by both the regular budget and other sources.

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35. Information Technology Fund The Information Technology Fund was established in 2002-2003 by the Director-General under Financial Regulation 9.3 to meet the current and future administrative information requirements of the Organization. This fund may be financed by way of appropriation from the regular budget and from other sources including the Special Account for Servicing Costs. This financing reflects the fact that the systems will support management of programmes funded by both the regular budget and extrabudgetary contributions.

36. International Agency for Research on Cancer - adjustment to fund balance IARC's financial statements were consolidated on a cash basis in previous biennia and are now consolidated on an accrual basis in conformity with the United Nations System Accounting Standards. The amount of $ 530 670 represents a one time adjustment to reflect IARC's unliquidated obligations and capital assets as at 1 January 2004.

37. Re-statement of 2002-2003 comparative figures The presentation of some figures in 2004-2005 has made it necessary to re-state relevant 2002-2003 figures for comparative purposes.

38. Statement of appropriations for the financial period 2004-2005 Transfers from the regular budget Expenditure figures for this period include transfers from the regular budget of $ 2.0 million to the UNICEF/UNDP/World Bank/WHO Special Programme for Research and Training in Tropical Diseases; of $ 0.05 million to the African Programme for Onchocerciasis Control; of $ 5.8 million to the Real Estate Fund; of $ 2.9 million to the Security Fund; and of $ 9.7 million to the Information Technology Fund. Unobligated balance of appropriations The unobligated balance of regular budget appropriations at the end of the financial period could either be funded in total, in part, or not at all depending on the extent to which assessed contributions have been collected. Any funded part of the unobligated balance of regular budget appropriations is credited to miscellaneous income. The unfunded part of the unobligated balance of regular budget appropriations represents the amount of the effective working budget that has not been implemented. The unfunded part is credited to miscellaneous income only when the underlying outstanding assessed contributions are collected. At 31 December 2005, the unobligated balance of regular budget appropriations of $ 8.9 million was all unfunded. Transfers between sections of the Appropriation Resolution Paragraph 3.1 of the Appropriation Resolution for the financial period 2004-2005 (resolution WHA56.32) states "notwithstanding the provisions of Financial Regulation 4.3, the Director-General is authorized to make transfers between appropriation sections of the effective working budget up to an amount not exceeding 10% of the amount appropriated for the section from which the transfer is made; all such transfers shall be reported in the financial report for the financial period 2004-2005; any other transfers required shall be made and reported in accordance with the provisions of Financial Regulation 4.3".

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All transfers between appropriation sections made by the Director-General during the 2004-2005 biennium were within the authority granted under the Appropriation Resolution and were effected in order to meet changing programme needs. However, an additional requirement under one allocation in a given section may be frequently offset by a reduced requirement under another allocation in the same appropriation section, thereby avoiding the need for a transfer. The regular budget transfers made in the course of the implementation of the 2004-2005 programme budget are summarized as follows: 2004-2005 (US dollars)

Appropriation Section 1 - Communicable diseases Increase: African Region Implementation variances and priority programmes South-East Asia Region Western Pacific Region Decrease: European Region Eastern Mediterranean Region Global and interregional Net increase Regional priorities and increased staff costs Avian flu and new activities in communicable disease prevention and control, malaria, and tuberculosis Reallocation based on regional review Reallocation due to organizational change and country-level programme changes Reductions to fund UN Common Services and statutory meetings partly offset by increases for avian flu activities

365 000 829 000 586 000

(353 000) (354 000) (116 000) 957 000

Appropriation Section 2 - Noncommunicable diseases and mental health Increase: Eastern Mediterranean Region Global and interregional Decrease: African Region Reallocation to priority programmes, including strengthening of WHO's presence in countries Transfer to strengthen country offices, to regional priorities and to cover implementation variances Reallocation based on regional review Transfer to priority programmes (2 503 000) Support to regional priorities and region-wide activities Minor adjustment 461 000 15 000

South-East Asia Region European Region Western Pacific Region Net decrease

(1 276 000) (557 000) (150 000) (4 010 000)

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2004-2005 (US dollars)

Appropriation Section 3 - Family and community health Increase: Western Pacific Region Increased requirements in priority, country level programmes Global and interregional Decrease: African Region South-East Asia Region European Region Eastern Mediterranean Region Net decrease Priority activities and additional support to HIV

620 000 418 000

Transfer to priority programmes and to cover cost increases in country presence Reallocation to regional priorities and strengthening of country offices Reallocation based on regional review Organizational changes, transfers to region-wide activities and implementation variances

(4 682 000) (830 000) (527 000) (1 033 000) (6 034 000)

Appropriation Section 4 - Sustainable development and healthy environments Increase: Global and interregional Decrease: African Region South-East Asia Region European Region Eastern Mediterranean Region Net decrease Organizational changes and reinforcement of priority activities 1 623 000

Reallocation to meet programme needs and to strengthen country presence Transfer to regional priorities Reallocation based on mid-term review Organizational changes and support to priority areas

(6 009 000) (406 000) (291 000) (287 000) (5 370 000)

Appropriation Section 5 - Health technology and pharmaceuticals Increase: European Region Reallocation based on regional review Western Pacific Region Global and interregional Decrease: African Region South-East Asia Region Eastern Mediterranean Region Net decrease Increased programme requirements and supplementary immunization activities in China Organizational changes

654 000 572 000 209 000

Reallocation based on programme needs to priority programmes and to strengthen country presence Transfers to regional priorities and to strengthen country offices Organizational changes and transfers to regional priorities

(2 962 000) (820 000) (1 429 000) (3 776 000)

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2004-2005 (US dollars)

Appropriation Section 6 - Evidence and information for policy Increase: European Region Increase based on the regional review Eastern Mediterranean Region Decrease: African Region South-East Asia Region Western Pacific Region Global and interregional Net decrease Appropriation Section 7 - External relations and governing bodies Increase: African Region Eastern Mediterranean Region Decrease: South-East Asia Region European Region Western Pacific Region Global and interregional Net decrease Reallocation to regional priorities and to cover cost variances Organizational changes and transfers to regional priorities Cost savings reallocated to priority programmes Organizational changes, including country cooperation Transfers to priority programmes Organizational changes and transfers for region-wide activities and intercountry meetings Increase due, in part, to organizational changes, regional emergencies and implementation variances Transfers to strengthen WHO's presence in countries and priority programmes Transfers to support country offices and regional priorities Reallocation at country level to priority programmes Organizational change and additional funds for statutory meetings

200 000 792 000

(2 382 000) (230 000) (2 019 000) (898 000) (4 537 000)

370 000 2 500 000

(1 069 000) (639 000) (1 195 000) (821 000) (854 000)

Appropriation Section 8 - General management Increase: African Region Increases to cover implementation variances Decrease: South-East Asia Region European Region Eastern Mediterranean Region Western Pacific Region Global and interregional Net decrease Transfer to regional priorities and to cover cost variances Reallocation to regional priorities Organizational changes and reallocation of cost variances Currency gains reallocated to priority programmes Organizational changes and reinforcement of priority activities

1 878 000

(629 000) (40 000) (1 059 000) (388 000) (2 378 000) (2 616 000)

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2004-2005 (US dollars)

Appropriation Section 9 - Director-General, Regional Directors and independent functions Increase: South-East Asia Region Transfer to regional priorities and to cover implementation variances European Region Eastern Mediterranean Region Global and interregional Decrease: African Region Western Pacific Region Net increase Reallocation based on regional review of resource situation Organizational changes and transfers for region-wide activities Organizational changes

723 000 135 000 1 339 000 595 000

Minor adjustment Cost savings

(10 000) (112 000) 2 670 000

Appropriation Section 10 - WHO's presence in countries Increase: African Region South-East Asia Region European Region Western Pacific Region Global and interregional Decrease: Eastern Mediterranean Region Organizational and country-level programme changes and transfers for region-wide activities (930 000) Strengthening of WHO's presence in countries and cost increases at country level Reallocation to strengthen country offices Organizational changes associated with country presence Additional funding for country offices Organizational change 15 935 000 3 708 000 1 418 000 2 126 000 1 993 000

Net increase Appropriation Section 11 - Miscellaneous Decrease: Global and interregional Net decrease Overall net transfer Transfers to priority programmes

24 250 000

(680 000) (680 000) -

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Schedule 1 Cash, deposits and securities as at 31 December 2005 (in thousands of US dollars)

2004-2005

2002-2003

Cash at banks, in transit and on hand Headquarters Regional and Country Offices Total cash at bank, in transit and on hand Deposits Bank deposits and call accounts in US dollars Total deposits Securities Short-term fixed income in US dollars Long-term fixed income in US dollars Equity investments in US dollars Total securities Total deposits and securities Total cash, deposits and securities as at 31 December 2005 and 31 December 2003 (Note 18)

15 549 80 637 96 186

54 313 64 815 119 128

934 856 934 856

639 902 639 902

474 313 237 750 54 332 766 395 1 701 251 1 797 437

517 460 176 059 9 109 702 628 1 342 530 1 461 658

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Schedule 2 Cash, deposits and securities by sources of funds as at 31 December 2005 (in thousands of US dollars) 2003 2005 (re-stated, note 37)

Unliquidated obligations Inter-organization arrangements WHO programme activities Non-WHO programme activities - Trust funds, Foundations and other funds Total unliquidated obligations Internal Borrowing - Regular Budget Voluntary Fund for Health Promotion Other WHO funds Miscellaneous Income Casual Income Account Real Estate Fund Security Fund Revolving Fund for Teaching and Laboratory Equipment Special Account for Operation of Concessions at Headquarters Special Account for Income Derived from Patent Policy Staff Development Fund Revolving Sales Fund Information Technology Fund Special Account for Servicing Costs Tax Equalization Fund Terminal Payments Account Total other WHO funds Trust funds Inter-organization arrangements WHO programme activities Non-WHO programme activities Total trust funds Accounts payable and receivable Accounts payable and deferred income Accounts receivable and prepaid expenses Total accounts payable and receivable Construction in progress IARC capital assets Members' contributions received in advance Borrowings payable after one year Total cash, deposits and securities 42 517 (98 295) (55 778) (26 510) (4 193) 50 328 29 829 1 797 437 46 685 2 832 1 461 657 53 663 (62 560) (8 897) (2 890) 1 621 77 944 569 448 649 013 (10 976) 69 999 447 610 506 633 1 142 229 400 2 818 4 2 735 4 650 19 346 92 267 (2 706) 56 409 179 726 6 474 1 950 136 103 1 778 52 911 215 903 2 432 9 800 (58) 1 038 1 467 400 4 036 4 7 659 355 653 70 897 434 209 (13 034) 553 847 11 626 204 986 30 638 247 250 (1 744) 455 885

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Schedule 3 Income and expenditure for the effective working regular budget for 2004-2005 (in thousands of US dollars) Actual 2004-2005

Budget

Income: Members' net assessments (Schedule 4) Less: Provision for delays in collection of assessed contributions (Schedule 4) a/ Contributions collected (Includes amounts credited under the new financial incentive scheme - Financial Regulation 6.5) Less: Amounts transferred to Tax Equalization Fund b/

863 101 52 981 810 120 4 626 805 494 21 636 827 130 871 163 44 033

863 101 863 101 4 626 858 475 21 636 880 111 880 111

Contributions collected for the effective working budget Plus: World Health Assembly Appropriations: Resolution WHA56.32 Miscellaneous income Total Income for the effective working budget c/ Expenditure for the effective working budget (Statement IV, Appropriation sections 1 to 11) d/ Excess of expenditure over income Financed from: - the Working Capital Fund - Internal borrowing 31 000 13 033

Expenditure:

44 033

a/ Assessed contributions for 2004-2005 Contributions collected: in 2004 in 2005 Total (Schedule 4) Shortfall in collection of contributions for 2004-2005 436 652 373 468

863 101

100.00% 50.59% 43.27%

810 120 52 981 2004-2005

93.86% 6 .14% 2002-2003 80 000 77 333 2 667

b/ Transfer to Tax Equalization Fund (Statement IV, Appropriation section 12) Less: Credits to Members Amounts transferred to Tax Equalization Fund to meet Income Tax reimbursements c/ Approved Budget and Planned Financing Total approved budget (Statement IV) To be financed as follows: Assessed contributions from Members for the effective working budget Reimbursement of programme support costs Miscellaneous income appropriated Casual income appropriated Total financing of budget d/ Financial outcome of the budget Total approved budget Less: Total expenditure incurred Unobligated balance of appropriations - becoming cash for credit to Miscellaneous Income Account when the outstanding underlying contributions are received

80 000 75 374 4 626

880 111 858 475 21 636 880 111

855 654

792 526 500 49 732 12 896 855 654

880 111 871 163

855 654 830 401

8 948

25 253

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Schedule 4 Assessed contributions – 2004-2005 and prior financial periods (in US dollars) 2004-2005 assessments Collected or Balance adjusted outstanding Net during 31 December assessments 2004-2005 2005 46 790 34 340 621 960 38 200 12 880 21 470 8 956 040 17 180 13 705 120 7 686 790 38 200 106 450 204 750 84 990 81 120 157 530 9 356 950 8 580 17 180 8 580 72 540 29 620 93 580 16 631 240 285 440 127 910 17 180 8 580 17 180 72 540 22 877 250 8 580 8 580 8 580 1 852 590 15 282 580 1 514 350 8 580 8 110 8 580 213 330 81 120 323 650 311 200 327 930 46 790 34 340 621 960 38 200 12 880 117 180 13 705 120 7 686 790 38 200 106 450 204 750 84 990 81 120 157 530 9 356 950 8 199 17 180 8 580 29 620 93 580 10 165 636 285 440 127 910 17 180 8 580 17 180 37 360 22 877 250 47 8 580 667 841 15 282 580 1 022 577 8 110 8 580 110 742 323 650 284 866 327 930 381 21 470 8 838 860 17 180 216 098 21 961 624 2 496 150 2 046 439 4 011 115 63 504 67 180 2 046 439 216 842 152 594 21 961 624 2 428 970 174 064 30 800 484 2 446 150 Assessments of prior financial periods Balance Collected or Balance outstanding adjusted outstanding 1 January during 31 December 2004 2004-2005 2005 259 875 259 875

Members, including Associate Members Assessed Members Afghanistan Albania Algeria Andorra Angola Antigua and Barbuda Argentina Armenia Australia Austria Azerbaijan Bahamas Bahrain Bangladesh Barbados Belarus Belgium Belize Benin Bhutan Bolivia Bosnia and Herzegovina Botswana Brazil Brunei Darussalam Bulgaria Burkina Faso Burundi Cambodia Cameroon Canada Cape Verde Central African Republic Chad Chile China Colombia Comoros Congo Cook Islands Costa Rica Côte d'Ivoire Croatia Cuba Cyprus

Total outstanding 306 665

3 794 273

395 475

315 475

80 000

237 530 381

72 540

28 498

101 038

6 465 604

9 720 805

6 465 604

9 146 35 180 8 533 8 580 1 184 749 491 773 8 580 10 048

9 146 10 048 35 180 8 533 164 841 1 184 749 491 773 444 427

156 261 225 073 249 039 839 253 445 462

156 261 225 073 249 039 839 253 9 615

435 847

102 588 81 120 26 334

67 693

102 588 81 120 26 334

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Schedule 4 (continued) 2004 -2005 assessments Collected or Balance adjusted outstanding Net during 31 December assessments 2004-2005 2005 1 642 690 81 120 29 620 8 580 6 245 410 8 580 8 580 247 240 187 150 857 190 170 410 12 880 8 580 93 580 33 910 33 910 4 492 400 54 438 720 97 860 8 580 33 910 78 440 150 38 200 4 551 210 8 580 242 950 25 760 8 580 8 580 21 470 42 490 1 047 770 285 440 3 247 180 1 454 260 1 822 540 643 000 2 744 110 3 757 120 42 359 300 51 080 165 988 280 81 130 225 350 72 540 8 580 1 316 050 8 580 6 245 410 4 290 51 647 187 150 857 190 170 410 4 861 8 580 93 580 33 910 33 910 4 492 400 54 438 720 97 860 1 642 690 81 005 115 29 620 215 215 115 29 835 Assessments of prior financial periods Balance Collected or Balance outstanding adjusted outstanding 1 January during 31 December 2004 2004-2005 2005

Members, including Associate Members Czech Republic Democratic People's Republic of Korea Democratic Republic of the Congo Democratic Republic of Timor-Leste Denmark Djibouti Dominica Dominican Republic Ecuador Egypt El Salvador Equatorial Guinea Eritrea Estonia Ethiopia Fiji Finland France Gabon Gambia Georgia Germany Ghana Greece Grenada Guatemala Guinea Guinea-Bissau Guyana Haiti Honduras Hungary Iceland India Indonesia Iran (Islamic Republic of) Iraq Ireland Israel Italy Jamaica Japan Jordan Kazakhstan Kenya Kiribati Kuwait

Total outstanding

4 290 8 580 195 593

37 610 3 680 1 092 729

37 610 268 750 3 680 823 979

4 290 12 260 1 019 572

8 019

53 155 8 580 33 910 4 428 686

53 155 (2 083) 23 433

2 083 4 405 253

10 663 4 439 163

78 440 150 38 200 4 551 210 4 290 242 950

4 290 25 760 8 580 25 264 214 010 25 264 214 010

4 290 25 760 222 590

8 580 21 470 42 490 1 047 770 285 440 3 232 726 1 454 260 960 258 2 744 110 3 105 186 42 359 300 51 080 165 988 280 81 130 225 350 72 540 4 290 1 316 050

14 454 862 282 643 000 651 934 768 465 5 755 801 62 965 437 379 768 465 5 755 801 62 965 437 379

14 454 862 282 6 398 801 651 934

4 615 253 4 290 7 951

724 765 7 951

3 890 488

3 890 488 4 290

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Schedule 4 (continued) 2004-2005 assessments Collected or Balance adjusted outstanding Net during 31 December assessments 2004-2005 2005 8 580 14 880 106 460 153 670 8 580 8 580 849 460 174 700 668 320 25 760 12 880 1 863 750 8 580 17 180 123 620 8 580 8 580 93 580 12 668 940 8 580 29 620 8 580 387 600 8 580 84 990 55 380 8 580 33 910 14 594 500 1 966 340 8 580 8 580 467 440 8 580 5 642 750 558 010 493 620 8 580 157 540 38 210 118 900 893 240 830 150 3 575 120 3 968 730 8 580 14 880 106 460 112 331 8 580 236 669 71 680 668 320 25 760 8 590 1 863 750 8 580 17 180 123 620 73 6 599 93 580 10 434 794 8 580 29 620 8 580 387 600 8 580 84 990 55 380 8 580 33 910 14 594 500 1 966 340 8 580 8 580 467 440 4 304 5 642 750 558 010 243 589 344 108 000 11 604 49 190 461 591 3 575 120 3 968 730 4 276 224 030 23 880 94 798 23 880 129 232 137 812 4 276 95 241 95 241 103 821 8 580 Assessments of prior financial periods Balance Collected or Balance outstanding adjusted outstanding 1 January during 31 December 2004 2004-2005 2005 1 229 058 4 226 1 224 832

Members, including Associate Members Kyrgyzstan Lao People's Democratic Republic Latvia Lebanon Lesotho Liberia Libyan Arab Jamahiriya Lithuania Luxembourg Madagascar Malawi Malaysia Maldives Mali Malta Marshall Islands Mauritania Mauritius Mexico Micronesia (Federated States of) Monaco Mongolia Morocco Mozambique Myanmar Namibia Nauru Nepal Netherlands New Zealand Nicaragua Niger Nigeria Niue Norway Oman Pakistan Palau Panama Papua New Guinea Paraguay Peru Philippines Poland Portugal Puerto Rico

Total outstanding 1 233 412

41 339 8 580 612 791 103 020

346 600 2 166 340 103 70 548 138

346 600 2 166 30 000 70 548 138 310 103

41 339 318 683 612 791 103 020

4 290

8 507 1 981 2 234 146

250 031 8 236 49 540 38 210 107 296 844 050 368 559

240 079 48 166 22 169 178 398 1 241 145 240 355 155 093 8 421

240 079 48 166 22 169 178 398 826 000 240 355 155 093 8 421 415 145

250 031 8 236 49 540 60 379 107 296 1 259 195 368 559

8 580

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Schedule 4 (continued) 2004-2005 assessments Collected or Balance adjusted outstanding Net during 31 December assessments 2004-2005 2005 418 080 418 080 15 526 810 10 917 700 4 609 110 12 880 12 880 502 630 502 630 9 789 620 9 789 620 8 580 8 580 8 580 8 580 17 180 4 960 12 220 8 580 8 580 21 470 8 580 5 400 230 42 490 166 120 17 180 8 580 3 325 300 400 480 694 080 8 580 8 580 2 998 930 21 454 580 140 360 59 670 12 880 17 180 8 620 380 10 518 460 500 920 8 580 2 138 890 51 090 8 580 8 580 8 580 161 820 263 990 3 452 150 34 340 8 580 46 300 391 030 1 861 610 8 580 8 580 21 470 8 580 5 400 230 42 490 84 560 17 180 8 580 3 325 300 400 480 694 080 4 290 2 998 930 21 454 580 140 360 29 520 17 180 8 620 380 10 518 460 500 920 8 580 2 138 890 25 330 7 551 4 190 8 580 161 820 263 990 3 452 150 8 580 46 300 391 030 1 861 610 25 760 1 029 4 390 17 885 17 985 17 885 17 985 25 760 1 029 4 390 615 024 154 530 460 494 469 074 Assessments of prior financial periods Balance Collected or Balance outstanding adjusted outstanding 1 January during 31 December 2004 2004-2005 2005

Members, including Associate Members Qatar Republic of Korea Republic of Moldova Romania Russian Federation Rwanda Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines Samoa San Marino Sao Tome and Principe Saudi Arabia Senegal Serbia and Montenegro Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa Spain Sri Lanka Sudan Suriname Swaziland Sweden Switzerland Syrian Arab Republic Tajikistan Thailand The Former Yugoslav Republic of Macedonia Togo Tokelau Tonga Trinidad and Tobago Tunisia Turkey Turkmenistan Tuvalu Uganda Ukraine United Arab Emirates

Total outstanding 4 609 110 2 950 023

2 941 433

4 290

2 937 143

16 844

12 220

81 560

84 213

81 560

4 290 8 580

11 571 391 644

4 290 400 224

30 150 12 880

23 730 107 834

23 730 8 422

99 412

30 150 112 292

34 340

1 224 674

1 259 014

32 309 438

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Schedule 4 (continued) 2004-2005 assessments Collected or Balance adjusted outstanding Net during 31 December assessments 2004-2005 2005 Assessments of prior financial periods Balance Collected or Balance outstanding adjusted outstanding 1 January during 31 December 2004 2004-2005 2005

Members, including Associate Members United Kingdom of Great Britain and Northern Ireland United Republic of Tanzania United States of America Uruguay Uzbekistan Vanuatu Venezuela Viet Nam Yemen Zambia Zimbabwe

Total outstanding

49 680 810 41 660 192 220 680 543 840 106 450 8 580 1 612 650 157 530 50 730 17 180 63 640

49 680 810 41 660 170 192 054 1 601 66 029 8 580 878 650 157 530 50 730 17 180 63 640

22 028 626 542 239 40 421 734 000

21 641 286 592 890 40 396 1 359 279

21 641 286 197 610 40 396 1 359 279

395 280

22 028 626 937 519 40 421 734 000

Total - Assessed Members

863 100 890

810 119 574

52 981 316

126 502 933

42 094 675

84 408 258

137 389 574

New and formerly inactive Members Belarus a/ Democratic Republic of Timor-Leste Ukraine a/ Total - new and formerly inactive Members Former Members Yugoslavia (up to 2001) Total - all Members 863 100 890 810 119 574 52 981 316

606 539 976 4 882 650 5 490 165

243 195 976 2 608 970 2 853 141

363 344

2 273 680 2 637 024

5 532 592 137 525 690 44 947 816

5 532 592 92 577 874

5 532 592 145 559 190

a/ In addition to the unbudgeted amounts due from Belarus and Ukraine shown under the heading "New and formerly inactive Members", these members also owe budgeted contributions, as indicated in this schedule under "Assessed Members"

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Schedule 4 (continued)

Certain Member States with outstanding unpaid contributions from prior years have agreed to repayment plans under which the Member States concerned commit to make annual payments towards the arrears, in addition to paying their current year assessment. These special arrangements are approved by Health Assembly resolutions, and specify the number of years over which the concerned Member State must pay the outstanding contributions. In the event that minimum payments are not made according to the agreed plan, the Member State's voting privileges are suspended in accordance with Article 7 of the Constitution. The Members concerned are listed below, together with summary information concerning the terms of approved payment plans: Payment period 2003-2011 1997-2006 2002-2011 2006-2020 2006-2020 2003-2012 1999-2004 2006-2020 2006-2015 2004-2018 154 530 2 608 970 3 866 059 724 765 29 516 Payments received during 2004-2005 100 000 90 836 134 009 23 433 Balance outstanding a/ 3 794 273 363 344 b/

Member States Azerbaijan Belarus Dominican Republic Georgia Iraq Kazakhstan Liberia Republic of Moldova Tajikistan Ukraine Total

Resolution WHA55.5 WHA45.23 WHA55.6 WHA58.8 WHA58.9 WHA56.11 WHA52.3 WHA58.10 WHA58.11 WHA57.6

823 979 4 439 163 6 398 801 3 890 488 285 346 2 950 023 469 074 34 583 118 57 997 609 b/

In addition to the minimum annual payments in respect of arrears, the Member States concerned must also pay their current year assessed contributions. The Dominican Republic and Liberia have been unable to respect the terms of their repayment plans and as a result their voting privileges have been suspended.

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Schedule 5 Working Capital Fund and internal borrowing as at 31 December 2005 (in thousands of US dollars)

In accordance with Financial Regulation VII, pending the receipt of assessed contributions, implementation of the Regular Budget may be financed from the Working Capital Fund and thereafter by internal borrowing against available cash reserves of the Organization, excluding trust funds. Amounts borrowed are repaid from the collection of arrears of assessed contributions and are credited first against any internal borrowing outstanding and then against any borrowing outstanding from the Working Capital Fund. Resolution WHA48.21 established the level of the Working Capital Fund at $ 31 million. 2004-2005 Working Capital Fund Internal borrowing Working Capital Fund 2002-2003 Internal borrowing

Opening balance as at: 1 January 2004 and 1 January 2002 Repayments Collection of arrears of assessed contributions 31 000 31 000 1 744 31 000 31 000 24 628 (1 744) (24 628)

Sub-total

Withdrawals Financing of regular budget pending receipt of assessed contributions 31 000 13 033 31 000 1 744

Balance as at: 31 December 2005 and 31 December 2003 (Statement I) 0 (13 033) 0 (1 744)

Borrowing as at: 31 December 2005 and 31 December 2003 Working Capital Fund Internal borrowing Total borrowing 31 000 13 033 44 033 31 000 1 744 32 744

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Schedule 6 Miscellaneous Income Account as at 31 December 2005 (in thousands of US dollars)

The Miscellaneous Income Account is credited with income arising from a number of sources in accordance with Financial Regulation VIII.

2004-2005

Balance as at 1 January 2004 Income 2004-2005 Sub total Less: Resolution WHA56.32 - Appropriation resolution for the financial period 2004-2005 Financing the regular budget Adjustment mechanism Financial incentive scheme Sub total

9 800 28 206 38 006

21 636 12 364 1 574 35 574

Balance as at 31 December 2005 (Statement I.1)

2 432

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Schedule 7 All extrabudgetary funds Summary of 2004-2005 income and expenditure as at 31 December 2005 (in thousands of US dollars)

Balance 1 January 2004

Income 2004-2005

Adjustments

Expenditure 2004-2005

Balance 31 December 2005

Voluntary Fund for Health Promotion (Statement 1) Trust funds (Statement 1.2 and Statement 1.3) Technical cooperation funds United Nations Development Programme United Nations Population Fund United Nations Environment Programme United Nations International Drug Control Programme United Nations Iraq Programme (UN SCR 986) United Nations Afghanistan Emergency Trust Fund United Nations Children's Fund Global Programme on AIDS Onchocerciasis Control Programme African Programme for Onchocerciasis Control Sasakawa Health Trust Fund TDR c/ HRP d/ Associate Professional Officers Other trust funds Iraq Programme (UN SCR 1472 and 1476) All others Supply services funds Iraq Programme (UN SCR 1472 and 1476) United Nations Development Programme United Nations Population Fund Onchocerciasis Control Programme World Bank Countries and Nongovernmental Organizations Revolving Fund for Teaching and Laboratory Equipment for Medical Education and Training Total - Trust funds (Statement 1.2 and Statement 1.3) Total - Extrabudgetary Funds

455 885

1 723 432

(2 310)

1 623 160

553 847

(2 704) (1 703) 20 (170) (13 305) 63 2 277 285 1 851 2 278 10 131 17 309 8 122 3 295 9 069 14 779 3 729 687 31 (1) 101 2 707 172 59 023 514 908

640 8 540 771 207 8 604 (63) 2 193 6 106 23 012 5 708 63 312 21 010 6 513 (5 412) 66 957 (617) 1 107 (31) 1 7 777 89 110 632 300 083 2 023 515

5 525 67 20 6 145 (1 366) (291) 311 4 692 482 3 874 1 613

1 441 9 893 771 37 1 444 2 270

2 020 (2 989) 20 20

834 2 268 3 823 7 010 18 796 4 632 3 224 (76) 30 174 (1) (127)

26 159 9 311 65 699 26 113 6 584 3 733 51 562 3 113 1 921

6 034 83 921 606 21 072 18 762 300 612 1 923 772

1 844 7 896 198 79 566 633 413

Includes contributions, refunds, interest and other revenue. Includes transfers between funds and savings on prior periods' unliquidated obligations. c/ Trust Fund for the UNICEF/UNDP/World Bank/WHO Special Programme for Research and Training in Tropical Diseases. d/ Trust Fund for the UNDP/UNFPA/WHO/World Bank Special Programme of Research, Development and Research Training in Human Reproduction. b/

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Schedule 8 Special Account for Servicing Costs as at 31 December 2005 (in thousands of US dollars)

This account was established in order to facilitate the budgeting and accounting of funds made available to the Organization to cover in part the costs of servicing activities financed from sources other than the regular budget, (i.e. from all other extrabudgetary resources). The Account is credited with income from the following sources: (i) Credits received from the United Nations Development Fund, the United Nations Population Fund and other organizations and bodies of the United Nations system to cover support costs are passed to the Account; (ii) Under Resolution WHA 34.17, funds received for support costs from other extrabudgetary sources, including funds-in-trust arrangements with governments and other entities, and the Voluntary Fund for Health Promotion; (iii) Interest earned on the balances of funds in the Special Account for Servicing Costs; and (iv) Foreign exchange gains/losses arising in respect of hedging operations on this account.

Income and expenditure 2004-2005 2002-2003

Balance as at 1 January 2004 and 1 January 2002 Income United Nations Programmes Support costs of subcontracting agencies Programme support costs Rental of office accommodation at headquarters from trust funds and other arrangements Interest Gains (losses) on hedging operations Total income Balance

136 103

140 797

345 148 949 404 4 675 154 373 290 476

431 335 110 221 1 179 10 072 2 972 125 210 266 007

Transfers To Revolving Sales Fund in accordance with resolution WHA55.9 Balance Expenditure Africa The Americas South-East Asia Europe Eastern Mediterranean Western Pacific Global and interregional activities Total expenditure Balance as at 31 December 2005 and 31 December 2003

290 476

(7 927) 258 080

26 805 869 6 910 14 101 18 110 10 219 121 195 198 209 92 267

25 552 1 399 5 860 3 976 4 038 1 953 79 199 121 977 136 103

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Schedule 9 Real Estate Fund as at 31 December 2005 (in thousands of US dollars)

This fund was established by the Twenty-third World Health Assembly in resolution WHA23.l4. The Real Estate Fund, under the Financial Regulations and Financial Rules, is funded by appropriation from the regular budget. The Real Estate Fund is also credited with receipts of rentals relating to real estate operations (other than rental for office accommodation, garage rentals and income from the operation of concessions at headquarters), and interest earned on balances in the fund. The fund is used to meet the costs of the construction of buildings or extensions to existing buildings; the acquisition of land which may be required; major repairs of and alterations to the Organization’s existing office buildings and maintenance and repairs of and alterations to houses leased to staff by the Organization. Specific Health Assembly authorization is required for acquisition of land and construction of buildings or building extensions. a/ 2004-2005

Balance as at 1 January 2004 Income Appropriation from Regular Budget Rents collected Interest Total income Expenditure Headquarters: Maintenance and repairs of existing premises Regional Office for Africa: Maintenance of staff housing Water supply at premises Purchase and installation of security lights Improvement of the external lighting system Renovation and improvement of electric installations Construction of new conference room and office space - WHA 56.14 Construction of new housing facilities - WHA 56.14 Fire hydrants and new boreholes Purchase of a new lift Drainage system Renovation of the roofs Regional Office for the Americas: Remodelling of three meeting rooms and repairs of existing premises Regional Office for the Eastern Mediterranean: Maintenance of staff housing Access control and security management system Regional Office for Europe: Refurbishment of the Regional Office Regional Office for South-East Asia: Renovation, maintenance and repairs of existing premises Regional Office for the Western Pacific: Extension of existing building and construction of new building - WHA 55.8 Total expenditure Balance as at 31 December 2005 b/

1 038 5 820 698 159 6 677

969 273 2 53 28 4 121 14 151 233 38 56 97 50 23 291 466 3 704 6 573 1 142

a/ b/

See note 27 regarding the construction of a new building at Headquarters. This balance has been allocated to planned projects.

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Schedule 10 Terminal Payments Account as at 31 December 2005 (in thousands of US dollars)

This account was established to provide for financing the terminal emoluments of staff members, including repatriation grant, accrued annual leave, repatriation travel, removal on repatriation, and other separation payments. It is funded by a budgetary provision set for the biennium 2004-2005 at 2.5% of fixed term staff net salaries and professional staff post adjustment. It applies to all fixed term staff, including those assigned to the Joint United Nations Programme on HIV/AIDS (UNAIDS); the International Agency for Research on Cancer (IARC); the International Computing Centre (ICC); the African Programme for Onchocerciasis Control (APOC); the Global Fund to fight AIDS, Tuberculosis and Malaria (TGF). It excludes, however, those staff funded from UNDP and staff appointed under the Associate Professional Officers programme. In this way, it is ensured that each source of funds which participates under the scheme bears its appropriate share of the terminal emoluments paid to separating staff members. Interest earned on investments is also credited to the account. The account does not reflect the Organization's and other entities full long-term liability for the terminal emoluments of staff members, of which the present value at 31 December 2005 is estimated at $ 104 million. 2004-2005

2002-2003 38 579

Balance as at 1 January 2004 and 1 January 2002 Income Provision for terminal payments Interest Total income Expenditure Repatriation grant Accrued annual leave Repatriation travel Removal on repatriation End-of-service grant Abolition of posts Separation by mutual agreement Termination for reason of health Total expenditure Balance as at 31 December 2005 and 31 December 2003

52 911

15 120 2 280 17 400

21 865 6 431 28 296

5 061 4 849 1 332 985 194 804 582 95 13 902 56 409

5 013 4 285 1 274 581 499 1 602 623 87 13 964 52 911

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Schedule 11 Supply services funds (trust funds) as at 31 December 2005 (in thousands of US dollars)

These include funds deposited with the Organization, usually in local currencies, by governments and institutions for the purchase of medical supplies, equipment and literature on their behalf. Local currencies are accepted to the extent that they can be utilized by the Organization in its day-to-day operations and activities within a reasonable time. Funds are also received from, and supplies made available to, other organizations of the United Nations system for use in the health aspects of emergency operations and activities. Balance 1 January 2004 Receipts 2004-2005 Expenditure 2004-2005 Balance 31 December 2005

Countries United Nations sources Iraq (SCR 986) Other Sub-total - United Nations sources Total

2 707

89 110

83 921

7 896

3 729 817 4 546 7 253

(617) 8 855 8 238 97 348

3 113 7 954 11 067 94 988

(1) 1 718 1 717 9 613

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Financial implementation of WHO's Programme Budget for 2004-2005

This part of the Financial Report shows financial implementation compared with the approved Programme Budget for 2004-2005. Information is provided both for the regular budget and for other sources by Area of Work at the Organizational level, and for Global (Headquarters) and for each Regional Office. Implementation by category of expenditure is also shown.

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Table 1 Budget and expenditure summary Regular budget by organizational level and total other sources Financial period 2004-2005 (in thousands of US dollars)

Transfers effected and Programme budget unallocated balances Working a/ budget Expenditure

Implementation rate as % of working budget

Regular budget Country Regional Global (Headquarters) Sub-total-Substantive Areas of Work Miscellaneous Total regular budget Other sources Total

336 991 230 592 278 528 846 111 34 000 880 111 1 944 000 b/ 2 824 111

(6 402) 3 004 (4 383) (7 781) (1 020) (8 801)

330 589 233 596 274 145 838 330 32 980 871 310 1 944 000

330 584 233 587 274 012 838 183 32 980 871 163 2 160 793 3 031 956

100.0 100.0 100.0 100.0 100.0 100.0 111.2 107.7

(8 801)

2 815 310

Reconciliation to total expenditure: Plus: UNFPA programme support costs Less: Eliminations - Statement I Total - WHO programme activities Statement I

79 3 032 035 303 365

2 824 111

2 728 670

96.6

The working budget represents that part of the programme budget that has been allocated and adjusted by transfers between appropriation sections and/or Offices. b/ Other sources figure as noted in EB113/42 Add.1. c/ The implementation rate is based on the working budget as shown in this Table, whereas Tables 2, 3 and 4 show the implementation rate based on the programme budget approved by WHA 56.32 and EB 113/42 Add. 1.

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Table 2 Budget and expenditure summary by area of work - all offices Financial period 2004-2005 (in thousands of US dollars) Regular Budget Area of work Programme budget Expenditure %

Other sources Programme budget Expenditure % Programme budget

Total Expenditure %

Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Substantive areas of work - total Miscellaneous Exchange rate hedging Real Estate Fund Information Technology Fund Security Fund Miscellaneous - total Total - ALL OFFICES

36 600 23 786 3 468 17 140 12 031 23 480 9 983 16 664 5 133 14 356 15 849 9 070 13 211 4 094 18 116 14 840 9 526 39 946 9 453 8 037 18 947 16 646 14 135 30 106 28 662 9 217 107 466 21 791 22 264 6 826 16 412 22 341 93 715 21 670 111 130 846 111 15 000 6 000 10 000 3 000 34 000 880 111

36 311 20 573 3 350 19 469 13 027 22 802 8 812 17 110 4 354 11 893 15 355 7 218 12 370 3 301 15 462 15 144 8 134 35 133 8 565 8 574 16 217 16 431 12 980 29 252 30 544 8 024 101 440 23 794 19 016 6 244 16 647 21 363 90 915 24 092 134 267 838 183 14 550 5 820 9 700 2 910 32 980 871 163 99.0

58 000 110 500 111 000 109 000 112 500 14 000 10 500 31 500 12 500 9 500 51 500 58 000 25 500 11 000 200 000 14 000 11 000 47 000 13 000 111 000 32 500 420 500 10 500 50 500 17 500 11 000 52 500 6 000 16 000 4 500 18 500 21 500 81 000 7 000 37 500 1 908 000 5 000 0 25 000 6 000 36 000 1 944 000

64 650 80 196 70 836 137 200 139 465 18 553 8 903 22 823 8 874 8 782 38 676 55 081 10 503 5 283 110 644 15 864 9 272 42 492 5 494 238 800 33 739 671 824 9 248 29 915 18 758 5 919 44 494 4 568 9 720 4 187 21 233 22 296 99 232 11 521 27 167 2 106 214 0 6 031 32 243 16 305 54 579 2 160 793 111.2

94 600 134 286 114 468 126 140 124 531 37 480 20 483 48 164 17 633 23 856 67 349 67 070 38 711 15 094 218 116 28 840 20 526 86 946 22 453 119 037 51 447 437 146 24 635 80 606 46 162 20 217 159 966 27 791 38 264 11 326 34 912 43 841 174 715 28 670 148 630 2 754 111 20 000 6 000 35 000 9 000 70 000 2 824 111

100 961 106.7 100 769 75.0 74 186 64.8 156 669 124.2 152 492 122.5 41 355 17 715 39 933 13 227 20 675 54 032 62 299 22 873 8 583 126 106 31 008 17 407 77 625 14 059 247 375 49 956 688 255 22 228 59 167 49 302 13 943 145 935 28 362 110.3 86.5 82.9 75.0 86.7 80.2 92.9 59.1 56.9 57.8 107.5 84.8 89.3 62.6 207.8 97.1 157.4 90.2 73.4 106.8 69.0 91.2 102.1

28 736 75.1 10 431 37 881 43 659 190 147 92.1 108.5 99.6 108.8

35 613 124.2 161 434 108.6 2 944 397 106.9 14 550 11 851 a/ 41 943 a/ 19 215 a/ 87 559 3 031 956 107.4

a/ Funds were transferred from the regular budget to the Information Technology Fund, the Security Fund and the Real Estate Fund and from the Special Account for Servicing Costs to the Information Technology Fund and the Security Fund. The amounts transferred are treated as expenditure under the regular budget and the Special Account for Servicing Costs. The amounts transferred are treated as income in the Information Technology Fund, the Security Fund and the Real Estate Fund, and eventually as expenditure in line with the activities undertaken within those areas. This accounting treatment is necessary to maintain the integrity of the individual funds while it does lead to duplication of expenditure under the total column.

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Table 3 Budget and expenditure summary - by office Financial period 2004-2005 (in thousands of US dollars)

Regular Budget Country Programme budget Expenditure Regional Programme budget Expenditure Total regular budget Programme budget Expenditure %

Regional Office for Africa

122 333

120 202

69 402

70 324

191 735

190 526 99.4

Regional Office for the Americas

40 818

40 419

32 409

32 118

73 227

72 537 99.1

Regional Office for South-East Asia

69 719

69 062

23 735

24 090

93 454

93 152 99.7

Regional Office for Europe

13 493

13 393

41 289

41 256

54 782

54 649 99.8

Regional Office for the Eastern Mediterranean

50 576

47 361

31 773

34 510

82 349

81 871 99.4

Regional Office for the Western Pacific

40 052

40 147

31 984

31 289

72 036

71 436 99.2

Sub-total - Regional Offices Global (Headquarters) Total

336 991

330 584

230 592

233 587

567 583 312 528

564 171 99.4 306 992 98.2 871 163 99.0

336 991

330 584

230 592

233 587

880 111

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Table 3 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure %

Total

Programme budget Expenditure %

358 500

248 439

194 500

326 581

553 000

575 020 104.0

744 735

765 546 102.8

64 000

8 444

30 000

17 066

94 000

25 510

27.1

167 227

98 047

58.6

128 000

162 251

63 500

43 498

191 500

205 749 107.4

284 954

298 901 104.9

60 000

25 910

43 500

74 836

103 500

100 746

97.3

158 282

155 395

98.2

149 500

238 570

52 500

69 910

202 000

308 480 152.7

284 349

390 351 137.3

70 000

47 199

51 500

53 511

121 500

100 710

82.9

193 536

172 146

88.9

830 000

730 813

435 500

585 402

1 265 500 678 500

1 316 215 844 578 124.5 2 160 793 111.2

1 833 083 991 028 2 824 111

1 880 386 1 151 570 116.2 3 031 956 107.4

830 000

730 813

435 500

585 402

1 944 000

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Table 4 Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Global (Headquarters) Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Substantive areas of work - total Miscellaneous Exchange rate hedging Real Estate Fund Information Technology Fund Security Fund

Regular budget Programme budget Expenditure

Other sources Programme budget Expenditure

Total Programme budget Expenditure

17 128 7 143 2 752 5 868 2 546 7 757 3 877 3 058 2 145 4 608 4 664 3 433 1 593 1 535 5 073 3 290 3 172 10 858 3 470 1 691 7 091 7 323 5 166 13 424 13 128 4 221 9 277 18 512 12 798 2 562 8 570 12 330 55 318 12 182 965 278 528 15 000 6 000 10 000 3 000 34 000 312 528

14 751 7 607 2 984 5 613 2 339 7 991 3 633 2 937 2 211 4 540 4 844 3 263 1 307 1 460 4 923 4 627 3 090 10 120 3 670 2 315 6 834 7 707 5 227 11 735 13 282 3 476 10 319 19 787 10 439 2 360 8 965 11 666 52 508 12 536 2 946 274 012 14 550 5 820 9 700 2 910 32 980 306 992 98.2

18 000 36 000 100 000 31 000 25 000 9 000 3 000 22 000 7 000 2 500 19 000 46 000 11 000 7 000 23 000 6 000 7 000 18 000 3 500 6 000 22 000 63 000 7 500 16 000 12 000 4 000 17 000 6 000 5 000 3 000 12 000 14 000 51 000 7 000 3 000 642 500 5 000 25 000 6 000 36 000 678 500

38 360 18 521 69 818 74 311 66 471 13 102 4 009 20 435 6 114 3 822 19 547 47 851 7 509 4 338 40 053 7 483 6 747 24 837 4 660 35 203 22 000 84 535 5 472 18 808 16 154 3 357 16 453 4 084 4 073 2 797 13 301 14 506 63 846 10 398 3 053 796 030

35 128 43 143 102 752 36 868 27 546 16 757 6 877 25 058 9 145 7 108 23 664 49 433 12 593 8 535 28 073 9 290 10 172 28 858 6 970 7 691 29 091 70 323 12 666 29 424 25 128 8 221 26 277 24 512 17 798 5 562 20 570 26 330 106 318 19 182 3 965 921 028 20 000

53 111 151.2 26 128 60.6 72 802 70.9 79 924 216.8 68 810 249.8 21 093 7 642 23 372 8 324 8 362 24 392 51 114 8 816 5 797 44 976 12 110 9 838 34 957 8 330 37 519 28 834 92 242 10 699 30 543 29 436 6 833 26 773 23 871 125.9 111.1 93.3 91.0 117.6 103.1 103.4 70.0 67.9 160.2 130.4 96.7 121.1 119.5 487.8 99.1 131.2 84.5 103.8 117.1 83.1 101.9 97.4

14 512 81.5 5 157 22 267 26 172 116 354 92.7 108.2 99.4 109.4

22 934 119.6 5 999 151.3 1 070 042 116.2 14 550 5 820 a/ 41 943 a/ 19 215 a/ 81 528 1 151 570 116.2

Miscellaneous - total Total - Global (Headquarters)

32 243 16 305 48 548 844 578 124.5

6 000 35 000 9 000 70 000 991 028

See Table 2, Footnote a/

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Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Regional Office for Africa Country Programme Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Total - Africa budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

5 324 3 184 208 2 018 1 538 2 467 253 4 825 201 1 410 3 028 1 446 3 044 542 2 945 1 997 1 866 4 341 1 292 2 080 2 170 1 544 1 243 694 295 204 20 581

5 919 2 532 21 1 787 1 029 1 269 120 4 618 130 626 1 278 1 147 2 769 381 2 125 976 454 2 772 285 1 652 964 625 924 256 369 58 18 087

2 277 1 132 377 1 122 973 2 438 696 687 273 1 341 1 212 1 653 2 082 855 2 994 1 619 925 2 237 397 1 216 1 597 412 1 860 1 493 3 649 711 7 454 1 363 1 996 801 2 423 3 572 12 778 1 701 1 086 69 402

3 710 1 661 339 994 644 2 348 863 581 662 723 1 086 1 960 1 329 579 2 683 1 468 573 1 764 525 1 310 1 440 449 1 374 1 698 4 234 640 7 006 1 993 2 056 625 2 277 3 451 14 902 1 674 703 70 324

7 601 4 316 585 3 140 2 511 4 905 949 5 512 474 2 751 4 240 3 099 5 126 1 397 5 939 3 616 2 791 6 578 1 689 3 296 3 767 1 956 3 103 2 187 3 944 915 28 035 1 363 2 391 801 2 423 3 572 12 778 1 701 52 284 191 735

9 629 4 193 360 2 781 1 673 3 617 983 5 199 792 1 349 2 364 3 107 4 098 960 4 808 2 444 1 027 4 536 810 2 962 2 404 1 074 2 298 1 954 4 603 698 25 093 1 993 2 092 625 2 277 3 451 14 902 1 674 67 696 190 526

395

51 198 122 333

66 993 120 202

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Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

4 000 18 000 3 000 7 000 15 000

4 289 3 682 71 12 338 5 321 40 138 35 861 11 2 096 1 112 95 42 22 061 957 844

14 000 24 000 3 000 33 000 4 000 1 000 1 000 500 500 9 000 1 000 500 500 23 000 500 1 000 500 4 000 8 000 44 000 500 3 000

7 155 38 606 98 23 017 3 531 1 072 661 220 195 105 10 459 1 173 668 164 9 715 703 33 303 94 3 301 2 783 192 281 732 691 361 128 1 866

18 000 42 000 6 000 40 000 19 000 1 000 1 500 1 000 500 1 500 12 000 2 000 7 500 1 000 115 000 2 500 1 000 1 500 37 000 8 000 181 000 1 000 10 000

11 444 42 288 169 35 355 8 852 1 112 799 255 1 056 116 12 555 2 285 763 206 31 776 1 660 33 1 147 94 19 110 5 473 358 159 802 1 167 410 128 8 956

25 601 46 316 6 585 43 140 21 511 5 905 2 449 6 512 974 4 251 16 240 5 099 12 626 2 397 120 939 6 116 2 791 7 578 3 189 40 296 11 767 182 956 4 103 12 187 3 944 4 415 39 035 1 363 2 391 1 301 5 423 8 572 17 778 1 701 67 284 744 735

21 073 46 481 529 38 136 10 525 4 729 1 782 5 454 1 848 1 465 14 919 5 392 4 861 1 166 36 584 4 104 1 060 5 683 904 22 072 7 877 359 233 3 100 3 121 5 013 826 34 049 1 993 4 028 1 646 5 876 9 342 25 972 1 674 73 029 765 546

82.3 100.4 8.0 88.4 48.9 80.1 72.8 83.8 189.7 34.5 91.9 105.7 38.5 48.6 30.2 67.1 38.0 75.0 28.3 54.8 66.9 196.3 75.6 25.6 127.1 18.7 87.2 146.2 168.5 126.5 108.4 109.0 146.1 98.4 108.5 102.8

500 500 500 1 000 3 000 1 000 7 000 500 92 000 2 000

1 000 33 000

15 809 2 690 165 878 70 476 49

137 000 500 7 000

3 000 8 000

7 090

500 3 000

3 500 11 000

2 000

500 3 000 5 000 3 000

1 936 1 021 3 599 5 891 11 070

500 3 000 5 000 5 000

1 936 1 021 3 599 5 891 11 070

12 000 358 500

2 384 248 439

3 000 194 500

2 949 326 581

15 000 553 000

5 333 575 020

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Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Regional Office for the Americas Country Programme Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Total - the Americas budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

340 4 198 1 218

1 604 3 880

242 2 662

1 944 8 078

242 3 880

1 164 2 153 1 110 1 696 334 768

493 439 524 397 474 1 524 571

2 079 1 368 643 546 318 1 382 266

536 439 1 939 397 2 126 1 628 609 1 593 305 36 602 1 754 1 182 6 354 909

3 243 3 521 1 753 546 2 014 1 716 1 034

1 415 1 652 104 38 1 593

948 36 104 990 71 4 626 450 47 638 71 4 747 539 80 429 304 17 3 357

305 498 764 1 111 1 728 459

588 546 480 1 098 1 792 649

1 536 593 1 118 1 169 6 539 1 188 80 779 1 478 663 4 606 1 700 16 559 218 1 185 594 1 419 2 856 757 9 551 72 537

388 322 48 2 802

255 1 328 612 1 365 2 145 399 4 434 278 1 139 634 1 604 2 680 765

350 1 174 646 1 249 1 700 5 311 218 1 185 594 1 419 2 856 757 32 118

643 1 650 660 4 167 2 145 399 16 385 278 1 139 634 1 604 2 680 765 9 647 73 227

11 951

11 248

9 647 40 818

9 551 40 419

32 409

A59/28 Page 73

Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

3 000 2 000 711

2 000 3 000 3 000 2 000 500 500 500 500 500 500 500

73 1 576 394 658 1 132 675 494 36 142 446 1 707

5 000 5 000 3 000 7 000 2 500 500 500 1 500 1 000 4 500 1 000 2 000 1 000 12 000 1 500 1 000 4 500 2 000 17 000 500 2 500 4 000

73 2 287 394 678 3 328 675 491 36 278 446 2 415 189 266 272 4 100 523 496 253 255 385 606 2 294 484 313 66 61 732

6 944 13 078 3 000 7 536 2 939 2 439 897 3 626 2 628 5 109 2 593 2 305 1 036 12 602 3 254 2 182 10 854 2 909 17 000 1 143 4 150 660 8 167 2 145 899 20 885 278 1 139 1 634 1 604 7 680 765 13 147 167 227

315 6 167 394 3 921 6 849 2 428 1 037 2 050 278 2 162 3 449 189 1 802 272 4 693 1 641 1 665 6 792 1 443 465 1 385 3 772 1 147 4 919 1 766 61 17 291 218 1 338 50 1 566 1 584 2 856 758 11 324 98 047

4.5 47.2 13.1 52.0 233.0 99.5 115.6 56.5 82.3 67.5 7.3 78.2 26.3 37.2 50.4 76.3 62.6 49.6 2.7 121.2 90.9 173.8 60.2 82.3 6.8 82.8 78.4 117.5 95.8 98.8 37.2 99.1 86.1 58.6

5 000 2 000

20 2 196

( 3) 1 000 136 500 4 000 500 2 000 1 000 8 000 1 000 500 4 000 1 000 15 000 708 189 50 203 2 373 345 125

4 000 500 500 500 1 000 2 000 500 500 1 000

216 69 1 727 178 496 128 255 385 495 2 157 449 258 66 36 717

2 000 3 000

111 137 35 55

3 000

25 15

500 1 500

500 4 500

500 2 000

500 3 000

153 50 972 165

1 000 5 000

153 50 972 165

3 000 64 000

1 013 8 444

500 30 000

1 760 17 066

3 500 94 000

1 1 773 25 510

A59/28 Page 74

Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Regional Office for South-East Asia Country Programme Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

2 064 1 305 106 2 017 1 570 3 124 1 916 1 533 969 1 328 2 113 631 2 458 357 1 966 1 156 565 4 049 937 1 058 2 744 1 315 1 218 1 599 93 795 12 743

2 372 1 640 6 1 870 2 014 3 634 1 158 815 487 1 045 2 494 198 2 437 386 1 450 1 606 608 3 197 619 1 031 2 061 1 522 949 1 746

1 287 330 25 702 380 380 431 333 353 390 791 50 519 330 703 751 330 1 016 296 330 430 442 465 1 180 881 479 2 839 298 358 820 712 842 2 877 1 385

1 852 299

3 351 1 635 131 2 719 1 950 3 504 2 347 1 866 1 322 1 718 2 904 681 2 977 687 2 669 1 907 895 5 065 1 233 1 388 3 174 1 757 1 683 2 779 974 1 274 15 582 298 1 144 1 197 712 842 2 877 1 385 16 827

4 224 1 939 6 2 775 2 028 4 029 1 638 1 598 707 1 400 3 183 198 2 805 705 2 189 2 501 951 4 472 644 1 409 2 434 2 041 1 253 2 843 1 059 1 675 14 595 306 53 1 028 861 972 2 082 2 182 20 367

905 14 395 480 783 220 355 689

368 319 739 895 343 1 275 25 378 373 519 304 1 097 1 059 904 2 016 306 53 1 028 861 972 2 082 2 182

771 12 579

786 377

16 827

20 367

Miscellaneous Real Estate Fund Total - South-East Asia

69 719

69 062

23 735

24 090

93 454

93 152

A59/28 Page 75

Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

1 000 3 000

2 778 4 720 23 1 374 26 452

4 000 15 000 500 6 000 1 000 500 1 000 500

118 5 874 100 1 040 3 491 645 418 525 35 104 636 475 588 78 2 273 140 39 166 10 089 662 7 594 28 202 59 114 130

5 000 18 000 500 8 000 32 000 500 1 500 1 000 500 500 3 000 3 000 1 500 500 18 000 1 500 500 1 500 1 500 6 000

2 896 10 594 123 2 414 29 943 645 456 525 35 124 684 2 329 686 78 10 189 834 39 809 48 298 805 83 765 247 391 191 132 419

8 351 19 635 631 10 719 33 950 4 004 3 847 2 866 1 822 2 218 5 904 3 681 4 477 1 187 20 669 3 407 1 395 6 565 2 733 7 388 3 174 66 757 2 183 8 779 1 974 1 274 20 582 298 1 144 1 197 1 212 1 342 7 877 1 385 20 327

7 120 12 533 129 5 189 31 971 4 674 2 094 2 123 742 1 524 3 867 2 527 3 491 783 12 378 3 335 990 5 281 644 49 707 3 239 85 806 1 500 3 234 1 250 1 807 15 014 306 864 1 056 1 641 1 458 6 331 2 334 21 931 28 298 901

85.3 63.8 20.4 48.4 94.2 116.7 54.4 74.1 40.7 68.7 65.5 68.6 78.0 66.0 59.9 97.9 71.0 80.4 23.6 672.8 102.0 128.5 68.7 36.8 63.3 141.8 72.9 102.7 75.5 88.2 135.4 108.6 80.4 168.5 107.9

2 000 31 000

500 1 000 500 1 000 3 000 1 000 13 000 1 000 1 000 1 000 5 000

20 48 1 854 98 7 916 694 643 38 209 143 76 171 219 189 132 18 289

2 000

500 500 5 000 500 500 500 500 1 000

49 000 500 4 000 500 4 000

16 000 2 000 500 1 000

65 000 500 6 000 1 000 5 000

102 500 500 3 000

2 000

709 28 780 486 4 249 152 1 443 28 43 498

500 500 5 000

811 28 780 486 4 249 152 1 564 28 205 749

3 000

121

500

3 500

128 000

162 251

63 500

191 500

284 954

104.9

A59/28 Page 76

Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Regional Office for Europe Country Programme Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Total - Europe budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

277

275

841 50

1 146

1 118 50

1 421

101 340 519 250 282 41 620 212 101 264 21 200 138 73 283 76 80 239 160 66 557 71 1 514

212 286 277 163 142 65 343 307 82 283 19 238 50 99 297 142 177 428 231 55 833 9 898

50 822 840 474 466 50 802 524

20 464 976 357 521 59 840 478 20 644 49 444 506 475 2 454 352 454 648 787 326 4 149 5 078 355 2 627 626 456 803 2 519 1 748 8 477 1 309 1 089 41 256

151 1 162 1 359 724 748 91 1 422 736 101 818 71 1 319 749 547 2 968 521 566 713 734 392 4 309 4 833 288 4 418 651 1 087 1 318 2 254 1 516 8 637 1 186 7 225 54 782

232 750 1 253 520 663 124 1 183 785 102 927 68 682 556 574 2 751 494 631 1 076 1 018 381 4 982 5 087 355 3 525 626 456 803 2 519 1 748 8 477 1 309 8 571 54 649

554 50 1 119 611 474 2 685 445 486 474 574 326 3 752 4 762 288 2 904 651 524 1 318 2 254 1 516 8 637 1 186 780 41 289

563

6 445 13 493

7 482 13 393

A59/28 Page 77

Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

1 000 500

1 000

946 96

2 000 500

1 045 96

3 118 550

2 466 96

79.1 17.5

1 000 6 000 500 500 1 000 500 1 000 1 000 3 000 1 000 500 7 000 500 1 500 3 000 1 000 4 000

318 6 998

2 000 2 000 1 000 500 3 000 500 1 000 2 000 500 500 3 000 500 12 000 500 1 000 500 4 000 2 000 500

1 226 2 100 431 1 124 965 329 2 619 803 342 511 350 4 452 3 386 271 13 340 52 1 796 884 9 434 303 7 386 1 128 2 057 4 334 81 150 236 1 216 682 9 344 915 1 547 74 836

3 000 8 000 1 500 1 000 4 000 1 000 2 000 3 000 3 500 1 000 1 000 10 000 500 2 000 15 000 1 500 5 000 500 16 000 500 5 000 1 500 4 000

1 544 9 098 431 1 349 1 013 367 3 232 1 072 459 524 350 6 409 3 452 356 13 438 52 10 997 997 10 225 413 7 449 1 128 2 057 8 521 81 150 236 1 216 682 9 344 915 2 048 100 746

3 151 9 162 2 859 1 724 4 748 1 091 3 422 3 736 3 601 1 818 1 071 11 319 1 249 2 547 17 968 2 021 5 566 1 213 16 734 892 9 309 6 333 288 8 418 651 1 087 1 318 2 754 2 016 13 637 1 186 11 725 158 282

1 776 9 848 1 684 1 869 1 676 491 4 415 1 857 561 1 451 418 7 091 4 008 930 16 189 546 11 628 2 073 11 243 794 12 431 6 215 2 412 12 046 707 606 1 039 3 735 2 430 17 821 2 224 10 619 155 395

56.4 107.5 58.9 108.4 35.3 45.0 129.0 49.7 15.6 79.8 39.0 62.6 320.9 36.5 90.1 27.0 208.9 170.9 67.2 89.0 133.5 98.1 837.5 143.1 108.6 55.7 78.8 135.6 120.5 130.7 187.5 90.6 98.2

225 48 38 613 269 117 13 1 957 66 85 98 9 201 113 791 110 63

12 000 500 3 000 1 000 3 000

4 187

1 000

2 000

500 500 3 000

500 500 5 000

4 000 60 000

501 25 910

500 43 500

4 500 103 500

A59/28 Page 78

Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars) Regional Office for the Eastern Mediterranean Country Programme Area of work Communicable disease surveillance Communicable disease prevention, eradication and control Research and product development for communicable diseases Malaria Tuberculosis Surveillance, prevention and management of noncommunicable diseases Tobacco Health promotion Injuries and disabilities Mental health and substance abuse Child and adolescent health Research and programme development in reproductive health Making pregnancy safer Women's health HIV/AIDS Sustainable development Nutrition Health and environment Food safety Emergency preparedness and response Essential medicines: access, quality and rational use Immunization and vaccine development Blood safety and clinical technology Evidence for health policy Health information management and dissemination Research policy and promotion Organization of health services Governing bodies Resource mobilization, and external cooperation and partnerships Programme planning, monitoring and evaluation Human resources development Budget and financial management Infrastructure and informatics services Director-General, Regional Directors and independent functions WHO's presence in countries Total - Eastern Mediterranean budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

1 836 783

2 069 677

940 645

1 033 1 254

2 776 1 428

3 102 1 931

1 599 1 197 1 213 287 1 387 295 541 1 181

1 458 854 1 655 169 1 434 248 561 1 363

635 430 476 414 695 354 468 384 57 576 293 563 504 259 1 509 369 263 513 446 650 952 1 338 450 5 688 228 739 685 1 043 1 331 5 328 2 548

279 306 430 350 1 567 9 107 116

2 234 1 627 1 689 701 2 082 649 1 009 1 565 57 1 363 328 1 349 3 524 432 4 224 763 962 1 717 1 603 2 154 1 917 2 001 1 808 18 265 228 933 685 1 043 1 331 5 328 2 548 12 026 82 349

1 737 1 160 2 085 519 3 001 257 668 1 479

787 35 786 3 020 173 2 715 394 699 1 204 1 157 1 504 965 663 1 358 12 577

712 36 843 3 263 312 892 234 753 757 637 1 616 714 1 040 227 13 861

347 211 635 330 2 490 344 265 196 411 373 658 2 223 1 295 4 526 393 3 256 1 015 809 1 077 4 343 3 862 34 510

1 059 36 1 054 3 898 642 3 382 578 1 018 953 1 048 1 989 1 372 3 263 1 522 18 387 393 3 256 1 015 809 1 077 4 343 3 862 10 976 81 871

194

12 026 50 576

10 976 47 361

31 773

A59/28 Page 79

Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

2 000 3 000 500 7 000 13 000 500 500 500 500 1 000 3 000 500 1 000 500 7 000 500 500 1 000 33 000

451 634

4 000 1 000 1 000 5 000 1 000 500 1 000 500 500 2 000 500

35 828 231 1 702 1 055 976 497 128 417 360 904 285 223 17 1 987 538 563 503 21 7 651 505 36 194 67 907 305 17 527

6 000 4 000 1 500 12 000 14 000 1 000 1 500 500 1 000 1 500 5 000 1 000 1 000 500 10 000 500 1 000 1 500 35 000 500 78 000 500 4 500 2 000 1 500 5 000

486 1 462 231 9 916 12 149 1 278 566 160 409 433 950 892 223 21 5 430 953 854 566 21 122 875 1 660 119 866 169 907 780 37 3 495

8 776 5 428 1 500 14 234 15 627 2 689 2 201 2 582 1 649 2 509 6 565 1 057 2 363 828 11 349 4 024 432 5 224 2 263 35 962 2 217 79 603 2 654 6 417 4 001 3 308 23 265 228 933 1 685 1 543 1 831 10 328 2 548 16 526 284 349

3 588 3 393 231 11 653 13 309 3 363 1 085 3 161 666 1 101 2 429 892 1 282 57 6 484 4 851 1 496 3 948 599 123 893 2 613 120 914 2 158 2 279 4 043 1 559 21 882 393 4 193 1 052 1 589 1 253 13 872 3 917 21 153 390 351

40.9 62.5 15.4 81.9 85.2 125.1 49.3 122.4 40.4 43.9 37.0 84.4 54.3 6.9 57.1 120.6 346.3 75.6 26.5 344.5 117.9 151.9 81.3 35.5 101.0 47.1 94.1 172.4 449.4 62.4 103.0 68.4 134.3 153.7 128.0 137.3

8 214 11 094 302 69 32 ( 8) 73 46 607 4 3 443 415 291 63 115 224 1 155 83 672 102

3 000

500 500 2 000 500 19 000 2 000

59 000 500 2 500 1 000 1 000 4 000

475 20 2 968

1 000 500 1 000

2 000 ( 1) 9 225 238 570

1 000 500 500 3 000

937 37 780 176 9 529 56 952 69 910

1 000 500 500 5 000

937 37 780 176 9 529 55 10 177 308 480

4 000 149 500

500 52 500

4 500 202 000

A59/28 Page 80

Table 4 (continued) Budget and expenditure summary by area of work - by office Financial period 2004-2005 (in thousands of US dollars)

Regional Office for the Western Pacific Country Programme Area of work budget Expenditure

Regular budget Regional Programme budget Expenditure Total regular budget Programme budget Expenditure

1 324 939

1 249 841

1 358 197

1 693 182

2 682 1 136

2 942 1 023

1 330 807 1 397 464 843 323 663 591 54 388 504 225 1 766 504 27 1 010 684 744 452 10 59 11 930

1 075 391 1 293 290 1 335 181 558 1 248 499 106 43 602 347 1 182 697 58 904 1 135 947 839

1 162 989 930 524 429 129 557 540 52 641 40 661 282 2 133 364 107 832 939 233 871 1 627 253 3 574 461 1 766 263 776 1 146 6 097 1 903 148

2 013 1 165 781 683 363 82 479 418 49 532 29 611 334 2 151 484 101 833 930 222 921 1 550 196 3 386 471 1 535 283 622 1 030 5 747 1 346 67

2 492 1 796 2 327 988 1 272 452 1 220 1 131 106 1 029 40 1 165 507 3 899 868 134 1 842 1 623 977 1 323 1 637 312 15 504 461 2 772 263 776 1 146 6 097 1 903 12 156

3 088 1 556 2 074 973 1 698 263 1 037 1 666 548 638 72 1 213 681 3 333 1 181 159 1 737 2 065 1 169 1 760 1 550 298 12 962 471 1 535 413 622 1 030 5 747 1 772 14 160

102 9 576

1 006 130

12 008

426 14 093

Miscellaneous Real Estate Fund Total - Western Pacific

40 052

40 147

31 984

31 289

72 036

71 436

A59/28 Page 81

Table 4 (continued)

Other sources Country Programme budget Expenditure Regional Programme budget Expenditure Total other sources Programme budget Expenditure Programme budget

Total

Expenditure

2 000 3 000

6 391 1 664

2 000 2 000

3 955 3 284 101 2 887 5 358 1 043 993 138 511 564 950 379 532 18 4 347 192 505 1 161 248 1 166 1 950 8 294 330 637 29 147 3 326 403 1 660 18 585 390 1 194

4 000 5 000

10 346 4 948 101 12 982 9 624 1 310 1 233 399 615 609 1 453 1 076 532 18 12 687 959 747 1 442 412 1 932 2 198 12 980 1 661 880 29 147 5 918 403 1 660 18 585 390 1 194

6 682 6 136

13 288 5 971 101 16 070 11 180 3 384 2 206 2 097 878 1 646 3 119 1 624 1 170 90 13 900 959 1 428 4 775 1 593 2 091 3 935 15 045 2 830 2 640 1 579 445 18 880 874 3 195 431 1 207 1 420 6 941 1 772 17 379 6 003 172 146

198.9 97.3

4 000 7 000

10 095 4 266 267 240 261 104 45 503 697

4 000 5 000 500 1 000 500 500 3 000 500 500 3 000 500 2 000 500 1 000 1 000 4 000 2 000 500 500 1 000

8 000 12 000 500 1 500 1 500 2 500 500 5 000 1 500 1 500 12 000 1 500 500 6 000 1 500 5 000 1 000 15 000 500 5 000 1 000 1 500 6 000

10 492 13 796 2 827 2 488 2 772 2 952 1 720 6 131 1 606 2 529 40 13 165 1 500 1 007 9 899 2 368 5 134 2 842 16 623 1 477 6 323 2 637 1 812 21 504 461 13 772 263 1 776 2 146 11 097 1 903 15 656

153.2 81.0 119.7 88.7 75.6 29.7 95.7 50.9 101.1 46.3 225.0 105.6 63.9 141.8 48.2 67.3 40.7 138.5 90.5 191.6 41.8 59.9 24.6 87.8 189.6 23.2 163.9 68.0 66.2 62.5 93.1 111.0

500 1 000 2 000 500 2 000 1 000 1 000 9 000 1 000 500 4 000 1 000 4 000

8 340 767 242 281 164 766 248 4 686 1 331 243

11 000 500 3 000 500 1 000 5 000

2 592

11 000 500 2 000 500 1 000 3 000

11 000 1 000 1 000 5 000

3 000

3 006

500

213 6 003 53 511

3 500

3 219 6 003 100 710

70 000

47 199

51 500

121 500

193 536

88.9

A59/28 Page 82

Table 5 Expenditure by sources of funds Financial period 2004-2005 (in thousands of US dollars) 2004-2005 % 2002-2003 %

Regular budget Other sources: Voluntary Fund for Health Promotion Special Account for Servicing Costs Supply services trust funds All others Iraq Programme (UN SCR 1472 and 1476) TDR a/ All other trust funds African Programme for Onchocerciasis Control HRP b/ Information Technology Fund Security Fund Sasakawa Health Trust Fund Revolving Sales Fund Staff Development Fund Associate Professional Officers Revolving Fund for Teaching and Laboratory Equipment Programmes financed by appropriation from casual income Onchocerciasis Control Programme Special Account for Income Derived from Patent Policy Special Account for the WHO Renewal Fund Trust Fund for the Global Programme on AIDS United Nations sources United Nations Population Fund Iraq Programme (UN SCR 1472 and 1476) United Nations Children's Fund United Nations Iraq Programme SCR 986 United Nations Development Programme United Nations Environment Programme United Nations International Drug Control Programme United Nations Afghanistan Emergency Trust Fund

871 163 1 623 160 198 209 91 875 3 113 65 699 51 563 26 159 26 113 13 223 10 303 9 311 7 843 7 536 6 584 606 (14)

28.7

827 401 1 016 559 121 977 2 179 18 524 61 418 42 085 20 414 27 410 482 6 961 10 268 7 535 6 231 2 531 12 580 100 (51) (33)

35.7

53.6 6.5 3.0 0.1 2.2 1.7 0.9 0.9 0.4 0.3 0.3 0.3 0.3 0.2

43.9 5.3 0.1 0.8 2.7 1.8 0.9 1.2 0.3 0.4 0.3 0.3 0.1 0.5

9 893 3 733 2 270 1 444 1 441 771 37

0.4 0.1 0.1

9 552 347 5 326 108 474 4 733 968 780 8

0.4 0.2 4.7 0.2

Total - Other sources Sub-total Less: Eliminations (see Statement I, Annex 2) Total -WHO programme activities

2 160 872 3 032 035 (303 365) 2 728 670

71.3 100.0

1 487 358 2 314 759 (267 125) 2 047 634

64.3 100.0

a/ b/

A59/28 Page 83

Table 6 Financial implementation by category of expenditure and sources of funds Financial period 2004-2005 (in thousands of US dollars)

Sources of funds Voluntary Fund Special Account for Servicing Costs Other funds including United Nations sources Total

Category of expenditure

Regular Budget

for Health Promotion

% Salaries and common staff costs Short-term staff Consultants Temporary advisers Members of expert committees, study groups and scientific groups Governing body delegates and members Travel on official business Research contracts Contractual services, translation, printing, data processing and other operations Supplies and materials, rental and maintenance of premises and equipment, stationery, utilities and communications Supplies in kind and in services Acquisition of furniture and equipment Acquisition and improvement of premises Fellowships and other educational activities Local cost subsidies General project costs - The Americas - Other Hedging operations Other expenditure, including programme support costs and joint activities with the United Nations Sub-total Eliminations (see Statement I) Total - WHO programme activities (29 623) (3.4) 507 733 91 534 5 039 7 136 775 339 21 789 727 2.5 0.1 58.2 10.5 0.6 0.8 0.1 157 024 279 508 40 879 47 477 234 5 58 208 25 420

% 9.7 17.2 2.5 2.9 65 807 38 929 719 645 119 100 3.6 1.6 4 740 86

% 33.2 19.6 0.4 0.3 0.1 0.1 2.4 7 016 28 676 53 082 28 142 1 769 8 900 3

% 15.5 8.3 0.5 2.6 783 646 438 113 48 406 64 158 1 131 444 2.1 8.4 91 753 54 909

% 25.9 14.4 1.6 2.1

3.0 1.8

65 920

7.6

218 662

13.5

17 424

8.8

30 291

8.9

332 297

11.0

67 777 15 404 255 31 225 37 561 23 355

7.8 1.8

262 615 51 731 68 067 8 317

16.2 3.2 4.2 0.5 1.8 22.5 1.1 (5.5)

33 018 13 859 2 876 511 1 022 362

16.7 7.0 1.5 0.3 0.5 0.2

116 611 7 809 533 8 790 23 047 2 292

34.2 2.3 0.2 2.6 6.8 0.7

480 021 51 731 105 139 11 981 69 330 427 403 44 524 (88 925) (29 623)

15.8 1.7 3.5 0.4 2.3 14.1 1.5 (2.9) (1.0)

3.6 4.3 2.7

28 804 365 773 18 515 (88 925)

24 217 871 163

2.8 100.0

80 846 1 623 160

5.0 100.0

17 992 198 209

9.1 100.0

22 542 339 503

6.6 100.0

145 597 3 032 035 (303 365) 2 728 670

4.8 100.0

A59/28 Page 84

Glossary of budgetary and financial terms 2004-2005 This glossary of budgetary and financial terms provides an explanation of the main terms used in the two documents that present the WHO financial framework. The Programme Budget is approved by the Health Assembly and is a plan in programmatic terms for the work of the Organization in the biennium. The Financial Report, which is audited on a biennial basis, provides information on the actual expenditure of the Organization and shows the assets and liabilities at the end of each year. The report of the External Auditor is presented together with the Financial Report and enables Member States and other readers of the Financial Report to know that an independent audit has taken place and whether there are any significant issues that require attention. The External Auditor also gives an opinion on whether the Financial Report for the biennium presents fairly, in all respects, the financial position of the Organization. Account: a formal record of an asset, liability, revenue or expense in which the effects of transactions are indicated in terms of money or some other unit of measurement. Accounting, cash basis of: the method of recording transactions by which income and expenditure and other costs are recorded on the basis of actual collection or disbursement of cash in a given period. Accrual: the accrual basis of accounting for revenue in each financial period means that income is recognized when it is due and not when it is received. Accrual of expenditure in each financial period means that costs are recognized when obligations arise or liabilities are incurred and not when payments are made. Appropriation: an amount voted by the Health Assembly for a specified purpose and for a financial period. This represents a ceiling, a maximum figure against which regular budget obligations may be incurred. Effective appropriation: represents the amount of the appropriation after taking into account any transfers which the DirectorGeneral is authorized to make between appropriation sections. Appropriation resolution: a resolution by the Health Assembly approving the regular budget appropriations for a financial period and their financing. The appropriation resolution also notes the amount of the expenditure in the Programme Budget to be financed from other sources. Assessment, scale of: a scale established by the Health Assembly to apportion the amount required for the regular budget net assessments of the Organization for a given period among Member States. Budget: a plan in financial terms for the carrying out of a programme of activities in a specific period. A programme budget focuses upon the work to be undertaken and the objectives sought through that work: it emphasizes the ends to be achieved and translates them into the costs required for their implementation. Decisions relate both to resource levels, financing and to results to be achieved. Budget, effective working: represents that part of the approved regular budget against which the Director-General is authorized to incur obligations. Budget, working: The working budget comprises allocations from the regular budget and other sources and represents that part of the programme budget that has been allocated as adjusted by transfers between appropriation sections and/or Offices. Disbursements: payment in cash. Exchange rate hedging: this mechanism seeks to maintain the level of the budget so that the activities represented by the budget approved by the Health Assembly may be carried out irrespective of the effect of any fluctuation of currencies against the US dollar. Expenditure: expenditure for a financial period is the total amount of obligations. This figure represents the sum of disbursements and unliquidated obligations made against an appropriation or other sources. Fund accounting: the method of accounting under which each fund is maintained as a distinct financial and accounting entity with a separate, self-balancing group of accounts.

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Imprest accounts: a fund or an account established with a fixed amount and maintained at that level by periodic replenishments of the sums disbursed. Generally, imprest accounts are used for making payments in Country Office locations. Internal borrowing: a mechanism by which, once the Working Capital Fund has been fully utilized, other available funds are used in order to finance regular budget implementation pending the receipt of assessed contributions. Internal borrowing is repaid when Member States pay their arrears of assessed contributions. Liability: a current obligation, the settlement of which is expected to result in an outflow of resources from the Organization. These include: i. Contributions or payments received in advance; ii. Borrowings payable within one year; iii. Unliquidated obligations; iv. Accounts payable, including inter-fund balances payable and other accounts payable; v. Other funds and special accounts; vi. Other liabilities; vii. Borrowings payable after one year. Obligation: a commitment or undertaking that creates a legal liability against the resources of the Organization. Obligation, unliquidated: that part of an obligation which has not been disbursed, i.e. an outstanding liability. Revolving fund: a fund established so that income from specific activities may be used to cover the costs of those activities. Any surplus may be carried forward to a future period. Savings on unliquidated obligations: the balance remaining within unliquidated obligations after payment of all liabilities under those obligations. Tax equalization fund: a fund to which is credited the revenue from Staff Assessment and which is reduced by: i. Refunds to staff for income taxes levied on their emoluments; ii. Credits against the assessed contributions of Members, in proportion to their assessments but less any income taxes they have levied on the emoluments received from the Organization by their nationals or others liable to such taxes. Unobligated balance: that part of an appropriation, contribution or allotment which has not been obligated. The unobligated balance of regular budget appropriations at the end of the financial period could either be funded in total, in part, or not at all depending on the extent to which assessed contributions have been collected. Any funded part of the unobligated balance of regular budget appropriations is credited to miscellaneous income. The unfunded part of the unobligated balance of regular budget appropriations represents the amount of the budget appropriations that cannot be implemented. The unfunded part is credited to miscellaneous income only when the underlying outstanding assessed contributions are collected. Working capital fund: a fund established by the Health Assembly for the purpose of financing regular budget implementation pending receipt of assessed contributions. Withdrawals from the fund are reimbursed when Members eventually pay their arrears of assessed contributions.

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REPORT OF THE EXTERNAL AUDITOR TO THE WORLD HEALTH ASSEMBLY ON THE FINANCIAL OPERATIONS OF THE WORLD HEALTH ORGANIZATION FOR THE FINANCIAL PERIOD 1 JANUARY 2004 TO 31 DECEMBER 2005 1. The audit of the World Health Organization (WHO) was assigned to the Comptroller and Auditor-General of India for the financial periods 2004-2005 and 2006-2007, in terms of resolution WHA 56.8 of the Fifty-sixth World Health Assembly. 2. During the financial period 2004-2005, audits were performed at all Regional offices of the Organization, in addition to selected country offices. My Interim Report, containing the results of the audits performed in the first year of the financial period, was transmitted to the Fifty-eighth World Health Assembly in document A58/28. In the second year of the financial period, we continued to perform audits at different levels of the Organization. Audits were conducted at the Regional Office for South-East Asia (SEARO) as well as the Regional Office for Europe (EURO). Three country offices were also audited. 3. Apart from the audits performed in the Regional and country offices, two in-depth reviews were also conducted at the Headquarters of the Organization. These reviews, the findings of which are discussed subsequently in this report, examined the functioning of the Contracting and Procurement Services unit at Headquarters and the establishment and management of Technical Services Agreements by different technical departments at WHO Headquarters. The findings arising from all the audits were conveyed to the relevant managements through management letters. The results of these audits, appropriately aggregated, have been taken into consideration while framing this report. 4. The scope of the audit was in accordance with Regulation XIV of the Financial Regulations and the Additional Terms of Reference governing the External Audit appended thereto. In accordance with these terms of reference, the auditor shall express an opinion on the financial statements for the financial period and report on the financial operations and various other matters set out therein. 5. The audit was conducted in accordance with the Common Auditing Standards of the Panel of External Auditors of the United Nations, the specialized agencies and the International Atomic Energy Agency. The audit approach followed was comprehensive, encompassing financial, compliance and value-added aspects. 6. The audit of the financial statements for the financial period 2004-2005 was completed and I have expressed an unqualified opinion on the financial statements for the financial period ended 31 December 2005. 7. The working relationship with the Secretariat continues to be constructive and I have received the required cooperation in the discharge of my functions. Effective and regular coordination with the Office of Internal Oversight Services has assisted in the avoidance of duplication and overlapping of activities. Reliance was placed on the work performed by internal audit to the extent that it related to the audit objectives of the external audit process. 8. As had been recommended earlier by the Programme, Budget and Administration Committee, this report which covers the financial period 2004-2005, contains a schedule depicting the status of implementation of significant recommendations made by the External Auditor. The Secretariat has also developed a programme for the tracking of implementation of recommendations, made by both External Audit and the Office of Internal Oversight Services, which was presented to the Executive Board in its 117th session. Periodic monitoring of the implementation of these recommendations will serve to strengthen accountability within the Organization. 9. I also note that the Secretariat has developed and disseminated an accountability framework that seeks to bring together various aspects of responsibility, authority and accountability. Decentralization involves delegation of responsibility and authority and, therefore, accountability for actions also requires to be clearly defined. The accountability framework is intended to be a part of the overall corporate governance and oversight framework of the Organization.

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10. In addition to the audit of WHO, the separate accounts of the African Programme on Onchocerciasis Control, the Trust Fund for the Special Programme for Research and Training in Tropical Diseases, the Trust Fund for the Joint United Nations Programme on HIV/AIDS, the International Computing Centre and the International Agency for Research in Cancer were also examined. The respective audit opinions are transmitted separately to the governing bodies or management committees of these entities.

FINANCIAL MATTERS 11. The rate of collection in respect of assessed contributions during the financial period 2004-2005 was 94%, which was the same as in the previous financial period. 12. As at 31 December 2005, a sum of USD 82.03 million was owed by Member States and Associate Members, out of which USD 29.75 million related to the period 1987-2003. Further, a sum of USD 58 million was owed by Member States and Associate Members, as at 31 December 2005, under special arrangements authorized by the World Health Assembly. The total contributions outstanding as at 31 December 2005 amounted to USD 140.03 million, while at the end of the previous financial period, the corresponding balance stood at USD 137.25 million. 13. Pending the receipt of assessed contributions, implementation of the regular budget may be financed from the Working Capital Fund and, thereafter, by internal borrowings against the available cash reserves of the Organization, excluding Trust Funds. Total borrowings, as at 31 December 2005, stood at USD 44.03 million as compared to USD 32.74 million as at the end of the financial period 2002-2003. 14. The level of extrabudgetary funding being received by the Organization is significant. During the financial period 2004-2005, the total amount received for WHO programme activity was USD 1.94 billion, in comparison to USD1.14 billion in the financial period 2002-2003. 15. The increasing level of extrabudgetary funding evidently calls for increased administrative and support work, which is financed by the regular budget and through the medium of Programme Support Costs. Since extrabudgetary funding continues to grow at a rate faster than that of the regular budget, a larger proportion of the regular budget would need to be utilized to support extrabudgetary activities. A related issue is the utilization of Programme Support Costs, which are currently being allocated to Headquarters and the Regional offices. The Secretariat has indicated that the overall policy relating to Programme Support Costs was being reviewed, including issues related to the recovery of costs, the rates to be applied for Programme Support Costs and the subsequent allocation and use of the earnings arising from Programme Support Costs. 16. The Fifty-seventh World Health Assembly had requested the Director-General to develop guiding principles, based on objective criteria, to be applied in the allocation of funds from all sources, taking into account equity, efficiency and performance, and support to countries in greatest need, in particular least developed countries. It is noted that the Secretariat has developed guiding principles for the strategic allocation of resources, linked to the results-based management framework of the Organization, which have been discussed by the Executive Board and the Regional Committees. A validation mechanism, to provide an objective and transparent relative resource indication across Headquarters and Regions for all sources of funds, was also developed. The guiding principles and validation mechanism were discussed by the Executive Board in its 117th session in January 2006. It was decided that the item would be referred to the Programme, Budget and Administration Committee at its next meeting, for further consideration by the Executive Board at its 118th session.

POLICIES AND PROCEDURES 17. Earlier reports of the External Auditor had indicated areas where specific and formalized policies and procedures should be attempted. These included, among others, a fraud prevention policy, a comprehensive framework for delegation of authority and an environmental policy.

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18. I am pleased to note that the Secretariat has since issued the fraud prevention policy, which has been disseminated across the Organization. Additionally, fraud awareness guidelines have also been developed and issued, which are to be used in conjunction with the fraud prevention policy. The purpose of these guidelines is to inform and enhance the understanding of managers and staff about assessing risk, the conditions that encourage fraudulent activities, preventive measures and actions to be taken in the event of a fraud being detected. The fraud prevention policy and associated guidelines will contribute to raising awareness and minimizing the exposure of the Organization to the consequences associated with fraudulent activities. 19. I understand that the Secretariat is working on the development of a detailed framework of delegation of responsibility and authority. The framework aims to spell out managerial, as well as administrative and financial responsibilities of those to whom the Director-General has delegated authority, including the Assistant-Directors General and the Regional Directors. The WHO Accountability Framework also contemplates a system of annual Letters of Representation to be obtained from Regional Directors and Assistant-Directors General and downwards for all staff who have been delegated financial authority. It is expected that the framework of delegation of responsibility and authority will be formalized in the near future. 20. My Interim Report had mentioned that a draft environmental policy had been prepared and was undergoing technical review. After its approval for Organization-wide endorsement by the Director-General, environmental management systems were to be developed by each location, taking into account local conditions and legislation. I have been informed that work on the environmental policy is still ongoing and it is yet to be formalized and issued.

BUDGET AND FINANCE UNIT IN THE REGIONAL OFFICE FOR AFRICA 21. The operations of the Regional office for Africa are divided between two locations, Brazzaville and Harare. In order to address issues, arising out of the difficulties in operating the budget control and financial accounting system in two locations, an external consulting firm had been commissioned in 2004 to review the budget and finance functions. The consulting firm had issued its report in May 2004. Its recommendations were examined in the Regional office and a course of action had been suggested to senior management. However, no action on the recommendations could be taken in 2004. 22. Subsequently, in 2005, a new strategic vision has been developed for the Region, focussing on enhancing the Organization's performance at country level. This strategic vision includes consolidation of the Budget and Finance Unit, within the Division of Administration and Finance in Brazzaville. The intention is to strengthen country offices, inter alia through significant decentralization envisaging the redevelopment of four to five InterCountry Teams, that would provide technical and management support to clusters of eight to twelve countries. This approach would subsequently involve decentralization of the Division of Administration and Finance, in order to provide the required management support at levels of the country and the Inter Country Teams. However, the Regional office is of the view that the decentralization of the Budget and Finance unit will require changes in the current information technology system. Full implementation of the planned decentralization would have to wait for the implementation of the Global Management System, unless costeffective modifications could be made to the existing Regional Office- Administration and Finance System. 23. Until the consolidation of the Budget and Finance Unit takes place the difficulties, associated with split operations across two locations and the related impact on direct supervision and internal controls mentioned by the external consultants in May 2004, would continue to persist.

CONTRACTS FOR SERVICES 24. Contracts for miscellaneous short-term or technical services with firms or individuals are formalized through Agreements for Performance of Work. Adjudication reports are required, for contracts of value of USD 15,000 and above, to demonstrate in a substantive and detailed manner the objectivity and fairness of the process undertaken to select the contractual partner. My Interim Report had focussed on instances where adjudication reports had not been prepared.

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25. During our audits, we have continued to notice cases where adjudication reports had not been prepared though the contract values exceeded USD 15,000. In some cases, technical and financial reports had not been submitted though the contractual periods had ended. The absence of such reports renders it difficult to assess whether the contractual partners have delivered the required services to the satisfaction of the Organization. The Secretariat should continue its efforts to ensure compliance with the requirements underpinning such contracts for services.

LOCAL COST SUBSIDIES 26. Local cost subsidies are payments made by the Organization to cover the costs of items that would otherwise be borne by national governments, in order to strengthen their health development capacity in, or to meet their commitments to, WHO technical cooperation at country level. Funds for local cost activities are provided by way of advances, after formalizing the agreements which include costing details and permissible categories of expenditure. Financial reports are to be submitted by the national governments to the responsible WHO official who has to certify that expenditures were admissible and in conformity with the objectives of the agreements. 27. There have been some difficulties associated with the receipt of the stipulated financial returns from national governments concerned and these have been mentioned in earlier reports of the External Auditor. These financial returns are integral to the accountability process and are required to assess whether activities and related expenditures were in conformity with programme objectives. 28. The Secretariat has been addressing, since 2001, the subject of the overall policy and procedures to be followed, in relation to the issue of local cost subsidies. Local cost subsidies will now be known as Direct Financial Cooperation and a revised policy, setting out the principles for funding support to countries, has been formalized and is effective from January 2006. 29. The revised policy is set against the framework of results-based management and lays emphasis on technical reports that would address programmatic outcomes. While the technical reports would include a summary expenditure statement certified by the responsible government official, the revised policy attempts to shift the emphasis from financial reporting to technical reporting. Since results-based management involves an integrated budget, the existing financial ceilings on local costs would no longer be required, since they applied to the regular budget. This is expected to facilitate the Regional Directors in assessing the level of direct financial support to governments required in order to achieve the desired outcomes. Requests for financial support from WHO would have to be related to approved work plans and would need to be formalized through an agreement. 30. The revised policy notes that, in some cases, statements of expenditure, for local costs advances given in the past, were still outstanding. Despite follow-up, some governments have been unable to produce records relating to these long-standing releases. It has now been decided that each Regional office would do a comprehensive analysis of the amounts involved and the periods for which statements of expenditure have not been submitted. They would write to the governments concerned and request them to either refund balances, or provide statements of expenditure and certify that the funds have been spent for the intended purposes. A condition of WHO's acceptance of the governments' certification is their agreement to abide by the principles and procedures applicable to further WHO financing of government activities. On the basis of this information, each Regional Director would write to the Comptroller, seeking a waiver from reporting on outstanding statements of expenditure. Waivers can also be granted to national authorities who are unable to certify prior activities due to a change in government or other similar circumstances. 31. Local cost subsidies accounted for a significant 14.1 per cent of expenditure, from all sources of funds, in the financial period 2004-2005. The accountability for the use of resources, therefore, needs to be ensured. Before any waiver is granted, it is important that the Secretariat satisfy itself that the analysis carried out at Regional offices of amounts advanced, statements of expenditure pending and details of unspent balances are thorough and complete. Waivers should be granted only after all possibilities of obtaining the statements of expenditure are ruled out. The revised procedures also require certification of expenditures and details of unspent balances and prescribe that advances be withheld from contractual partners who have overdue technical and financial reports. Compliance with these requirements should be monitored closely and corrective measures taken, where required. This would obviate the possibility of similar situations arising in future.

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TRAVEL ADVANCES 32. The issue of outstanding travel advances had been discussed in my Interim Report, wherein it had been mentioned that at WHO Headquarters complete information on travel advances granted prior to 15 October 2004, the date of introduction of the revised travel policy, was not readily available. It was planned to clear the backlog of travel advances by the end of 2005. As of 31 December 2005, 640 transactions were pending which were more than a year old. Of these, 466 cases involving an amount of USD 635,000 would involve recoveries from staff members. The Secretariat expects to clear the 466 cases by July 2006. The Secretariat is encouraged to continue focussing attention on this issue. 33. Similarly, in an audit performed at a country office in the African region, a review of outstanding travel advances revealed that there were 256 cases where advances were outstanding for more than two years and there were 414 cases where advances were outstanding for periods ranging between one and two years. The country office has since issued instructions to address the problem of outstanding travel advances and it will be necessary to closely monitor progress so as to ensure that all outstanding advances are appropriately adjusted.

CONTRACTING AND PROCUREMENT SERVICES AT HEADQUARTERS 34. A detailed study of the Contracting and Procurement Services (CPS) unit at WHO Headquarters was performed in order to review the procedures and practices being followed in relation to the procurement of goods and to examine whether they were in consonance with the WHO Manual. Procurement of goods is an area of risk and the audit also aimed to ascertain whether the controls in place served to mitigate such risk. The audit was based on a risk analysis and included review of high value Purchase Orders approved by the Contract Review Committee and procurements related to emergencies. After the audit was concluded, a management letter containing specific recommendations was issued to the Secretariat. These recommendations and the Secretariat's responses are discussed in the subsequent paragraphs. 35. Procurement process: CPS is headed by the Coordinator, CPS and functions under the supervision of the Director, Infrastructure and Logistics Services (ILS). There are five procurement units dealing with different products and supplies. These are: Computer and Office Supplies; Drugs and Biologicals; Environment and Medical procurement; Hospital and Teaching equipment and Laboratory supplies. A separate unit is responsible for the e-procurement system called WebBuy. 36. The procurement process in WHO aims to obtain goods suited to the purpose for which they are to be used, for delivery by the time required and at the lowest cost. Regional offices are authorized to make purchases for their respective Regions and also to delegate authority within prescribed cost limits. Items which cannot be purchased at the Regional level are referred to Headquarters. CPS is responsible for handling Regional requisitions as well as procurements at Headquarters. 37. CPS processes all procurement requests, known as Purchase Authorizations, which are sent to them after the indenters ensure that funds are available to cover the proposed purchase and appropriate approvals are obtained. CPS calls for bids, prepares adjudication reports, makes submissions to the Contract Review Committee (CRC) in the case of high value purchases which exceed USD150, 000. Subsequently, Purchase Orders are issued to suppliers. The Purchase Order, along with the supplier's acknowledgement, constitutes a legal contract. 38. During the period 1 January 2004 to 30 September 2005, 9713 purchase orders were processed by CPS, amounting to USD 153.39 million. 39. Contract file management: It was noticed that the existing system of management of contract files requires to be streamlined and improved. While a master file was maintained for each purchase authorization, separate folders were maintained for each purchase order resulting from the purchase authorization. In cases referred to the CRC, the files were incomplete in that invitations to bid were not available in some files; bid documents received from suppliers were not available in the purchase authorization/ purchase order files; papers relating to the public opening of bids were not found in any of the folders. However, it was noticed that these documents were available in different folders and files maintained in CPS. Procurement actions involve considerable financial implications and it is essential that all documents, leading up to the procurement decision, are kept systematically together. This will establish the audit trail and enable subsequent independent review.

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40. I recommend that appropriate changes be effected in order to ensure the orderly maintenance of contract files, which would enhance transparency and facilitate the completion of audit procedures. Institutional guidance, by way of a provision in the WHO Manual, should be provided on the manner in which a contract file is to be managed. 41. The Secretariat has accepted the recommendation and has stated that instructions and institutional guidance were being prepared for implementation as from 1 January 2006.They also stated that CPS was planning to launch a project, in the near future, to establish an e-filing system for all procurement related documentation. 42. Low value purchase orders: The WHO Manual provides that where significant economies are not expected to result from central purchasing, users should be authorized to purchase directly from the supplier. An analysis was conducted of the 9713 purchase orders issued by CPS, in the period 1 January 2004 to 30 September 2005. Out of these, 6591 purchase orders had been issued on behalf of Regional offices. It was also noticed that 69% of the orders were below USD 5000 and 33% of the orders were below USD 1000. The value of orders below USD 5000 amounted to only 6.5 % of the total value of procurement during the period of reference. The high proportion of low value orders indicates that scope exists to improve procurement planning, by consolidation of requirements as against fragmented and repeated requisitions. 43. It was noticed that Regional offices had accounted for 26% of the purchase authorizations below USD 5000. In case procurement of lower value items is planned appropriately at the Regional level, it would decrease transaction costs, reduce time taken in procurement actions and free resources at Headquarters to focus on more strategic aspects of procurement planning. 44. I recommend that CPS review this issue, in consultation with Regional offices, so as to ensure an appropriate balance in the value of purchase authorizations being placed by them on Headquarters. 45. The Secretariat, while agreeing with the recommendation, indicated that they would work with Regional offices to increase the volume of low value items to be procured directly by them. This would improve the efficiency and effectiveness of CPS. 46. Suppliers' acknowledgements: Since the purchase order, along with the supplier's acknowledgement or acceptance of the orders, constitutes a legal contract, against which the supplier may demand payment if the goods are delivered, the supplier's agreement should be obtained in writing should cancellation be necessary. CPS sends an acknowledgement copy along with the purchase order mentioning delivery dates, terms of payment and delivery and other general terms and conditions of the contract. However, it was noticed that in many cases, the acknowledgement forms had not been signed and returned by the suppliers. 47. I recommend that suppliers be advised to invariably acknowledge the purchase order. This requirement could also be included in any proposed IT module for procurement. 48. Accepting the recommendation, the Secretariat stated that a proper system check had been established in the Web Buy e-procurement system to ensure that all purchase orders are acknowledged by suppliers. 49. Vendor data base: Procurement in WHO is conducted by calling for bids from a selected list of suppliers. It is, therefore, essential that the list of potential vendors for various non-proprietary items be continually updated. This would facilitate invitation of bids from a larger vendor base and enhance competition. 50. CPS was presently conducting vendor identification through attendance in major medical exhibitions; participation in "contact days" with industry organized by Ministries of Health or Departments of Commerce and industry in different countries; issue of international expressions of interest for different products to identify and evaluate new suppliers and sources. 51. There is presently no system through which data and statistics regarding new vendors identified in the last two years could be extracted. Vendor performance evaluation was not being carried out. CPS stated that analysis of vendor performance was part of the requirements of the proposed Global Management System. It was also envisaged that there would be more Long Term Agreements for different items in future, leading to a possible contraction in the total vendor base.

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52. I recommend that details of potential vendors be documented in a centralized database. A larger vendor database will provide greater choice and enhance competition even for finalizing Long Term Agreements. Vendor performance evaluation should also be considered in the interim period, which will facilitate transition to the Global Management System, as and when it is rolled out. 53. The Secretariat, in response, stated that they would be working on implementation of this recommendation. Specifically, they would start with the performance evaluation of Long Term Agreements entered into with vendors, focussing on criteria linked to delivery timing and quality aspects. 54. Emergencies: The WHO Manual provides that the Director-General or Regional Directors could declare emergencies and also the end of emergencies, after prescribed consultations. During emergencies, the Coordinator, CPS has the authority to approve purchases up to the amount of allotments issued. 55. In the financial period 2004-2005 and up to 30 September 2005, Coordinator CPS had issued 135 purchase orders amounting to USD 13,886,387 under these provisions of the WHO Manual. A review of the purchase authorization and purchase order files showed that the information note /orders of the Director- General or Regional Directors or any other delegated authority, declaring the emergency, were not recorded on the files. 56. I recommend that the purchase orders should cite the specific information note/order declaring the emergency as it involves delegation of financial authority. There should also be a formalized and periodic monitoring of the continuance/withdrawal of the declaration of emergency, in consultation with the appropriate authorities within the Organization. 57. The Secretariat has accepted this recommendation and stated that the written declaration of emergencies, when issued, would be kept on record in consonance with the provisions of the WHO Manual. 58. The WHO Manual provides that procurement should be done with full and free competition. For single purchases above USD 15,000, tenders from three suppliers are to be sought by formal written invitation to bid. Sealed bids are to be invited where purchases are estimated to exceed USD 150,000. While some exceptions to this are permitted, the Manual does not indicate any general waiver of the sealed bid procedure for cases of emergency purchase. In a review of emergency purchase cases, it was noticed that a consistent approach had not been followed. While the sealed bid procedure had been followed in some cases of emergency purchase and the cases submitted to the CRC, in yet other cases of emergency purchase, the sealed bid procedure was not followed nor were the cases submitted to the CRC. In some cases, three bids were not obtained. 59. I recommend that the existing procedures being followed in emergencies, with respect to the invitation of sealed bids and the number of quotes to be obtained, be reviewed in order to ensure both consistency in approach and consonance with the provisions of the WHO Manual. 60. The Secretariat, while noting the recommendation, stated that the WHO Manual was currently under review and that it would be ensured that the wording of the specific Manual provisions would properly reflect the procedures to be followed in emergencies. 61. Purchases based on estimates: The WHO Manual (Manual VI.1.370) provides that CPS may provide price and delivery estimates from central purchasing records in order to assist Regional offices in determining what could be considered a "reasonable cost" for any proposed purchase. The Manual does not provide for calling of quotes to make price estimates. 62. It was noticed that in a case involving the purchase of 298 laboratory refrigerators valuing USD 619,997, the purchase order was issued on the basis of quotes obtained from suppliers. Since the value of the purchase exceeded USD 150,000, the sealed bid procedure should have been followed. However, this had not been done. It was learnt that this was a "Request for Price Estimate" (RPE) case, where the requisitioning office had requested price information. In such cases, the practice is that CPS obtains quotes from different vendors and then sends these price estimates to the requisitioning office, which takes a decision on whether to procure the product, based on its requirements and availability of funds. Thereafter, it would issue a purchase authorization to CPS. Since current rates quoted by vendors are already available, CPS does not invite sealed bids but issues the purchase order, based on available prices.

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63. However, there is no specific provision in the WHO Manual relating to Request for Price Estimates. Procurement based on price estimates cannot supplant the sealed bid procedure, which has certain inbuilt controls. In the instant case, there were neither sealed bids nor consequent public opening of bids; there was no last date for submission of quotes; there had been correspondence with vendors after submission of their original quotes, following which quotes were revised. It had also not been mentioned in the submission to the CRC that the sealed bid procedure had not been followed. 64. I recommend that the practice of finalizing procurement actions based on quotes received in response to "RPE" be reviewed, since it is effectively supplanting the prescribed procedure of inviting sealed bids. Controls built into the bidding process are consequently bypassed, leading to potential risks in procurement decisions. CPS should consider responding to requests for price information from requisitioning offices in the manner prescribed in the WHO Manual. 65. The Secretariat, in response, stated that these comments had been noted and that it would be ensured that the provisions relating to Request for Price Estimates would be reflected in the Procurement section of the Manual, which was currently under review. It would also ensure that the provisions of Manual VI.1.370 are followed while responding to requests for price information. 66. Since procurement is an area of potential risk, we accord these recommendations high priority and will monitor their implementation closely, including through a follow-up review at an appropriate time.

TECHNICAL SERVICES AGREEMENTS AT WHO HEADQUARTERS 67. An audit was performed at WHO Headquarters to review the procedures and controls governing the establishment and management of Technical Services Agreements (TSA). The term TSA refers to an agreement whereby collaborative research services are provided under contract by an institution to WHO. 68. The audit was undertaken across different clusters at Headquarters and covered the Special Programme for Research and Training in Tropical Diseases; HIV/AIDS, Tuberculosis and Malaria (HTM); Family and Community Health (FCH); Non-communicable Diseases and Mental Health (NMH) and Evidence and Information for Policy (EIP). The findings and recommendations, arising out of the audit, were communicated to the Secretariat through a management letter. The response of the Secretariat to the recommendations has also been discussed in the subsequent paragraphs. 69. General conditions: TSAs at Headquarters are concluded by the technically responsible officer and by the programme manager. At the institution, the TSA is required to be signed by the Principal Investigator responsible for the research project and by another official who is authorized to enter into contracting arrangements on behalf of the institution. For research agreements exceeding USD100,000, the institutions concerned should have administrative structures capable of administering and accounting for funds, in accordance with acceptable standards of internal control. 70. TSAs are not to be used for funding maintenance, repair of buildings and laboratories or equipment for institutions. Principal Investigators are required to be employees of the concerned institutions and TSA funds are not to be used for their salary support. The institutions are required to submit technical and financial reports to WHO in terms of the agreement or at least annually. These are among some of the significant conditions governing the funding of TSAs. 71. Delays in formalizing contracts: It was noticed that in many cases, TSAs were being signed by the institutions concerned after the commencement of the contracts. 72. I recommend that agreements be formalized before the commencement of the contract as TSAs represent legal and contractual obligations of the Organization, 73. The Secretariat, while agreeing with the recommendation, stated that various administrative and other processes, both at WHO and at the contracting institutions, sometimes led to delays. More effort would be made to redress this issue since it was agreed that this was not a normally accepted practice. In case there were exceptions in future, they would be accompanied by justification as appropriate.

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74. Advance payments: The Financial Rules of WHO require that advance payments for performance of services be regulated. Advance payments are to be justified in writing. In case advance payments are necessary, the recommended practice is to allow a maximum initial payment of 50 %. Certain departments have specifically been allowed to make 100% advance payments. It was noticed that advance payments were made without written justification in some other departments. 75. I recommend that the requirement of providing justifying memos be invariably complied with in all cases. The Secretariat agreed with the recommendation. 76. Technical and financial reporting: Institutions are required to submit technical and financial reports on their work to WHO, as required or at least annually. In some cases, these reports were not available though they were overdue. In certain cases, there was no evidence of follow up. 77. I recommend that monitoring be appropriately strengthened to ensure the receipt of technical and financial reports. 78. The Secretariat stated that it agreed with and had implemented the recommendation. It was mentioned that, at times, institutions encounter unexpected administrative constraints rendering monitoring difficult. 79. Each TSA is a separate contract, supported by one or more budgetary obligations. Institutions are required to submit technical and financial reports for each TSA, to ensure proper accountal of funds disbursed earlier before signing subsequent contracts. In some multi-year research contracts, it was noticed that subsequent TSAs were signed though the financial reports for previous TSAs had not been received. 80. I recommend that previous financial reports be obtained and taken into account, before concluding subsequent contracts since each TSA covers a separate contract period. The Secretariat agreed with the recommendation. 81. Deviations from conditions: Funds made available to contracting institutions are not to be used to cover salary support of Principal Investigators or utilized for construction of new buildings or alterations and modifications of existing buildings or premises. There were cases where deviations from these conditions were noticed and funds made available for these purposes. Authority to permit such deviations had not been delegated to the departments concerned. 82. I recommend that such cases involving deviations from the general conditions underlying the contracts be examined by the Contract Review Committee. Appropriate instructions should be issued to ensure uniformity in practice across the Organization, while concluding such collaborative research contracts. The Secretariat agreed in principle and stated that these cases were exceptions and had been allowed by the department concerned in view of strong technical reasons. 83. Similarly, it was noticed that TSAs were used to fund activities that had no research component. Since TSAs are specifically meant for collaborative research, I recommend that the Organization review whether TSAs are appropriate instruments to fund such activities. The Secretariat agreed with the recommendation in principle. 84. Subsequent to these recommendations being made I am pleased to note that the Secretariat has, after review, issued specific instructions on advance payments. The existing delegations and authorizations, including those for making advance payments in respect of TSAs stand withdrawn with effect from 31 March 2006. In case certain departments require authorizations for making advance payments for TSAs, they would have to request one-time global approval for all their TSAs and such global approval would need to be renewed at the beginning of each biennium. Complete justification would need to be provided in case of contracts requiring full payment in advance and it would need to be demonstrated as to why such payment terms are necessary in the interest of the Organization. All such exceptions will require approval of the Comptroller. Departments have also been reminded of the need to respect the conditions governing the TSAs and that they should not be used for salary support of principal investigators or funding maintenance, repair of buildings/laboratories and equipment. 85. The above recommendations relating to the management of Technical Services Agreements are accorded medium priority and the Organization should strive to implement them in the financial period 2006-2007.

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ACKNOWLEDGEMENT 86. I wish to record my appreciation for the cooperation and assistance extended by the Director-General, the Regional Directors and the staff of the World Health Organization during my audits.

Vijayendra N. Kaul Comptroller and Auditor-General of India External Auditor 5 April, 2006

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ANNEX The Programme, Budget and Administration Committee of the Executive Board, in its second meeting in May 2005, had recommended that the External Auditor's report for the biennium should include a schedule showing the status of implementation of significant recommendations. Accordingly, the statement below briefly outlines the current status of implementation of significant External Audit recommendations.

STATUS OF IMPLEMENTATION OF EXTERNAL AUDIT RECOMMENDATIONS RECOMMENDATIONS STATUS OF IMPLEMENTATION

Formalization of policies and procedures: The fraud prevention policy and fraud awareness guidelines have been formalized and disseminated. The draft environmental policy is currently under technical review. Progress will be monitored. Accountability Framework issued in January 2006. The draft framework of delegation of authority has been developed and is to be formalized. A Working Group has been established to guide the work related to the revision of the WHO Manual and to coordinate the preparation of the new e-Manual. Progress will be monitored. The policy is yet to be finalized.

Fraud prevention policy

Environmental policy

Framework of delegation of authority

Revision of the WHO Manual

Development of a comprehensive ethics policy B. Local Cost Subsidies:

A new policy on Local Cost Subsidies, now called Direct Financial Cooperation, has been issued effective January 2006. Its implementation It had been recommended that the proposed revised policy on local costs contain will be monitored. adequate safeguards to ensure accountability for use of resources. C. Allotment and expenditure control

It was recommended that the Organization take measures to ensure that This is an ongoing process. The External Auditor will continue to review allotments are respected and that unliquidated obligations be monitored to ensure the progress made in this regard. that the obligations are still required to be maintained.

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Staff advances

It had been recommended that the Organization continue its efforts to review This is an ongoing process and will be regularly monitored by the External and settle travel and salary advances expeditiously, in compliance with stipulated Auditor. Cases of outstanding advances were noticed and brought to the procedures. attention of the Organization for appropriate action. E. Budget and Finance Unit in the Regional Office for Africa

It was recommended that a time-bound plan of action be implemented in It is now proposed to consolidate the Budget and Finance Unit at relation to the reengineering of business processes and the review of budget and Brazzaville. Progress will be monitored. finance functions. F. Non-Expendable Equipment:

It was recommended that measures be taken to establish a complete and The maintenance of inventory records will continue to be monitored consistent set of records of inventories. during visits to Regional and country offices. Inventory count at Headquarters has since been completed in 2005. G. Contracts for services:

It was recommended that compliance with the stipulated procedures governing Cases of non-compliance with the prescribed requirements relating to Agreements for Performance of Work be enforced. adjudication reports were noticed and brought to the attention of the Organization.

Informations clés

Organisation Organisation mondiale de la santé (OMS)

Type de document Governing Bodies documents

Date d'adoption 31 décembre 2006

Source Organisation mondiale de la santé