RESTRICTED
WORLD TRADE WT/SPEC/8
20June1995
ORGANIZATION(95-1663)
Original: English
ADMINISTRATIVE AND FINANCIAL QUESTIONS
External Audit oftheAccounts oftheWTO
1. From 1959to1985theUnited Kingdom Comptroller andAuditor General wasentrusted with
theExternal Audit oftheGATT.
2. In1985 theCommittee onBudget, Finance andAdministration oftheGATT expressed
concern about theevolution oftheAudit costs overtheyears (Annex I).1
3. Consequently, theSecretariat wasrequested tolaunch acompetitive tender. TenNational
Courts ofAudit andtwocommercial audit firms were contacted.
Thefollowing made proposals (Annex II):
Austria Sweden
Denmark United Kingdom
Germany PeatMarwick Mitchell andCo.SA.
Norway Price Waterhouse
4. TheAustrian Court ofAudit2wasretained andstarted theAudit withthe1986 accounts.
Since thentheirmandate hasbeenconstantly renewed (Annex III).
TheAudit team isgenerally composed offourpersons whocome twice ayeartothe
GATT/WTO foraone-week period: onceinSeptember/October foraninterim audit ofthefirstsix
months oftheyear, andinMarch/April ofthefollowing yearforthefinalaudit. Some years they
come forathirdtimebutusually withareduced team.
TheAustrian Court ofAudit audits, andhasaudited, theaccounts ofthefollowing
international organizations: GATT, International Organization forMigration (IOM), European Free
Trade Association (EFTA), aswellasthose oftheEuropean Molecular Biology Laboratory (EMBL),
European Molecular Biology Organization (EMBO), Heidelberg, Germany, theOrganization for
Security andCo-operation inEurope (OSCE), Vienna, Austria, andtheEuropean Patent Organization
(EPO), Munich, Germany.
1For1985 theyamounted toSwF67,000.
2Theprinciple retained bytheAustrian Court ofAudit isthattheycharge onlythemarginal costoftheir
work, i.e.thetravel andperdiem expenses oftheauditing team.WT/SPEC/8
Page2
ANNEX I
Extract from Document L/5881
Report oftheCommittee onBudget, Finance andAdministration
Dated 25October 1985
"77. Members oftheCommittee pointed outthatthecostoftheexternal auditofGATT 'saccounts
hadincreased constantly overthepastfewyears. Details ofthecosts inother organizations andof
theexchange ratesusedforbudgeting weremade available. They requested thattheDirector-General
make acallforcompetitive tenders which theywereconfident would leadtoabudgetary levelmore
inlinewiththatofother organizations. Relevant information would begiven totheCommittee in
duecourse."
"97. TheCommittee noted thattheDirector-General intended tomake thenecessary arrangements
withtheExternal Auditor forthefinalaudit ofthe1985 accounts oftheGATT forsubmission tothe
CONTRACTING PARTIES. With regard totheinterim audit ofthe1986 accounts, theCommittee
recommends totheCouncil that, withregard tothefuture auditing oftheGATT accounts, the
Director-General make acallforcompetitive tenders (seeparagraph 77)"3
3Approved bytheCouncil atitsmeeting on5-6November 1985.WT/SPEC/8
Page3
ANNEX II
Document Spec(86)17
Administrative andFinancial Questions
External Audit ofGATT 'sAccounts from 1986 Onwards
Dated 21April 1986
1. Asrequested bytheCommittee onBudget, Finance andAdministration atitsOctober 1985
session, acallforcompetitive tenders hasbeenmade withaviewtoreducing thecostoftheexternal
audit ofGATT 'saccounts (Document L/5881 paragraph 77page16).
2. Thegovernmental auditors oftencountries aswellastwocommercial auditing firms have
beencontacted.
3. Sixgovernmental auditors (Austria, Denmark, Federal Republic ofGermany, Norway,
Sweden, United Kingdom) andthetwocommercial auditing firms havestated thattheywould be
ready toaudit GATT accounts. Four governmental auditors (Belgium, Finland, France andthe
Netherlands) informed theSecretariat that,duetoother commitments, theycould notaccept thetask.
4. Thefollowing tablesums uptheproposals received:
Minimum number of
years ofappointmentAuditing timeproposed
inGenevaProposed fee
Foreign currency SwF
Austria noindication oneweek/two weeks
alternately5,400/11,200
alternately
Denmark 4years noindication DKr180,000 41,000
Fed.Rep. of
Germanynoindication noindication DM40,000 34,000
Norway 6years 7to8weeks NOK 180,000 48,000
Sweden 3years noindication SEK165,000 43,000
United Kingdom noindication 5weeks £17,000 47,000
Peat, Marwick,
Mitchell &Co.SA4years noindication 150,000 firstyearthen
50,000 perannum
Price Waterhouse
SA3years noindication 49,000
5. Itisrecalled thatthemandate oftheUnited Kingdom Auditor andComptroller General will
come toanendwiththeauditofthe1985accounts, consequently theappointment ofthenewexternal
auditor willstartwith the1986 accounts. This implies thatarecommendation oftheBudget
Committee should beforwarded assoonaspossible totheCouncil foranearly decision.WT/SPEC/8
Page4
ANNEX III
Extract from Document L/6014
Interim Report oftheCommittee onBudget, Finance andAdministration
Dated 4July1986
"External Audit ofGATT 'sAccounts
6. Atitsmeeting ofOctober 1985 theCommittee expressed thedesire thatthecostofthe
external audit ofGATT 'saccounts bereduced toabudgetary level more inlinewiththatofother
organizations andrequested thattheDirector-General make acallforcompetitive tenders inthis
connection.
7. On12May1986 theCommittee wasinformed thatacallforcompetitive tenders hadbeen
requested from tengovernmental auditors aswell astwocommercial auditing firms. Six
governmental auditors andthetwocommercial auditing firms expressed theirwillingness toauditthe
GATT accounts andsubmitted tenders.
8. The Committee examined theproposals received, which ranged from SwF 11,200 to
SwF150,000. Itdecided toselect thelowest tender, thatoftheAustrian Court ofAudit.
9. TheCommittee decided torecommend totheCouncil thattheexternal audit ofGATT 's
accounts beentrusted totheAustrian Court ofAudit witheffect fromtheauditof1986accounts. The
Committee further agreed torecommend totheCouncil thatthethanks oftheCONTRACTING
PARTIES, andappreciation forthemost valuable services rendered since 1959, beextended tothe
Comptroller andAuditor General ofUnited Kingdom."4
4Approved bytheCouncil atitsmeeting on15July1986.