Istanbul, December 2008

1. RBEC DRRs Meeting, Istanbul, December 2008

2. Topics • Atlas upgrade December 08 • IPSAS implementation to be operational by 2010 • Security • Procurement

3. What to expect in 9.0 ATLAS upgrade – High Level • No major changes to the business processes are being introduced with the 9.0 Upgrade • IPSAS functionality will be coming in 2010 • New features and functions of 9.0 will be introduced as requested by the business community and as time and budget permits • User Interface for many of the components has changed • Fewer hyperlinks and more ‘collapsible sections’ • More use of icons • Reorganized the data • Changes to the menu labels • Biggest impact on: eProcurement, Vendor Maintenance, Proposal data entry • Security completely reconfigured in 9.0 • Better aligned with the revised ICF • Extraneous menu items have been removed • Some customizations have been changes/enhanced • Bank defaults • IBAN • Matching options

4. New Feature and Functions for the Future • Contracts module (2010 for UNDP) • Will allow for better management of revenue • Available in 8.4 but the 9.0 version has improved, especially in areas such as reversals and corrections • Integrates seamlessly with Billing and AR • Is required for IPSAS compliance • 9.0 Treasury Module has a series of new feature that will be introduced • Financials Gateway – will facilitate creation of bank interfaces and reconciliation of statements • Investment Pooling – tracks pooled investments (cross agency) and interest calculations • Financials Sanctions Service

5. IPSAS implementation major benefits • Harmonization – increased comparability of financial statements across UN entities/Government-partners. This is in line with the TCPR. • Accountability and Transparency – Aligning UNDP’s accounting policies with international best practices in the public sector, consistent with the UNDP Accountability Framework. Also increased accountability and transparency for donor resources (e.g. reporting assets and liabilities). IPSAS is one of the transparency indicators of UNTAI and DFID • Financial/Donor Reporting – improved financial reporting by showing a complete and accurate view of UNDP’s business. • Reliable Financial Information – more reliable measures of performance e.g. delivery of goods and services will trigger expenses rather than the dispatching of purchase orders; this is consistent with Results Based Management. • Better Management/Procurement – future asset procurement and cash-flow needs will be better predicted since inflows and outflows of resources will be more accurately measured. IPSAS will benefit UNDP through the professionalization of the Finance function. • Credibility – knowing that 53 national Governments are in-process or have adopted IPSAS standards, the UN System will have more credibility with IPSAS adoption.

6. Summary of policy decisions with high impact There are 16 IPSAS standards that will have a significant impact on UNDP. Out of these standards the following have a high impact:

7. Summary of key policy decisions with high impact Expense Recognition for Goods & Services • Current Accounting Policy • Expenditure is recognized when the purchase order is dispatched • IPSAS Compliant Accounting Policy • Expenses are recognized on the basis of goods and services delivered • Key impact on UNDP • Delayed recording of Expenses  under IPSAS expenses will be recorded later on • Business Process Impact  Delivery date is the key date, not purchase order dispatch date

8. Summary of key policy decisions with high impact IPSAS 23 - Revenue from Non-Exchange Transactions • IPSAS Compliant Accounting Policy • Non Core: Revenue is recognized when UNDP has an enforceable claim to the contribution except to the extent that a “condition” exists on the contribution (i.e. the donor can request the return of funds in the case of non-compliance with the agreement) • Current Accounting Policy • Non-Core: Revenue from Non-Core contributions is recognized upon the receipt of cash • Key impact on UNDP • Timing of Revenue recording -> Terms of Donor agreement will impact timing i.e. when does UNDP have an enforceable claim? Are there “conditions”? • NEW Contracts Module in Atlas will be introduced to record non-core receivables / revenues

9. Summary of key policy decisions with high impact IPSAS 17 - Property, Plant & Equipment • Current Accounting Policy • Management Assets are expensed • Project assets are expensed • IPSAS Compliant Accounting Policy • Management Assets are capitalized and depreciated over their useful life. Initial Recognition/Valuation of Opening balance at Fair Value, subsequent periods using the Cost model • Project assets which are not controlled by UNDP are expensed • Key impact on UNDP • Management assets and related depreciation will appear on UNDP financial statements • Large valuation effort to obtain opening management asset balance needs to be conducted • Annual review of asset situation

10. Summary of key policy decisions with high impact IPSAS 25 - Employee Benefits • Current Accounting Policy • All employee benefits are recognized on a cash basis • IPSAS Compliant Accounting Policy • Employee benefits will be recorded when the employee renders service. E.g. Short-term employee benefits (payable within 12 months) should be recorded as an expense in the period in which the employee renders the service. Post employment benefits e.g. ASHI recorded on an actuarial basis and a liability and expense will be recorded • Key impact on UNDP • Timing of Expense recording  under IPSAS employee benefit expenses recorded earlier based on when the employee renders service • ASHI liability and accrued vacation will appear in financial statements

11. Security • All COs in the Bureau are MOSS compliant • New regional security advisor hired (Tony Monaghan tony.monaghan@undp.org) and will be working in Bratislava Regional Center starting January 5 2009 • Three new local security associates for Belarus, Moldova y Kazakhstan

12. DESIGNATED OFFICIAL (RC & UNDP ResRep) Country Security Structure CHIEF SECURITY ADVISER (CSA)- FSCO (Works for DO & SMT concurrently reports to UNDSS) FIELD SECURITY COORDINATION ASSISTANT (Locally-recruited) SECURITY SECRETARY (Locally-recruited) SECURITY MANAGEMENT TEAM (All HOA & others) Agency Security Focal Point AREA SECURITY COORDINATOTS (appointed for all sub-office operations) WARDENS Int'l system in the capital & each area WARDENS Int'l system in the capital & each area

13. Role of the DRR in the UNDP security structure Excerpts taken from the UNDP Security Policy Document (25 January 2006) • When the RR also has the responsibilities of the DO, then it is another senior international UNDP manager, normally the DRR, who is responsible for the security of UNDP personnel in the country and in representing UNDP on the SMT. In this case, the RR should formally hand over the UNDP security responsibility to the DRR, and the responsibility should appear as part of the job description, performance plan and RCA of the DRR. • When the office has a DRR (Operations) separate from the DRR (Programme), the DRR (Operations) is the individual who normally serves as UNDP’s security focal point for the country office. The functions of the security focal point consist largely of assisting the UNDP official responsible for the security of UNDP personnel (the RR, or the DRR when the RR is the DO).

14. Agency Security Focal Points • At those Duty Stations where there is a Chief/Security Advisor, respective Agencies, Funds and Programmes and where there is no professional single Agency Security Advisor, the Head of Agency should appoint a SFP for the Agency. The SFP may be either an internationally or a nationally-recruited staff member. • The Agency Security Focal Point Focal point is accountable to the Head of Agency for the following responsibilities: • Focal point for management of all agency/org security matters • Primary interface with UNDSS • Support agency field operations • Participate in joint inter-agency security missions/meetings • Ensure staff comply with system-wide security policy, procedures & instructions

15. UNDP procurement function CPO / Director of BOM Approval role ACP / Director of BOM Advisory role RCPO / RACP Up to 1 million (Dual role advisory and approval) CO RR Up to 100 K Approval role CO CAP Advisory role