Audit and Finance Sub-committeeReport to the Steering Committee

November 2013

Attendance in AFSCPresent Members

– Dorothy Manuel (Chair) via Skype– Kenzo HirokiSecretary– Catharina Sahlin-Tegnander

The AFSC would be in favour of increasing the number of members of the AFSC

Financial info to AFSC Chair for review and commentsMay 2013 - Nov 2013

Monthly liquidity reports Monthly budget follow-up and forecasts Monthly follow-up of commitments Discussions with the Secretariat on the policy

for fixed deposit of the Reserve Fund Approval of funds for the Global Dialogue Skype meetings with the Head of Finance

AFSC Report May 2013Remaining issues; 1. Hosting WAF and EAF -> Agenda item2. Contingency Reserve -> Request sent to the FPG –

not many responses – UK responded negatively3. The AFSC considers a change of procedure to

enable a more efficient handling of deposits of the Reserve Fund

4. Continuous fundraising beyond 2015 is vital to ensure stable growth of GWP budget -> Agenda item

Deposit of excess liquidity including the Reserve Fund

The SC has decided that the SC Chair shall approve all deposits

The AFSC considers a change of procedure to enable a more efficient handling;AFSC asked that SC Chair and Secretariat to discuss a

proposal for change The Secretariat will draft a policy to be approved by the

SC

Terms of Reference for the Audit of 2013 No comments on the ToR. Same as 2012 and the same audit fee

Procurement of audit 2014

Ernst & Young has had the assignment for 5 years

The Secretariat is asked to list pros and cons procuring for new auditors as well as including Ernst and Young as a candidate for new contract

The Nomination Committee formally proposes the audit firm

Work Programme 2014 - 2016

AFSC was searching for answers to;

Relations among GWPO, RWP and CWP, including the role of the Secretariat, to ensure the best performance of GWP as a whole

The expectation to CWP now and in the futureThe support to the CWP – how will it be positioned

and designed in the GWP system? What should be done to enable the CWPs to

increase financial sustainability?The funding strategy in 2015 and beyond – where

are the opportunities and challenges?

Discussed together with the PRSC – in addition;

Work Plan and Budget 2014Note; 46% increase in Secretariat staff costs 2012–2014 which will give budgetary pressure in 2015-Recommendation; Prioritize recruitment in 2014 so that recruitment of some staff is decided after secured fund in 2015-2016 is confirmed

Note; Regional core funds to increase by 10% in 2014Recommendation; Remain at this (i.e. 10% increased) level in 2015 only if funding is secured

Note; Some budget-lines have been based on unrealistic forecastsRecommendation; The Secretariat to examine budget-lines in order for more reliable forecasts through discussion with budget requesters

Work Plan and Budget 2014Budget in 2014 addressing fluctuation of revenue should be considered(1) Single-year budget items in 2014 should be considered in order to: avoid expenditure pressure in later years (e.g. by sharp increase

of core budget) help sustainable function of GWP networks in the future contribute to energized actions by CWP For example, by Establishing earmarked fund for seed money, as a pilot case, to

help CWP to draft project proposal to local donors (covering not hiring consultant but communication fee, visit to donors, etc.)

Establishing earmarked fund, as a pilot case, to help translation of GWP documents and materials into local languages

(2) Multiple revenue sources (other than bilateral donation) reflecting diverse business models should be sought in the long run

SC Discussion, particularly on (1), is requested

Work Plan and Budget 2014

The AFSC recommends approval of the 2014 budget

As agreements with Danida, Netherlands, Switzerland and the EC Mekrouare not yet in place the Secretariat is requested to present the confirmed agreements by the end of March 2014 for the AFSC.

AFSC recommends the Secretariat to carefully consider;Single-year budget items in 2014 should be considered in order to: avoid expenditure pressure in later years (e.g. by sharp increase of core budget) help sustainable function of GWP networks in the future contribute to energized actions by CWP

Reserve Fund 2014Secretariat reported that: Fund required to cover for an unforeseen closedown of GWPO

in 2014 is increased to Euro 1,836k due to increased budget The RF needs to be within the available equity (accumulated

surplus), currently Euro 1,571k There is no revenue item out of which fund can be used for RF

to meet increased requirement of 1,836k Deficit being Euro 265,000 There is no imminent prospect of unforeseen closedown of

GWPO in 2014 The AFSC recommends approval of a RF of Euro 1,571k The AFSC requests the Secretariat to propose solutions to

fill the gap If needed, Financial Partners should be consulted to find

out the solution

Risk Register

Note; The forecast 2013 and the budget 2014 includes legal fees of approximately Euro 80,000 in connection with staff complaints

Recommendation; Include this as a risk in the Risk Register and to

implement mitigation activitiesLessons from past and current cases should be

reflected in Risk Register. Discussion by HRSC is requested

Hosting West Africa, Eastern Africa, CEE, SITWA

West Africa; Agreement signed between West Africa and GWPO 25 Nov. 2013Review of procedures and financial management will be done Jan. 2014

Eastern Africa; Registered legal entity but not yet deemed capable of self hosting

Central Eastern Europe; Registered legal entity and in the process of signing a “self-hosting” agreement with GWPO

SITWA Project; Financial review was done in September 2013 (hosted by OMVS).Positive review with some minor recommendations for improved routines

STRATEGY

- Not discussed as time has been spent to solve imminent issues -

Thank you