UN CAPITAL MASTER PLAN: 2005 BOARD OF AUDITORS

UNCLAS USUN NEW YORK 001702

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: AORC KUNR UNGA
SUBJECT: UN CAPITAL MASTER PLAN: 2005 BOARD OF AUDITORS
REPORT



1. SUMMARY: The Board of Auditors latest report on the
Capital Master Plan, for the year ended December 31, 2005,
raises concerns regarding the cost impact of delays in
project implementation, the CMP office's adherence to the UN
Procurement Manual and the submission of certain contract
deliverables. The report also updates the General Assembly
on CMP expenditures as of the end of 2005. The Board of
Auditors report will be considered by the Fifth Committee
this fall, along with other reports on the CMP. END SUMMARY.


2. The Board comments that delays in General Assembly
decisions on project strategy and financing have increased
the risk of higher costs to implement the project. They
therefore recommend that the Administration strongly urge the
General Assembly to make these decisions. (NOTE: The GA made
a decision on strategy in June 2006 and is to continue
discussions on financing during the main part of the 61st
session. END NOTE.)


3. The Board notes that some contract amendments did not
state the maximum amount that the United Nations was
obligated to pay. In other contract amendments, the Board of
Auditors review disclosed non-conformity with certain items
in the UN Procurement Manual and recommends that the CMP
office ensure that all future amendments are in full
conformity with the procurement manual. In both cases, the
Board is concerned that future disputes may arise due to
these deficiencies. (COMMENT: USUN discussed these findings
with the Board of Auditors and learned that they did not
consider these issues to be overly problematic at this stage.
They highlighted the issues to ensure that they are
addressed prior to the construction phase of the project.
END COMMENT.)


4. The Board of Auditors recommends, once again, that the
Secretary-General establish an advisory board to assist him

SIPDIS
on matters related to the CMP. The Board also found that
some contract deliverables were submitted after the date they
were due and recommends that steps be taken to strengthen the
monitoring of submissions. As of December 31, 2005, the
cumulative expenditures for CMP amounted to $32.533 million
(vs. $59.5 million appropriated by this date). The Board
notes that 2005 expenditures were below 2004 expenditures due
to the rescheduling of the construction documents phase for
most contracts from 2005 to 2006.
BOLTON