Wednesday, October 15, 2008

UN's Board of Auditors express deep concern with the way UNDP handled North Korea Investigation and lack of access

462. During the biennium, pursuant to article VII of the Financial Regulations and Rules of the United Nations, ACABQ requested the Board of Auditors to carry out a special audit of the operations of the United Nations in the Democratic People’s Republic of Korea, including the United Nations funds and programmes which fall within the Board’s mandate, and to report its findings to ACABQ.

463. In accordance with the request of ACABQ, the scope of work for the preliminary phase was limited to four entities, including UNDP. The work focused on the five-year period from 1 January 2002 to 31 December 2006.

464. In accordance with the request of ACABQ, the Board focused on foreign currency transactions, the hiring of staff and access to reviewing local projects. Because of the limited scope of the assignment, the Board did not express any opinion on the financial results of any of the activities in the Democratic People’s Republic of Korea of the four entities. The audit was limited to personnel and documents made available in New York.

465. The Board’s major findings in respect of the three focus areas were contained in its report addressed to ACABQ in May 2007. In that report, the Board dealt with the three focus areas and reported on the shortcomings it had observed. Accordingly, in respect of the initial request of ACABQ, the Board, in its report, had not suggested any further procedures for the Board to perform.

466. ACABQ further requested the Board to complete its audit and visit the agency offices in the Democratic People’s Republic of Korea. The Board accepted the assignment subject to conditions necessary to enable the Board to complete its work, which the Administration had confirmed. The Administration, however, was unable to obtain the agreement of the Government of the Democratic People’s Republic of Korea that visas would be granted to the Board. The Board reported to ACABQ on its inability to complete its work.

467. The Board expressed its concern about the lack of access provided in this case to the independent external auditor of the United Nations to perform a field visit and stresses that all United Nations agencies must have irrevocable rights of access, monitoring and external independent review for their activities.

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