Organization of American States OAS QUARTERLY RESOURCE MANAGEMENT REPORT JUNE 30, 2011

Transcription

1 Organization of American States Original: English OAS QUARTERLY RESOURCE MANAGEMENT REPORT JUNE 30, 2011 Overview of the financial position of the funds administered by the General Secretariat for the first two quarters of 2011 and status report on other management activities GENERAL SECRETARIAT (GS/OAS) 1889 F Street, N.W., Washington, D.C , USA (202) /

2 3 FREQUENTLY ASKED QUESTIONS 5 SECTION I 6 A - QUARTERLY REPORTS IN COMPLIANCE WITH AG/RES.1 (XL-E/10) 6 Administrative and Financial Management Reports 24 B - MANAGEMENT DISCUSSION AND ANALYSIS 24 GS/OAS Resources at a Glance 25 Inflows from a Financial Perspective 27 Outflows from a Financial Perspective 29 Regular Fund Program-Budget Execution Status of Regular Fund Quota Contributions 33 Regular Fund Cash Balance: Liquidity Risk Assessment 34 GS/OAS Investment Composition and Performance 36 Activities Currently Delayed Due to Insufficient Human and Financial Resources 38 GS/OAS Improvements and Efficiencies 48 Recommendations of the Board of External Auditors 52 SECTION II OAS RESOURCES BY CHAPTER 53 All Chapters 58 Chapter 1 - Office of the Secretary General (SG) 61 Chapter 2 - Office of the Assistant Secretary General (ASG) 64 Chapter 3 - Autonomous and/or Decentralized Entities 67 Chapter 4 - Secretariat for Legal Affairs (SLA) 70 Chapter 5 - Secretariat for Multidimensional Security (SMS) 73 Chapter 6 - Secretariat for Political Affairs (SPA) 76 Chapter 7 - Executive Secretariat for Integral Development (SEDI) 79 Chapter 8 - Secretariat for External Relations (SER) 82 Chapter 9 - Secretariat for Administration and Finance (SAF) 85 Other Activities 89 SECTION III 89 FINANCIAL STATEMENTS AND REPORTS 90 Combining Financial Statements 93 Regular Fund Budget Execution Status Report 95 Quota Payments 97 Compliance Report 100 Regular Fund Cash Flow: Liquidity Risk Assessment 103 Indirect Cost Recovery (ICR) 114 Specific Funds: Statement of Changes in Fund Balance 143 Contributions to OAS Funds by Donor 146 Resolution CP/RES. 831 (1342/02) 150 Service and Revolving Funds 152 Activities of the Offices of the General Secretariat in the Member States 158 Projects Submitted to the Project Evaluation Committee (PEC) in 2011

3 1. Where can I find a brief summary of the financial position of the General Secretariat as a whole as well as highlights of the important activities that took place during the last quarter? An executive summary of the financial situation of the General Secretariat can be found on pages 7 to 8 (click the link for direct access). The Management Discussion and Analysis at Section I pages 24 to 33 provides more in-depth analysis. 2. How can I determine if management has complied with the reporting requirements on administrative and financial management issues as established by the General Assembly? Section I A page 6 of the OAS Quarterly Resource Management Report is presented in compliance with resolution AG/RES.1 (XL-E/10) which mandates the General Secretariat to present its administrative and financial management reports to the CAAP on a quarterly basis showing the progress attained in austerity, efficiency, effectiveness, transparency, and prudence in the use of the Organization s resources. 3. Where can I find a report on management progress in addressing recommendations from the Board of External Auditors? The new Board of External Auditors recommendations for 2010 can be found on Section I page Where can I find information on administrative efficiencies being achieved? Section I pages 38 to 47 provides a description of these improvements and efficiencies by department. 5. Which reports tell me how many people are employed by the OAS, where they work and how these employment contracts are financed? Detailed employee information distributed by Chapter, Department, and source of financing is found on Section II pages 52 to Where can I find a status report on the execution of the Regular Fund Program-Budget? Section III page 93 provides the most detailed Budget Execution report including transfers between Chapters. Section II page 52 provides a very high level summary by Chapter and Fund. Section I, pages 29 to 30 - Management Discussion and Analysis provides a discussion on Regular Fund budget execution. 7. Where can I find detailed reports on all of the sources of financing to the OAS, the uses of those funds and the projects that are being executed? All GS/OAS resources at a glance can be seen on the consolidated statements on Section I page 24. GS/OAS inflows by Fund can be found on Section I pages 25 to 26. GS/OAS outflows by Fund, object category, and disbursements by location can be found on Section I pages 27 to 28. Execution by Chapter and Department is reported under Section II page 52. Specific Fund execution by project is reported under Section III pages 115 to

4 Frequently Asked Questions 8. Where can I find a report on indirect cost recovery and how these funds have been used? A detailed report on Indirect Cost Recovery (ICR) is found on Section III page Who are the top contributors to the Organization so far this year? A summary of the top 15 contributors by Source of Financing can be found on Section I page 26. A detailed report on contributions to OAS funds by Donor is found on Section III pages 144 to What is the cash flow outlook of the Regular Fund for the remainder of the year? A 2011 Regular Fund actual and projected cash balance, is found on Section I page Where can I find information on the number of persons employed under personal service contracts to the OAS, where those services are being provided, and how they are being financed? Information regarding persons employed under personal service contracts is reported by Chapter and Department on Section II page Where can find information on staff separations during the year? Section I page 11 provides information on separations by Chapter, Source of Funding and employee grade 13. What activities have been delayed or suspended as a result of the budget cuts and insufficient resources? Section I pages 36 to 37 provides a description by Department and Office of the activities that have been delayed or suspended due to insufficient human and financial resources. 14. Where can I find information on project activities in member states? Disbursements by country are presented on the following map Section I page 28. Additional project activities in Member States can be found on Section III page

5 The reports included in this section are intended to serve as a comprehensive management guide to the strategic allocation of resources. These reports are also intended to inform on the General Secretariat s compliance with mandates of the General Assembly that address policies affecting administration and management, as well as to show progress in attaining austerity, efficiency, accountability, effectiveness, transparency, and prudence in the use of the Organization s resources. Furthermore, these reports include a follow-up of the recommendations from the Board of External Auditors and their status. This section is divided into the following sub-sections: A - QUARTERLY REPORTS IN COMPLIANCE WITH AG/RES.1 (XL-E/10) B - MANAGEMENT DISCUSSION AND ANALYSIS 5

6 This sub-section is presented in compliance with the quarterly reports requested of the General Secretariat through Resolution AG/RES.1 (XL-E/10) Program-Budget of the Regular Fund of the Organization for 2011 and Contributions to FEMCIDI under section III.A.2.b. This sub-section includes the following reports: 1. Executive summary / discussion and analysis of the report at the management level that summarizes the financial situation of the General Secretariat. 2. Detailed financial reports, including budgetary execution of the Regular Fund and the voluntary, specific, service, including indirect cost recovery ICR, and trust funds. 7. Information on the progress in implementing the International Public Sector Accounting Standards. 8. Information on additional costs incurred further to nonobservance of meetings scheduled times. 9. Information on the foundations, civil society organizations, and other private entities that carry out projects with specific funds, including details on their areas of activity and the work carried out by the Secretariat for External Relations that forges cooperation between the Organization and these private entities. 3. Detailed information on the management of human resources, including information on staff transfers, reclassifications, resignations and terminations, and the budgetary impact of these changes, as well as gender distribution and geographic representation. 4. Detailed information on travel expense control measures as detailed in paragraph III.A.11 of this resolution. 5. Detailed information on the income generated through the rental of conference rooms and the Hall of the Americas. 6. Information on external contributions to support the activities of the organization, as well as contributions to building maintenance and improvements. 6

7 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 1. Executive summary / discussion and analysis of the report at the management level that summarizes the financial situation of the General Secretariat. Inflow of Funds The slowing pace of incoming funds to the General Secretariat (GS/OAS) reported in the first quarter continued through June 30, affecting the majority of funds managed by the Secretariat. Inflows to all funds through the end of the second quarter totaled USD 77.2 million, a marked decline of 26% when compared to the same period in 2010 (Table 1, pg. 24). Inflows include cash receipts from member states and donors as well as interest earnings, rental and miscellaneous income and exclude USD 15.5 million of transfers between funds and accounts of the Secretariat. While most Member States met their agreed-upon Regular Fund quota payment schedules through June, quota receipts are (net of prompt-payment credits) still falling short of the total amount of USD 81.7 million. Thus far GS/OAS received USD 47.9 million by June 30. In comparison, net quota receipts for the same period in 2010 were USD 53.4 million. Fourteen Member States earned a total of USD thousand in prompt payment credits toward the 2012 quota assessment. Inflows to Specific Fund accounts also declined slightly to USD 21.7 million from a contribution level of USD 22.9 million at the end of 2Q The outlook through the end of the year points to a continued three-year downward trend in Specific Fund contributions with a resulting impact on the Service and Revolving Funds as indirect cost recovery is reduced. Inflows to the Voluntary Fund (FEMCIDI) amounted to USD 1.6 million through June, compared to USD 0.7 million in the prior year. This is mainly due to timing as the United States pledge (USD 1.2 million), traditionally received in December, was received in February. Outflow of Funds Despite the marked decline in incoming funds, outflows across all funds remain relatively flat when compared to the second quarter of As of June 30, the GS/OAS had entered into commitments totaling USD million across all funds (USD million in 2010) with unexpended commitments of USD 50.8 million. Execution (obligations and expenditures) in the Regular Fund stood at 95% (USD 80.8 million) and USD 4.4 million is available for programming through the end of the year. Personnel costs are projected through year-end. Specific Fund outflows of USD 37.2 million were slightly higher than the comparable period in 2010 and FEMCIDI outflows of USD 1.8 million were on par with the prior year. Quota Receivable As of June 30, 2011, there is an outstanding USD 33.8 million quota receivable, out of which USD 24.4 million is backed by payment plans approved as follows: Jamaica (USD 75.2 thousand), Nicaragua (USD thousand) and the United States (USD 24.2 million). Most payments from these plans are expected in No payment plan has been presented for the remaining USD 9.4 million in quota receivable hence the timing of these receipts is unclear. Liquidity The Regular Fund began the year with a USD 2.9 million cash balance. During the first six months, cash levels fluctuated between USD 0.5 million and USD 14.3 million, reflecting the timing differences between receipts and required expenditures. At the end of June 30, the cash balance was USD 4.4 million. Projections of inflows and outflows for the Regular Fund point to severe cash shortages beginning in the month of October, and extending through the end of November. Managing the Organization s liquidity risk during the first and second quarters required that the GS/OAS shorten the investment horizon of its portfolio, the result of which was reduced rates of return and diminished interest income during

8 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 1. Executive summary / discussion and analysis of the report at the management level that summarizes the financial situation of the General Secretariat (continued). While in recent years the Treasury Fund portfolio was somewhat insulated from the declining interest rate environment, the Fund s long-term investments with higher yields have either matured or been sold to meet cash requirements and are being replaced with securities at lower prevailing interest rates. These conditions have resulted in net interest income to be significantly reduced as compared to 2010 and year-to-date the OAS portfolio has underperformed the custom benchmark rate of return of 1.0% by 0.27%. Termination Costs At June 30, and taking into account separation agreements already reached with staff, the General Secretariat projects that personnel costs will exceed the approved personnel budget by USD 0.5 million (down from USD 1.4 million) and that separation costs to bring personnel execution in line with the approved budget will amount to USD 3.2 million, USD 2.0 million over the appropriation for terminations. The General Secretariat will issue a special report to the CAAP recommending the transfer of appropriations between Chapters to meet these anticipated costs. Indirect Cost Recovery (ICR) As of June 30, 2011, the ICR Fund had income of USD 2.8 million and incurred expenditures in the amount of USD 3.6 million. Resulting in an operating deficit of USD 0.8 million. Obligations for the same period amounted to USD 1.0 million to cover employment contracts through the end of July This operating deficit drew down on the cash balance of the Fund reducing it from USD 2.3 million at the beginning of the year to 0.5 million at June 30. As a service organization, the GS/OAS invests a significant amount of its income on salaries and contracts. As of June 2011, Personnel (Object 1) equaled 48% of total outflows; Performance contracts (Object 8) equaled 15%; and Other Expenses (Object 9) equaled 9%, which includes administrative and technical support, subsidies to the Inter-American Court of Human Rights, the Pan American Development Foundation and the Inter- American Defense Board. 8

9 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 2. Detailed financial reports, including budgetary execution of the Regular Fund and the voluntary, specific, service, including indirect cost recovery ICR, and trust funds. ALL CHAPTERS Service and Revolving Funds (in thousands of USD) Regular Fund Voluntary Funds (FEMCIDI) Specific Funds Indirect Cost Recovery (ICR) Other Accounts (a) Other Funds (b) TOTAL Chapter 1 Office of the Secretary General BUDGET 4,298 EXECUTION 3,969 VARIANCE (6) 5,194 4, Chapter 2 Office of the Assistant Secretary General BUDGET 16,411 EXECUTION 15,579 VARIANCE 832 1, ,803 16,449 1,355 Chapter 3 Autonomous and/or Decentralized Entities BUDGET 11,853 EXECUTION 10,796 VARIANCE 1,057 7, ,240 23,503 4, ,546 18,302 2, (454) 1,694 5,202 Chapter 4 Secretariat for Legal Affairs BUDGET 2,529 EXECUTION 2,505 VARIANCE 23 3, , , ,407 5,153 1,254 Chapter 5 Secretariat for Multidimensional Security BUDGET 3,922 EXECUTION 3,718 VARIANCE , , , ,266 17,866 16,399 Chapter 6 Secretariat for Political Affairs BUDGET 4,139 EXECUTION 4,125 VARIANCE 14 18, , , ,955 19,207 3,748 Chapter 7 Secretariat for Integral Development BUDGET 14,733 5,067 (c) 28, EXECUTION 12,889 1,758 (c) 7, VARIANCE 1,844 3,309 21, ,162 64, ,178 14,975 41,867 Chapter 8 Secretariat for External Relations BUDGET 4,531 EXECUTION 4,686 VARIANCE (155) 1, , (2) 5,980 5, Chapter 9 Secretariat for Administration and Finance BUDGET 10,884 EXECUTION 10,996 VARIANCE (112) 941 2, , ,066 13, TOTAL OTHER ACTIVITIES BUDGET EXECUTION VARIANCE 12,051 11, , ,933 36,992 79, ,038 4,254 27,366 19, (105) 32,738 52,467 TOTAL BUDGET EXECUTION VARIANCE 85,350 5, ,985 5,100 11,156 55, ,052 80,976 1,758 45,621 4,619 11,716 5, ,676 4,374 3,309 66, (560) 49, ,375 (a) Includes Parking Services, Rental Hall of the Americas, Building and Maintenance and Tax Equalization. See Section III of this report for further details. (b) Includes preliminary balances for the Trust for the Americas, Rowe Fund Pan American and Medical Benefits Trust Fund (as of June 30, 2011). (c) Budget corresponds to 2010 Cycle (May 1, 2010 through December 31, 2011) and execution from January 1, 2011 to June 30,

10 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 3. Detailed information on the management of human resources, including information on staff transfers, reclassifications, resignations and terminations, and the budgetary impact of these changes, as well as gender distribution and geographic representation. 10

11 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 11

12 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 12

13 13 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10)

14 14 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10)

15 e. Gender Distribution The GS/OAS continues to emphasize gender equity at all levels of the Organization Figure 1 Gender distribution at the GS/OAS as of June 30, 2011 Figure 2 Gender distribution by level at the GS/OAS, as of June 30, Male % Female % Note: Total excludes 31 Associates SG ASG D02 D01 P05 P04 P03 P02 P01 G07 G06 G05 G04 G03 G02 G01 f. CPR s By Type of Fund As of June 30, 2011 Female Male Table 5 CPR s as of June 30, 2011 Chapter Fund Total Total Regular Fund Specific Funds by Chapter USD Chapter 1. The Office of the Secretary General (SG) ,750 Chapter 2. The Office of the Assistant Secretary General (ASG) ,071 Chapter 3. Autonomous and/or Decentralized Entities ,392,747 Chapter 4. The Secretariat for Legal Affairs (SLA) ,980 Chapter 5. The Secretariat for Multidimensional Security (SMS) ,092 Chapter 6. The Secretariat for Political Affairs (SPA) ,545 Chapter 7. The Executive Secretariat for Integral Development (SEDI) ,934,908 Chapter 8. The Secretariat for External Relations (SER) ,871 Chapter 9. The Secretariat for Administration and Finance (SAF) ,392 Total CPR's = ,603,354 15

16 4. Detailed information on travel expense control measures as detailed in paragraph III.A.11 of this resolution. Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) Tickets purchased in Economy using all funds: OPS monitors and provides summary information related to travel and compliance with the Permanent Council resolution that requires that all tickets paid for by the Regular Fund, FEMCIDI, specific funds, and trust funds administered by the General Secretariat be purchased in economy class, except for travel by the Secretary General, the Assistant Secretary General, and the Chair of the Permanent Council. The following chart provides the information registered by the OAS Preferred Travel Service Provider, Omega World Travel. Travel purchased outside Omega World Travel is closely monitored by OPS to ensure that reservations are made following the corresponding rules and regulations. OPS reported only one case of non compliance during this quarter. This was because of an administrative error by OWT. A credit memo will be issued by OWT for the difference in favor of the GS/OAS. 16

17 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 5. Detailed information on the income generated through the rental of conference rooms and the Hall of the Americas. Rental Hall Americas and Other Conference Rooms STATEMENT OF CHANGES IN FUND BALANCE For the period January 01, 2011 to June 30, 2011 (in USD) 2011 Increases Rental income 101,895 Interest income 443 Total increases 102,338 Decreases Expenditures & Obligations Personnel Contracts 7,989 Building and Maintenance 81,469 Performance Contracts 2,400 Total decreases 91,858 (A) (B) Net change during period 10,480 Cash balance at beginning of period 155,201 Fund balance 165,681 (A) Includes interest accreditation until March 2011 (B) Includes obligations in the amount of USD 31,903 17

18 6. Information on external contribution to support the activities of the organization, as well as contributions to building maintenance and improvements. As of June 30, 2011, no contributions were received for building maintenance and improvements. Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) Organization of American States Contributions to OAS Funds by Donor From January 1, 2011 to June 30, 2011 Regular Fund 2011 Prior Years FEMCIDI Specific Funds (in USD) Trust for the Americas TOTAL Member States Antigua and Barbuda Argentina 2,619, ,568 2,914,968 Bahamas, Commonwealth of 62,800 12,600 75,400 Barbados 48,900 19,500 68,400 Belize 17,900 17,900 Bolivia 37,500 37,500 Brazil 125,847 60, ,943 Canada 11,225,600 2,607,372 13,832,972 Chile 875, , ,000 1,105,300 Colombia 684, ,400 Costa Rica 152, ,500 Dominica, Commonwealth of 17,900 17,900 Dominican Republic 168,000 34, ,860 Ecuador 168,900 16, ,580 El Salvador 85,700 32, , ,414 Grenada Guatemala 152, ,500 Guyana 17,900 2,227 20,127 Haiti 35,564 2,500 38,064 Honduras Jamaica 25,075 34,252 59,327 Mexico 6,641, ,000 7,201,100 Nicaragua 36,700 56,671 18,000 8, ,000 Panama 133,000 39, , ,600 Paraguay 101, , ,450 Peru 451,100 55, ,100 St. Kitts and Nevis 17,900 5,100 23,000 St. Lucia 17,865 17,865 St. Vincent and the Grenadines Suriname 36,700 75, ,196 Trinidad and Tobago 124,000 83, ,895 United States 24,256,375 (a) 9,087, ,701 33,989,475 Uruguay Venezuela 57,000 57,000 Total Member States 48,302, , ,160 13,844, ,701 63,276,468 (b) (Continues on next page) 18

19 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) Organization of American States Contributions to OAS Funds by Donor From January 1, 2011 to June 30, 2011 Regular Fund 2011 Prior Years FEMCIDI Specific Funds (in USD) Trust for the Americas TOTAL Permanent Observers China European Union France Germany Korea Netherlands Portugal Republic of Serbia Slovenia Spain Sweden Switzerland United Kingdom Total Permanent Observers 150, , , ,554 60, ,101 5,000 20,000 9,704 1,428, ,510 25,569 4,985 2,822, , , , ,554 60, ,101 5,000 20,000 9,704 1,428, ,510 25,569 4,985 2,822,110 Institutions and Others Applied Energy Services (AES) I A Development Bank Intl. Bank for Reconstruction and Development Intl. Institute for Democracy & Electoral Assistance Intl. Org. for Migration National Commission of Espatial Activities Swedish NGO for Human Rights The Conference Board of Canada United Nations Multiple Funding Sources Total Institutions and Others 200, ,126 24,570 96, , , , , ,000 1,130,000 1,130,000 1,049,960 1,049, , , , , , ,533 1,040, ,715 1,261,481 4,181, ,992 4,698,565 GRAND TOTAL 48,302, , ,160 20,847,980 1,162,693 70,797,143 (a) Does not include USD 1.2 million programmed to FEMCIDI (transferred from Specific Funds) as this amount was already reported in (b) Does not include contributions to the Tax Equalization Fund and an estimated USD 45 thousand contributed through "Penalty Mail" Preparer AE Reviewer DY Prepared on 7/11/ :17 19

20 7. Information on the progress in implementing the International Public Sector Accounting Standards (IPSAS). Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) The GS/OAS contracted the firm International Business and Technical Consultants (IBTCI) to review and update the gap analysis between the GS/OAS proprietary rules and IPSAS taking into account recently issued standards. IBTCI will also draft an IPSAS-compliant fixed asset policy and review the IPSAS Project Plan to identify potential areas of risk during implementation. Given the lack of resources to implement the IPSAS standards, IBTCI will assess the cost/benefit of converting cash/budget balances to an accrual basis using manual spreadsheets and adjustments outside of the Organization s ERP versus updating the Organization s ERP and business processes to automatically perform these accruals. As of June, these were the last major activities scheduled around the IPSAS project. After consulting with other international organizations and experts, it has become apparent that the implementation of IPSAS is a complex undertaking that requires financial and human resources solely dedicated to it. In light of the challenging financial situation it currently faces, the GS/ OAS has been forced to delay implementation until such time as funds are identified to carry the project forward. 20

21 8. Information on additional costs incurred further to nonobservance of meetings scheduled times. Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) Financial loss due to cancelled meetings and half day meetings that did not share interpretation costs with other meetings From January 1 through December 31, 2011 TOTAL OF ALL MEETINGS OF THE OAS MEETINGS OF THE OAS PER QUARTER TOTAL: All half day meetings not shared Jan Mar Apr Jun Jul Sep Oct Dec TOTAL (USD) Political Bodies / Areas CP, its Committees and Work Groups CEPCIDI CP/CEPCIDI Half day meetings Interpretation hours Half day rate USD Loss Political Bodies / Areas CP, its Committees and Work Groups 33,075 19, , ,675 CEPCIDI 4,900 2, , ,840 CP/CEPCIDI 5, , ,880 AG 0 4, ,900 USD General Assembly Preparation ,900 Other Areas 13,720 9, ,030 Other Areas TOTAL, All meetings ,030 TOTAL 57,575 36, , ,325 Percentage of financial loss for half-day meetings that did not share interpretation costs with other meetings January - June, 2011 Half-day Meetings that did not Share Interpretation Costs - Per Quarter % 56% 61% 50% 40% 30% 20% 10% 0% Meetings CP Com. & WG $52,675 CEPCIDI $7,840 8% 6% CP/CEPCIDI $5,880 5% AG Meetings $4,900 24% Other Areas $22,030 70% 60% 50% 40% 30% 20% 10% 0% 39% Jan-Mar $57,575 Apr-Jun $36,750 21

22 8. Information on additional costs incurred further to nonobservance of meetings scheduled times. Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) DIVIDED BY POLITICAL BODY AND LANGUAGE Political Body / Area Languages Half day meetings Interpretation hours Half day rate USD 2 Lang ,800 3 Lang Lang ,875 Subtotal All Lang ,675 CP and its Committees and Working Groups 2 Lang ,940 CEPCIDI 3 Lang Lang ,900 Subtotal All Lang ,840 2 Lang ,880 CP/CEPCIDI 3 Lang Lang Subtotal All Lang ,880 2 Lang ,900 AG General Assembly 3 Lang Preparatory Meetings 4 Lang Subtotal All Lang ,900 2 Lang ,350 Other Areas of the GS/OAS 3 Lang ,350 4 Lang ,330 Subtotal All Lang ,030 Total ,325 Loss $45,000 $30,000 $15,000 $0 Half-day Meetings that did not share interpretation costs January - June, 2011 $9,800 $42,875 $52,675 $2,940 $4,900 $7,84 $5,880 $4,900 $5,880 $4,900 $23,030 $7,350 $7,350 $8,330 CP CEPCIDI CP/CEPCIDI AG Other Areas 2-Lang 3-Lang 4-Lang 22

23 Section I Administrative and Financial Management Reports in Accordance to AG/RES.1(XL-E/10) 9. Information on the foundations, civil society organizations, and other private entities that carry out projects with specific funds, including details on their areas of activity and the work carried out by the Secretariat for External Relations that forges cooperation between the Organization and these private entities. Information has not been received for the publication of this OAS Quarterly Resource Management Report. 23

24 The GS/OAS financial position can be presented from two perspectives: financial and budgetary, as shown in Table 1. The financial perspective is based on actual inflows and outflows of all funds of the Organization. Inflows under the Regular Fund include current quotas, quotas in arrears, interest income, rental space income, and miscellaneous income, received through the first semester of the year. Inflows under FEMCIDI include voluntary contributions from member states, interest and reimbursements. Inflows for Specific Funds include current year contributions for specific activities as mandated by the donor agreement, interest income and transfers. Service Funds include Regular Fund transfers for basic infrastructure and common costs, tax reimbursements, indirect cost recovery and other income. Inflows for Other Funds (which includes Medical Benefit, Rowe Pan-American and Trust for the Americas) vary depending on the nature for which these funds were established and may include unrealized gain from investments. On the outflows side, the Regular, Specific and Service Funds include expenditures, obligations, payroll encumbrances to year-end, transfers, and other decreases. Outflows under FEMCIDI include only non-payroll expenditures, obligations and transfers. Other Funds include only expenditures and transfers. For all funds, the ending balance represents the excess of inflows over outflows plus the beginning balances carried forward from the prior year. The budgetary perspective for the Regular Fund reflects the authorized appropriations for the 2011 cycle and does not show actual income collected. For FEMCIDI, it reflects the authorized appropriations for the 2010 cycle, which began on May 1, 2010 and will end on December 31, 2011, and does not show actual income collected, as shown under the financial perspective. The budget for Specific, Service, and Other Funds includes beginning balances, contributions, transfers, and miscellaneous income through the first semester of the year, reflecting funds available for programming. Execution for the Regular Fund and FEMCIDI includes expenditures and obligations for the current budgetary year. Execution for Specific, Service, and Trust Funds may include expenditures and obligations from prior budgetary years. Table 1 GS/OAS Resources (in millions of USD) From January 1, 2011 to June 30, 2011 FINANCIAL PERSPECTIVE Regular Fund Voluntary Funds (FEMCIDI) Specific Funds Service and Revolving Funds Other Funds (*) Interfund Transactions TOTAL 2011 BEGINNING BALANCE INFLOWS OUTFLOWS ENDING BALANCE (124.7) (80.8) (1.8) (37.2) (14.5) (5.9) (32.3) (0.1) 49.4 (15.5) BUDGETARY PERSPECTIVE Regular Fund Voluntary Funds (FEMCIDI) Specific Funds Service and Revolving Funds Other Funds TOTAL 2011 BUDGET EXECUTION VARIANCE (0.1) (*) Includes Medical Benefits Trust Fund, Rowe Pan American Fund and Trust for the Americas. 24

25 Figure 1 Trend and Composition of Inflows by Fund (in millions of USD) From January 1 to June 30 TREND Trend and Composition of Inflows by Fund Figure 1 presents a comparative summary of all inflows through June 30, for the last 5 years for funds managed by the GS/OAS. Overall income through June has decreased compared to last year Quotas payments to the Regular Fund were lower during the second quarter by 11% compared to the same period in 2010, primarily due to the timing of quota payments to the Regular Fund Regular Fund Service and Revolving Funds Other Funds* FEMCIDI Specific Funds Pledges received for FEMCIDI increased to USD 1.6 million through June, compared to USD 0.7 million from last year. Although FEMCIDI pledges have increased by USD 0.9 million, the increment is due to the timing of the United States pledge of USD 1.2 million that was received during the month of February 2011 rather than the customary month of December. Overall inflows to Service and Revolving Funds have significantly decreased by 42% when compared to the same period in 2010, primarily due to the timing of tax reimbursements which by June 2010 amounted to USD 7.7 million. As by June 2011 no amount has been received. COMPOSITION Total 2011 USD 92.7 M** 100% Service and Revolving Funds % Other Funds* % Specific Funds % * Includes Medical Benefits Fund, Rowe Pan American Fund and Trust for the Americas ** Includes Inter fund transactions of USD 15.5 million FEMCIDI 1.6 2% Regular Fund % Inflows to Specific Fund are at the lowest level from the past three years. This year s figure represents a slight decrease of 5% when compared to the same period in Although most inflows to Specific Funds vary depending on donor s preferred themes, the difference in contributions received as compared to previous years is attributable, to the unprogrammed OAS DEMOC, the XL General Assembly, and Port Security projects. Based on current trends and data from prior years, Specific Fund projects could receive approximately USD 21 million through year-end, totaling an annual contribution of roughly USD 42 million. This projection falls below contributions received in the last few years, even when it includes a possible second phase of the multi-million OAS/CIDA Cooperation Plan. Inflows attributed to Other Funds have increased from USD 8.1 million in 2010 to USD 10.4 million in 2011, mostly due to an increase in the portfolio s market value of the Medical Benefits Fund and the Rowe Pan-American Fund. 25

26 Contributions by Source of Financing Section I Inflows from a Financial Perspective During the first semester of 2011 (see Table 2), the United States was the major contributor to the GS/OAS (USD 34.0 million), followed by Canada (USD 13.8 million), Mexico (USD 7.2 million) and Argentina (USD 2.9 million). Among Permanent Observers, Spain is at the top of contributors with USD 1.4 million to Specific Funds. Table 2 Contributions by Source of Financing - Top Donors From January 1, 2011 to June 30, 2011 (in millions of USD) Contributor Regular Fund Voluntary Funds (FEMCIDI) Specific Funds Trust for the Americas TOTAL United States Canada Mexico Argentina Spain Intl. Organization for Migration Chile National Commission of Espatial Activities Colombia El Salvador 0.1 Panama 0.1 Peru 0.5 Germany Intl. Bank for Reconstruction and Development * ** ** ** Other Member States Multiple Funding Sources & Others TOTAL * Does not include USD 1.2 million programmed to FEMCIDI (transferred from Specific Funds) as this amount was already reported in ** Although Voluntary Funds show zero due to rounding in millions, this corresponds to contributions from El Salvador for USD 32,100, Panama for USD 39,600 and Peru for USD 55,

27 Outflows by fund Total outflows in GS/OAS funds totaled USD million (excluding interfunds transactions of USD 15.5 million) through June 30, 2011, a slight decrease from the same period last year. Figure 2 shows that outflows in the Regular Fund amounted to USD 80.8 million or 58% of the total committed; Specific Funds USD 37.2 million or 27%, and Service and Revolving Funds USD 14.5 million or 10%. These outflows combined, account for 95% of the total committed. The remaining amount corresponds to Other Funds and FEMCIDI. Outflows by category As a service organization, the GS/OAS invests a significant amount of its income on salaries and contracts (Figure 3). Personnel (Object 1) represents 48% of total outflows, Building and Maintenance (Object 7) represents 8%, Performance contracts (Object 8) represents 15%, and Other expenses (Object 9) represents 9% which includes administrative and technical support, subsidies to the Inter-American Court of Human Rights, the Pan American Development Foundation and the Inter-American Defense Board. Figure 2 Outflows by Fund From January 1, 2011 to June 30, 2011 (in millions of USD) Service and Revolving Funds % Specific Funds % Other Funds 5.9 4% * Includes Interfund transactions of USD 15.5 million Voluntary Funds (FEMCIDI) 1.8 1% Total: USD * Regular Fund % Figure 3 Outflows by category From January 1, 2011 to June 30, 2011 (in millions of USD) Personnel Temporary Posts Fellowships Travel Documents Equipment, Supplies and Maintenance * Includes Interfund transactions of USD 15.5 million Building and Maintenance Performance Contracts 2011 USD * 2010 USD USD Other expenses Other outflows 27

28 Disbursements by Location The General Secretariat executes numerous activities throughout its member states, requiring payment for goods and services in their corresponding local currencies. Figure 4 shows disbursements by location through the first two quarters of the year, totaling USD million. The majority of disbursements occur in Headquarters, mostly due to payroll expenses and infrastructure costs. Section I Outflows from a Financial Perspective A great majority of disbursements are related to the Mission to Support the Peace process in Colombia (MAPP), Electoral Observation Mission and civil registry activities in Haiti, demining and judicial facilitators activities in Nicaragua. There were no disbursements for activities held in Canada or Chile. Disbursements in the Caribbean are also significant due to projects related to recovery efforts in Haiti. Figure 4 Disbursements by Location (in millions of USD) Belize Bahamas Honduras Dominican Republic Mexico 0.87 Costa Rica Saint Kitts and Nevis Guatemala 0.59 Panama 0.38 El Salvador Haiti Antigua and Barbuda 0.69 Suriname Nicaragua 0.87 Guyana Jamaica Dominica Colombia 1.93 Venezuela Santa Lucia Barbados Ecuador Saint Vicent and the Grenadines 0.12 Grenada Peru Trinidad and Tobago Bolivia Paraguay 0.40 Brazil 0.42 Argentina 0.63 Uruguay 0.69 Headquarters (DC) TOTAL DISBURSEMENT USD M 28

29 Approved Levels For 2011, through Resolution AG/RES. 1 (XL-E/10) CORR. 1, the General Secretariat was authorized to execute up to USD 85.3 million for Regular Fund activities. Table 3 presents the 2011 original and modified appropriation and the corresponding sources of financing. Quota assessments represent 94.8% of the sources of financing for the 2011 appropriation. Table Appropriations and Financing (in thousands of USD) Original Modified Appropriations Personnel 54, ,943.8 Non personnel 30, , , ,349.8 Actual Projected June 30, 2011 Sources of Financing Quota Assessment 80, ,945.6 Administrative and Technical Support 3,064.0 a Other Income 1,335.0 b , ,409.2 a) ICR Collection from Specific Funds (USD 2,500.0) and FEMCIDI (USD 564) b) Interest, rents, refunds and deobligations income Transfers Between Chapters Most of the transfers between chapters were related to personnel during the first semester (see Table 4). Executive Order rev.4 was released during the month of February: the Department of Legal Services was transferred from chapter 4 to chapter 1, and the Special Legal program was transferred from chapter 4 to chapter 7. Other transfers correspond to personnel reinforcements and transferring of projects between chapters. Table 4 Transfers Between Chapters (in thousands of USD) Original Appropriation AG/RES. 1 (XL E/10) CORR. 1 Transfers January to June 2011 Modified Appropriation as of June 30, 2011 % CHAPTERS (a) (b) (c) (b/a) Chapter 1 Office of the Secretary General 2, , , % Chapter 2 Office of the Assistant Secretary General 16, , % Chapter 3 Autonomous and/or Decentralized Entities 12,177.4 (324.6) 11,852.8 Chapter 4 Secretariat for Legal Affairs 3,587.3 (1,058.6) 2,528.7 Chapter 5 Secretariat for Multidimensional Security 3, % 29.5% 3, % Chapter 6 Secretariat for Political Affairs 4,784.3 (645.7) 4,138.6 Chapter 7 Executive Secretariat for Integral Development 14, , % Chapter 8 Secretariat for External Relations 4, , % Chapter 9 Secretariat for Administration and Finance 10,922.5 (38.7) 10,883.8 Chapter 10 Basic Infrastructure and Common costs 12,062.4 (11.0) 12,051.4 (0.0) Grand Total 85, ,349.8 Regular Budgetary Execution by Chapter As of June 30, 2011 the Regular Fund appropriation of USD 85.3 million has been obligated or executed up to USD 80.9 million, or 94.8% of the appropriation. Table 5 shows the Regular Fund modified appropriation (per Table 4) versus Execution. The variance corresponds to the unused appropriations remaining for programming, which amounts to USD 4.4 million as of June 30, Nine of the ten chapters have already executed over 90% of their corresponding appropriations (Figure 5). The lowest percentage of execution comes from Chapter 7 - Executive Secretariat for Integral Development 87.5%, mostly due to the Department of Human Development, Education, and Culture s low execution of 82.9%. 13.5% 0.4% 29

30 Section I Regular Fund Program-Budget Execution 2010 Table 5 Budget vs Execution As of June 30, 2011 (in thousands of USD) Modified Appropriation Execution Variance CHAPTERS (a) (b) (c) = (a) (b) Chapter 1 Office of the Secretary General 4, , Chapter 2 Office of the Assistant Secretary General 16, , Chapter 3 Autonomous and/or Decentralized Entities 11, , ,056.8 Chapter 4 Secretariat for Legal Affairs 2, , Chapter 5 Secretariat for Multidimensional Security 3, , Chapter 6 Secretariat for Political Affairs 4, , Chapter 7 Executive Secretariat for Integral Development 14, , ,844.0 Chapter 8 Secretariat for External Relations 4, ,686.3 (155.2) * Chapter 9 Secretariat for Administration and Finance 10, ,995.6 (111.8) * Chapter 10 Basic Infrastructure and Common costs 12, , Grand Total 85, ,976.0** 4,373.8 * Corresponds to budgetary and execution personnel variances and reinforcements ** Includes pre obligations in the amount of USD Figure 5 Budgetary Execution by Program As of June 30, 2011 (in millions of USD) CHP 1 CHP 2 CHP 3 CHP 4 CHP 5 CHP 6 CHP 7 CHP 8 CHP 9 CHP10 Modified Appropriation Expenditures Obligations 30

31 Quota Contributions At the beginning of 2011, the GS/OAS had USD 82.2 million in quotas receivable: USD 80.9 million from current year quota assessment and USD 1.3 million from quotas in arrears. As of June 30, 2011, the GS/OAS was credited USD 48.5 million (USD 48.0 million in quota payments plus USD 0.5 million in credits received) to quota assessments, equivalent to 60% of total quotas receivable: USD 48.3 million for 2011 assessment and USD 0.2 million from quotas in arrears from Haiti, Jamaica, Nicaragua, Paraguay and Venezuela. This is in comparison to the 68% of total quota receivable during the same period in Figure 6 Quota Receivable vs Quota Payments (in millions of USD) As of June 30 Member State Quota Receivable (current and arrears) Quota Payments Balance Due Member State Quota Receivable (current and arrears) Quota Payments Balance Due Antigua and Barbuda 17, ,534 Guyana 17,900 17,900 Argentina 2,619,400 2,619,400 Haiti 72,264 35,564 36,700 Bahamas 62,800 62,800 Honduras 43,709 43,709 Barbados 48,900 48,900 Jamaica 134,552 59,327 75,225 Belize 17,900 17,900 Mexico 6,641,100 6,641,100 Bolivia 37,500 37,500 Nicaragua 230,672 93, ,301 Brazil 6,487, ,847 6,361,853 Panama 133, ,000 Canada 11,225,600 11,225,600 Paraguay 101, ,228 Chile 875, ,300 Peru 451, ,100 Colombia 684, ,400 St. Kitts and Nevis 17,900 17,900 Costa Rica 152, ,500 St. Lucia 17,900 17, Dominica, Comm. Of 17,900 17,900 St. Vincent and the Grenadines 17, ,534 Dominican Republic 168, ,000 Suriname 36,700 36,700 Ecuador 168, ,900 Trinidad and Tobago 124, ,000 El Salvador 85,700 85,700 United States 48,512,700 24,256,375 24,256,325 Grenada 57,682 57,682 Uruguay 147, ,700 Guatemala 152, ,500 Venezuela 2,652,552 57,000 2,595,552 Total 82,233,459 48,486,309 33,747,150 31

32 Section I Status of Regular Fund Quota Contributions Arrears As of January 1, 2011, quotas in arrears amounted to USD 1.3 million, mainly from Nicaragua (USD 0.2 million) and Venezuela (USD 1.0 million). Through the first semester of 2011, USD 0.1 million were received in payments towards quotas in arrears, leaving an outstanding balance of USD 1.2 million. As illustrated in Figure 7, quotas in arrears remain at low levels. Quota Compliance As of June , there were twenty four member states under the current category with respect to the Regular Fund Quota contribution; one member state considered current, and nine member states considered not current. This is in accordance with AG/RES (XXX-O/00), and as amended by AG/ RES.2157 (XXXV-O/05). See the following report on compliance below. Figure 7 Quotas in Arrears As of June 30 (in millions of USD) Table 6 Summary on Compliance with Quota Contributions according to AG/RES (XXX-O/00), as amended by AG/RES (XXXV-O/05) As of June 30, 2011 USD YEAR Current Argentina Bahamas Barbados Belize Bolivia Canada Chile Colombia Costa Rica Dominica, Comm. Of Dominican Republic Ecuador Considered Current Nicaragua Not Current Antigua and Barbuda Brazil Grenada Haiti Honduras El Salvador Guatemala Guyana Jamaica Mexico Panama Paraguay Peru St. Kitts and Nevis Suriname Trinidad and Tobago United States St. Lucia St. Vincent and the Grenadines Uruguay Venezuela 32

33 Liquidity Risk Assessment The Regular Fund cash balance is derived from a combination of inflows, primarily from quota receipts, and corresponding outflows in the form of payments. While the Regular Fund has a fairly predictable stream of expenditures throughout the year, the timing of inflows of cash does not directly correlate to the timing of these expenditures. As a result, the cash balance can fluctuate significantly during the course of the year. Projections of cash inflows are based on an analysis of member states payment history over the past three years as well as current payment plans. Outflows take into account scheduled disbursements including payroll, subsidies to other organizations, termination payments, among other commitments, and projects payments to suppliers based on obligation levels and past trends. Figure 8 shows actual and projected cash balances for the Regular Fund. The Regular Fund began the year 2011 with a USD 2.9 million cash balance. Total inflows of USD 48.6 were received for the first semester, of which, USD 47.9 million were quota payments (58.9% of the quota receivables for 2011). During the same period, outflows totaled USD 47.1 million, resulting in an ending cash balance in the Regular Fund of USD 4.4 million. Current projections point to another cash shortfall during October and November 2011; Thus measures must be identified so that the Organization can meet its scheduled commitments these months. In April, SAF presented two reports on the subject to CAAP (CAAP/GT/RVPP- 104/11 and CAAP/GT/RVPP-104/11 add.1). Figure 8 Regular Fund 2011 Actual and Projected Cash Balance (in millions of USD) (5) (10) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec (0.1) Projected Actual Projected (5.7)