FINANCIAL REPORT AND AUDITED FINANCIAL STATEMENTS OF UNESCO FOR THE PERIOD ENDED 31 DECEMBER 2009, AND REPORT BY THE EXTERNAL AUDITOR PART I SUMMARY

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1 Executive Board Hundred and eighty-fifth session 185 EX/25 Part I PARIS, 30 August 2010 Original: English/French Item 25 of the provisional agenda FINANCIAL REPORT AND AUDITED FINANCIAL STATEMENTS OF UNESCO FOR THE PERIOD ENDED 31 DECEMBER 2009, AND REPORT BY THE EXTERNAL AUDITOR PART I SUMMARY In accordance with Financial Regulation 12.10, the report by the External Auditor and the audited financial statements, together with the report by the Director-General on the accounts of UNESCO for the financial period ended 31 December 2009, are submitted to the Executive Board. The financial report and the audited financial statements, together with the formal opinion of the External Auditor, are contained in document BOC/125 (attached hereto) while the report by the External Auditor, together with the comments of the Director-General thereon, is presented in document 185 EX/25 Part II. Action expected of the Executive Board: proposed decision in paragraph In accordance with Financial Regulation 12.10, the Executive Board is required to examine the External Auditor s report together with the final audited accounts and to forward them to the General Conference with such comments as it deems appropriate. 2. The Executive Board may also wish to note in particular the opinion of the External Auditor on the financial statements which states: My opinion is that the financial statements present fairly, in all material respects, the financial position of UNESCO as at 31 December The longform report of the External Auditor and the Director-General s comments thereon are to be found in document 185 EX/25 Part II.

2 185 EX/25 Part I page 2 Action expected of the Executive Board 3. The Board may wish to adopt a decision along the following lines: The Executive Board, 1. Recalling Article of the Financial Regulations, 2. Having examined documents 185 EX/25 Parts I and II, 3. Expresses its appreciation to the External Auditor for the high standard of his work; 4. Notes the opinion of the External Auditor that the financial statements presented fairly, in all material respects, the financial position of UNESCO as at 31 December 2009 and the results of its operations and its cash flow for the two-year financial period then ended; that they were prepared in accordance with the stated accounting policies, which were applied on a basis consistent with that of the preceding financial period; 5. Takes note of the unobligated balances in Statement IV by appropriation line and approves the expenditure as reported; 6. Invites the Director-General to report on the implementation of the recommendations of the External Auditor to the General Conference at its 36th session and to submit this report to it at its 187th session for prior review; 7. Decides to transmit to the General Conference at its 36th session the report by the External Auditor and the audited financial statements of UNESCO for the period ended 31 December 2009.

3 185 EX/25 Part I page 3 BOC/125 PARIS, 22 July 2010 Original: English UNITED NATIONS EDUCATIONAL, SCIENTIFIC AND CULTURAL ORGANIZATION FINANCIAL REPORT AND AUDITED FINANCIAL STATEMENTS OF UNESCO FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009

4 185 EX/25 Part I page 5 CONTENTS 1. REPORT OF THE DIRECTOR-GENERAL ON THE ACCOUNTS OF UNESCO FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER OPINION OF THE EXTERNAL AUDITOR 3. APPROVAL OF THE FINANCIAL STATEMENTS 4. STATEMENTS Statement I Statement II Statement III Statement IV Statement of Income and Expenditure and Changes in Reserves and Fund Balances for the financial period ended 31 December 2009 Statement of Assets, Liabilities and Reserves and Fund Balances as at 31 December 2009 Statement of Cash Flow of Proprietary Funds (General, Working Capital and Other) for the financial period ended 31 December 2009 Status of Appropriations of the General Fund Regular and Participation Programmes for the financial period ended 31 December NOTES TO THE FINANCIAL STATEMENTS 6. SCHEDULES Schedules of Income and Expenditure and Changes in Reserves and Fund Balances for the financial period ended 31 December 2009 for the following funds: Schedule 1.1 Schedule 1.2 Schedule Schedule Schedule Schedule 1.3 Schedule Schedule Schedule 1.4 General Fund (GEF) Other Proprietary Funds (OPF) Other Proprietary Funds (OPF) Revenue-Generating Activities Other Proprietary Funds (OPF) Support Costs Other Proprietary Funds (OPF) Staff Related Accounts Programme Fiduciary Funds (PFF) Special Accounts for Institutes Other Special Accounts and Trust Funds Staff Fiduciary Funds (SFF) Schedules of Assets, Liabilities and Reserves and Fund Balances as at 31 December 2009 for the following funds: Schedule 2.1 Schedule 2.2 Schedule General and Working Capital Funds Other Proprietary Funds Other Proprietary Funds Revenue-Generating Activities

5 185 EX/25 Part I page 6 Schedule Schedule Schedule 2.3 Schedule Schedule 2.4 Other Proprietary Funds (OPF) Support Costs Other Proprietary Funds (OPF) Staff-Related Accounts Programme Fiduciary Funds Special Accounts for Institutes Staff Fiduciary Funds 7. UNAUDITED ANNEXES Annex I Annex II Annex III Annex IV Ex gratia payments Report of special accounts and trust funds established and closed during the financial period ended 31 December 2009 Aged analysis of assessed contributions receivable Waivers granted for contracts submitted to the Contracts Committee

6 Introduction 185 EX/25 Part I page 7 REPORT OF THE DIRECTOR-GENERAL ON THE ACCOUNTS OF UNESCO FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER In accordance with Article 11.1 of the Financial Regulations, I have the honour to submit the financial statements and report of the Organization for the biennium ending 31 December The financial statements have been prepared in accordance with the United Nations System Accounting Standards (UNSAS). This is the last time that the accounts have been prepared under UNSAS since, as from 1 January 2010, the Organization will be applying International Public Sector Accounting Standards (IPSAS) as the basis for the preparation of its financial statements. 3. The Report of the External Auditor, together with his opinion on the financial statements, is also submitted in accordance with Article 12 of the financial regulations. Programme Expenditure 4. UNESCO s programme activities are financed mainly from two sources- the regular budget (GEF) and extra budgetary funding (PFF). The Regular Budget of the Organization including additional appropriations has increased by $22million (or 4%) from $620million in the 2006/2007 biennium to $642million this biennium. Extra budgetary spending, for the same period, shows a decrease of $93 million (or 12%) from $744 million to $651 million. 5. An implementation rate of almost 100% has been achieved on the execution of the regular budget activities for the biennium. Of the total amount of $642 million available in the 34 C/5 adjusted (including additional appropriations), only $8K remain as unspent at the end of the period. Unliquidated obligations represent just 4% of the total expenditure meaning that 96% of budget activities have been delivered by 31 December The decrease of $93 million in extra budgetary expenditure is mainly due to the decrease in the operations of the UNESCO Brasilia office. In addition, the functional currency of the office has been changed from USD to Real to better reflect the economic substance of transactions managed by the Brasilia office. This change of functional currency has also resulted in accounting adjustments affecting the amount of expenditure recorded during the period. 7. Expenditure on Other Proprietary funds (OPF) has increased by 17% to $89 million for the biennium. The constant increase on these funds from one biennium to another demonstrates their growing significance to the delivery of the Organization s programme activities. 8. The table below shows the expenditure for the biennium , together with the comparative figures of the previous financial period $ '000s % $ '000s % General Fund (GEF - Schedule 1.1) 641, , Other Proprietary Funds (OPF - Schedule 1.2) 88, , Total, Proprietary Funds (A) 730, , Add : Programme Fiduciary Funds (PFF - Schedule 1.3) (B) 651, , Total (A) + (B) 1,381, ,439, Less Inter-fund Transfers (C) (61,268) (4.64) (60,698) (4.40) Total (A) + (B) + (C) 1,320, ,379,

7 185 EX/25 Part I page 8 9. For the first time in three biennia, programme expenditure from fiduciary funds (PFF) has fallen below the 50% threshold to 49.3% of overall expenditure. With the Regular Budget (GEF) accounting for 48.6% of expenditure and 6.73% from Other Proprietary Funds, the combined proprietary funds financed 55.34% of the Organization s programme activities for the biennium before inter-fund eliminations. CONTRIBUTIONS AND CASH FLOW GENERAL FUND 10. Receipts of contributions in respect of the biennium amounted to $610.5 million against an assessed total of $631 million, which represents 97% of the total receivable on Member States during the biennium. 11. Receipts of contributions in respect of previous biennia and payment plans prior to the 35th session of the General Conference amounted to $58.7 million against a total due of $71.5 million for Before the approval of six new payment plans at the 35th session of the General Conference, the total deferred to future years equalled $12.8 million but after the new payment plans, the total amounts to $18.3 million under 17 payment plans. 12. Unpaid contributions remain a cause for concern with $ 49.6 million due at the end of The working capital fund of $29 million was not sufficient to finance arrears and instalments deferred to future years. 13. The cash position of Headquarters accounts based on the total resources of the General Fund with and without the Working Capital Fund as at the end of each month for the Biennium is shown graphically as follows, in millions of US dollars: 150,00 General Fund Cash Position with and without Working Capital Fund at Headquarters 100,00 50,00 0,00-50,00 1/08 2/08 3/08 4/08 5/08 6/08 7/08 8/08 9/08 10/08 11/08 12/08 1/09 2/09 3/09 4/09 5/09 6/09 7/09 8/09 9/09 10/09 11/09 12/09 Cash position Cash position with Working Capital Fund (WCF) 2008 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Cash position -20,2 24,4 35,6 74,2 83,5 85,1 79,5 47,2 22,6 9,3 16,7 8,8 Cash position with WCF 8,1 53,0 64,2 102,9 112,4 114,0 108,0 76,2 51,6 38,3 45,7 37, Cash position 4,00 42,10 25,07 23,36 63,47 42,23 67,01 52,45 28,84-2,83-17,85 14,74 Cash position with WCF 33,00 71,10 54,06 52,35 92,47 71,23 96,01 81,45 57,84 26,17 11,15 43, The peak amounts in April through August are due to the receipt of large contributions in those months, whereas payments are more evenly spread throughout the Biennium.

8 185 EX/25 Part I page As at 31 December 2009, the General Fund at Headquarters excluding field offices showed positive cash balance of $8.8 million but with the Working Capital Fund of $28 million the total cash balance equalled $37.8 million. Investments 16. As at the end of 2009, the investment portfolio of UNESCO totalled $1,319.8 million in comparison to $1,214.4 million at the end of The performance of the investments made in accordance with a very conservative Investment Policy of the Organization has been in line with the established benchmarks and was not affected by the turmoil of the financial markets during the Biennium. International Public Sector Accounting Standards (IPSAS) 17. The Organization, like many United Nations agencies, has adopted IPSAS as the basis of the preparation of the financial statements and accounts as from 1 January This represents a significant change but the Organization is well on track to delivering a set of IPSAS-compliant financial statements as at 31 December Throughout the biennium various documents and reports have been submitted to the Executive Board on the progress and activities relating to IPSAS implementation and this will continue in order to keep Member States fully informed of this important project. Liabilities for employee benefits 18. The funding of long term contractual obligations with employees, both current and past, remains an issue for the Organization. The main liability, relating to After Service Health Insurance, amounts to $649 million as at 31 December 2009 based on an actuarial valuation. This shows an increase of $35 million from the last valuation as at 31 December As highlighted previously, it is the belief of the Secretariat that this liability should be funded gradually over a reasonable period of time. Renovation of Headquarters Building 20. The renovation of the Fontenoy building, financed from a loan from the French Government, which commenced in early 2004, was completed in September The accumulated cost of these works at 31 December 2009 amounted to $ 89 million.

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11 STATEMENT I UNESCO STATEMENT OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) PROPRIETARY FUNDS PROGRAMME FIDUCIARY FUNDS General Fund Other Programme Staff Inter-fund (Regular Programme) Proprietary Total Proprietary Funds Fiduciary Fiduciary Eliminations Funds Funds Funds "GEF" "OPF" "PFF" "SFF" Total Managed Funds (Schedule) (1.1) (1.2) (1.3) (1.4) INCOME Assessed contributions 631, , ,271 9, , ,280 Voluntary contributions 10, ,041 8, , , ,674 Revenue producing activities 29,407 29,407 22,837 3,168 17,411 49,986 42,125 Funds received under inter-organization arrangements 79,059 79,059 54,933 Allocations from other funds (Regular Programme) 7,817 7,817 5,149 28,133 20,083 (56,033) Income for services rendered 25,318 25,318 26,822 54,795 19,631 (25,318) 74,426 58,398 Investment income 4,554 16,338 20,892 22,751 36,043 45, , ,590 Currency exchange adjustments 8,892 (1,138) 7,754 (2,870) (39,078) (118) (31,442) 47,793 Other income 3,061 6,309 9,370 8,986 1,851 1,551 12,772 15,610 TOTAL INCOME 658,430 84, , , , ,424 (81,351) 1,442,453 1,618,403 EXPENDITURE 641,892 88, , , ,112 65,560 (81,351) 1,366,151 1,421,510 TOTAL EXPENDITURE 641,892 88, , , ,112 65,560 (81,351) 1,366,151 1,421,510 EXCESS (SHORTFALL) OF INCOME OVER EXPENDITURE 16,538 (4,746) 11,792 6,059 25,646 38,864 76, ,893 Increase in land and buildings (Note 11) 14,858 14,858 9,590 14,858 9,590 Distribution to Member States (18,451) (18,451) (8,182) (18,451) (8,182) Distribution to members of USLS (38,847) (38,847) (41,596) Other adjustments to reserves and fund balances 3,092 (62) 3,030 3,924 40,956 (214) 43,772 13,306 Reserves and fund balances, beginning of period 140,327 56, , , ,366 57, , ,050 RESERVES AND FUND BALANCES, END OF PERIOD 156,364 51, , , ,968 57, , ,061 The accompanying notes and schedules are an integral part of the financial statements. 185 EX/25 Part I - page 13

12 UNESCO STATEMENT OF ASSETS, LIABILITIES AND RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) STATEMENT II 185 EX/25 Part I - page 14 PROPRIETARY FUNDS PROGRAMME FIDUCIARY FUNDS General Fund Other Programme Staff (Regular Programme) Proprietary Inter-fund Total Proprietary Funds Fiduciary Fiduciary Inter-fund Funds Eliminations Funds Funds Eliminations Total Managed Funds "GEF" "OPF" "PFF" "SFF" (Schedule) (2.1) (2.2) (2.3) (2.4) ASSETS Cash and term deposits (Note 6) 47,204 39,572 86,776 66, , ,231 1,262,938 1,107,049 Investments (Note 7) 1, , , ,792 Accounts receivable Assessed contributions receivable from Member States (Note 8) 49,647 49,647 90,979 49,647 90,979 Inter-fund balances 14,523 (2,826) 11, (11,697) Other (Note 9) 8,004 9,340 17,344 14,795 18,307 52,578 88,229 93,384 Other assets (Note 10) ,289 1,720 3,530 3,106 7,925 7,936 Land and buildings (Note 11) 187, ,207 98, ,207 98,141 Renovation work in progress (Note 12) 65,582-65,582 TOTAL ASSETS 292,514 64,272 (2,826) 353, , , ,934 (11,697) 1,712,848 1,592,863 LIABILITIES Payments or contributions received in advance 3,451 3, , Unliquidated obligations 24,694 2,202 26,896 29,279 82, , ,131 Accounts payable Inter-fund balances 2,826 (2,826) ,697 (11,697) Other 12,638 9,880 22,518 26,833 42,781 8,266 73,565 57,432 Members' deposits 627, , ,474 Other liabilities 3, ,533 1,748 1,541 13,868 18,942 27,591 Loan for HQ building renovation (Note 12) 87,954 87,954 80,451 87,954 80,451 Loan for IBE building (Note 11) 1,575 1,575 1,733 1,575 1,733 TOTAL LIABILITIES 136,150 12,603 (2,826) 145, , , ,240 (11,697) 922, ,802 RESERVES AND FUND BALANCES Working Capital Fund (Note 3) 29,000 29,000 28,097 29,000 28,097 Capital funds relating to land and buildings (Note 11) 118, , , , ,484 Currency Exchange Reserve (Note 12) (17,813) (17,813) (16,942) (17,813) (16,942) Operating reserves (Note 5) 1,640 1,640 1,620 18,238 27,704 47,582 43,474 Balances relating to projects funded by donors 433, , ,218 Budgetary surpluses (Note 4) 7,219 7,219 7,237 7,219 7,237 Other surpluses (Note 5) 19,616 50,029 69,645 73,308 72,767 29, , ,493 TOTAL RESERVES AND FUND BALANCES 156,364 51, , , ,968 57, , ,061 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 292,514 64,272 (2,826) 353, , , ,934 (11,697) 1,712,848 1,592,863 The accompanying notes and schedules are an integral part of the financial statements.

13 185 EX/25 Part I - page 15 Statement lll UNESCO PROPRIETARY FUNDS (General, Working Capital and Other) STATEMENT OF CASH FLOW FOR THE PERIOD ENDED 31 DECEMBER 2009 Expressed in '000s US dollars) CASH FLOWS FROM OPERATING ACTIVITIES Net excess of income over expenditure (Statement I) 11,792 6,059 (Increase) / decrease in contributions receivable 41,332 (5,879) Increase in other accounts receivable (2,549) (6,399) (Increase) / decrease in other assets 431 (322) Increase in inter-fund balances receivable (10,845) (852) Increase in contributions or payments received in advance 2, Decrease in unliquidated obligations (2,383) (6,613) Increase (decrease) in accounts payable (4,315) 990 (Increase) / decrease in other liabilities 1,785 (255) Increase (decrease) in inter-fund balances payable (859) 750 Less: Interest income (20,892) (22,751) Plus: Interest expense Currency exchange adjustments (7,754) (13,204) NET CASH FROM OPERATING ACTIVITIES 8,602 (47,677) CASH FLOWS FROM INVESTING ACTIVITIES: Increase in renovation work in progress (23,484) (36,686) (Increase) decrease in land and buildings 1 Increase in borrowings 7,345 49,097 Plus: Interest income 20,892 22,751 Less: Interest expense (398) (349) Currency exchange adjustments 7,754 13,204 NET CASH USED FROM INVESTING 12,109 48,018 CASH FLOWS FROM FINANCING ACTIVITIES Savings on or cancellation of prior periods' obligations 2,203 3,735 Credits to member States (18,451) (8,182) Other adjustments to reserves and fund balances 15,685 9,779 NET CASH FLOWS FROM FINANCING ACTIVITIES (563) 5,332 NET INCREASE IN CASH AND TERM DEPOSITS 20,148 5,673 CASH AND TERM DEPOSITS, BEGINNING OF PERIOD 66,628 60,955 CASH AND TERM DEPOSITS, END OF PERIOD 86,776 66,628

14 185 EX/25 Part I - page EX/25 Part I - page 16 STATEMENT IV UNESCO GENERAL FUND STATUS OF APPROPRIATIONS REGULAR AND PARTICIPATION PROGRAMMES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in 000s US dollars) Main Appropriation Line PART I GENERAL POLICY AND DIRECTION Authorized Additional 34 C/5 Approved Expenditure Transfers Appropriations as Adjusted Disbursements ULOs Total $ $ $ $ $ $ $ $ 34 C/5 Approved Unobligated balance A. Governing bodies 1. General Conference 5, ,618 5, , Executive Board 7,883 1,517-9,400 9, ,946 (546) Total Part I.A 13,396 1,622-15,018 15, ,536 (518) B. Direction 20,677 (64) 81 20,694 19, ,690 1,004 (Including: Directorate; Office of the Director-General; Internal Oversight; International Standards and Legal Affairs; Ethics Programme) C. Participation in the joint machinery of the United Nations system 10, ,892 10, ,008 (116) TOTAL, PART I 44,308 2, ,604 44,853 1,381 46, PART II PROGRAMMES AND PROGRAMME RELATED SERVICES A. Programmes Major Programme I - Education 108,468 1,280 4, , ,031 4, ,981 4,393 Major Programme II - Natural sciences 56, ,207 56,029 2,467 58,496 (289) Major Programme III - Social and human sciences 29, ,000 28,386 1,259 29, Major Programme IV - Culture 51, ,671 53,404 53,520 2,958 56,478 (3,074) Major Programme V - Communication and information 31, ,792 29,701 2,116 31, UNESCO Institute for Statistics 9, ,020 9,020-9,020 - Field - Management of decentralized programmes 45,474 7,405-52,879 54, ,825 (1,946) Total, Part II.A 332,236 9,712 8, , ,135 14, , B. Participation Programme 18, ,800 18, ,828 (28) C. Programme Related Services 1. Coordination and monitoring of action to benefit Africa 4,655 (16) - 4,639 4, ,837 (198) 2. Fellowships Programme 1, ,794 1, ,918 (124) 3. Public information 13,814 (35) - 13,779 12, ,843 (64) 4. Strategic planning and programming monitoring 5,927 2, ,572 8, ,770 (198) 5. Budget preparation and monitoring 4,871 (36) 155 4,990 4, , Anticipation and foresight 1,355 (1,355) Total, Part II.C 32, ,774 33,043 1,271 34,314 (540) TOTAL PART II 383,434 10,435 9, , ,941 15, ,404 (154) PART III SUPPORT FOR PROGRAMME EXECUTION AND ADMINISTRATION A. Field management and coordination 24, ,039 25,786 23,268 1,615 24, B. External relations and cooperation 19,565 (95) ,810 18, , C. Human resources management 33, ,416 32,137 1,457 33, D. Accounting, treasury management and financial control 11,043 (8) - 11,035 10, , E. Administration 99, ,736 99,981 2, ,042 (1,306) TOTAL, PART III 188,026 2,319 1, , ,313 5, ,284 1,499 TOTAL, PARTS I - III 615,768 14,969 10, , ,107 22, ,922 1,715 Reserve for reclassifications/merit based promotions 2,000 (1,737) PART IV ANTICIPATED COST INCREASES 13,732 (13,732) Absorption to be made under Part I and/or Part III (500) SUBTOTAL 631,000-10, , ,107 22, ,922 1,978 Transfers approved in principle from identified savings: 1. Transfer to the IPSAS Special Account as per 182 EX/Decision Transfer of savings to the Special Account for Strengthening the Security of UNESCO Premises Worldwide as per 35 C/Resolution 97. TOTAL APPROPRIATION ,600-1,600 (1,600) (370) 631,000-10, , ,077 22, ,892 8 Totals may not sum exactly due to rounding

15 185 EX/25 Part I - page 17 UNESCO NOTES TO THE FINANCIAL STATEMENTS 1. OBJECTIVES (purpose, mandate and governance of the Organization) (a) (b) The United Nations Educational, Scientific and Cultural Organization (UNESCO) was created in London on 16 November 1945 by governments of the States Parties to contribute to peace and security by promoting collaboration among the nations through education, science and culture in order to further universal respect for justice, for the rule of law and for human rights and fundamental freedoms which are affirmed for the peoples of the world, without distinction of race, sex, language or religion, by the Charter of the United Nations Organization. As one of the specialized agencies referred to in Article 57 of the Charter of the United Nations Organization, the provisions of Articles 104 and 105 of that Charter concerning the legal status of that Organization, its privileges and immunities, apply in the same way to UNESCO. UNESCO is governed by a General Conference, consisting of the representatives of its Member States, which determines the policies and main lines of work of the Organization. The Executive Board, which consists of 58 Member States elected by the General Conference, takes, in accordance with the decisions of the General Conference, all necessary measures to ensure the effective and rational execution of the programme by the Director-General. 2. SIGNIFICANT ACCOUNTING POLICIES Introduction The financial statements have been prepared in accordance with the provisions of UNESCO s Financial Regulations and with stated accounting policies as described below. These accounting policies conform to the United Nations System Accounting Standards (UNSAS) which provide a framework for accounting and financial reporting in the United Nations system. The financial period of UNESCO is a biennium and consists of two consecutive calendar years, beginning with an even-numbered year. The financial statements are presented in thousands ( 000s/K) of United States dollars ($). (a) Financial Statement presentation In conformity with the framework for financial reporting in the United Nations system, the financial statements are prepared on a combined basis, which includes the accounts of all the funds managed by UNESCO with a sub-grouping for UNESCO Proprietary Funds (GEF and OPF), on which the Statement of Cash Flow is presented at the end of each financial period, followed by Programme Fiduciary Funds (PFF) and Staff Fiduciary Funds (SFF). Elimination columns show adjustments for inter-fund transfers and balances. Managed Funds are disclosed in the following business areas: (1) General Fund (GEF) includes both the General and Working Capital Funds set up in accordance with Financial Regulations 6.1 and 6.2. (2) Other Proprietary Funds (OPF) include revenue-generating activities, programme support costs for special accounts and trust funds, the Staff Compensation Fund, the Terminal Payments Fund, and Headquarters-related special accounts.

16 185 EX/25 Part I - page 18 These funds are used to carry out the programmes, or to group other authorized expenditure, of UNESCO. The residual right of ownership of all of these funds is ultimately vested in Member States. The funds have been established in accordance with Financial Regulation 6.6 and normally have individual special financial regulations. (3) Programme Fiduciary Funds (PFF) include institutes, special accounts and trust funds set up in accordance with Financial Regulation 6.6. They are used to carry out extrabudgetary programme activities in accordance with the respective agreements signed between UNESCO and the related parties or other legal authority. (4) Staff Fiduciary Funds (SFF) are funds that have been established for the benefit of UNESCO s staff members, namely the Medical Benefits Fund, the UNESCO Staff Savings and Loans Services (USLS), UNESCO Commissary Fund (UCF), the UNESCO Restaurant Service (URS) and the UNESCO Children s Club & Day Nursery. The residual right of ownership of these funds is totally or partially vested in staff or retired staff members. The resources of each fund in the Programme Fiduciary Funds and the Staff Fiduciary Funds can only be used for the purposes for which the respective fund has been established. (b) Income recognition Income from assessed contributions represents a legal obligation of Member States, which is recognized as income in the year or biennium in which it becomes due and payable. No provision is made for delays in the collection of assessed contributions. Voluntary contributions are recognized when funds are received. Other sources of income are recorded on an accrual basis of accounting. A provision for doubtful receivables is recorded at the end of the financial period to recognize the risk of non receipt of certain amounts. (c) Expenditure recognition Expenditure is recorded on a modified accruals basis and includes amounts for goods supplied and services rendered in the financial period as well as amounts for legal obligations of the financial period. UNESCO employees are entitled to annual leave, termination and repatriation grant entitlements. The Organization also contributes an amount equal to the employees share of medical costs. The cost of these benefits is normally recognized as an expense in the financial period in which they are paid. However, a Terminal Payment Fund (TPF) reserve for repatriation grant and other post-termination entitlements is maintained by appropriate transfers from certain non-general Fund accounts for the benefit of staff financed by these accounts. Acquisitions of non-expendable equipment, including furniture, computers and other office equipment and motor vehicles as well as maintenance and repairs to buildings are charged to operations in the financial period in which the expenditure is contracted. A figure for non-expendable equipment (referred to as Inventories) is given in Note 14 of these Financial Statements.

17 185 EX/25 Part I - page 19 (d) Translation of currencies Transactions carried out during the period in currencies other than United States dollars, are translated to United States dollars using the United Nations operational rate of exchange at the date of the transaction except for budgetary income and expenditure in euros of the Regular and Participation Programmes of the General Fund. For budgetary purposes, General Fund expenditures (Regular and Participation Programmes) in euros are translated to United States dollars using UNESCO constant budget rate. The difference between the translation at constant and operational rates of exchange is recorded in the currency exchange adjustments account. Likewise, the differences between the constant budget rate and operational rates of exchange at which the assessed contributions of the General Fund are brought to account are also credited or debited in the currency exchange adjustments account. Monetary balances carried at fair value are converted using the United Nations rate of exchange at 1 January of the following year. Non-monetary balances carried at historical cost are converted using the United Nations rate of exchange at the date of the transaction. For operations carried out by entities where the functional currency is different from the United States Dollar, transactions are recorded in the functional currency of the entity. The financial statements of each entity are then translated into US dollars at the end of the reporting period for presentation with the combined Financial Statements of UNESCO. Income and Expenditure items are translated using an average rate for the period and Balance sheet items at the UN operational rate at the end of the reporting period. Any exchange adjustment resulting from such a translation is accounted for through reserves. In addition to three Category 1 Institutes for which the Euro is the established functional currency, transactions carried out by UNESCO Brasilia Office have, for the first time this biennium, been reported using the Real as the functional currency. (e) Land and buildings Land and buildings are carried at historical purchase cost except for donated properties where land is shown at nominal valuation and structures at insurance valuation as of the balance sheet date. Major construction and renovation in progress are recorded at cost, which includes material, direct labour and related overhead and are capitalised under land and buildings when a project, or distinct phase of a project, is completed. In the case of large projects, the duration of which extends over several accounting periods, cost may be initially recorded as work-in-progress before being transferred to land and buildings on completion. No provision is made for depreciation since the cost is charged to expenditure as approved by the General Conference. (f) Pension fund participation UNESCO is a member organization participating in the United Nations Joint Staff Pension Fund (UNJSPF) which was established by the United Nations General Assembly to provide retirement, death, disability and related benefits. The Pension Fund is a defined benefit plan. The financial obligation of the Organization to the UNJSPF consists of its mandated contribution at the rate established by the United Nations General Assembly together

18 185 EX/25 Part I - page 20 with any share of any actuarial deficiency payments under Article 26 of the Regulations of the Fund. Such deficiency payments are only payable if and when the United Nations General Assembly has invoked the provision of Article 26, following determination that there is a requirement for deficiency payments based on an assessment of the actuarial sufficiency of the Fund as of the valuation date. At the time of this report the United Nations General Assembly has not invoked this provision. (g) Investments 3. FUNDS Investments are recorded at cost adjusted for amortization of premiums or discounts to maturity or market value, if significant. (a) General Fund A General Fund has been established for the purpose of accounting for the expenditure of the Regular Programme appropriation voted by the General Conference of UNESCO for a given financial period. It is financed from assessed contributions from Member States. Appropriations, which are voted by the General Conference, are available for obligation during the financial period to which they relate and for a further twelve months to the extent they are required to discharge obligations incurred during that financial period. In addition to the appropriations voted by the General Conference, the Director-General is authorized by Financial Regulation 7.3 to accept voluntary contributions, gifts, bequests and subventions. Such receipts are shown as voluntary contributions in Statement I and as Additional Appropriations in Statement IV. (b) Working Capital Fund A Working Capital Fund has been established in an amount and for purposes to be determined from time to time by the General Conference. It is financed by advances from Member States made in accordance with the scale of assessments as determined by the General Conference. By 34 C/Resolution 78, the authorized level of the fund was increased to K$29,000 for 2008/2009 biennium. (c) Trust funds, reserves and special accounts Trust funds, reserves and special accounts are established by the Director-General and are reported to the Executive Board. They are administered in accordance with the Financial Regulations of UNESCO unless otherwise provided. Trust Funds and Special Accounts are financed principally by voluntary donations. They are organized into three groups, namely, Institutes, UNESCO Brasília office and Other. Details of Other, their sources of income and the projects they support are detailed in Schedule INCREASE/DECREASE IN BUDGETARY SURPLUSES Budgetary surpluses for a financial period, after deducting therefrom any contributions of Member States relating to that financial period which remain unpaid, shall, in accordance with Financial Regulations 4.3 and 4.4, unless otherwise determined by the General Conference, be apportioned among Member States in proportion to their assessed contributions for that financial period and

19 185 EX/25 Part I - page 21 surrendered to each Member State once its contribution for that financial period has been paid in full. The balance of budgetary surplus from previous periods which has not been paid to Member States is summarized as follows: Un-apportioned surpluses relating to the budgets of previous financial periods: Not yet available for apportionment Surpluses apportioned but not surrendered ,958 5,261 $ 000s 1,958 5,279 Total (Statement II) 7,219 7, OPERATING RESERVES AND OTHER SURPLUSES (i) Operating reserves Operating reserves have been created within the legislative authority of certain funds as is deemed to be required for the purpose of sound administration or legal obligation and are summarized as follows: Increase/ (Decrease) (a) Administrative reserves $ 000s (i) Public Information Liaison and Relations Fund 1,351 1,351 - (ii) International Centre for Theoretical Physics (ICTP) 9,984 10,006 (22) (iii) International Institute for Education Planning (IIEP) 6,669 4,898 1,771 (iv) UNESCO Institute of Statistics (UIS) 1,585 1, (b) Currency fluctuation reserves 19,589 17,522 2,067 Public Information Liaison and Relations Fund (PILRF) (c) Staff savings reserves UNESCO Savings and Loan Services (USLS) 27,704 25,683 2,021 27,704 25,683 2,021 (d) Other reserves Headquarters Utilization Fund (HQF) Total (Statement II) 47,582 43,474 4,108

20 185 EX/25 Part I - page 22 (a) (b) (c) (d) Administrative reserves have been established in accordance with the rules pertaining to each fund to cover mainly staff related costs (separation, after service entitlements, etc.) and other outflows that may arise in the future. The currency fluctuation reserve is established to cover the foreign currency risk element arising from the operation of the coupons programme. The staff savings reserves for USLS include statutory reserves and special reserves for unrealized portfolio profits and interest rate stability. The Headquarters utilization reserve is intended to cover accidental damages to Works of Art. (ii) Other surpluses (a) (b) Other surpluses consist of the net amount of all miscellaneous income earned for the biennium after taking into account currency exchange adjustments and the balance of the currency clearing account. Included also are other General Fund surpluses; surpluses on other proprietary funds and surpluses on fiduciary funds. Apart from surpluses of the regular programme and certain other funds, to which special rules apply, surpluses can be carried forward from one financial period to the next. An overall summary of all other surpluses is given in the following table: Increase/ (Decrease) $ 000s Proprietary funds Regular programme (Note 5(ii)(c)) 19,616 18,451 1,165 Other Proprietary Funds 50,029 54,857 (4,828) 69,645 73,308 (3,663) Fiduciary funds Institutes UNESCO Brasilia Office 31,540 41,227 25,977 5,563 41,227 Staff Fiduciary Funds 29,990 32,208 (2,218) 102,757 58,185 44,572 Total (Statement II) 172, ,493 40,909

21 185 EX/25 Part I - page 23 (c) The surplus of the regular programme is reconciled to Statement II of the Financial Statements as follows: $ 000s Excess of Regular Programme Income over Expenditure (Schedule 1.1) 16,538 1,302 Unspent balance of appropriations from previous financial period (Note 5(ii)(d)) 2,203 3,735 Unspent balance on MBF subcontracting 406 Other Adjustments to Reserves 4 Currency Exchange Reserve ,942 Distribution PILRF 47 Transfer to Special account IPSAS in accordance with 34C/Resolution 77 (246) Transfer to Special account Renovation Plan in accordance with 34 C/Resolution 85 (3,735) Other surpluses (Schedule 2.1) 19,616 18,451 (d) At the close of financial period, a provision of K$24,972 was set up to cover the unliquidated obligations of the Regular and Participation Programmes at that date. Those unliquidated obligations remained available for 12 months up to 31 December 2008 to the extent that they were required to discharge obligations against goods received and services rendered in the financial period and to liquidate any other outstanding legal obligations of that financial period. The Director-General decided that the unspent balance of these unliquidated obligations be used to cover the following outstanding items amounting to K$150: $ 000s Unspent balance 2,353 4,237 (i) Field offices expenditure (ii) Headquarters expenditure (iii) ILO Administrative Tribunal Judgement 180 Subtotal Total 2,203 3,735

22 185 EX/25 Part I - page CASH AND TERM DEPOSITS The table below shows that of the total K$1,262,938 (2007 K$1,107,049), the amount available under proprietary funds is K$86,776 (2007 K$66,628) and the remaining balances are held by UNESCO in a fiduciary capacity $ 000 Regular programme (GEF) 47,204 (1,902) Other Proprietary Funds (OPF) 39,572 68,530 Total Proprietary Funds 86,776 66,628 Programme Fiduciary Funds (PFF) 639, ,286 Staff Fiduciary Funds (SFF) 536, ,135 Total (Statement II) 1,262,938 1,107, 049 The term deposits are held with international banks which are assigned deposit ceilings in accordance with the investment policy of UNESCO. The deposit ceilings are determined using the following criteria: minimum equity $2,5 billion and minimum Fitch ratings: sovereign AA-, individual B/C, support 1. The Investment Committee regularly follows up that the rate of return is in line with the benchmarks set up in the investment policy. 7. INVESTMENTS Investments, all of which are held in a fiduciary capacity, are summarized as follows: $ 000s $ 000s Carrying value Market value Carrying value Market value Short-term money market funds & shares 4,410 4, Bonds 112, , , ,915 Total (Statement II) 116, , , ,859 Within Staff Fiduciary Funds (SFF), the UNESCO Staff Savings and Loan Service (USLS) portfolio managers are authorized within defined limits to buy and sell futures contracts which complement the bond investment strategy by covering firm investment positions and generating additional income. All such contracts are traded on organized markets and valued at official settlement prices. As at 31 December 2009, the fair market value of futures contracts owned by USLS was K$20 and as at 31 December 2007 K 4,307 (K$6,353). The futures are off-balance sheet amounts and consequently, the underlying values are not included in the Financial Statements. Bonds include obligations issued or guaranteed by governments, supranational organisations or corporations with duration of 2 years, the quality of which is not to be less than AA (Fitch or its equivalent). The Investment Committee regularly follows up that the investment performance is in line with the benchmarks set up in the investment policy.

23 185 EX/25 Part I - page ASSESSED CONTRIBUTIONS RECEIVABLE FROM MEMBER STATES The balance of assessed contributions receivable is summarized as follows: $ 000s $ 000s Contributions due as at 1 January 2008 Contributions received Unpaid contributions as at 31 December 2009 Unpaid contributions as at 31 December 2007 Arrears * 71,495 (64,085) 7,410 13,402 Contributions assessed for the biennium** 631,023 (607,061) 23,962 49,844 Subtotal 702,518 (671,146) 31,372 63,246 Deferred arrears under payment plans 18,275 27,636 Subtotal contributions Receivable 49,647 90,882 Working Capital Fund 97 TOTAL (Statement II) 49,647 90,979 * includes arrears payable in annual instalments up to the current year. ** includes new Member States and Associated Members. Summary of aged Contributions Receivable: Due for Arrears $ 000s 6, ,962 Sub-total 1 30,860 Arrears under payment plans (annual instalments) Deferred arrears under payment plans ,275 Sub-total 2 18,787 TOTAL 49,647

24 185 EX/25 Part I - page 26 In application of 34 C/Resolution 75.II paragraph 1 (c), the contributions for that remained unpaid as at 31 December 2009 that were assessed in euros are considered as due and payable in United States dollars. These balances are converted into United States dollars at the United Nations prevailing rate in December A detailed listing of unpaid contributions as at 31 December 2009 is shown in Annex III. 9. ACCOUNTS RECEIVABLE OTHER The balances of Accounts Receivable Other, which are shown net of any provisions established to cover the risk of non-payment of any sum which appears doubtful, are summarized as follows: $ 000s Staff loans and advances 50,866 54,019 Interest receivable 3,791 13,681 Amounts receivable for goods and services 6,241 3,693 Value added tax recoverable 5,359 5,440 Advances to project partners 10,517 6,267 Miscellaneous 11,455 10,284 Total (Statement II) 88,229 93, OTHER ASSETS Other assets are summarized as follows: $ 000s Field office payments Stock on hand, at lower of cost or net realizable value 1,595 1,720 Fixed assets Miscellaneous 4,670 1,176 4,484 1,309 Total (Statement II) 7,925 7,936

25 185 EX/25 Part I - page LAND AND BUILDINGS $ 000s Headquarters premises, Place de Fontenoy at cost Add Phase I Belmont Plan renovation costs, Place de Fontenoy - Phase II Renovation Works Completed, Place de Fontenoy Subtotal, Headquarters premises, Place de Fontenoy at cost 23,022 23,549 89, ,637 23,022 23,549 46,571 Headquarters Fifth Building, rue Miollis at cost 7,899 7,899 Headquarters Sixth Building, rue François Bonvin at cost 30,426 30,426 Headquarters Seventh Building, rue François Bonvin at cost 3,525 3,525 Industrial building, rue François Bonvin at cost Headquarters Apartment, place Vauban at cost 2,601 2,601 Building of the International Bureau of Education (IBE), Geneva at cost 4,615 4,615 Ocampo Villa, Buenos Aires 1,800 1,800 Total (Statement II) 187,207 98,141 (a) Headquarters buildings The land at Place de Fontenoy is rented from the French Government at a nominal rent of 2 per annum and the land lease covers a period of 99 years starting with the year The land at rue Miollis and François Bonvin is rented from the French Government at a nominal rent of 15 per annum and the land lease covers a period of 84 years starting from 1 January (i) Building renovation costs of Phase I Belmont Plan The Phase I of the Belmont Plan on the renovation of the Fontenoy Building complex was completed in 2004 and the associated costs amounting to K$23,549 were brought to account and capitalized under Land and Buildings as at 31 December (ii) Building renovation costs of Phase II Belmont Plan The Phase II of the Belmont Plan on the renovation of the Fontenoy Building complex was officially completed in September 2009 and the associated costs amounting to K$89,066 initially recorded as renovation work in progress were brought to account and capitalized under Land and Buildings as at 31 December (iii) Headquarters Apartment Place Vauban By 32 C/Resolution 76, the General Conference approved the purchase of the apartment currently occupied by the Director-General under the conditions stated in the available offer for the use of UNESCO Directors-General and authorized the Executive Board to review and approve on its behalf the implementation of this purchase, including its funding from UNESCO s own cash balances. The

26 185 EX/25 Part I - page 28 Resolution states that the purchase will be amortized over two biennia starting in and invites the Director-General to include in future budgets the necessary funds to cover such amortization. The purchase was concluded in May 2004 and the cost incurred in the entire acquisition of K$2,601 is disclosed in the above table. The remaining balance of K$1,301 has been amortized in the current biennium (b) IBE building (and related loan) (i) Building An agreement was signed on 31 July 1984 between UNESCO and FIPOI (Property Foundation for International Organizations) of Switzerland for the purchase of three floors of a building situated at 17 rue des Morillons, Geneva to house the International Bureau of Education. Further to an agreement signed between FIPOI and the Canton of Geneva on 16 October 1996, UNESCO s share of the costs of this building have been finalized at KCHF (thousands of Swiss francs) 6,692 (K$4,615) and the IBE building has consequently been brought to account for this amount. This amount was financed partly by a donation of KCHF 2,255 by the Conseil d Etat of the Republic and Canton of Geneva and partly by loans from FIPOI for the balance of KCHF 4,437. Following a renegotiation of the repayment schedule in December 1997 it was agreed to fix the amount of the loan outstanding as of 1 January 1998 at KCHF 3,223 (K$2,270) repayable in equal annual instalments of KCHF 133 from 1998 until 2021, with a final payment of KCHF 19 in (ii) IBE loan outstanding Swiss francs $ 000s Balance at 1 January ,889 1,733 Less -: (i) Loan repayment 2008 and 2009 (267) (241) (ii) Exchange adjustment on revaluation Balance at 31 December ,622 1,575 Amount payable in 2010 Amount payable in future periods 133 1, ,446 (c) Ocampo Villa, Buenos Aires Land is valued at a nominal amount of $1 and structures are included at their insurance valuation. (d) Capital funds related to land and building The increase in the capital funds relating to land and buildings amounting to K$14,858 bringing the total capital funds at 31 December 2009 to K$ 118,342 (2007 K$103,484) is due to the following:

27 185 EX/25 Part I - page 29 (i) (ii) (iii) Renovation loan amortisation for a total sum of K$13,398 corresponding to the repayments made in 2008 and 2009; Headquarters Apartment amortisation of K$1,302; Repayment of the outstanding loan on IBE building equivalent to K$241 and a loss on the loan revaluation of K$ RENOVATION LOAN AND WORK-IN-PROGRESS (a) Loan for renovation Phase II of the Belmont Plan By 32 C/Resolution 74, the General Conference had authorized the Director-General to contract a loan of K 79,875 with a lender chosen by him in cooperation with the Government of France and to take into account the necessity of making provision in future budgets for the funds required for reimbursement of the sums borrowed. An agreement was signed on 23 March 2004 between UNESCO, the Caisse des Dépôts et Consignations (CDC) and the Government of France for the loan which would be drawn in five yearly instalments from 2004 to 2008 and repaid over eight biennia starting in The loan repayments are fully guaranteed by the Government of France and the interest due on the loan is also paid by the Government of France. The interest that would have been payable by the Organization during the biennium, which was actually paid by the Government of France, amounts to K$6,408. $ 000s Balance at 1 January ,189 80,451 Loan withdrawals from CDC in ,406 20,030 Less -: (i) Loan repayment in (11,643) (13,398) Add - : (ii) Exchange adjustment on revaluation 871 Balance at 31 December ,952 87,954 Amount payable in 2010 Amount payable in future periods 5,989 54,963 8,642 79,312 Due to the significant impact and the extraordinary nature of the renovation loan, the exchange difference arising from the revaluation of the loan balance at the close of the reporting period is disclosed under a Currency Exchange Reserve account dedicated to the renovation loan. The exchange difference of K$17,813 from revaluation has therefore been reported separately in the balance sheet of the General Fund (GEF) (Statement II) as at 31 December (b) Work-in-progress Renovation costs are recorded as work in progress due to the significant amounts involved, the duration of the remaining phases of the Belmont Plan and the approved method of charging expenditure.

28 185 EX/25 Part I - page 30 The renovation work undertaken under Phase II of the Belmont Plan includes major reconstruction and improvements to the existing Headquarters premises at the Place de Fontenoy. In conformity with the United Nations System Accounting Standards (UNSAS) the expenditure incurred on such undertakings would need to be accumulated and disclosed in a separate account and then on completion should be brought to account at final cost. In this respect the accumulated cost incurred under Phase II of the Plan as at 31 December 2009 amounting to K$89,066 (of which K$23,484 was incurred during ) has been transferred to Buildings upon the official completion of the works in September LIABILITIES FOR EMPLOYEE BENEFITS (a) Annual leave, termination and repatriation grants As stated in note 2(c) on expenditure recognition, UNESCO does not normally recognize in its financial statements liabilities for accrued annual leave, termination and repatriation grant entitlements. Where not provided, charges are recorded in the financial period in which they are paid. At 31 December 2009, the total liability for these costs in respect of UNESCO staff is estimated to be approximately K$50,075 (2007 K$44,000) for which an amount of K$22,850 (2007 K$19,657) has been accumulated as reserves in the Financial Statements. (b) After-service medical care Staff retiring from UNESCO, who have reached their fifty-fifth birthday and who have completed at least 10 years of participation in the Medical Benefits Fund as at the date of their separation, may opt to remain (indefinitely) in that Fund as a voluntary participant with UNESCO continuing to participate in the funding of their contributions. The Organization s policy is to undertake a detailed actuarial valuation at the end of each biennium in order to calculate the potential amount of after service medical care costs. As at 31 December 2009 the net present value of UNESCO s liability, which is not provided for in these Financial Statements, amounted to K$649,018 (2007 K$614,000). 14. INVENTORIES (non-expendable equipment) Estimates of Inventories, excluding Works of Art, at Paris Headquarters, UNESCO institutes and offices away from Headquarters as at 31 December 2009 are as follows: $ 000s Paris Headquarters UNESCO institutes at valuation/original cost at valuation/original cost 10,814 9,174 6,811 10,316 Offices away from Headquarters at original cost 12,508 10,310

29 185 EX/25 Part I - page 31 The Organization has a significant number of Works of Art including paintings, statues and various other objects, which have been mainly donated by governments, artists and other partners. An internal fund has been set-up to cover accidental damages to these works, which have a considerable intrinsic value. 15. UNESCO BRASILIA OFFICE (a) Change in functional currency During the biennium UNESCO Brasilia Office adopted the Real as its functional currency in order to better reflect the economic substance of transactions and facilitate the recording of its activities which are based almost entirely in Brazil and conducted in the currency of that country. For practical reasons, the timing of the change of functional currency coincided with the introduction of the UNESCO Finance and Budget System (FABS) to the Brasilia Office which went live on 1 January For the year 2008 the shortfall of income over expenditure reported in the Interim Financial Statements, under Programme Fiduciary Funds, Self benefiting Trust Fund Brazil, included an amount of K$ (37,329) as Currency exchange adjustments. Following the change of functional currency from USD to Real in January 2009 these biennium Financial Statements show on Schedule 1.3, under the equivalent fund, a currency exchange adjustment for the period of K$ (40,386) including the amount reported in 2008 and an adjustment to reserves of K$ 41,227 as required following the change in functional currency. (b) Presentation of information The roll-out of the FABS system to the Brasilia Office has also had an impact on the way information is analysed between Brasilia activities and Other Special Accounts and Trust Funds as set out in Schedule 1.3. As from 1 January 2009 all the activities handled by the Brasilia office are now shown under one column, as opposed to only the Self-Benefiting Trust Funds which was the basis of presentation in previous Financial Statements. If there had been no change in the way information is analysed and presented, the non Self-Benefiting activity relating to Brasilia, previously included under Other Special Accounts and Trust Funds, would have increased that category of income by K$ 18,821, increased its expenditure by K$ 23,235 and reduced the excess of Other Special Accounts and Trust Funds by K$ 4,414 in these Financial Statements. 16. CONTINGENT LIABILITIES (a) A civil action suit alleging acts of administrative impropriety was filed in January 2005 against high-ranking former officials of the National Social Security Institute of Brazil in which UNESCO and its former representative in the country were also cited as codefendants, with respect to technical assistance agreements concluded between the aforementioned Institute and the UNESCO Brazil Office. The Federal Prosecutors are claiming damages of approximately US$28 million. At the outset, UNESCO invoked its immunity from jurisdiction and that of its former Representative. In 2008, the Federal Court issued a decision declaring that civil action could continue against UNESCO and the former representative. Following an appeal in 2009 by UNESCO, the reporting judge issued a preliminary decision staying the proceedings in favour of UNESCO, pending his final decision on the admissibility of the appeal. The Federal Prosecutors have contested both UNESCO s appeal and the reporting judge s preliminary decision concerning the stay of proceedings. At this stage it is not possible to give an estimate as to the outcome of the case nor the amount of loss associated with the outcome.

30 185 EX/25 Part I - page 32 (b) A number of legal cases are pending before labour courts in which former employees have lodged claims for compensation alleging violation of employment contracts. It is not possible at this time to determine whether any of these cases will result in a material outflow of resources. Staff members have also lodged complaints which are pending before UNESCO Appeal Board or the International Labour Organization Administrative Tribunal.

31 Schedule 1.1 REGULAR PROGRAMME INCOME Assessed contributions Member States 631, ,000 New Member States 249 Associate Member States , ,271 Voluntary contributions 10,900 8,258 Investment income 4,554 3,949 Currency exchange adjustments 8,892 (5,043) Other income 3,061 2,028 TOTAL INCOME 658, ,463 EXPENDITURE 641, ,233 TOTAL EXPENDITURE 641, ,233 EXCESS (SHORTFALL) OF INCOME OVER EXPENDITURE 16,538 (770) Increase in land and buildings 14,858 9,590 Increase in Working Capital 903 Distribution to Member States (18,451) (8,182) Transfers (to)/from other funds (246) Decrease in budgetary surpluses (18) Other adjustments to reserves and fund balances 2, Reserves and fund balances, beginning of period 140, ,801 RESERVES AND FUND BALANCES, END OF PERIOD 156, , EX/25 Part I - page 33

32 185 EX/25 Part I - page 34 UNESCO OTHER PROPRIETARY FUNDS SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 SCHEDULE 1.2 Revenue Generating Activities Support Costs Staff Related Accounts Renovation Plan New Management Monitoring Instruments US Special Account IPSAS Special Account Cost Recovery Policy External Evaluation of UNESCO Voluntary Contributions- Security (Schedule 1.2.1) (Schedule 1.2.2) (Schedule 1.2.3) Elimination INCOME Voluntary contributions Revenue generating activities 29,407 29,407 22,837 Allocations from other funds 130 1,070 4,622 1, ,817 5,149 Income for services rendered 25,318 25,318 26,822 Investment income , ,338 18,802 Currency exchange adjustment (1,138) (1,138) 2,173 Other income 391 3,934 1,984 6,309 6,958 TOTAL INCOME 30,335 43,473 2,274 1,205 4, , ,192 82,741 EXPENDITURE 27,083 47,176 1,357 5,756 4,438 2, ,938 75,912 TOTAL EXPENDITURE 27,083 47,176 1,357 5,756 4,438 2, ,938 75,912 EXCESS ( SHORTFALL ) OF INCOME OVER EXPENDITURE 3,252 (3,703) 917 (4,551) 239 (2,831) 1, (154) 418 (4,746) 6,829 Transfer to/from reserves 246 Other adjustments to reserves and fund balances (569) (2,211) 2,718 (62) 3,790 Reserves and fund balances, beginning of period 14,873 25,604 6,603 3, , ,477 45,612 RESERVES AND FUND BALANCES, END OF PERIOD 17,556 19,690 7,520 2,035 1,148 1,543 1, (154) ,669 56,477

33 UNESCO REVENUE GENERATING ACTIVITIES SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE Public Information Liaison and Relations Fund Publications and Auditory and Visual Material Fund Utilization of Headquarters Fund Special Account for Documents/ Publications Services Special Account for Interpretation Services TOTAL INCOME Revenue producing activities Sales & Royalties 432 2, ,182 3,574 15,430 11,801 Rental & Charges from letting 13, ,977 11,036 Allocation from other funds Investment income ,092 Currency exchange adjustment 25 Other income TOTAL INCOME 830 2,230 14,454 9,247 3,574 30,335 25,748 EXPENDITURE Cost of Goods Sold Staff Costs 1, , ,915 7,398 Other Expenditure 444 1,193 6,085 6,761 3,068 17,551 14,719 TOTAL EXPENDITURE 1,873 1,599 13,003 7,090 3,518 27,083 22,582 EXCESS (SHORTFALL) OF INCOME OVER EXPENDITURE (1,043) 631 1,451 2, ,252 3,166 Other adjustments to reserves and fund balances (569) (569) (46) Reserves and fund balances, beginning of period 2,700 1,821 6,779 2, ,873 11,753 RESERVES AND FUND BALANCES, END OF PERIOD 1,088 2,452 8,230 4, ,556 14, EX/25 Part I - page 35

34 UNESCO PROGRAMME SUPPORT COSTS FOR SPECIAL ACCOUNTS AND TRUST FUNDS SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE EX/25 Part I - page 36 Funds-in Trust Overhead Cost Account (FITOCA) Special Account for Administrative and Operational Services ( UNDP-AOS ) Technical Support Services at the Programme Level ( UNDP-SPPD ) Technical Support at the Project Level (UNDP-STS ) TOTAL INCOME Income for services rendered Programme Support Costs 25, ,318 26,822 Investment income 15, ,359 15,013 Currency exchange adjustments (1,138) (1,138) 2,148 Other income 3,934 3,934 4,585 TOTAL INCOME 43, ,473 48,568 EXPENDITURE Staff Costs 28,040 28,040 24,454 Other Expenditure 18, ,136 14,644 TOTAL EXPENDITURE 46, ,176 39,098 EXCESS (SHORTFALL) OF INCOME OVER EXPENDITURE (3,371) 23 4 (359) (3,703) 9,470 Other adjustments to reserves and fund balances 731 (2,285) (740) 83 (2,211) Reserves and fund balances, beginning of period 22,300 2, ,604 16,134 RESERVES AND FUND BALANCES, END OF PERIOD 19, ,690 25,604

35 UNESCO STAFF RELATED ACCOUNTS SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE Terminal Payment Fund Staff Compensation Fund Language Courses TOTAL INCOME Allocations from other funds Investment income Other income 1, ,984 1,579 TOTAL INCOME 1, ,274 2,264 EXPENDITURE Staff Costs ,272 Compensation/Benefits Paid Other Expenditure TOTAL EXPENDITURE 1, ,357 1,951 EXCESS OF INCOME OVER EXPENDITURE Other adjustments to reserves and fund balances 173 Reserves and fund balances, beginning of period 5, ,603 6,117 RESERVES AND FUND BALANCES, END OF PERIOD 5, ,520 6, EX/25 Part I - page 37

36 UNESCO PROGRAMME FIDUCIARY FUNDS SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE EX/25 Part I - page 38 Institutes (Schedule 1.3.1) UNESCO Brasilia Office Other Special Accounts and Trust Funds (Sch ) TOTAL INCOME Assessed contributions 9,203 9,203 8,009 Voluntary contributions 153, , , , ,416 Revenue producing activities 3,168 3,168 3,121 Funds received under inter-organization arrangements 79,059 79,059 54,933 Allocations from other funds (Regular Programme) 28,133 28,133 28,333 Income for services rendered 54,795 54,795 40,900 Investment income 2,340 23,337 10,366 36,043 47,599 Currency exchange adjustments 1,626 (40,386) (318) (39,078) 45,713 Other income 1,851 1,851 3,519 TOTAL INCOME 245,174 86, , , ,543 EXPENDITURE Expenditure 236, , , , ,729 TOTAL EXPENDITURE 236, , , , ,729 EXCESS/ (SHORTFALL) OF INCOME OVER EXPENDITURE 8,471 (51,951) 69,126 25, ,814 Other adjustments to reserves and fund balances (841) 41, ,956 6,185 Reserves and fund balances, beginning of period 42, , , , ,367 RESERVES AND FUND BALANCES, END OF PERIOD 49, , , , ,366

37 UNESCO SPECIAL ACCOUNTS FOR INSTITUTES SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s USD) SCHEDULE International Bureau of Education International Centre for Theoretical Physics International UNESCO Total International International UNESCO Institute for Higher UNESCO-IHE Institute for UNESCO Institute for Institute for Institute for Education in Latin Institute for Information Institute of Capacity Educational Lifelong America and the Water Education Technologies in Statistics Building in Africa Planning Learning Carribean Education IBE ICTP IESALC IHE IICBA IIEP IITE UIS UIL INCOME Voluntary contributions 3,559 65,025 1,250 29, , ,542 7, , ,272 Revenue producing activities 3 1,397 1, ,168 3,121 Allocations from other funds (Regular Programme) 4,591 1,263 2,200 2,000 5,100 1,100 9,020 2,859 28,133 27,878 Income for services rendered ,195 2, ,795 40,900 Investment income 133 1, ,340 2,913 Currency exchange adjustments 14 (49) (70) (3) 1,756 (2) (20) 1,626 1,182 Other income ,851 3,519 TOTAL INCOME 8,556 69,237 3,451 82,727 2,031 40,146 1,117 27,216 10, , ,785 EXPENDITURE Expenditure 7,931 69,256 3,082 82,819 2,242 38, ,919 9, , ,292 TOTAL EXPENDITURE 7,931 69,256 3,082 82,819 2,242 38, ,919 9, , ,292 EXCESS (SHORTFALL) OF INCOME 625 (19) 369 (92) (211) 1, ,297 1,328 8,471 9,493 OVER EXPENDITURE Savings on prior period obligations , ,906 1,716 Other adjustments to reserves and fund balances (859) (20) (1,741) (123) (4) (2,747) 4,469 Reserves and fund balances, beginning of period 1,225 14, , , ,194 1,732 42,148 26,470 RESERVES AND FUND BALANCES, END OF PERIOD 1,904 14, , , ,560 3,056 49,778 42, EX/25 Part I - page 39

38 U N E S C O OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 (Expressed in US dollars) Sub-schedule EX/25 Part I - page 40 RECEIPTS DISBURSEMENTS Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies PART I - UN SOURCES UN AIDS - AIDS Prevention, Awareness and Education Projects 3,415,685 20,602,360 98,450 10,889, ,186 12,573,237 2,543,982 10,029,255 UN Democracy Fund 310,007 1, ,089 6, , ,687 76,104 UN Development Fund for Women 54,589 28,654 1,471 24,464 1,346 23,118 UN Development Programme (3,795,303) 2,581, , ,558 52,032 (1,392,861) 20,133 (1,412,994) UN Development Programme Projects 313,682 1,466,097 16,834 31, ,828 50,242 1,248,320 86,316 1,162,004 UN Economic and Social Commission for Asia and the Pacific 100, ,914 12, ,247 11, ,823 60, ,942 UN Environment Programme - Memoranda of Understanding 601,149 1,247,982 1,083 1,353,924 49, ,279 33, ,535 UN Fund for International Partnership 4,586,957 2,237, ,685 22,630 3,430, ,532 3,358, ,033 2,805,248 UN Fund for Population Activities (729) 729 UN Fund for Population Activities Projects and UN Multi-Donor for International Conferences 7, ,336 1,495 (23,791) 227,886 16,152 61,868 50,084 11,784 UN Joint Programmes 1,704, ,834 1,968, ,386 1,794,448 3,802, ,102 2,222, ,897 1,898,514 UN Mine Action Service Fund 360,000 7, ,996 30,400 32,764 18,768 13,996 UNDP/Spain MDG Fund 116,098 22,474, ,616 5,743, ,059 16,724,105 3,653,008 13,071,097 UNHCR Fund 41,100 29,532 (37,532) 30,184 1, UNICEF Fund 136,336 1,555,578 24,721 (54,078) 777,292 92, , , ,504 UNICEF Joint Programme - Pakistan HRP Fund 206, ,600 11,102 37,634 22,898 14,736 United Nations Central Emergency Response Fund 11, ,235 3, ,841 36,459 88,016 18,547 69,469 United Nations Development Group Iraq Trust Fund 28,089,761 3,820,450 (931,708) 17,106, ,115 12,944,408 6,070,134 6,874,274 United Nations Human Security Fund 577,827 1,606,671 2, ,545 77,549 1,128, , ,797 United Nations International Strategy for Disaster Reduction 215, ,550 8, ,020 43, , , ,715 United Nations Lebanon Recovery Fund 774, ,000 49, ,109 29,548 1,191,761 19,741 1,172,020 International Trade Centre Fund 49,038 22,927 1,605 24,506 24,506 One UN Fund Albania 149, ,954 2, ,833 39,639 77,194 One UN Fund Mozambique 2,053,179 34, ,886 44,372 1,409, ,701 1,017,498 One UN Fund Pakistan 2,223, , ,222,209 2,222,209 One UN Fund Rwanda 596,116 5, ,555 37,559 27,286 5,735 21,551 One UN Fund Tanzania 5,373,358 11, ,074 34,165 4,863,035 35,507 4,827,528 One UN Fund Uruguay 1,084,184 7, ,173 56, ,689 50, ,203 One UN Fund Viet Nam 1,507,766 3, ,008 9,870 1,360, ,174 1,125,945 Preventing and Responding to Domestic Violence through a Multi-sectoral Approach Joint Programme in China 106, , ,989 Peacebuilding Fund 1,970,049 26, ,168 37,882 1,417, ,413 1,277,936 World Conference on Education for All 4,484 (484) 4,000 TOTAL PART I 36,901, ,834 78,906,196 (115,973) 2,527,060 51,395,527 3,194,428 64,385,605 15,406,450 48,979,155 PART II - OTHER EXTRA-BUDGETARY SOURCES A.TECHNICAL ASSISTANCE PROJECTS FINANCED BY LOANS / GRANTS FROM INSTITUTIONS African Development Bank: Cameroon 117, ,184 1, ,067 12, ,601 31, ,415 Côte d'ivoire 17,440 15,434 2,006 Democratic Republic of Congo 1,308,017 1,798,082 40,644 1,792,138 85,652 1,268, ,154 1,134,799 Gambia 1,864 (1,864) Sierra- Leone 61, ,174 4,442 24,336 17,074 7,262 Support to the ECOWAS Peace and Development Programme 86,348 8, , ,031 30,333 53,012 2,327 50,685 Co-operative Programme 66,336 43,150 8, , ,494

39 U N E S C O OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 Schedule page 2 (Expressed in US dollars) RECEIPTS DISBURSEMENTS Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies Asian Development Bank: Fighting HIV/AIDS in Asia and the Pacific/Developing Capacity among Ethnic Minority Communities to Combat HIV/AIDS , ,298 14,079 28,245 27, HIV/AIDS Vulnerability and Risk Reduction among Ethnic Minorities Groups through Communication Strategies in GMS 45,792 38,990 75,028 9,754 Lao PDR 64, ,112 7,424 Inter-American Development Bank: Brazil 21,176 60,667 52,737 3,164 25,942 25,942 Latin America - Comparative Evaluation of Education 32,825 70, ,442 Islamic Development Bank: Cameroon 168, ,780 17,131 20,224 5,015 15,209 Chad 3,450 3,450 3,450 Niger Co-operative Programme (23,731) (23,731) (23,731) Japan Bank for International Cooperation: Vietnam 10,777 (10,843) (66) OPEC Fund: World Bank: Côte d'ivoire 32,661 32,661 32,661 Mali 4,564 (4,564) Mauritania 51, (47,869) 4, Senegal (18,416) 18,416 Strengthening Education Sector Response to prevent HIV/AIDS 184,527 1,200 (66,894) 118,833 Strengthening Education Sector Response to HIV/AIDS in Southern Africa 915 1,499,975 1,500,890 1,500,890 Co-operative Programme 5,041 (5,041) Bangladesh 439,464 15, , ,840 Brazil 19,380 3,155 (350) (17) 22,902 22,902 Ghana 60 (60) Global Initiative for Quality Assurance Capacity 1,280,000 31,503 1,261,425 1,292,647 81,920 1,198, , ,627 Haiti 53, (14,515) 39,617 Iran (84,689) 84,689 Latin American Laboratory for Assessment of the Quality of Education 205,143 4, , ,037 19,306 44,235 44,235 Morocco (11,653) 11,653 Prog. of Analytical and Capacity Building conducted by the Pôle de Dakar 475,477 20,627 1,619,805 1,267,936 63, ,576 37, ,803 Uzbekistan 10,000 (69) 8,789 1,142 SUB-TOTAL PART II A 2,738, ,541 79,527 60,667 4,826,993 3,627, ,563 4,093, ,855 3,518,449 B.SELF BENEFITING PROJECTS Aga Khan Foundation 149,605 1,395 (47,759) 91,364 11,877 Albania 1,389,741 42, ,118 29,049 1,039, , ,778 Angola 99, , ,270 Azerbaijan 73,428 4, ,799 67,799 Bahrain 667,758 16, ,764 54, , ,406 Cameroon 198, ,152 18,480 38,549 22,054 16,495 Chile 188, , ,936 34, ,700 51,410 70,290 Costa Rica 5,695 (5,695) Ecuador 140, ,000 4,186 (5,698) 406,543 23, , , ,951 Guatemala 565,178 (549,809) 4,113 17,241 2,241 Iraq 3,613, , ,597 1,045, ,549 3,399,822 3,144, ,418 Latin American Laboratory for Assessment of Quality in Education 142, ,831 61, , ,300 61,218 47, EX/25 Part I - page 41

40 U N E S C O OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 (Expressed in US dollars) RECEIPTS Schedule page 3 DISBURSEMENTS 185 EX/25 Part I - page 42 Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies Lebanon 30,409 25,367 3,298 1,744 1,744 Libyan Arab Jamahiriya 15,399, , ,372 1,936, ,041 14,119, ,714 14,000,025 Mexico 193, ,644 (10,580) 722,620 93,941 45,914 5,093 40,821 Namibia 113,389 (779) 46,793 6,083 59, ,059 Nigeria 1,154, ,863 17, ,902 69, ,229 10, ,895 Peru 174, ,639 11,783 72,418 46,849 25,569 Saudi Arabia 274,926 9,150 (282,400) 1, United Arab Emirates 316,801 17,206 (14,910) 276,284 35,917 6,896 2,769 4,127 Uruguay 50, , ,138 13,057 75,990 75,990 SUB-TOTAL PART II B 17,532,562 1,902, ,697 (293,759) 4,283, ,318 14,894, ,434 14,709,230 C.DONATED PROJECTS Albania Trust Fund 159,643 5, , ,230 Arab Gulf Programme for United Nations Development 542,348 15,897 14, ,606 14, ,418 3, ,320 Associate Experts' Scheme Austria (23,176) 19, (4,271) (4,271) Belgium 177, ,185 2, ,900 46,188 16,560 4,437 12,123 Denmark 17, ,352 17,352 Finland 233, ,400 6, ,015 53, ,451 1, ,038 France 264, ,200 6, ,864 33,224 79,370 79,370 Germany 81, ,640 (2,825) 443,569 53, ,731 4, ,632 Greece 93, ,700 6, ,144 31, , ,601 Italy 255, ,069 9,001 1,087, ,451 (71,496) 11,694 (83,190) Japan 384,953 1,332,500 20,894 1,309, , ,157 10, ,971 Korea, Republic of 9, ,593 1, ,757 37,771 68,994 68,994 Norway 33,137 (33,137) Portugal 21,822 21,822 21,822 Spain 700,372 1,036,272 14,899 1,006, , ,169 5, ,300 Sweden 46, , ,203 48,384 (21,902) (21,902) Switzerland 198,731 21,886 2, ,559 22,267 15,137 15,137 United Kingdom (549) (549) (549) Association of Private Committees Trust Fund 436,460 (592) (36,841) 1,268,920 1,454,606 72, , ,635 25,976 Australia Trust Fund 167,280 2,820,107 35,066 (7,753) 480,361 58,994 2,475, ,671 2,090,674 Belgium (Flanders) Trust Fund 5,515,783 5,146, ,587 4,999, ,700 5,367, ,454 4,819,084 Bulgaria Trust Fund 669,101 5,265 31,280 4, ,020 43, ,696 Canada Trust Fund 137, ,756 6,315 (3,653) 412,481 53,622 45,358 8,547 36,811 Czech Republic Trust Fund 79,439 90,181 3,375 33,262 4, ,412 5, ,743 Denmark Trust Fund 376,442 1,976,105 23, ,072 49,052 1,471,312 6,835 1,464,477 European Commission Trust Fund 3,434, ,853 11,156,488 6,496, ,738 7,864,397 1,464,636 6,399,761 Felissimo Trust Fund 252,829 9,123 15,738 5, , ,040 Finland Trust Fund 95, ,518 8, ,349 18, , ,652 France Trust Fund 1,374,069 5,037,957 3,690 5,700 3,012, ,368 3,118, ,497 2,851,844 Germany Trust Fund 1,833,868 2,773,255 27,082 (1,433) 2,977, ,817 1,297, , ,086 Greece Trust Fund 248,146 10,327 (5,695) 122,682 15, , ,351 Hungary Trust Fund 48, ,673 49,673 Iran Trust Fund 90,478 3,166 93,644 93,644 Ireland Trust Fund 290,105 40,348 (34,301) 247,102 32,123 16,927 16,927 Islamic Call Society Trust Fund 5,864, ,106 (271,176) 617,814 79,663 5,085,788 25,620 5,060,168 Italy Trust Fund 37,435,957 9,016, ,356 (50,000) 23,163,182 2,594,868 21,431,168 2,364,445 19,066,723 Japan Trust Fund 31,921,221 36,570,012 1,441,213 26,089,493 3,380,286 40,462,667 3,698,302 36,764,365 Libyan Arab Jamahiriya Trust Fund 1,000,000 9, ,470 25, , ,703 Luxembourg Trust Fund 330,720 10,715 83,258 10, ,353 2, ,251 Malta Trust Fund 61,180 2,141 63,321 63,321 Mexico Trust Fund 200, , ,561 36, ,714 56,002 79,712 Monaco Trust Fund 327, ,270 23, ,270 6, ,769 Multi-Donor Trust Fund 268, ,664 15, ,645 26, , ,945 Netherlands Trust Fund 1,024,921 1,394,288 1,225, ,920 1,034, , ,830 New Zealand Trust Fund 286, ,775 7, ,125 77, ,196 24, ,066 Norwegian Agency for Development Trust Fund 22,728 (23,025) 297

41 U N E S C O Schedule page 4 OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 (Expressed in US dollars) RECEIPTS DISBURSEMENTS Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies Norway Trust Fund 6,247,300 7,219,123 29,725 (10,205) 6,770, ,903 5,979, ,839 5,313,686 Poland Trust Fund 25, ,240 2,631 2,366 1,000 1,366 Portugal Trust Fund 698, ,792 23, ,263 34, ,036 20, ,696 Private Sector Trust Funds - other 5,466, ,272 12,709,535 8,995,472 1,087,534 8,326,472 1,123,974 7,202,498 Private Sector UNESCO Chairs 230,986 5,171 (7,406) 127,852 16,021 84,878 27,316 57,562 Qatar Foundation Trust Fund 1,874,056 62,759 8,456,668 1,098, ,958 9,173, ,839 8,965,280 Republic of Korea Trust Fund 1,874,967 2,576,210 70,712 1,954, ,223 2,313, ,637 2,185,261 Romania Trust Fund 147,493 3, ,272 14,465 24,804 24,804 Russian Federation Trust Fund 1,882,315 20, ,146 53,319 1,439,330 29,391 1,409,939 Saudi Arabia Trust Fund 4,693,463 2,530, , , ,683 21,504 7,128,898 92,898 7,036,000 Singapore Trust Fund 40, ,619 1,380 28,140 23,759 4,381 Spain Trust Fund 11,212,120 21,928, ,168 (826,444) 8,450,435 1,070,163 23,219,347 1,110,362 22,108,985 Sweden Trust Fund 3,457,843 3,907, ,099 3,621, ,298 3,413, ,883 2,850,976 Switzerland Trust Fund 186,430 1,394,949 17,429 (19,413) 614,292 79, , , ,726 The People s Republic of China Trust Fund 250,000 2, ,953 26,514 21, ,153 Turkey Trust Fund 400,000 8,541 55,426 7, , ,707 United Arab Emirates Trust fund 1,727 (1,767) 40 United Kingdom Trust Fund 842, ,190 19,770 (180) 918, , ,558 32, ,089 United States of America Trust Fund 170,358 6,446,962 40,741 (59,098) 3,317, ,522 2,849, ,996 2,523,858 SUB- TOTAL PART II C 37,104,574 49,635,312 1,290,504 20,525,857 37,524,606 4,511,069 66,520,572 4,482,605 62,037,967 D.FUNDS FOR CULTURAL CAMPAIGNS, VOLUNTARY CONTRIBUTIONS AND INTERNATIONAL APPEALS PRIZES AND AWARDS : Arirang Prize (Korea Rep. Of) 31,025 31,025 31,025 Emir Jaber Al-Ahmad Al-Jaber Al-Sabah Prize 549,810 30,000 29,620 80,346 8, ,269 1, ,139 Felix Houphouet-Boigny Peace Prize 8,597, ,731 (129,768) 1,108,944 7,965,540 66,729 7,898,811 International Prize for Water Conservation : "Great Artificial River" 405,782 21,349 32,626 4, , ,264 Japan Shipbuilding Industry Foundation Endowment for UNESCO Peace Prize 1,105,576 55, ,576 13,725 1,041,918 1,041,918 Javad Husain "Young Scientist" Prize 211,931 11, , ,138 King Hamad Bin Isa Al-Khalifa Prize 260, ,600 16, ,477 26, ,310 27, ,454 Literacy Prizes Conficius Prize for Literacy 79, ,978 5, ,658 38,306 51,451 1,511 49,940 International Reading Association Literacy Award 6, ,000 49,826 6,477 1,110 1,110 King Sejong Literacy Prize 5, ,000 1, ,685 16,469 18, ,558 Noma Literacy Prize 5,720 (5,720) Melina Mercouri Prize 14,342 47,509 61,851 61,851 Prince of Asturias Prize 3 (3) Samarkand Taronasi Prize 3,000 (3,000) Sharjah Prize for Arab Culture 289, ,557 19, ,160 12, , ,371 Sheikh Zayed Bin Sultan Al Nahyan Prize 126,732 4, ,722 20,755 20,755 Special Account for : International Simon Bolivar Prize 302,320 15, , ,306 Sultan Qaboos Prize for Environmental Preservation 310, ,568 25,800 33,041 4, , ,306 UNESCO Avicenna Prize for Ethics in Science 65, ,330 5,113 20,736 18,809 1,927 UNESCO Bilbao Prize for the Promotion of Culture of Human Rights 163,297 3, ,015 13,262 51,541 22,513 29,028 UNESCO-Guillermo Cano World Press Freedom Prize 20,000 20,000 20,000 UNESCO - Hamdan bin Rashid Al-Maktoum Prize 1, ,956 11,592 1, ,116 5, ,929 UNESCO-IPDC Prize for Rural Communication 38,000 38,000 38,000 UNESCO-Jikji Memory of the World Prize 30,636 39,510 60,862 4,012 5, ,970 UNESCO-Juan Bosch Prize for the Promotion of Social Science Research in Latin America and the Caribbean 62,500 62,500 62,500 UNESCO Kalinga Prize for the Popularization of Science 7,175 16,046 16,083 2,091 5,047 5,047 UNESCO Prize for the Promotion of the Arts 38,650 7, , , ,549 UNESCO-Madanjeet Singh Prize for the Promotion of Tolerance and Non-Violence 103,888 2, , ,538 15, ,868 7, , EX/25 Part I - page 43

42 U N E S C O OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 (Expressed in US dollars) RECEIPTS DISBURSEMENTS Schedule page EX/25 Part I - page 44 Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies UNESCO-Obiang Nguema Mbasogo International Prize for Research in the Life Sciences 3,000,000 25,647 81,515 10,597 2,933,535 20,568 2,912,967 FELLOWSHIP AND SCHOLARSHIP FUNDS : Nessim Habif Fund 2,250,069 (297,564) 17,602 1,934,903 1,934,903 Scholarship Programme for Girls in Africa 6,868 4,993 11,861 11,861 Theresa McKay Memorial Fund Fellowships 226,824 10,865 85,730 5, ,681 1, ,763 Third World Academy of Sciences 21,377,593 10,473,934 1,145,498 23, ,503 10,522,265 23,457,944 4,673,880 18,784,064 UNESCO-ASCHBERG Foundation Trust Fund 3,590, ,414 23,775 1,765 3,754,174 39,377 3,714,797 UNESCO Fellowship Bank 92,861 32,034 3,219 57,608 57,608 OTHERS : Action in Education for Afghan Refugees 24,893 (6,299) 14,475 4,119 4,119 African Research and Development - Science & Technology 204 (204) ANSTI Membership Fund 115,451 6, ,108 97,380 4, , ,332 Asian Programme of Educational Innovation for Development 103,194 24,989 5, ,565 56,460 3, , ,861 Asia-Pacific Programme of Education for All 18,744 9,989 5, ,275 5,500 17,775 Capacity Building for Education for All 10,697,568 15,531, ,061 10,184 8,761, ,715 17,573,577 1,171,658 16,401,919 CCT Links 59,567 10,542 2,170 34,517 2,355 35,407 35,407 Children in Need 1,989,540 70,929 76, ,605 1,536,681 56, ,818 43, ,334 Education For All - Dakar Follow-up 5,064,223 6,784, ,490 (524) 8,154, ,529 3,522, ,302 2,975,155 Fund for the Elimination of Doping in Sport 1,099,417 1,297,526 71,306 7, ,769 14,677 2,314,345 7,700 2,306,645 Global Alliance for Cultural Diversity 282, ,082 14, ,433 1, , ,216 Great Apes Survival Project 4,960 1,020 5,980 5,980 Higher Education Activities in CEPES 12,343 10,151 1,015 1,177 1,177 Increased Aid to Developing Countries 260,663 7,231 9,953 (385) 199,165 6,225 72,072 1,760 70,312 Information Programme for All 378,728 40,000 14, ,843 22, ,861 51, ,146 Integral Study of the Silk Roads 1,659 (1,659) Intergovernmental Oceanographic Commission ( I.O.C ) 5,575,595 2,952,975 12, , ,290 3,956, ,087 4,773, ,186 4,477,100 International Campaigns - Cultural Heritage 161,578 16,234 5,375 (3,724) 87,330 7,502 84,631 84,631 International Computer Driving License 3,822,541 36,842 4,404,016 2,965, ,105 5,182,263 72,055 5,110,208 International Fund for Cultural Diversity 13,514 2,322,285 36, ,372,137 2,372,137 International Fund for the Development of Physical Education and Sport 88,870 1,923 88, , , ,384 International Fund for the Promotion of Culture 3,850, , , ,940,766 3,940,766 International Fund for the Promotion of the Return of Cultural Works of Art to their Country of Origin 108, ,090 6, ,118 8, , ,093 International Programme for the Development of Communication 3,255,037 2,729, , ,276 3,232, ,320 3,618, ,240 2,837,451 Man and Biosphere Programme (MAB) 1,832,259 3,497, ,742 23,044 2,097, ,505 3,192, ,103 2,871,269 Mitigation Against Earthquake Losses in the Mediterranean Region 9,450 6, ,825 2,825 Ocampo Donations Special Account 53,437 71,780 4, , ,073 14, ,865 19, ,632 Plan for the Promotion of Arab Culture 7,523 6, Portal on Higher Education Institutions 87,754 19,763 1,123 80,362 8,036 20,242 12,100 8,142 Preliminary Microzonation Map for Bam 1 (1) Priority Africa 1,221,814 47,420 62,903 50, ,101 66, , , ,443 Programme for Education of Children in Difficult Situations 89,091 66, ,907 3,543 28, ,421 Promotion of Cultural Heritage Activities 8,425 (340) 7, Protection of Cultural Property in the Middle East in the Event of Armed Conflict 462, ,792 24, ,631 11, ,978 10, ,845 Protection of the World Cultural and Natural Heritage 246, ,370 10,001 (6,796) 153,945 5, ,034 4, ,325 Special Account - Egypt 11,469, , ,076 27,807 11,767,455 20,835 11,746,620 Special Accounts for General Histories 326,382 9,609 (5,259) 186,265 9, ,880 28, ,617 Special Account - Contribution to Internal Oversight Service 204,795 10,761 1, , ,077 Special Account for Latin American Laboratory for Assessment of Quality in Education 544, , ,828 Special Account for Science and Human Sciences Sector - Div. of Foresight & Philosophy 72,583 41,102 4, , ,221 Special Account for South South Cooperation in Education 80, ,965 8,474 26,787 1, ,195 13, ,960 Special Account for Voluntary Contributions 1,886,949 1,035, ,916 88,576 (6,536) 1,686,817 2,303, ,645 2,362, ,522 2,183,018 Special Account for the Reinforcement of the 33C/5 4,864, ,637 3,020,977 2,041, ,893 1,752,485 Special Account for the Strengthening of UNESCO's Infrastructure and its Programme 1,780, ,164 54,872 1,876,176 84,025 8,007 76,018 Special Account for the Support to Countries in Post-conflict and Post-disaster Situations 9, , ,951 20, ,939 52, ,252 Special Account Teachers for Education for All 2,192,129 1,322 44,956 3,147 2,145,348 16,457 2,128,891

43 Schedule page 6 U N E S C O OTHER SPECIAL ACCOUNTS AND TRUST FUNDS BALANCES AS AT 1 JANUARY 2008, RECEIPTS AND DISBURSEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 AND BALANCES AS AT 31 DECEMBER 2009 (Expressed in US dollars) RECEIPTS DISBURSEMENTS Fund Balances UNESCO Government Amounts Investment Exchange Other Project Programme Fund Balances Unliquidated Fund excluding ULOs Regular Contributions Financed From Income Difference Receipts Disbursements Support excluding ULOs Obligations Balances 1 January Programme UN and Costs 31 December (ULOs) 31 December 2008 UN Agencies Special Fund for Youth 2,674 (2,674) The Convention for the Safeguarding of the Intangible Cultural Heritage 1,952,346 3,153, , ,762 4,999, ,395 4,777,648 Trust Fund for the Establishment of the Nubia Museum in Aswan and - - the National Museum of Egyptian Civilization in Cairo 641,371 17,891 28, ,463 6, ,410 15, ,808 Trust Funds for the Preservation of : Moenjodaro 460,229 20, ,236 12, ,732 25, ,691 Parsi Zorastrian Culture and Heritage 19,853 12,012 23, ,595 7, Trust Funds for Safeguarding the : Monuments of Borobodur 196,326 8, ,991 6,250 86,607 30,089 56,518 Monuments of Venice 94,639 7, , ,569 76,356 76,356 UNESCO History Project 32,425 26,825 2,682 2,918 2,918 UNESCO Media Fund 12,057 (568) 11,489 Women's Empowerment and Gender Equality ,961 56,327 5,633 40,591 5,500 35,091 World Commission on Culture and Development 2,167 (61) 1, World Heritage Fund 5,659,335 7,882, , ,303 8,181,129 46,877 6,459,969 1,442,755 5,017,214 Sub-Total Part II D 110,787,272 66,371, ,758 5,232,204 (104,648) 11,732,534 64,241,222 2,254, ,676,095 10,793, ,882,137 E. GOVERNMENT CONTRIBUTIONS TO FIELD OFFICES Special Account for the Contribution of the Government - - of Qatar for the Operation of the UNESCO Regional - Representative's Office in the Arab States of the Gulf 117, , , ,271 14, ,922 Beirut Office 76, , , ,354 81, ,532 Bucharest Office 1,490,000 1,490,000 1,490,000 UNEVOC Office 459,779 33, , ,565 35, ,955 Venice Office 22,890 (21,155) 1,735 Regional Bureau for Science and Culture in Europe - Venice 1,569,511 3,725,274 50,517 3,716,633 1,628, ,717 1,319,952 SUB-TOTAL - PART II E 1,786,814 6,419,782 84,100 (21,155) 4,568,682 3,700, ,498 3,260,361 F. CONTRIBUTIONS FOR HQ RENOVATIONS Japanese Garden - Renovation Plan 55,646 2,170 (36,617) 21,199 SUB-TOTAL - PART II F 55,646 2,170 (36,617) 21,199 TOTAL - PART II 273,472, ,165, ,758 10,482,341 (80,822) 49,236, ,158,395 16,929, ,340,415 30,494, ,845,558 TOTAL PROGRAMME EXPENDITURE PARTS I AND II 310,373, ,922,456 79,058,954 10,366,368 (80,822) 51,763, ,553,922 20,124, ,726,020 45,901, ,824,713 Closing Exchange Revaluation 1,679 (237,276) (235,597) (3,749) (231,848) GRAND TOTAL 310,375, ,922,456 79,058,954 10,366,368 (318,098) 51,763, ,553,922 20,124, ,490,423 45,897, ,592,865 Note: The fund balance of US $338,592,865 at 31 December 2009 includes amounts of US $28,724,750 held as Endowments 185 EX/25 Part I - page 45

44 UNESCO STAFF FIDUCIARY FUNDS SCHEDULE OF INCOME AND EXPENDITURE AND CHANGES IN RESERVES AND FUND BALANCES FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE EX/25 Part I - page 46 TOTAL Medical Benefit Fund UNESCO Staff Savings and Loan Service UNESCO Commissary Fund UNESCO Restaurant Service UNESCO Children's Club & Day Nursery INCOME Revenue Generating Activities 3,696 13, ,411 16,167 Employer Contribution to Benefit Plan 19,689 19,689 17,555 Employee Contribution to Benefit Plan 19,631 19,631 17,498 Allocation from Other Funds Investment Income 2,122 43, ,866 48,240 Currency Exchange Adjustments (118) (118) 4,950 Other income ,551 3,105 TOTAL INCOME 42,172 43,846 3,829 13,565 1, , ,909 EXPENDITURE Staff costs 2, , ,931 10,991 Compensation/Benefit Paid 44,619 44,619 39,389 Other Expenditures 516 2,902 7, ,010 9,509 TOTAL EXPENDITURE 44,619 2,789 3,823 13, ,560 59,889 EXCESS/(SHORTFALL) OF INCOME OVER EXPENDITURE (2,447) 41, ,864 48,020 Distribution to members of USLS (38,847) (38,847) (41,596) Other adjustment to reserves & fund balances (189) (23) (2) (214) 3,197 Reserves and fund balances, beginning of period 29,640 25,683 2, ,891 48,270 RESERVES AND FUND BALANCES, END OF PERIOD 27,193 27,704 2, ,694 57,891

45 UNESCO GENERAL AND WORKING CAPITAL FUNDS SCHEDULE OF ASSETS, LIABILITIES AND RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE 2.1 REGULAR PROGRAMME ASSETS Cash and term deposits 47,204 (1,902) Assessed contributions receivable from Member States 49,647 90,979 Accounts receivable Inter-fund balances 852 Other 8,004 8,422 Other assets Land and buildings 187,207 98,141 Renovation work in progress 65,582 TOTAL ASSETS 292, ,992 LIABILITIES Payments or contributions received in advance 3, Unliquidated obligations 24,694 24,972 Accounts payable Inter-fund balances 2,826 Other 12,638 13,505 Other liabilities 3,012 1,014 Loan for HQ building renovation 87,954 80,451 Loan for IBE building 1,575 1,733 TOTAL LIABILITIES 136, ,665 RESERVES AND FUND BALANCES Working Capital Fund 29,000 28,097 Capital funds relating to land and buildings 118, ,484 Currency Exchange Reserve (17,813) (16,942) Budgetary surpluses 7,219 7,237 Other surpluses 19,616 18,451 TOTAL RESERVES AND FUND BALANCES 156, ,327 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 292, , EX/25 Part I - page 47

46 185 EX/25 Part I - page 48 UNESCO OTHER PROPRIETARY FUNDS SCHEDULE OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE 2.2 Revenue Staff Related New Management United States Voluntary Generating Support Costs Renovation Plan TOTAL Accounts Monitoring special account IPSAS Cost Recovery External Evaluation Contributions- Unattributed Activities Instruments special account Policy of UNESCO Security OPF Balances (Schedule 2.2.1) (Schedule 2.2.2) (Schedule 2.2.3) ASSETS Cash and term deposits ,232 39,572 68,530 Accounts receivable Inter-fund balances 22,872 20,454 7,595 2,139 1,161 1,790 1, (43,862) 14, Other 2,405 6,935 9,340 6,373 Other assets TOTAL ASSETS 26,113 20,454 7,595 2,139 1,161 1,790 1, ,646 64,272 75,951 LIABILITIES Unliquidated obligations ,202 4,307 Accounts payable Inter-fund balances 1,105 Other 7,655 2,225 9,880 13,328 Other liabilities TOTAL LIABILITIES 8, ,646 12,603 19,474 RESERVES AND FUND BALANCES Operating reserves 1,640 1,640 1,620 Other Surpluses 15,916 19,690 7,520 2,035 1,148 1,543 1, (154) ,029 54,857 TOTAL RESERVES AND FUND BALANCES 17,556 19,690 7,520 2,035 1,148 1,543 1, (154) ,669 56,477 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 26,113 20,454 7,595 2,139 1,161 1,790 1, ,646 64,272 75,951

47 UNESCO REVENUE GENERATING ACTIVITIES SCHEDULE OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE Public Information Liaison and Relations Fund Publications and Auditory and Visual Material Fund Utilization of Headquarters Fund Special Account for Documents/ Publications Services Special Account for Interpretation Services TOTAL ASSETS Cash and term deposits Accounts receivable Inter-fund balances 8,607 1,676 6,409 5, ,872 22,598 Other ,064 2,405 2,149 Other assets TOTAL ASSETS 8,862 2,527 8,544 5, ,113 25,620 LIABILITIES Unliquidated obligations ,215 Accounts payable Unredeemed coupons 7,608 7,608 8,860 Other Other liabilities TOTAL LIABILITIES 7, ,557 10,747 RESERVES AND FUND BALANCES Operating reserves 1, ,640 1,620 Other Surpluses (428) 2,452 8,105 4, ,916 13,253 TOTAL RESERVES AND FUND BALANCES 1,088 2,452 8,229 4, ,556 14,873 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 8,862 2,527 8,544 5, ,113 25, EX/25 Part I - page 49

48 UNESCO PROGRAMME SUPPORT COSTS FOR SPECIAL ACCOUNTS AND TRUST FUNDS SCHEDULE OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE EX/25 Part I - page 50 Funds-in Trust Overhead Cost Account (FITOCA) Technical Support at the Project Level (UNDP-STS) TOTAL ASSETS Accounts receivable Inter-fund balances 20, ,454 26,758 - TOTAL ASSETS 20, ,454 26,758 LIABILITIES Unliquidated obligations ,154 TOTAL LIABILITIES ,154 RESERVES AND FUND BALANCES Other Surpluses 19, ,690 25,604 TOTAL RESERVES AND FUND BALANCES 19, ,690 25,604 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 20, ,454 26,758

49 UNESCO STAFF RELATED ACCOUNTS SCHEDULE OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE Terminal Payment Fund Staff Compensation Fund Language Courses TOTAL ASSETS Accounts receivable Inter-fund balances 5, ,595 6,691 TOTAL ASSETS 5, ,595 6,691 LIABILITIES Unliquidated obligations TOTAL LIABILITIES RESERVES AND FUND BALANCES Other Surpluses 5, ,520 6,603 TOTAL RESERVES AND FUND BALANCES 5, ,520 6,603 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 5, ,595 6, EX/25 Part I - page 51

50 UNESCO PROGRAMME FIDUCIARY FUNDS SCHEDULE OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCES AS AT 31 DECEMBER 2009 (Expressed in '000s US dollars) SCHEDULE EX/25 Part I - page 52 Institutes (Schedule 2.3.1) UNESCO Brasilia Office Other Special Inter-fund Accounts and Eliminations Trust Funds 2009 TOTAL 2007 ASSETS Cash and term deposits 64, , , , ,286 Investments 1,883 1,883 2,305 Accounts receivable Inter-fund balances 7,527 (7,527) 6 Other 15, ,274 18,307 16,565 Other assets 3, ,530 3,186 TOTAL ASSETS 91, , ,702 (7,527) 663, ,348 LIABILITIES Unliquidated obligations 6,291 30,475 45,898 82,664 85,852 Accounts payable Inter-fund balances 263 9,443 9,518 (7,527) 11,697 Other 34,408 3,806 4,567 42,781 22,324 Other liabilities 415 1,126 1,541 2,806 TOTAL LIABILITIES 41,377 43,724 61,109 (7,527) 138, ,982 RESERVES AND FUND BALANCES Balances relating to projects funded by donors 95, , , ,218 Operating reserves 18,238 18,238 16,171 Other surpluses 31,540 41,227 72,767 25,977 TOTAL RESERVES AND FUND BALANCES 49, , , , ,366 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 91, , ,702 (7,527) 663, ,348

51 Schedule (Expressed in '000s USDs) International Bureau of Education International Centre for Theoretical Physics International Institute for Higher Education in Latin America and the Carribean UNESCO-IHE Institute for Water Education International Institute for Capacity Building in Africa International Institute for Educational Planning UNESCO Institute for Information Technologies in Education UNESCO Institute of Statistics UNESCO Institute for Lifelong Learning Inter-fund Eliminations 2009 Total 2007 IBE ICTP IESALC IHE IICBA IIEP IITE UIS UIL ASSETS Cash and term deposits , , , , ,602 52,012 Investments Accounts receivable Inter-fund balances ,537 2,462 (63) 7,527 4,364 Other , ,798 11,239 Other assets 3, ,228 2,719 TOTAL ASSETS 2,384 16, , , ,752 3,232 (63) 91,155 70,334 LIABILITIES Unliquidated obligations 404 2, , ,291 8,605 Accounts payable Inter-fund balances (63) 263 1,094 Other , ,408 18,133 Other liabilities TOTAL LIABILITIES 480 2, , , , (63) 41,377 28,186 RESERVES AND FUND BALANCES Operating reserves 9,984 6,669 1,585 18,238 16,171 Other surpluses 1,904 4, , , ,975 3,056 31,540 25,977 TOTAL RESERVES AND FUND BALANCES 1,904 14, , , ,560 3,056 49,778 42,148 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 2,384 16, , , ,752 3,232 (63) 91,155 70, EX/25 Part I - page 53

52 SCHEDULE EX/25 Part I - page 54 AS AT 31 DECEMBER 2009 TOTAL Medical Benefit Fund UNESCO Staff Savings and Loan Service UNESCO Commissary ASSETS Cash and term deposits 32, ,957 1, , ,135 Investments 115, , ,487 Accounts receivable Inter-fund balances 1 Loans to staff members 48,172 48,172 50,493 Other 312 3, ,406 11,531 Stock on hand , Other assets ,711 2,007 2,112 TOTAL ASSETS 32, ,889 2,696 2, , ,677 LIABILITIES Accounts payable 5, , ,266 8,275 Inter-fund balances Distribution payable to members 13,849 13,849 23,037 Members' deposits 627, , ,474 Other Liabilities TOTAL LIABILITIES 5, , , , ,786 RESERVES AND FUND BALANCES Operating reserves 27,704 27,704 25,683 Surplus 27,193 2, ,990 32,208 TOTAL RESERVES AND FUND BALANCES 27,193 27,704 2, ,694 57,891 TOTAL LIABILITIES, RESERVES AND FUND BALANCES 32, ,889 2,696 2, , ,677

53 185 EX/25 Part I Annex I ANNEX I UNESCO EX GRATIA PAYMENTS In accordance with the provisions of Financial Regulation 10.3, the following ex gratia payments, made during the financial period ended 31 December 2009, are hereby reported: $ 000 (i) (ii) (iii) (iv) Compensation paid to a departing staff member due to illness Amount granted to a late staff member s family due to work-related illness Transportation and funeral fees paid for a staff member s deceased spouse Repatriation of a staff member s deceased dependant Total ex gratia payments for the biennium 100

54 185 EX/25 Part I Annex II ANNEX II UNESCO SPECIAL ACCOUNTS AND TRUST FUNDS The new special accounts and trust funds established during the financial period were the following: United Nations Sources UN Democracy Fund UN Development Fund for Women UN Mine Action Service Fund UNICEF Joint Programme - Pakistan HRP Fund One UN Fund Albania One UN Fund Mozambique One UN Fund Pakistan One UN Fund Rwanda One UN Fund Tanzania One UN Fund Uruguay One UN Fund Viet Nam Preventing and Responding to Domestic Violence through a Multi-sectoral Approach Joint Programme in China Peacebuilding Fund International Trade Centre Fund Technical Assistance Projects Asian Development Bank Fighting HIV/AIDS in Asia and the Pacific/Developing Capacity among Ethnic Minority Communities to Combat HIV/AIDS Lao PDR Islamic Development Bank Cameroon OPEC Fund Strengthening Education Sector Response to HIV/AIDS in Southern Africa Self-Benefiting Projects Angola Azerbaijan Cameroon Peru Donated Projects Bulgaria Trust Fund Hungary Trust Fund Monaco Trust Fund Poland Trust Fund Russian Federation Trust Fund Singapore Trust Fund The People s Republic of China Trust Fund Turkey Trust Fund China Cultural Heritage Foundation

55 185 EX/25 Part I Annex II - page 2 Danone Waters Deutschland GMBH Foundation Virginio Bruni-Tedeschi I.A.T.W.S. IFESCCO Manufacture Jaeger-Lecoultre Mercedes Benz China Ltd Plan International Inc. The Zayed Bin Sultan Al Nahyan The Stratreal Foundation The A.G. Leventis Foundation Special Accounts for: UNESCO Avicenna Prize for Ethics in Science UNESCO Bilbao Prize for the Promotion of Culture of Human Rights UNESCO-Guillermo Cano World Press Freedom Prize UNESCO - Hamdan bin Rashid Al-Maktoum Prize UNESCO-IPDC Prize for Rural Communication UNESCO-Juan Bosch Prize for the Promotion of Social Science Research in Latin America and the Caribbean UNESCO-Obiang Nguema Mbasogo International Prize for Research in the Life Sciences Higher Education Activities in CEPES Special Account for Latin American Laboratory for Assessment of Quality in Education Special Account for the Support to Countries in Post-conflict and Post-disaster Situations Special Account Teachers for Education for All Women's Empowerment and Gender Equality Bucharest Office UNEVOC Office The following special accounts were closed during the biennium: Noma Literacy Prize Prince of Asturias Prize Samarkand Taronasi Prize African Research and Development - Science & Technology Integral Study of the Silk Roads Preliminary Microzonation Map for Bam Preliminary Microzonation Map for Bam Promotion of Cultural Heritage Activities Special Fund for Youth UNESCO Media Fund World Commission on Culture and Development

56 ANNEX III UNPAID CONTRIBUTIONS AS OF 31 DECEMBER 2009 PART I: ARREARS ON CONTRIBUTIONS FOR PRIOR FINANCIAL PERIODS (EXCLUDING ARREARS PAYABLE IN ANNUAL INSTALMENTS) AS OF 31 DECEMBER 2009 Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due TOTAL Member States * Balance due USD USD USD USD USD USD USD USD USD USD USD Algeria 298, ,592 Antigua and Barbuda ,867 16,054 19,072 17,657 14,839 75,489 Benin 3,578 3,578 Bolivia, Plurinational State of ,524 44,524 Brazil - - 2,203,028 2,203,028 Burundi - 1,938 1,938 Cape Verde - - 7,415 7,415 Central African Republic 6,357 7,062 7,422 20,841 Chile - - 1,071,191 1,071,191 Colombia 221, ,831 Costa Rica - 196, ,809 Côte d'ivoire 33,392 33,392 Democratic People's Republic of Korea Dominica - 7,062 7,422 14,484 El Salvador 77,301 77,301 Ghana 1,508 1,508 Guatemala Guinea - 14,125 7,422 21,547 Guinea-Bissau 7,062 7,422 14,484 Hungary 353, ,206 Iceland 51,409 51,409 India Iran, Islamic Republic of - 474, ,328 Jamaica 21,120 21,120 Lebanon - 132, ,879 Liberia - 7,422 7,422 Libyan Arab Jamahiriya , ,023 Marshall Islands - 7,062 7,422 14,484 Mauritania - - 7,422 7,422 Mexico - 879, ,046 Micronesia 2,013 7,422 9,435 Myanmar ,297 32,297 Nepal 10,903 10,903 Nicaragua 7,206 7,206 Pakistan - 309, ,323 Palau - - 5,527 5,527 Panama - 122, ,187 Papua New Guinea - - 2,756 2, EX/25 Part I Annex III

57 UNPAID CONTRIBUTIONS AS OF 31 DECEMBER 2009 PART I: ARREARS ON CONTRIBUTIONS FOR PRIOR FINANCIAL PERIODS (EXCLUDING ARREARS PAYABLE IN ANNUAL INSTALMENTS) AS OF 31 DECEMBER 2009 Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due Balance due TOTAL Member States * Balance due USD USD USD USD USD USD USD USD USD USD USD Peru 12,926 12,926 Philippines 12,276 12,276 Saint Lucia 3,290 3,290 Sao Tome and Principe 7,422 7,422 Senegal ,052 15,052 Solomon Islands Somalia 103,293 63,897 76,034 76,340 5,422 5,445 5,704 6,357 7,062 7, ,976 Sudan ,872 41,872 Timor-Leste - - 4,473 4,473 Tunisia ,346 23,346 Tuvalu United States of America - 16,324,939 16,324,939 Vanuatu - 7,422 7,422 Venezuela, Bolivarian Republic of , ,583 Zimbabwe - - 2,361 2,361 Yugoslavia, SFRY** 2,469, , ,766,483 Yugoslavia, Former FRY*** 1,528, , , ,918 85, ,669,816 Total Member States 2,572,337 1,890,063 1,026, , ,340 99,206 21,758 31,786 69,105 23,961,901 30,859, EX/25 Part I Annex III - page 2 1 Associate Member States Faroe Islands Total Associate Member States TOTAL 2,572,337 1,890,063 1,026, , ,340 99,206 21,758 31,786 69,105 23,962,395 30,859,641 * Arrears on contributions due in euros for are translated at the UN operational rate of exchange rate prevailing in December 2009 of USD 1 = EUR ** By Resolution 63/249 the United Nations decided that the arrears of the Socialist Federal Republic of Yugoslavia (SFRY) should be apportioned among the successor States. The General Assembly of the United Nations requested the successor States to inform the Secretary-General of their respective shares. *** By the same above Resolution the United Nations decided that the unpaid contributions of the former Federal Republic of Yugoslavia (FRY) should be written off. UNESCO will submit to the Executive Board at its 187th session as well as to the General Conference at its 36th session, proposals to cover the write-off of USD 3,669,816 when the Organization closes its 2010 accounts under IPSAS.

58 UNPAID CONTRIBUTIONS AS OF 31 DECEMBER 2009 PART II: ARREARS OF CONTRIBUTIONS PAYABLE UNDER PAYMENTS PLANS AS OF 31 DECEMBER 2009 General Conference Member States 2008 and 2009 Total due Total deferred DUE PLUS session prior years to 2015 DEFERRED $ $ $ $ $ $ $ $ $ 34th 1 ARGENTINA th - 208,674 3,202,358 3,202,358 6,613,390 6,613,390 32nd 2 ARMENIA nd 103, , , , , ,394 32nd 3 CENTRAL AFRICAN REPUBLIC 167, ,218 32nd - 167,218 35th 4 COMOROS th 77,336 77,426 77,426 77, , , ,468 33rd 5 COSTA RICA rd 30,499 30,504 61,003 61,003 35th 6 GEORGIA th 110, , , ,122 2,312,577 2,753,065 2,753,065 33rd 7 GUINEA-BISSAU 212,955 51, ,484 33rd 51,529 51, , ,546 35th 8 IRAQ 828, , , ,671 1,657,341 4,972,025 4,972,025 35th 9 KYRGYZSTAN th 19,688 19,688 19,688 19, , , ,138 33rd 10 LIBERIA rd 35,587 35,588 71,175 71,175 33rd 11 NIGER rd 18,338 21,430 39,768 39,768 34th 12 PARAGUAY th 32,299 32,299 32,299 33rd 13 PERU rd 229, , , ,873 33rd 14 REPUBLIC OF MOLDOVA rd 145, , , , , , ,421 34th 15 SAO TOME AND PRINCIPE 40,316 40,316 80,632 34th 40,316 40,316 40,316 40, , ,896 35th 16 SIERRA LEONE - 35th 15,000 10,947 10,947 10,947 21,894 69,735 69,735 35th 17 TAJIKISTAN th 5,000 5,000 5,000 5, , , ,992 TOTAL 420,489 91, ,334 1,743,316 1,919,282 4,543,974 4,543,979 5,524,521 18,275,072 18,787,406 TOTAL 185 EX/25 - Part I Annex III - Page 3

59 185 EX/25 Part I Annex IV ANNEX IV WAIVERS GRANTED FOR CONTRACTS SUBMITTED TO THE CONTRACTS COMMITTEE In accordance with 176 EX/Decision 39.7 (c), information on waivers granted after review by the Contracts Committee during is as follows: Total Contracts approved Total waivers approved Regular Programme Extrabudgetary TOTAL Contracts Contracts Contracts $ 000s $ 000s Submitted Submitted Submitted $ 000s 36 18, , , , , ,343 The waivers granted in regard to the Regular Programme are mainly for Single Source Situations (e.g. when certain equipment has been bought competitively, but after sales services have to be obtained by the manufacturer to ensure the validity of guarantees) or reasons of standardization and harmonization, mainly in respect to UNESCO IT infrastructure to facilitate maintenance and support. For the Extrabudgetary Funds, the main reason for granting a waiver was due to partnerships or multi year projects where it would not have been cost effective to change the partner / contractor after a satisfactory performance during the first part of the project. The number of waivers granted for extra budgetary projects has significantly gone down due to the introduction of Implementation Partner Agreements (IPA). These IPAs involve the assessment of the partners capacity to implement projects on behalf of the Organization. Printed on recycled paper

60 Executive Board Hundred and eighty-fifth session 185 EX/25 Part II Rev. PARIS, 5 October 2010 Original: French/English Item 25 of the provisional agenda FINANCIAL REPORT AND AUDITED FINANCIAL STATEMENTS OF UNESCO FOR THE PERIOD ENDED 31 DECEMBER 2009 AND REPORT BY THE EXTERNAL AUDITOR PART II EXTERNAL AUDITOR s REPORT Summary This document contains the External Auditor s full report on the accounts of UNESCO for the biennium and written comments by the Director-General thereon.

61 185 EX/25 Part II Rev. Office of the External Auditor of the United Nations Educational, Scientific and Cultural Organization REPORT ON UNESCO s FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2009