Independent External Audit Of WIPO Expected Soon

An independent external audit of the finances of the World Intellectual Property Organisation (WIPO) is expected to be issued in early December, according to government sources in Geneva.

The audit, being conducted by Ernst and Young in Geneva, was undertaken soon after the early October WIPO General Assembly, the sources said. The report will be sent to the WIPO director general who will be able to comment but not make changes. It will then be sent to member governments who will decide on the next step, they said.

At the General Assembly, the WIPO secretariat announced that the director general “had decided to have an independent review undertaken in order to respond to the allegations that had been made concerning the organisation.”

Press reports and government officials have indicated the biggest financial questions at WIPO lie in the contracts for building construction in the past few years. Despite questions, WIPO members in October approved construction of a new building expected to begin in 2006. Concerns of financial scandal and mismanagement at WIPO reach to the highest levels, even to WIPO Director General Kamil Idris, according to government sources who asked to remain anonymous.

A WIPO spokesperson said the independent review process currently underway at WIPO “was initiated by the director general to complement a number of internal measures that have been undertaken in the recent past.” The official added, “As you know, all member states are interested in good governance of all UN organizations and we are confident that they are supportive of any initiative that seeks to ensure greater efficiency of management.”

Government sources said it is too soon to know what will be in the report, but one official suggested that given the short time frame for the analysis, it might simply express a need for further investigation. Ernst and Young could not be reached for comment by presstime.

The investigation is being sought by developed countries, sources from those countries said. Several sources said that developed country governments once generally accepted Idris, but that he has lost favour and rich countries may be seeking a way to remove him from office.

The WIPO spokesperson strongly disagreed with this assertion, noting that WIPO is “operated on the consensus of its member states.” The spokesperson said, “The way to measure the respect that all the member states have for the director general is by looking at the success of the Organization on a daily basis.”

“In a consensus-based organization it is very easy for any member state to make its feelings known,” the spokesperson said. “The tremendous successes of this organization during Dr. Idris’ tenure would have been impossible without the member states’ faith in Dr. Idris’ judgement and the high value they place on his leadership. In addition, you will recall the positive results of the last General Assembly which reflect the support by member states for the future work program of the Organization.” Moreover, member states expressed support for Idris in 2003.

WIPO also is undergoing an investigation by the UN Joint Inspection Unit, which issued its first report in early 2005 and is preparing a second report. The first report found fault with WIPO’s financial and management practices but gave no indication of scandal.

In addition, WIPO has strengthened its internal audit function under pressure from member states, though some members remain sceptical about an audit process that gives the WIPO secretariat oversight. The chairman of the Program and Budget Committee audit committee, Dirk Kraner, is leaving the German mission soon to work for the German president, but some Geneva diplomats have indicated interest in convincing him to stay on as audit committee chairman.