President,
I deliver this statement on behalf of Australia, Belgium, Canada, Finland, France, Iceland, Italy, Japan, Netherlands, Sweden, Switzerland, United Kingdom, United States, and my own country Norway.
Let me start by recognizing the full worth of the annual reports of UNICEF’s Office of Internal Audit and Investigation and the Audit Advisory Committee, and thanking UNICEF for the accompanying management responses.
The Office has, for the third time, provided an overall assurance opinion of the effectiveness of the agency’s governance, risk management and control frameworks, and concluded they are generally satisfactory. This opinion is valuable to Member States, and we welcome the analysis given this year to support it. We also welcome management’s commitment to address the areas in need of strengthening, including risk management, management of implementing partners, fraud risk management, and safeguarding.
We appreciate the actions taken by UNICEF to follow up on concerns of the Board regarding continuous areas of risk identified in the previous annual report by the OIAI, as thoroughly described in the management response this year.
240 recommendations were made through 22 internal audit reports in 2017. 51 of these were rated as high priority, and we appreciate the detailed status of these given in management’s response. We commend UNICEF for its efforts to reduce the number of recommendations outstanding for more than 18 months, and ask that priority be given to the remaining recommendations stemming from as far back as 2013 and 2015.
We note that no internal audit reports were rated adverse in 2017, but we also notice the decrease in the overall number of reports rated satisfactory – with none rated unqualified, compared to 4 last year - and the increase in reports rated strongly qualified. The increased focus on risk prone areas and offices responding to complex humanitarian situations explains this development to a certain extent, but we would ask for further analysis.
We encourage the OIAI to include reporting against a full set of key performance indicators in its next Annual report, perhaps as an annex. The plans to undertake an external quality assessment of the function are welcome, and we similarly encourage OIAI to include a summary of the findings of that assessment and progress in implementing its recommendations in next year’s report.
President,
We welcome the implementation of a new anti-fraud strategy and initiatives to strengthen the control of third parties to minimise such losses, which hopefully will contribute to a reduction in the large number of fraud cases involving misuse of funds by third parties. We continue, however, to be concerned with the consistently low level of reported recoveries, and urge UNICEF to increase its focus on strengthening the recovery processes, and to strengthen reporting to the Board on recovery of losses, in particular the degree to which losses sustained in one year are recovered in subsequent years.
We would also request that OIAI include in next year’s report an analysis of the channels by which allegations of fraud and other misconduct are detected or reported to OIAI.
The issue of implementation of harmonized approach to cash transfers was also raised in the Board of Auditors report 2016. We urge UNICEF to make sure that the HACT is understood and implemented in a qualitative manner throughout the organization.
President,
A need to strengthen the speakup culture and the systems of prevention and follow-up of cases of sexual exploitation and abuse and sexual harassment in UNICEF has been uncovered during the last year. We appreciate the Executive Director’s clear stance on these issues, and the broad analysis in the management response of actions taken concerning sexual exploitation and abuse.
OIAI has confirmed that it will conduct work in 2018 to provide assurance that a coherent and effective approach to child protection and safeguarding is successfully embedded in and mainstreamed across UNICEF. We would request that OIAI in its assessment and assurance make specific recommendations for improvements in UNICEF’s approach and policies, where appropriate, and that progress is monitored against key performance indicators.
Even though sexual exploitation and abuse and sexual harassment are closely interlinked, they do require somewhat different approaches with regard to prevention, follow-up of victims and survivors, and reporting. We ask UNICEF to distinguish between sexual exploitation and abuse and sexual harassment in the development of programmes, policies and reports. We would like to see more in depth analysis of both categories of cases, including allegations, investigations and actions taken, in future Annual reports of the Office of Internal Audit and Investigation.
Thank you.