FAO Conference resolutions

Resolution

13/81

SPECIAL RESERVE

ACCOUNT

THE CONFERENCE

Recalling

its Resolution 27/77, whereby a Special Reserve Account was established, as of 31 December 1977, to assist in protecting the Organization's Programme of Work against the effects of unbudgeted extra costs that may arise in the 1978-79 biennium or in any subsequent biennia,

Conscious

of the need to ensure that adequate cash resources are available to the Organization to finance the Programmes of Work approved by the

Conference

for any given biennium,

Recognizing

that implementation of the Organization's approved Programme of Work and Budget should not be placed in Jeopardy due to unbudgeted extra costs arising from adverse currency fluctuations and unbudgeted inflationary trends,

Taking into account

the experience gained with respect to the magnitude of currency fluctuations and unbudgeted coats in comparison to the effective working budget total,

Noting

that up to

30 September 1981

US$ 16 135 000 had been credited to the Special Reserve Account as savings on staff costs arising from currency fluctuations and that, provided the rate of exchange for the lira did not change substantially in the remainder of 1981, further amounts would be credited to the Account,

Considering

that, provided Member Nations pay their contributions in good time, a cash surplus is expected,

Having examined

the recommendations of the Council at its Seventy-ninth Session

CL 79/REP, paras. 184-192.

on measures to ensure the financing of such unbudgeted extra coats as may have to be met,

Authorizes

the

Director-General

to use the funds in the Special Reserve Account:

(a)

whenever the Working Capital Fund la insufficient to finance budgetary expenditure pending receipt of contributions from Member Nations to the budget; such advances to be reimbursed from subsequent receipts of contributions as soon as possible;

(b)

to finance unbudgeted extra costs due to movements of currency exchange rates;

(c)

subject to prior review and approval by the

Programme

and

Finance Committees

, to finance unbudgeted extra-costs of approved programmes due to unforeseen inflationary trends, to the extent that such costs cannot be met through budgetary savings without impairing the implementation of such programmes

Directs

the

Director-General

to credit to the Special Reserve Account any savings on staff costs arising from favourable differences between the lira exchange rate used in calculating the budget and the effective United Nations rate, applying an appropriate statistical formula for the purpose.

Decides

that any balance of funds remaining in the Special Reserve Account at the end of the 1980-81 biennium and of each biennium thereafter shall be carried forward into the Special Reserve Account for the respective subsequent biennium, up to an amount equivalent to five percent of the total effective working budget for the respective subsequent biennium.

Further

decides

that, notwithstanding the provisions of Financial Regulation 6.1(b), such portion of the Cash Surplus in the General Fund at the end of 1980-81 and of any subsequent biennium as is required to bring the level of the Special Reserve Account to five percent of the effective working budget for 1982-83 and for any subsequent biennium shall be withheld and credited to the Special Reserve Account.

Authorizes

the

Director-General

, in the event that a cash surplus should not arise at the end of any biennium adequate to bring the Special Reserve Account to the level specified in paragraph 4, to apply to the Special Reserve Account, notwithstanding Financial Regulation 6.1(a), any sums received in the subsequent biennium in payment of arrears of contributions for previous biennia.

Requests

the

Director-General

, in the event that the Special Reserve Account, replenished in accordance with the foregoing paragraphs, should not attain the aforesaid level of five percent of the total effective working budget for the subsequent biennium to submit proposals to the

Conference

, through the

Finance Committee

and

Council

, concerning the ways and means of bringing the Special Reserve Account up to the level of five percent of the total effective working budget for the subsequent biennium.

Further

decides

that any balance at the end of 1980-81 or any subsequent biennium in excess of the amount referred to in pare. 3 above shall not be used for any purpose other than provided for in this resolution and shall be returned to the General Fund and allocated in accordance with Financial Regulation 6.1(b).

(Adopted

25 November 1981

)

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