1. IPSAS IMPLEMENTATION - ISSUES AND IMPACT PBC 18 th Session Geneva September 2011

2. 2 Presentation Outline Definitions, concepts and dates Overview of key differences UNSAS / IPSAS Walk-through UNSAS to IPSAS: opening balances Walk-through of UNSAS vs IPSAS: 2010 results Walk-through UNSAS vs IPSAS: RWCF

3. 3 Definitions, Concepts, Dates (1) UNSAS vs. IPSAS – what are these? IPSAS key concepts:  Accrual basis of accounting  Going concern Adoption by WIPO of IPSAS by 2010

4. 4 Accrual basis of accounting – a simplified example: Income vs expenditure for the year = IPSAS result EXPENDITURE FOR THE FINANCIAL YEAR: Materials purchased not used Cost of equipment, services used to deliver the service Salaries for 12 months Unused leave earned and carried over to next year ASHI/termination benefits earned on the basis of the year worked INCOME FOR THE FINANCIAL YEAR: Fees for patent applications published in the yearCash received in advance Definitions, Concepts, Dates (2) Jan. 1Dec. 31 Reporting Period Process patent applications WIPO service Cash due for services

5. 5 KEY DIFFERENCES UNSAS vs. IPSAS Some terminology  Statement of financial position  Statement of comprehensive income  Statement of changes in net assets  Statement of cash flows  Notes INCOME – revenue not “earned” must be deferred EXPENDITURE – expenses are recognized when an obligation is incurred not when payment is made Balance sheet – various differences in method of valuation and disclosure

6. 6 WALK-THROUGH: 2010 results Adjustments to 2010 income and expenditure, summarized as follows: IPSAS Adjustments to 2010 Income and Expenditure (in millions of Swiss francs) A net increase in expenditure of 5.1 million Swiss francs: Depreciation:+5.2 million Sfr Equipment acquisition: -1.3 million Sfr Capitalization of construction expense: -1.1 million Sfr Capitalization of construction loan interest: -1.9 million Sfr Repayment of loan principal: -1.4 million Sfr Changes in employee benefit provisions: +5.9 million Sfr Inventory recognition: -0.1 million Sfr Reduction of 5.7 million Swiss francs in income, to reflect income deferral of monies received but unearned

7. 7 WALK-THROUGH: 2010 results Resulting income and expenditure views: Budgetary basis adjustments IPSAS basis Note: differences may be due to rounding

8. 8 WALK-THROUGH: opening balances Adjustments to the opening balances of the Reserves and Working Capital Funds (RWCF) via the balance sheet, totaling 20 million Swiss francs (reduction), summarized as follows: IPSAS Adjustments to RWCF Opening Balances (in millions of Swiss francs) Adjustment for the recognition of land and buildings+151.5 million Sfr Adjustment for the revaluation of investment property + 0.9 million Sfr Adjustment for the recognition of PCT receivables +11.5 million Sfr Adjustment for deferral of unearned revenue-132.2 million Sfr Adjustment for the recognition of intangible assets +28.2 million Sfr Adjustment for the recognition of inventory +2.4 million Sfr Adjustment for the recognition of provision for doubtful accounts -7.3 million Sfr Adjustment for the recognition of post employment benefits -78.8 million Sfr Adjustment for the recognition of equipment +3.8 million Sfr Land and Buildings Total 180.6 Current liabilities Total 132.2 Post employmen t benefits Total -78.8

9. 9 Opening Balances – Land and Buildings

10. 10 Opening Balances – Current Liabilities

11. 11 Opening Balances – Post Employment Benefits

12. 12 WALK-THROUGH: RWCF Resulting RWCF levels: Budgetary basis adjustments IPSAS basis Note: differences may be due to rounding