IPSAS 4_Excahnge Gains or Losses | Swiss Franc | Exchange Rate

IPSAS 4 – THE EFFECT OF CHANGES IN FOREIGN EXCHANGE RATES The functional and reporting currency of WIPO is the Swiss

franc. The exchange rate used shall be the United Nations Operational Rate of Exchange (UNORE). This is close to market rate at the end of the preceding month, except when mid-month or more frequent adjustments are made. For the rate for the year end a separate UNORE will be applied (the “closing rate”). At the date of a transaction, a nonCHF transaction is recorded in CHF (functional currency) by applying to the non-CHF amount the exchange rate between that currency and the CHF announced by the United Nations and applicable for that date. At each reporting date, non-CHF balance sheet monetary items are translated using the official closing rate for that reporting date. Items carried at historical cost such as fixed assets use the rate at the date of the acquisition of the asset. Exchange gains and losses resulting from the settlement of transactions other than in the reporting currency and from translation are included in the statement of financial performance in the respective fund or special account. Sources of Exchange gains or losses a) Exchange gains and losses are realized on accounts payable and accounts receivable transactions incurred in currencies other than CHF based on the exchange rate in effect on the date of the transaction. b) Exchange gains or losses also realized from payments made to International Searching Authorities under PCT which are valued in the currency of the ISA but collected by WIPO in CHF or by the national receiving office in its local currency. c) In addition, unrealized exchange gains and losses relating to the revaluation of bank accounts and other monetary assets and liabilities into CHF at the United Nations Operational Rate of Exchange on the reporting date are recognized on the financial statements. The net effect of all exchange gains and losses of 6.6 million Swiss francs is recognized as a component of revenue on the Statement of Financial Performance, principally within the lines PCT System fees (7.5 million Swiss francs) and Other/miscellaneous revenue (-0.9 million Swiss francs). Details are given below,

WIPO will include in the annual financial statements a note disclosure detailing the components of exchange gains and losses for the year.266 711 97 212 109 109 157 1.794 -167 -14 2 -28 33 2 -19 -191 6. including identifying whether gains or losses are realized or unrealized Yes Yes No KD ref Remarks 3.793 3. 4.379 -5.812 -3.298 296 7. The effect of movement in exchange rates between the recognition of revenue from non-CHF voluntary or assessed contributions and the receipt of that revenue are accounted for directly against revenue. No 1. 5.972 -153 -79 -268 -2.454 -1.Gain Loss Net Impact 2012 (in thousands of Swiss francs) Accounts payable Accounts receivable PCT fees received PCT International Searching Authority Total realized gain/(loss) Bank accounts Special account bank accounts PCT bank accounts Arbitration and Mediation bank accounts PCT current accounts Arbitration and Mediation other assets and liabilities Other assets and liabilities Total unrealized gain/(loss) Total exchange gain/(loss) 1. WIPO translates all non-CHF monetary asset and liability items into CHF using the official UNORE closing rate for that reporting date.530 -205 6. Select a sample of transactions to verify the correctness of the rates applied.603 Tests conducted Sr. 2 . Result Test Check whether the system in place for applying UNOR is free from scope for errors or misapplication of rates Check whether the amount of exchange differences is recognized in surplus or deficit and a policy note on the treatment of currency risk should be disclosed At each reporting date.851 -674 143 7. Check for a sample of voluntary and assessed contributions. Check whether this was done. 6. thus increasing or reducing it as applicable. Exchange gains and losses resulting from the settlement of transactions other than in the reporting currency and from translation are included in the statement of financial performance in the respective funds or accounts.472 -878 -111 -210 -137 -76 -155 -1.609 63 9.188 12. 2.

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