As the largest financial contributor to the  United Nations, the United States has a strong interest in the completion  of these reforms and has played a significant role in promoting financial,  administrative, and programmatic changes. The call for reforms has also grown as a result of problems identified in  the United Nations’ management of the Oil for Food program. Sustained Oversight Is Needed for Lasting Results

Sustained oversight at all levels of the organization is needed for the  United Nations to advance its reform agenda and achieve lasting results. The United Nations had completed 51 percent of its 1997 and 2002 reform  initiatives. In addition, many reform efforts comprise only the first step in achieving  longer-term goals. More than one-quarter of the Secretary General’s  completed reforms in both the 1997 and 2002 agendas consisted of  developing a written plan or establishing a new office. Without such assessments, the  Secretariat was not able to determine what progress had been made and  where further improvements were needed. In February 2005, we contacted the Office of the Deputy Secretary General  to determine recent actions it has taken to report on the status and impact  of the Secretary General’s reform initiatives. Performance-Based Budgeting Had Begun but Lacked Monitoring and Evaluation

At the program level, management reviews that compare actual  performance to expected outcomes are critical elements of effective  oversight and accountability. The United Nations has completed the initial  phase of implementing reforms in a key area—performance-based  budgeting. Program reviews that compare  actual performance to expected outcomes are important to account for  resources and achieve effective results. In December 2000, the Secretariat implemented  the first key element of a performance-based budgeting framework by  adopting a budget that reflects a results-based budgeting format, including  specific program costs, objectives, expected results, and performance  indicators to measure the results. Specifically, we recommended that the United States work with  other member states to encourage the Secretary General to (1) report  regularly on the status and impact of the 1997 and 2002 reforms and other  reform that may follow, (2) differentiate between short- and long-term  goals and establish time frames for completion, and (3) conduct  assessments of the financial and personnel implications needed to  implement the reforms. U.N. Oil for Food Program

In addition to a systematic monitoring and evaluation system, a strong  internal audit and evaluation function can provide the independent  assessments needed to help ensure oversight and accountability. OIOS  provides this service through audits, evaluations, inspections, and  investigations of U.N. funds and programs. In addition, constraints on the internal auditors’  scope and authority prevented the auditors from examining and reporting  more widely on some critical areas of the Oil for Food program. U.N.  oversight bodies did not obtain timely reporting on serious management  problems and were unable to take corrective actions when needed. These  constraints limited the internal audit unit’s effectiveness as an oversight  tool. In 2002, the U.N. A systematic  review of the status of the 154 reforms begun in 1997 and 2002 and  information from the Oil for Food program would allow the Secretary  General to develop a comprehensive, prioritized agenda for continued  U.N. reform.
Why GAO Did This Study

The U.N. regular budget for the 2004-2005 biennium exceeded $3 billion for the first time. In light of the organization's increasing demands, the U.N. Secretary General and member states have called on the Secretariat to better define priorities and eliminate outdated activities. In response, the Secretary General launched major reform initiatives in 1997 and 2002, and we reported on the status of these efforts in February 2004. Audits and investigations of the U.N. Oil for Food program have also brought attention to recurring management weaknesses. As the largest financial contributor to the United Nations, the United States has a strong interest in the completion of the Secretary General's reforms. GAO provides observations on areas for U.N. reform based on our 2004 report and our continuing review of the Oil for Food program, including our analysis of internal audit reports and other documents.

What GAO Found

The United Nations needs sustained oversight at all levels of the organization to achieve lasting results on its reform agenda. We reported in 2004 that the Secretariat had made progress in implementing 51 percent of the Secretary General's 1997 and 2002 management reform initiatives. However, we found that more than one-quarter of the completed reforms only consisted of developing plans or establishing new offices--the first steps in achieving longer term reform goals. In addition, the Secretariat had not periodically conducted comprehensive assessments of the status and impact of its reforms. Accordingly, the Secretariat had not been able to determine what progress had been made or where future improvements were needed. A t the program level, management reviews that compare actual performance to expected results are critical elements of effective oversight and accountability. The United Nations has completed the initial phase of implementing reforms in a key area--performance-based budgeting. It adopted a budget that reflects a result-based budgeting format, including specific program costs, objectives, expected results, and performance indicators to measure results. However, the United Nations has yet to implement the next critical step in performance-based budgeting--a system to monitor and evaluate program impact or results. Program reviews that compare actual performance to expected outcomes are important for accounting for resources and achieving effective results. A strong internal audit function provides additional oversight and accountability through independent assessments of U.N. activities, as demonstrated by audits of the U.N Oil for Food program. U.N. internal auditors found recurring management weaknesses in 58 audits it conducted over 5 years. However, constraints on their scope and authority prevented the auditors from examining and reporting widely on problems in the Oil for Food program. U.N. oversight bodies did not obtain timely reporting on serious management problems and were unable to take corrective actions when needed. These constraints limited the internal audit unit's effectiveness as an oversight tool. GAO plans to conduct more detailed work on the role of the internal auditors in upcoming engagements.