report by chair of the budget and management...

___________________________________________________________________________

2017/SOM3/021 Agenda Item: 8

Report by Chair of the Budget and Management Committee

Purpose: Consideration

Submitted by: BMC Chair

Third Senior Officials’ MeetingHo Chi Minh City, Viet Nam

29-30 August 2017

Executive Summary This report presents the major outcomes of the second meeting of the Budget and Management Committee (BMC) held on 26 August 2017 in Ho Chi Minh City, Viet Nam. Actions Required of SOM Senior Officials to:

• Endorse the 2018 Secretariat Account budget and corresponding level of 2018 Members’

Contributions for Ministers’ approval (paragraph 17); and

• Note this report by the BMC Chair.

Report by the Chair of the Budget and Management Committee to the Third Senior Officials’ Meeting

Ho Chi Minh City, Viet Nam

29 - 30 August 2017

Mr Chairman,

The Budget and Management Committee (BMC) held its second meeting of this year on 26 August 2017 in the margins of SOM3 in Ho Chi Minh City, Viet Nam. This report provides a summary of the major outcomes of the meeting, and seeks Senior Officials’ endorsement of the decisions made by BMC. APEC Management Issues Secretariat Staffing Matters

2. BMC noted the Secretariat’s update on its key staffing issues, including the new Program Directors seconded from members’ economies, the Secretariat’s initiatives to enhance efficiency and productivity, and the training and development of the Secretariat’s staff. 3. The Secretariat also expressed that there were long gaps between the posting in and out of secondees from economies. The Secretariat was concerned if such situation would persist and, if it does, the Secretariat might need to engage temporary staff to deal with the situation. Updates on Communication and Public Affairs 4. BMC noted the Secretariat’s early analysis of social media progress. The Secretariat also briefly explained its expanded role in the Social Media front as a result of the newly hired full-time Community Manager in April 2017. 5. The Secretariat also shared an analysis of perceptions of APEC and its message resonance. Some recommendations on content, community management, social media and data gathering were also presented at the meeting. Streamlining Reporting 6. The Secretariat presented its findings and recommendations in respect of the streamlining of its reporting work. BMC agreed that the Secretariat should continue to look for efficiencies in reporting. Review of Fora's Terms of Reference 7. BMC noted the SOM’s requirements on quorum and sunset clauses and the Secretariat’s findings in respect of the requirements. BMC agreed that to include a quorum of 14 in its Terms of Reference. Furthermore, BMC and the Secretariat will work together to develop recommendations for SOM’s consideration regarding when and how the quorum requirements should be applied to APEC groups other than Committees, and working groups/sub-committees/experts groups that report to SOM and Committees. 8. Some members expressed concerns on the adverse impact of the review exercise to the existence and normal work of various working groups, fora, sub-fora, as well as APEC centres and networks, and suggested that a prudent and incremental approach should be taken, so as to strengthen rather than weaken APEC. Some other economies, on the other hand, called for strong determination to ensure APEC’s focus on its core works as well as SOM’s due oversight of all workstreams Update on the Guidelines for Hosting APEC Meetings

9. The Secretariat presented its recommendations on revising some procedures to improve the efficiency of hosting APEC meetings. BMC approved the corresponding changes in the Guidelines for Hosting APEC Meetings. Update on the Guidelines for APEC Collaboration System (ACS) Policy 10. BMC noted the changes to access and security rights to ACS, delineation of roles and responsibilities for ACS and the new ACS Policy. Update on Process Modernisation 11. BMC noted the Secretariat’s update on the progress so far on its process modernisation. Members thanked US-APEC Technical Assistance to Advance Regional Integration (US-ATAARI)’s contribution in the exercise. Others

12. BMC noted the presentation given by the US-ATAARI and thanked their continued efforts to provide support to APEC’s institutional development, including capacity building of member economies and incoming hosts and other initiatives relating to the Secretariat. APEC Budget Issues 2016 Audited Financial Statements 13. BMC approved the 2016 audited financial statements of the Secretariat at Annex A presented by the independent external auditors, Deloitte & Touche LLP, who expressed an opinion that the financial statements were properly drawn up in accordance with the Financial Reporting Standards in Singapore so as to give a true and fair view of the financial position of the Secretariat as at 31 December 2016. 14. For 2016, the Secretariat’s actual expenditure was about S$6.42 million, or 93% of the approved budget for the year, resulting in a surplus of about S$0.48 million. 2017 Forecast Expenditure 15. BMC noted that for 2017, the Secretariat’s forecast expenditure will likely be about S$5.8 million, or 94% of the approved budget. The surplus will be placed in the Secretariat Account reserve, which is expected at about S$6.8 million by the end of this year.

2018 Proposed Budget and Members’ Contribution 16. The Secretariat’s proposed expenditure budget for 2018 is about S$6.97 million. This is 13% more than the approved budget for 2017, mainly due to increase in travel costs for APEC meetings in Papua New Guinea next year. 17. BMC endorsed the 2018 Secretariat Account budget with expenditure totalling S$7,169,600 including the Secretariat’s proposed budget of S$6,966,100 and a provision of S$203,500 set aside for the asset replacement fund, detailed at Annex B. BMC invites Senior Officials to endorse the above 2018 Secretariat Account budget and corresponding level of 2018 Members’ Contributions at Annex C for Ministers’ approval.

Project Management and Funding Issues Aspirational Target for Voluntary Contributions 18. Following the Modus Operandi for Coordinating Voluntary Contributions endorsed by Ministers in 2014, an aspirational target of US$4.1 million was approved by Senior Officials at SOM1. As at end June, five member economies have made or committed untied contributions, totalling around US$2.8 million as follows –

Untied Voluntary Contributions for 2017 (USD)

ASF General Fund Australia 375,000.00 China 500,000.00 Russia 1,000,000.00

1,875,000.00

TILF Japan 185,000.00 Korea 700,000.00

885,000.00

Total Untied Project Funding 2,760,000.00

19. Hence, the remaining balance that still needs to be raised to achieve the 2017 aspirational target for untied project funding is about US$1.3 million. The Secretariat encouraged members to consider making voluntary contribution to the untied funds.

Project Management Unit Update & Update on Guidebook on APEC Projects

20. Director PMU presented the regular PMU Update Report. BMC noted the updates in relation to Project Session 1 and 2 and the new ASF sub-funds; the findings from the latest standard report on project monitoring and completion; the current status of project training; and the implementation status of the BMC SWG outcomes in relation to project reform. A fuller presentation on the proposed revised Guidebook was delivered separately.

21. Director PMU presented the Financial Reports for APEC Projects. It was noted that all projects completed or expired over the reporting period were completed at or below budget.

22. Director PMU introduced the new edition of the Guidebook on APEC Projects, and provided a summary of the key changes in relation to the current edition. An earlier iteration of the new edition was approved at BMC2, 2016. It remained to adopt a new round of changes to fully implement the BMC SWG outcomes from SOM1. BMC noted the changes to the text that addressed the new project selection model, as well as the changes to the Guidebook to clarify a number of administrative issues. New Women and the Economy Sub-fund 23. BMC noted the proposed establishment of the new Women and the Economy Sub-fund proposed by the United States. Upon PPWE’s endorsement, BMC would consider the proposal of establishing the new Sub-fund intersessionally.

Next BMC Meeting 24. BMC would hold its first meeting of 2018 in the margins of SOM1 in the Papua New Guinea in the end of January 2018. Víctor MUÑOZ (Mr) BMC Chair 2017 26 August 2017

BMC Chair's Report to SOM 3

Annex A

Deloitte.

ASIA-PACIFIC ECONOMIC COOPERATION SECRETARIAT

STATEMENT OF MANAGEMENT AND FINANCIAL STATEMENTS

YEAR ENDED DECEMBER 31, 2016


STATEMENT OF MANAGEMENT AND FINANCIAL STATEMENTS

CONTENTS

Statement of management

Independent auditor's report

Statement of financial position

Statement of surplus or deficit and other comprehensive Income

Statement of changes In funds

Statement of cash flows

Notes to financial statements

GRP1·MGR/3030394-;4058312-FS/CHK/ACYF/KSH/FLCH

1

2 - 4

5

6 - 7

8

9

10 - 30


STATEMENT OF MANAGEMENT

In the opinion of the Management, the accompanying financial statements as set out on pages 5 to 30 are

drawn up so as to give a true and fair view of the financial position of the Secretariat as at December 31,

2016, and the financial performance, changes In funds and cash flows of the Secretariat for the financial

year then ended and at the date of this statement, there are reasonable grounds to believe that the

Secretariat wlll be able to pay Its debts when they fall due.

ON BEHALF OF THE MANAGEMENT OF THE SECRETARIAT

tll•"f'Wtt'1ll•tt•t ·tt•tt•••.••••••t•t••·tc• ·•••••'f~ 1t ••" \I '~

Alan Bollard Executive Director

Date: 7 July 2017

1

............ £~ ............ . Sylvester Wong Director (Finance)

Deloitte. INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF


Opinion

Deloitte & Touche LLP Unique Entity No T08LL0721A 6 Shenton Way OUE Downtown 2 #33-00 Singapore 068809

Tel. +65 6224 8288 Fax. +65 6538 6166 www.deloitte.corn/sg

We have audited the accompanying financial statements of Asia-Pacific Economic Cooperation ("APEC") Secretariat {the "Secretariat"), which comprise the statement of financial position as at December 31, 2016 and the statement of surplus or deficit and other comprehensive income, statement of changes in funds and statement of cash flows for the year then ended, and a summary of significant accounting policies, as set out on pages 5 to 30.

In our opinion, the accompanying financial statements of the Secretariat are properly drawn up in accordance with the Financial Reporting Standards in Singapore ("FRSs") to give a true and fair view of the financial position of the Secretariat as at December 31, 2016 and of the financial performance, changes in funds and cash flows of the Secretariat for the year ended on that date.

Basis for Opinion

We conduct our audit in accordance with Singapore Standards on Auditing ("SSAs"). Our responsibilities under those standards are further described In tht! AwJilw 's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Secretariat in accordance with the Accounting and Corporate Regulatory Authority ("ACRA") Code of Professional Conduct and Ethics tor Public Accountants and Accounting Entities ("ACRA Code") together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical rP.sronsibilities in accordance with these requirements and the ACRA Code. We believe that the audit evidence we have obtuincd is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the FRSs, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against Joss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of financial statements and to maintain accountability of assets.

In preparing the financial statements, management is responsible for assessing the Secretariat's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either Intends to liquidate the Secretariat or to cease operations, or has no realistic alternative but to do so.

Information Other than the Financial Statements and Auditor's Report Thereon

Management is responsible for the other information. The other information comprises the Statement of Management as set out on Page 1, but does not include the financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other Information and we do not express any form if assurance conclusion thereon.

2

Oelo1ue & Touche LLP IUn1que Enllty Na TOBLL0721Al1~ an uccountmg limited l1i1bllity p.:mncr!lh1p regiSlered 1n S1ngJpor~ und~r the Limited Uab1lily Pc1rtnersh1ps ,ii.,ct ((l"Jptcr 103A)

Deloitte. INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF


Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to Issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted In accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or In the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

(a) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud Is higher than for one resulting from error, as fraud may Involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

(b) Obtain an understanding of Internal control relcvont to the oudit in order to design oudlt procedure~ that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Secretariat's internal control.

(c) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

(d) Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Secretariat's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures In the flnanclal statements or, if such disclosures are Inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Secretariat to cease to continue as a going concern.

(e) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events In a manner that achieves fair presentation.

3

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF


We communicate with management regarding, among other matters, the planned scope and timing of the audit and significant audit findings, Including any significant deficiencies In Internal control' that we Identify during our audit.

Public Accountants and Chartered Accountants Singapore

July 7, 2017

4


STATEMENT OF FINANCIAL POSITION December 31, 2016

ASSETS

Current assets Cash and cash equivalents other receivables and prepayments Total current assets

Non-current asset Plant and equipment

Total assets

LIABILITY

Current llablllty Other payables and accruals

Total liability

Net assets

Accumulated APEC Central Funds Secretariat Account General Project Account Trade and Investment Liberalisation and

Facilitation ("TILF") APEC Support Fund ("ASF") Account

Total Accumulated APEC Central Funds

See accompanying notes to financial statements.

5

Note 2016 2015 US$ US$

6 39,045,012 39,604,585 7 32§,8~0 261,Qi1

39.441.852 39,865.606

8 482.863 310,178

39.924.715 40.175 784

9 2.222.06Q 1,918,879

2.222,0.60

37.702,655 38.256.905

5,874,237 6,019,525 2,635,019 3,093,022

4,725,055 4,697,077 24.468.344 24.447.281

~Z,Z02,fi5~ 38,256,~Q~


STATEMENT OF SURPLUS OR DEFICIT AND OTHER COMPREHENSIVE INCOME Year ended December 31, 2016

2016

Income Members' contribution Publication sales Interest income Other income Total income resources

Project expenditure

Administrative expenditure Other operating expenses

Loss on foreign exchange Reversal of project expenditure accrual

Total resources expended

Surplus (Deficit) for the year

Total comprehensive income (loss) for the year

Note

10

11

12

13

Secretariat General Project TILF Special ASF account account account _____account Total

US$ US$ US$ US$ US$

5,076,473 320,000 959,218 4,956,417 11,312,108

26,822 15,655 23,212 140,082 205,771 92.699 84.420 925_ 1,672 --·· . 5L682

5,187,715 336,580 984,102 5,102,181 11,610,578

(4,657,632)

(134,820)

(4,792,452)

30

(1,289,577)

(11,750)

(935,966) (4,647,512) {6,873,055}

(7,950) (35,561) ( 4, 712,893}

(379) - - (135,199} (74,877) (12,208) (356,59.6) _(~3.681)

{1,376,583) (956,124) (5,039,669} (12,164,828}

.040.003> 27.9ZtL. ____ .62.512 <554.250)

395.263 u .. 040.003> 27.978 62.s12 ~ism

6


STATEMENT OF SURPLUS OR DEFICIT AND OTHER COMPREHENSIVE INCOME (cont'd) Year ended December 31, 2016

2015

Income Members' contribution Publication sales Interest income Other income Total income resources

Project expenditure

Administrative expenditure Other operating expenses

Loss on foreign exchange Reversal of project expenditure accrual

Total resources expended

Surplus (Deficit) for the year

Total comprehensive income (loss) for the year


Note

10

11

12

13

Secretariat General Project TILF Special ASF account account account account Total

US$ US$ US$ US$ US$

4,369,666 982,712 1,000,599 9,597,971 15,950,948 3,975 - - - 3,975

17,338 8,309 12,413 63,429 101,489 74.059 8.259 3.331 2.035 87 .684

4,465,038 999,280 1,016,343 9,663,435 16,144,096

(3,855,537)

(405,212)

(4,260,749)

(1,220,661)

(10,694)

(833,686) (5,039,613) (7,093,960)

(6,228) (38,365) (3,910,824)

(405,212} 102.226 (17.469) 420.493 505, 25_0

(1,129,129) (857,383) (4,657,485} (10,904,746)

204.289 (129.849) 158.960 5.005.950 5.239.35.Q

,204.289 U29.849l 158.960 5.005.950 s 239.350

7


STATEMENT OF CHANGES IN FUNDS Year ended December 31, 2016

At December 31, 2014

Transfer

Total surplus (deficit) and other comprehensive income (loss) for the year


Transfer

Total surplus (deficit) and other comprehensive Income (loss) for the year



Secretariat General Project account account

US$ US$

6,255,060 2;697,471

(439,824) 525,400

TILF Special account

US$

4,538,117

ASF account

US$

19,526,907

(85,576)

Total US$

33,017,555

204.289 (129.849) 158,960 5.005,950 5.239.350

6,019,525

(540,551)

3,093,022

582,000

4,697,077 24,447,281 38,256,905

(41,449)

395.263 (1.040.003) 27.978 62.512 (554.250}

5,874.237 2.635,019 4.725.055 24,468,344 37,702.655

8


STATEMENT OF CASH FLOWS Year ended December 31, 2016

Operating activities Surplus (Deficit} for the year Adjustments for:

Gain on sale of plant and equipment Depreciation of plant and equipment

Operating cash flows before movements in working capital

Other receivables and prepayments (Note A} Other payables and accruals (Note A}

Net cash from (used in} operating activities

Investing activities Proceed from sale of plant and equipment Purchase of plant and equipment Net cash used in investing activities

Financing activities Transfer to General Project Account Transfer from ASF Account Net cash (used in) from financing activities

Net (decrease} increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

./ 2015 2016 ....... ,,, ' Secretariat General Project TILF Special ASF account account account account ___Iota! _____ Total

US$ US$ US$ US$ US$ US$

395,263 (1,040,003} 27,978 62,512 (554,250) 5,239,350

(6,284) 76.111 - - - 76.111 77 .836

471,374 (1,040,003) 27,978 62,512 (478,139} 5,310,902

(113,679) (17,376) (837) 24,158 (107,734) (94,829) £146.574} 53.273 11.801 356.596 275.096 (283.915) 211.121 fl.004.106) 38.942 443,266 (310.777) 4.932.158

6,284 (248,796} - - - (248.796} (195.927) (248.796) - - - (248,796) (189._643)

(582,000) 582,000 41A49 - - (41.449)

(540,551) 582.000 - ( 41,449)

(578,226} (422,106) 38,942 401,817 (559,573) 4,742,515 6.750 .712 3.166.888 4.785.319 24.901.666 39.604.585 34.862.070 .6JZ2.486 2.744.782 4.824.261 25 303.483 39_J)4S 012 39.604.585

Note A: During the year, there was an offsetting arrangement between the funds as a result of payment on behalf of each fund. See accompanying notes to financial statements.

9

ASIA-PACIFIC ECONOMIC COOPERATION SECRETARIAT NOTES TO FINANCIAL STATEMENTS December 31, 2016

1 GENERAL

The Asia-Pacific Economic Cooperation ("APEC") Secretariat (the "Secretariat") is established in Singapore with its registered office and principal place of business at 35 Heng Mui Keng Terrace, Singapore 119616.

The Secretariat was incorporated on February 12, 1993 under the International Organisations (Immunities and Privileges) Act.

The principal activities of the Secretariat include the following:

a) to coordinate and assist in the development of APEC programs and activities;

b) to facilitate communication between members on APEC activities;

c) to build collaborative links with the public and private sectors;

d) to coordinate public relations activities; and

e) to manage the APEC Central Fund which comprises the Secretariat Account ("SA"), General Project Account ("GPA"), the Trade and Investment Liberalisation and Facilitation ("TILF") Special Account, and APEC Support Fund ("ASF") Account.

The financial statements of the Secretariat for the financial year ended December 31, 2016 were authorised for issue by the Management of the Secretariat on July 7, 2017.

2 SUMM/\RY OF SIGNIFIC/\NT /\CCOUNTING POLICIES

BASIS OF ACCOUNTING - The financial statements have been prepared in accordance with the historical cost basis, except as disclosed in the accounting policies below, and are drawn up in accordance with Singapore Financial Reporting Standards ("FRS") and are presented in United States dollars (USD or US$).

Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

10


NOTES TO FINANCIAL STATEMENTS December 31, 2016

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)

Fair value Is the price that would be received to sell an asset or paid to transfer a liability In an orderly transaction between market participants at the measurement date, regardless of whether that price Is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Secretariat takes into account the characteristics of the asset or liability which market participants would take into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes In these financial statements of the Secretariat is determined on such a basis, except for I easing transactions that are within the scope of FRS 17 Leases, or value in use In FRS 36 Impairment of Assets.

In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the Inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement In Its entirety, which are described as follows:

• Level 1 Inputs are quoted prices (unadjusted) In active markets for Identical assets or liabilities that the entity can access at the measurement date;

• Level 2 Inputs are Inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and

• Level 3 Inputs are unobservable inputs for the asset or liability.

Currently the FRS does not contain specific guidelines for non-profit organisations concerning the accounting treatment and the presentation of the financial statements. Where the FRS is silent and does not give guitlC111t:t:! on how to treat transl!lctions specific to the non-profit sector, accounting pollcles have been based on the general FRS prlnclples as detailed In the FRS Framework for the preparation and presentation of financial statements.

ADOPTION OF NEW AND REVISED STANDARDS - On January 1, 2016, the Secretariat has adopted all the new and revised FRS and Interpretations of FRS ("INT FRS") that are effective from that date and are relevant to Its operations. The adoption of these new/revised FRSs and INT FRSs does not result In changes to the Secretariat's accounting policies and has no material effect on the amounts reported for the current or prior year.

At the date of authorisation of these financial statements, the management anticipates that the adoption of the FRSs, INT FRSs and amendments to FRSs relevant to the Secretariat that were Issued but not effective will have no materlal Impact on the financial statements of the Secretariat in the period of their Initial adoption.

11




FINANCIAL INSTRUMENT - Financial assets and financial llabllltles are recognised on the Secretariat's statement of financial position when the Secretariat becomes a party to the contractual provisions of the Instrument.

Effective interest method

The effective Interest method Is a method of calculating the amortised cost of a financial Instrument and of allocating Interest Income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments (Including all fees on points paid or received that form an Integral part of the effective Interest rate, transaction costs and other premiums or discounts) through the expected life of the financial Instrument, or where appropriate, a shorter period. Income and expense is recognised on an effective Interest basis for debt instruments.

Financial assets

Cash and rash em1iyalents

Cash and cash equivalents In the statement of cash flows comprise cash at bank and fixed deposits and are subject to an insignificant risk of changes in value.

Loans and receivables

Other receivables and prepayments that have fixed or determinable payments that are not quoted in an active market are classified as "loans and receivables". Loans and receivables are measured at amortised cost using the effective Interest method less Impairment. Interest Is recognised by applying the effective interest method, except for short-term receivables when the effect of discounting Is Immaterial.

Imoalrment of financial assets

Financial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be Impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the financial assets have been impacted.

12



2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES {cont'd)

For financial assets carried at amortised cost, the amount of the Impairment is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the financial asset Is reduced by the Impairment loss directly for all financial assets with the exception of trade receivables where the carrying amount Is reduced through the use of an allowance account. When a trade receivable is uncollectlble, It is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited to the surplus or deficit. Changes In the carrying amount of the allowance account are recognised In surplus or deficit.

If, In a subsequent period, the amount of the Impairment loss decreases and the decrease can be related objectively to an event occurring after the Impairment was recognised, the previously recognised Impairment loss Is reversed through surplus or deficit to the extent that the carrying amount of the financial asset at the date the Impairment Is reversed does not exceed what the amortised cost would have been had the Impairment not been recognised.

Financial liabilities

Other payables

Other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest method.

Derecognltlon ot financial llabfl ltles

The Secretariat derecognlses tlnanclal llabiht1es when, and only when, the Secretariat's obligations are discharged, cancelled or they expire.

FUNDS

(a) Secretariat account (fu nd)

The income and expenditure related to the management of the APEC Central Fund are accounted for under the Secretariat account. The Secretariat account is used to support the continued operation of the Secretariat and Is operated in Singapore Dollars. The Secretariat account is funded by annual proportional contributions from each of the 21 APEC members based on a formula agreed by the APEC Ministers.

13




FUNDS - (cont'd)

(b) General Pro1ect account (fund)

The income and expenditure related to the GPA projects are accounted for under the General Project account. The General Project account is set up and disclosed separately from the Secretariat account to account for projects that support Initiatives under APEC's economic and technical cooperation agenda which Is aimed at attaining sustainable growth and equitable development while reducing economic disparities among APEC economies and Improving economic and social well-being. It ls operated in United States Dollars. The General Project account Is funded by annual proportional contributions from each of the 21 APEC members based on a formula agreed by the APEC Ministers. The use of these funds are governed by the terms and conditions set out in the Guidebook on APEC projects.

(c) TILF Special account (fund)

The income and expenditure related to the TILF projects are accounted for under the TILF Special account as to account for activities that are subject to grantor/donor Imposed stipuletlon. The TILF Special account Is sourced from volunt ;:iry contributions from /\PEC members. It provides funding for projects that expand cooperative programs and support trade and Investment liberalization and facilitation as articulated by directives of APEC Leaders or Ministers and the. O!'inkn ·Action Agenda. It is operated in United States Dollars. The use of these funds are governed by the terms and conditions set out In the Guidebook on APEC projects.

(d) ASF account (fund)

The Income and expenditure related to the ASF projects are accounted for under the ASF account as to account for activities that are subject to granter/donor Imposed stipulation. The ASF account is sourced from voluntary contributions from APEC members. The ASF supports capacity-building needs for APEC developing economies in agreed high-priority areas for economic and technical cooperation. All APEC members may apply for funds but projects must clearly demonstrate that they address the capacity building needs of developing member economies. It is operated in United States Dollars. The use of these funds are governed by the terms and conditions set out in the Guidebook on APEC projects.

14




PLANT AND EQUIPMENT - All Items of plant and equipment are inltlally recorded at cost. The cost of an Item of plant and equipment is recognised as an asset If, and only if, it is probable that future economic benefits associated with the item will flow to the Secretariat and the cost of the Items can be measured reliably.

Subsequent to recognition, plant and equipment are stated at cost less accumulated depreciation and any accumulated Impairment losses. The carrying values of plant and equipment are reviewed for Impairment when events or changes In circumstances Indicate that the carrying value may not be recoverable.

Depreciation Is charged so as to write off the cost of assets, over their estimated useful lives, using the straight-line method, on the following bases:

Computers Office furniture and equipment Motor vehicles

3 to 6 years 3 to 6 years 6 years

The estimated useful lives, residua! values and depreciation method are reviewed at the end of each annual reporting period, with the effect of any changes In estimate accounted for on a prospective basis.

Fully depreciated assets still In use are retained In the financial statements.

An Item of plant and equipment Is derecognised upon disposal or when no future economic benefits are expected from its use or dlsposul. I he g;:un or loi:;i:; ~rl!:ln9 on dl!:ipo!:ial or derecognltlon of C:111 ilt:!lll of plant and equipment is determined as thP. difference between the sales proceeds and the carrylnq amounts of the asset and Is recognised ln surplus or deficit.

IMPAIRMENT OF NON-FINANCIAL ASSETS - At the end of each reporting period, the Secretariat reviews the carrying amounts of Its non-financial assets to determine whether there Is any indication that those non-financial assets have suffered an Impairment loss. If any such Indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the Impairment loss (If any). Where It is not possible to estimate the recoverable amount of an Individual asset, the Secretariat estimates the recoverable amount of the cash-generating unit to which the asset belongs.

15




Recoverable amount Is the higher of fair value less costs to sell and value in use. In assessing value In use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) Is estimated to be less than Its carrying amount, an impairment loss Is suffered and the carrying amount of the asset (cashgenerating unit) is reduced to Its recoverable amount. An Impairment loss Is recognised Immediately in surplus or deficit.

Where an Impairment loss subsequently reverses, the carrying amount of the asset Is (cashgenerating unit) Increased to the revised estimate of Its recoverable amount, but so that the Increased carrying amount does not exceed the carrying amount that would have been determined had no Impairment loss been recognised for the asset In prior years. A reversal of an impairment loss is recognised immediately In surplus or deficit.

REVENUE RECOGNITION - Revenue is measured at the fair value of' the consideration received or receivables.

Members' contribution

Contributions from member economies are recognised as members' contribution on an accrual basis.

Interest income

Interest Income is accrued on a time basis, by reference to the principal outstanding and at the effective Interest rate applicable.

Income tax

The Secretariat is exempted from tax liability In respect of its Income generated from its principal activities by virtue of the provisions of Section 11(1) of the Singapore Income Tax Act, Chapter 134.

16




RETIREMENT BENEFIT COSTS - Payments to defined contribution retirement benefit plans are charged as an expense when employees have rendered the services entitling them to the contributions. Payments made to state-managed retirement benefit schemes, such as the Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where the Secretariat's obligations under the plans are equivalent to those arising In a defined contribution retirement benefit plan.

EMPLOYEE LEAVE ENTITLEMENT - Employee entitlements to annual leave are recognised when they accrue to employees.

FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION - The financial statements of the Sccrcturlat are measured and pre&ented In the currP.nr.y of thP prlmnry P.c:onomlc environment In whld1 lh~ ~11lily ope1ates (Its functional currency). The flnenclel stetements of the Secretariat are presented in United States dollars, which Is the functional currency of the Secretariat.

In preparing the financial statements of the Secretariat, transactions In currencies other than the Secretariat's functlonel currency arc recorded at the rates of exchange prevailing on the date of the transaction. At end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the end of the reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences arising on the settlement of monetary Items, and on retranslation of monetary items are Included in surplus or deficit for the period. Exchange differences arising on the retranslatlon of non-monetary items carried at fair value are Included in surplus or deficit for the period.

3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Secretariat's accounting policies, which are described In Note 2, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and llabliitles that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

17



3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (cont'd)

I) Critical judgements In applying the Secretariat's accounting policies

In the process of applying the Secretariat's accounting policies which are described In Note 2 above, management Is of the opinion that there are no critical judgements Involved that have a significant effect on the amounts recognised In the financial statements.

II) Key sources of estimation of uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting period, that have significant risk of causing a material adjustment to the carrying amounts of assets and llabllltles within the next financial year are discussed below:

Useful nves af plant and equipment

The cost of plant and equipment Is depreciated on a straight-line basis over their useful lives, which are estimated by management to be within three to six years. Changes in the expected level of usage, and technological developments could Impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised. The carrying amount of the plant and equipment at the end of the reporting period is disclosed In Note 8 of the financial statements. ·

18



4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND FUNDS RISKS MANAGEMENT

(a) Categories of financial instruments

The foll owing table sets out the financial instruments as at the end of the reporting period:

Financial assets Cash and cash equivalents Other receivables

Financial liability Other payables

(b) Financial risk management policies and objectives

2016 2015 US$ US$

39,045,012 308 as

39,604,585 206.~~2

1 091.737

Risk management Is Integral to the whole activities of the Secretariat. The Secretariat has a system of controls In place to create an acceptable balance between the cost of risks occurring and the cost of managing the risks. The Secretariat continually monitors its risk management process to ensure that an appropriate balance between risk and control ls achieved.

(i) foreign exchange risk mpnaqement

The Secretariat has transactlonal currency exposure cir1~111y fro111 expenses that !!Ire denominated In currency other than the functional currency of the Secretariat. The foreign currency In which these transactions are denominated ls mainly Singapore dollars (SGD).

At the end of the reporting period, the carrying amount of monetary assets and monetary liabllltles dominated in currencies other than the Secretariat's functional currency as follows:

Liabilities 2016 2015 2016 2015 US$ US$ US$ US$

Singapore dollars (SGD) 6.409.177 6.907.041 410,488 483.485

If Singapore dollar were to strengthen or weaken by 5% against Unites States dollar, surplus for the year will increase/decrease by US$299,934 (2015 : US$321,178).

19



4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND FUNDS RISKS MANAGEMENT (cont'd)

(ii) Interest rate rjsk management

The Secretariat's Income and operating cash flows are substantially independent of changes In market interest rate. The Secretariat's exposure to market risk for changes in Interest rates relates primarily to the Secretariat's cash and cash equivalents which are short-term In nature. As such, management is of the opinion that the Interest rate risk is not expected to be significant.

The sensitivity analysis of the Secretariat's surplus or deficit, to a reasonably possible change in Interest rates with all other variables held constant, has not been disclosed as the Secretariat's exposure to changes in market Interest rates is not significant.

(iii) Credit risk management

Credit risk Is the potential loss resulting from the failure of a counterparty to settle Its financial and contractual obligations to the Secretariat, as and when they fall due.

Cash and cash equivalents are placed with banks and financial institutions which are regulated. The maximum exposure to credit risk Is represented by the carrying amount of each financial asset ln the statement of financial position. At the end of the reporting µeriod, cash and cash equivalents were held with only one bank, thereby exposing the Secretariat to significant concentration of credit risk. However, the management considers that the high credit rating ot the bank reduces the risk raced by the Secretariat to an acceptable level.

(Iv) Liauldlty risk management

Liquidity risk ls the risk that the Secretariat will encounter difficulty in meeting financial obligations due to the shortage of funds. The exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Secretariat monitors Its liquidity risk and maintains sufficient cash and cash equivalents as deemed by management to finance the Secretariat's operations and activities and mitigate the effects of fluctuations In cash flows.

The Secretariat targets for available funds in the form of surplus liquidity and aims at maintaining flexlblllty In funding by maintaining receipt of contributions of funds from member economies and expenditure.

20



4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND FUNDS RISKS MANAGEMENT (cont'd)

Non-derivative financial assets and !labilltles

All non-derivative financial assets and llabllltles in 2016 and 2015 are repayable on demand or due within a year from the end of the reporting period and are Interest free.

(v) Fair value of financial assets and liabilities

The carrying amounts of cash and cash equivalents, other receivables and payables approximate their respective fair values due to the relatively short-term maturity of their financial Instruments.

(c) Fund risk management poflc/es and objectives

APEC economies make annual membership contributions to support the APEC process through the Secretariat.

The Secretariat's objectives when managing Its funds are to safeguard its ablllty to maintain adequate working capital so as to be able to continue as a going concern and to perform Its central project management role In the administration of the funding of the projects.

The Secretariat's overall strateoy remains unchangP.d from 2015.

5 RELATED PARTY TRANSACTIONS

The remuneration of key management personnel are as follows: 2016 2015 US$ US$

Short-term employee benefits 762.497 727.642

21



6 CASH AND CASH EQUIVALENTS

Cash at bank Fixed Deposits

2016 '-7

Secretariat General Project TILF Special ASF account account accQunt account Total

US$ US$ US$ US$ US$

2,024,256 4,148.230 6.172.486

94,782 2.650.000 2.744.782

1,499,261 3.325.000 ~.824.261

6,603/483 18.700.000 25.303.483

10,221,782 28.823.230 39.045.012

2015

Total US$

39,604,585

39.604 585

The Secretariat holds four bank accounts on behalf of Policy Support Unit ("PSU''), which is under the direction of the PSU Board, while some functions are under the management of APEC. As at December 31, 2016, the total PSU bank balance of U5$7,158,427 (2015 : US$7,323,644) has not been included in the cash and cash equivalents of the Secretariat.

The fixed deposits of the Secretariat are placed with banks and mature on varying dates within 1 to 6 months (2015: Nil months) from year end. The interest rates of the deposits at the end of the reporting period are 0.15% to 1.2% (2015: NII%) per annum.

22



7 OTHER RECEIVABLES AND PREPAYMENTS

Contribution receivable Interest receivable Deposits GST inputs Policy support unit Other receivables Prepayments

Secretariat a~unt

US$

134,757 350

47,369 25,510

6,630 21,986 87.983

324.585

General Project accoynt

US$

66,826 576

-------

67.402

23

2016 2015 TILF Special ASF

S!g;QUllt account Total Total US$ US$ US$ US$

- - 201,583 106,591 837 4,016 5,779

- - 47,369 48,444 - - 25,510 24,517 - - 6,630 4,133 - - 21,986 22,670 - - 87,983 54.666

.83.Z ~ 396.840 261.021



8 PLANT AND EQUIPMENT

Cost: At January 1, 2015 Additions Disposal At December 31, 2015 Additions Disposal Reclassification At December 31, 2016

Accumulated depreciation: At January 1, 2015 Depreciation for the year Disposal At December 31, 2015 Depreciation for the year Disposal Reclassification At December 31, 2016

Carrying 8mount: At December 31, 2016

At DecemhP.r 31, 2015

Office furniture s:iod ~gulQmgot

US$

229,618 23,447

253,065 39,157 (6,650) (§.,6J:;!)

278,937

194,017 14,275

208,292 12,075 (6,650) {f2 .2JSl

207,082

855

441773

24

Motor C2m12utg~ vel:!!clg~ Iota I

US$ US$ US$

681,449 84,009 995,076 126,966 45,514 195,927

(53 ,315} (53 ,315) 808,415 76,208 1,137,688 209,639 248,796 (33,656) (40,306) §,6~5

991,033 76,208 1,346,178

524,963 84,009 802,989 62,929 632 77,836

(53 ,315) (53,315) 587,892 31,326 827,510

63,404 632 76,111 (33,656) (40,306)

§,6 ,2!i 624,275 31,958 863,315

l

220,523 44 882 ~ 1.Q ,1Z~

ASIA-PACIFIC ECONOMIC COOPERAnON SECRETARIAT


9 OTHER PAYABLES AND ACCRUALS

2016 ..... /

Secretariat General Project TILF Special ASF

Other payables Accrued expenses Funds held on behalf of donors

account _account _ _ . account ___ account Tota! US$ US$ US$ US$ US$

113,036 ~

177.165

25

213 99,830

100.0£3,

839,066

839.066

314,509 1,148,124

759.427 2.222.060

2015

Total US$

394,518 697,219 827.142

1.918.879

ASIA-PACFIC ECONOMIC COOPERATION SECRETARIAT


10 MEMBERS' CONTRIBUTION

Australia Brunei canada Chile China Hong Kong, China Indonesia Japan Republic of Korea Malaysia Mexico New Zealand Papua New Guinea Peru Philippines Russia Singapore Chinese Taipei Thailand United States Vietnam

Secretariat account

US$

340,095 76,147

460,426 76,147

392,884 139,639

76,147 913,765 302,058

76,147 204,072 139,639 76,147 76,147 76,147

205,084 139,639 240,084

76,147 913,765

76.147 5.076.473

General Proje::t account

US$

21,500 4,800

28,500 4,800

24,800 8,300 4,800

58,600 19,500 4,800

12,900 8,300 4,800 4,800 4,800

12,900 8,300

14,600 4,800

58,600 4.800

320.000

26


ai;;:!;:ount account Total Total US$ US$ US$ US$

- - 361,595 5,101,436 - - 80,947 80,253 - 772,439 1,261,365 484,965 - - 80,947 80,253 - 1,800,000 2,217,684 2,714,308 - - 147,939 146,757 - - 80,947 80,253

184,218 933,978 2,090,561 2,087,281 700,000 - 1,021,558 1,018,965

- - 80,947 80,253 - - 216,972 215,130

75,000 - 222,939 279,717 - - 80,947 80,253 - - 80,947 80,268 - - 80,947 80,260 - 1,000,000 1,217,984 1,216,200 - - 147,939 146,757 - 450,000 704,684 852,667 - - 80,947 80,253 - - 972,365 964,466 - - 80,947 80,253

959.218 4.956.417 11.312.108 15.950.948


NOTES TO FlNANCIAL STATEMENTS December 31, 2016

11 OTHER INCOME

Others

2016 '- 2015 Secretariat General Project TILF Special ASF account account_ account accQunt Total _Total

US$ US$ US$ US$ US$ US$

84.420 ~ l.fil ~ ~ ~

27



12 PROJECT EXPENDITURE

Agricultural Technical Cooperation Working Group Anti-Corruption and Transparency Working Group Competition Policy and Law Group Emergency Preparedness Working Group Energy Working Group Experts Group on Illegal Loging and Associated Trade Health Working Group Human Resources Development Working Group Mining Task Force Ocean and Fisheries Working Group Small and Medium Enterprises Working Group Telecommunications and Information Working Group Tourism Working Group Transportation Working Group Committee on Trade & Investment Economic Committee SOM Steering Committee on ECOTECH Policy Partnership on Food Security Policy Partnership on Science, Technology & Innovation Policy Partnership on Women and the Economy

Secretariat General Project account account

US$ US$

- -- -- -- -- -- 41,601 - -- -- -- -- 388,990 - -- 97,140 - 72,642 - 476,803 - 105,019 - -- -- 107,382 - -

1.289.577

28


account acc2unt TotSi!l Total US$ US$ US$ US$

- 76,000 76,000 49,523 - 4,055 4,055 - 156,389 156,389 - 18,789 18,789 122,553

- 1,707,914 1,707,914 1,936,465 - - 41,601 - 40,171 40,171 105,930

2,338 70,001 72,339 278,589 - 13,512 13,512 - 75,952 75,952 104,554

138,935 241,560 769,485 463,625 - 108,788 108,788 19,458 - 126,690 223,830 172,388

14,058 229,866 316,566 302,329 657,806 1,007,318 2,141,927 2,226,127

50,000 327,507 482,526 789,024 7,024 165,624 172,648 307,256

65,805 66,362 132,167 - 128,763 236,145 216,139 - 82,251 82,251

935.966 4.647.512 6.873.055 7.093.960



13 ADMINISTRATIVE EXPENDITURE

Training/Seminars Publishing/Communications Library

Newspapers/periodicals/books Public relations Meeting support Depreciation Insurance and maintenance of vehicles Travel Telephone/fax Professional fees Information technology expenses Research expenses Office and building maintenance Others

Stationary and printing Postage and courier charges Miscellaneous support

Personnel - support staff Wages and salaries Central Provident Fund contribution

Other staff costs

Secretariat account

US$

-239,763

22,880 8,096

76,111 6,980

1,168,787 20,597 36,870

128,003 89,008

293,185

12,760 5,134

43,598

2,262,215 185,619

58,026 4.657.632

General Project £!~CO!!nt

US$

--

--

--------

--

11,750

---

11.750

29


account a!;;COUnt TQtal Total US$ US$ US$ US$

- - - 19,365 - - 239,763 197,801

- - 22,880 19,840 - - 8,096 5,841

- - 76,111 77,836 - - 6,980 6,625 - - 1,168,787 437,445 - - 20,597 21,846 - - 36,870 44,212 - - 128,003 112,128 - - 89,008 83,562 - - 293,185 305,098

- ~ 12,760 14,106 - - 5,134 3,670

7,950 35,561 98,859 86,452

- - 2,262,215 2,256,486 - - 185,619 169,251 - - 58,026 49.260 - -- ---~ -35.561 ~.712.893 3~10.824



14 OPERATING LEASE COMMITMENTS

Minimum lease payments under operating leases recognised as an expense in the year

2016 2015 US$ US$

159.056 161.600

At the end of the reporting period, the outstanding commitments under non-cancellable operating leases for the rental of office equipment and apartments were as follows:

Within one year In second year to fifth year Inclusive Total

2016 2015 US$ US$

158,802 170.818 329.620

157,303 304.990 462.293

Operating lease payments represent rentals payable by the Secretariat for certain of Its office equipment as well as residential property for an employee of the Secretariat. Leases are negotiated for an average term of 5 years and rental Is fixed for an average of 3 years.

30

Secretariat Account BMC Chair's Report to SOM 32017 Forecast Expenditure and 2018-20 Budget Annex B

2016 2017 Q1-Q2 Q1-Q4 2018 2019 2020Actual Approved Actual Actual Forecast Forecast Proposed Y-o-Y Budget Y-o-Y Budget Y-o-Y

Expenditure Budget Expenditure vs Budget Expenditure vs Budget Budget Change Projection Change Projection ChangeS$ S$ S$ % % S$ % S$ % S$ %

(1) COMMUNICATIONS AND PUBLIC AFFAIRS1.1 Publications and Library 23,660 61,500 26,425 43% 59,224 96% 80,700 31% 74,600 -8% 86,400 16%1.2 Support for Media and Outreach Programs 231,779 @ 217,000 74,012 34% 221,822 102% 170,900 -21% 160,200 -6% 162,100 1%1.3 Website Redevelopment and Operations 91,160 74,500 18,431 25% 80,043 107% 101,000 36% 102,500 1% 104,000 1%

Total Communications and Public Affairs Expenditure 346,599 353,000 118,868 34% 361,089 102% * 352,600 0% 337,300 -4% 352,500 5%

(2) ADMINISTRATION2.1 Building Maintenance and Facilities Costs 401,199 445,000 205,499 46% 425,000 96% 450,200 1% 466,700 4% 485,700 4%2.2 Furniture and Equipment 55,764 55,000 28,786 52% 54,500 99% 55,000 0% 55,800 1% 56,600 1%2.3 Miscellaneous Admin Expenses 40,884 - - - - - - - - - -2.4 Office Operations and Supplies 109,769 127,000 36,296 29% 119,100 94% 116,700 -8% 111,000 -5% 115,600 4%2.5 Personnel and Staff Welfare 96,112 150,000 18,425 12% 101,400 68% 213,800 43% 154,100 -28% 206,500 34%2.6 Independent Assessment of APEC Sub-fora 123,085 160,000 21,865 14% 94,000 59% 180,000 13% 90,000 -50% 90,000 0%2.7 Remunerations

2.7.1 Executive Director (including allowances) 552,069 555,000 223,361 555,000 600,000 600,000 600,000 2.7.2 Administration 1,178,426 1,430,000 518,431 1,300,000 1,363,000 1,433,000 1,543,000 2.7.3 Communications and Public Affairs 639,882 790,000 279,802 707,000 787,000 850,000 928,000 2.7.4 Information Technology 366,316 392,000 156,761 381,000 395,000 411,000 432,000 2.7.5 Project Management 635,567 673,000 307,260 763,000 827,500 863,000 905,000

3,372,260 3,840,000 1,485,615 39% 3,706,000 97% 3,972,500 3% 4,157,000 5% 4,408,000 6%

Total Administration Expenditure 4,199,073 4,777,000 1,796,486 38% 4,500,000 94% 4,988,200 4% 5,034,600 1% 5,362,400 7%

(3) INFORMATION TECHNOLOGY3.1 Broadband Networks and Related Charges 60,500 62,500 31,127 50% 62,516 100% 65,200 4% 65,800 1% 66,400 1%3.2 IT Development Costs 24,600 118,000 - 0% 126,000 107% 43,000 -64% - -100% - -3.3 IT Operational Costs 176,203 154,500 117,617 76% 159,937 104% 207,100 34% 174,600 -16% 241,200 38%

Total Information Technology Expenditure 261,303 335,000 148,744 44% 348,453 104% * 315,300 -6% 240,400 -24% 307,600 28%

(4) TRAVEL4.1 Executive Director 112,213 120,000 37,561 31% 100,000 83% 160,000 33% 169,700 6% 111,000 -35%4.2 Professional and Support Staff 1,504,044 545,000 193,562 36% 520,000 95% 1,100,000 102% 1,668,000 52% 535,000 -68%

Total Travel Expenditure 1,616,257 665,000 231,122 35% 620,000 93% 1,260,000 89% 1,837,700 46% 646,000 -65%

(5) CONTINGENT EXPENDITURE - 50,000 - 50,000 50,000 50,000

GRAND TOTAL : 6,423,232 6,180,000 2,295,220 37% 5,829,542 94% 6,966,100 13% 7,500,000 8% 6,718,500 -10%

@ Inclusive payment of APEC Video Contest of S$47,351.50 funded by Google sponsorship* Estimated expenditure higher than budgeted and reallocation will be required in due course to cover the shortage.

Budget Summary

Income S$ US$ S$ US$ S$ US$ S$ US$Members' Contribution 5,000,000 5,000,000 5,000,000 5,000,000

Secretariat Account Budget (SGD)Secretariat Budgeted Expenditure 6,180,000 6,966,100 7,500,000 6,718,500 Fund Set Aside for Asset Replacement Fund 153,000 203,500 - 290,000

6,333,000 4,222,000 7,169,600 4,779,700 7,500,000 5,000,000 7,008,500 4,672,300 General Project Account Funding (USD) 778,000 220,300 - 327,700 * USD/SGD Exchange Rate = 1.5 5,000,000 5,000,000 5,000,000 5,000,000

Secretariat Account ReserveBalance as at End of Previous Year 6,894,000 6,781,458 6,901,458 6,744,458 Reserve Target Level [a] 2,000,000 2,000,000 2,000,000 2,000,000 Reserve Available for Other Uses 4,894,000 4,781,458 4,901,458 4,744,458 Less:Transfer to General Project Account (605,000) Note 1 N.A. N.A. N.A.Transfer to Asset Replacement Fund - (277,000) -

Add:Surplus of Secretariat Budgeted Expenditure 350,458 Note 2 N.A. N.A. N.A.Other Income of the Year 142,000 Note 3 120,000 120,000 120,000 Funds Retained in Reserve [b] 4,781,458 4,901,458 4,744,458 4,864,458

Closing Balance of the Year (Estimated) [a]+[b] 6,781,458 6,901,458 6,744,458 6,864,458

Note 1 : Amount approved by BMC 1, 2017. The amounts for 2018-20 are to be confirmed and subject to BMC's approval at its first meeting of the year.

Note 2 : Estimated amount based on the Secretariat's 2017 forecast expenditure (i.e. approved budget minus forecast expenditure).

Note 3 : Estimated amount, including administrative/management fees received from member economies, sponsorship income and interest income from fixed deposits.

2017 2018 2019 2020

BMC Chair’s Report to SOM 3 Annex C

2018 Members’ Contributions

Economy

Total Members' Contribution

Percent Share

Contributions Contributions

to Secretariat

Account to General

Project Account

(US$) (%) (S$) (US$)

[a] [b]

[a] - ([b]/1.5)

[c]

1 Japan 901,000 18 1,290,600 40,600

2 United States of America 901,000 18 1,290,600 40,600

3 Canada 453,000 9.07 650,300 19,500

4 China 387,000 7.74 555,000 17,000

5 Australia 335,000 6.7 480,400 14,800

6 Republic of Korea 298,000 5.95 426,600 13,600

7 Chinese Taipei 236,000 4.73 339,100 9,900

8 Russia 202,000 4.04 289,700 8,900

9 Mexico 201,000 4.02 288,200 8,900

10 Hong Kong, China 137,000 2.75 197,200 5,600

11 New Zealand 137,000 2.75 197,200 5,600

12 Singapore 137,000 2.75 197,200 5,600

13 Brunei 75,000 1.5 107,500 3,300

14 Chile 75,000 1.5 107,500 3,300

15 Indonesia 75,000 1.5 107,500 3,300

16 Malaysia 75,000 1.5 107,500 3,300

17 Papua New Guinea 75,000 1.5 107,500 3,300

18 Peru 75,000 1.5 107,500 3,300

19 Philippines 75,000 1.5 107,500 3,300

20 Thailand 75,000 1.5 107,500 3,300

21 Viet Nam 75,000 1.5 107,500 3,300

Total 5,000,000 100 7,169,600 220,300

report by chair of the budget and management...

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