QSF

1
QSF Terminal Dues WorkshopNairobi, Kenya5-7
September 2005Financial aspects
2
1. Opening of workshop
3
2. Presentation on QSF
4
Briefing on the UPU Quality of Service Fund QSF
Terminal Dues Workshop September, 2005 Nairobi,
Kenya
5
What we will talk about today 3 main themes

• 1. QSF under Beijing 2001-2005
• - How the Fund began
• - How the Fund works
• - Who contributes to work related to Fund
• - What the Fund has accomplished
• 2. Bucharest Congress changes to QSF
• - How the Board and IB are preparing QSF for
  2006
• 3. The challenges ahead
• - Boards work plan and UPU members concerns

6
1. Quality of Service Fund 2001-2005
7
Brief history of Fund

• 1999 Beijing Congress decision created Fund
• Purpose of Fund to improve quality of service in
  developing countries
• From 2001 through 2005, ICs pay DCs 7.5
  supplement to terminal dues
• Monies can only be used by administrations whose
  projects are approved by nine-member Board of
  Trustees elected by POC

8
Who are main contributors to work of QSF?

• QSF Board of Trustees
• UPU International Bureau Funds secretariat and
  executive arm
• Regional advisors play crucial role
• Restricted Unions
• QSF coordinators in creditor postal
  administrations

9
Composition of Board of Trustees

• 9 Board members 2 Africa 2 Americas2
  Asia-Pacific 2 Europe 1 Eastern Europe
• 5 DCs and 4 ICs
• Chairman elected annually by Board members
• Board meets four times a year at POC, CA and
  other locations in January and July
• Annual report to the POC

10
Current QSF Board members

• 1. Brazil Jânio Pohren
• 2. Burkina Faso Sommanogo Koutou
• 3. France Philippe Hlavacek
• 4. India Anjali Devasher
• 5. Japan Kazunori Uchida
• 6. Kenya Ken Oluoch
• 7. Portugal Miguel Silva e Sá (Chairman)
• 8. Russian Federation Dmitri Makarov
• 9. United States Dennis Delehanty
• and Denise Vreuls of IB is Board Secretary

11
What does the Board do?

• Manages the affairs of the Trust
• Invests funds
• Disburses funds
• Analyzes and approves (or disallows) projects
• Evaluates results of projects
• Revises Project Manual and Financial Manual
• Gives interpretations on QSF rules
• Communicates work of QSF to postal administrations

12
QSF managers and staff in Bern
Denise Vreuls
Pascal-Thierry Clivaz
Thierry Nydegger
Ariane Proulx
Florian Bertschy
Magali Russo
Management
Maria Carnevale
Hubert Monod
Wendy Stevenson
Finance
13
What does the QSF secretariat in Bern do?

• Analyzes project proposals and reports
• Follows up on project implementation, including
  compliance with Board decisions
• Coordinates QSF activities
• Supports Board of Trustees
• Financial responsibilities billing, accounting
  and financial management, cash management,financi
  al statements and financial analysis

14
Basic QSF facts 2001-2005

• Total amount of funds generated by QSF 72
  million
• Average annual amount generated 16-18 million
• Total amount of projects funded since 2001 32
  million
• Total amount available for future projects 40
  million
• Number of projects approved 241 (8 cancelled)
• Number of projects rejected 13

15
Number of QSF projects worldwide
16
Value of QSF projects worldwide (millions of U.S.
)
17
QSF projects by region 2001-2005
Total number of QSF projects 2001-2005 233
18
To what aspects of service does QSF apply?
QSF must be used for projects concerning
sevenquality of service fields 1. Speed and
reliability (most projects so far) 2.
Security 3. Access to services 4. Liability and
inquiries 5. Customer satisfaction 6. Costing
and pricing systems 7. Quality development
plans
19
Common problems with project proposals

• Project does not qualify for QSF funding
• Key performance indicators and evaluation
  criteria are incomplete or unrealistic
• Financial information is not properly completed
• QSF budget in proposal does not tally with
  available QSF capital
• QSF forms are not properly completed
  missinginformation causes doubt and leads to
  delays in project approval

20
What QSF cannot pay for

• QSF cannot pay for projects related to services
  that do not give rise to payment of terminal
  dues, such as
• - EMS
• - Hybrid mail
• - Postal financial services
• QSF can only pay for projects to improve quality
  of universal postal service

21
Tips for projects

• For projects concerning speed and reliability,
  administrations must participate in UPU quality
  of service measurement exercises
• Projects require active involvement of
  administration, whose tangible contributions
  (labour costs, etc.) must be quantified
• Procurement of equipment, supplies and
  consultancy services must be carried out by open
  tender, but
• where tenders are impossible, or where
  tendering doesnot produced satisfactory results,
  administrationmust explain and justify decision
  not to tender

22
Catalog of project templates

• Experience shows a number of projects are
  typical
• Board developing Catalog of project templates
  for publication on Web Catalog based on actual
  projects
• First templates Quality development plans and
  tracking systems (IPS/IPS Light) to be examined
  by Board in July
• Next on line development of a cost accounting
  system, security systems (for example, eMaria)
• Objective is to provide administrations
  withtemplates which can be easily adapted
  totheir own needs

23
QSF financial rules common misunderstandings

• Projects cannot include such items as provisions
  for future expenses, or unforeseen expenses
  all project elements must be quantified and
  justified
• Budget requested for projects cannot exceed 96
  of available QSF funds
• Projects must take into account available QSF
  funds
• QSF cannot pay for staff costs unless staff is
  recruited specifically for the project
• QSF may exceptionally finance insfrastructurework
  these projects considered oncase-by-case basis

24
QSF administrative rules common misunderstandings

• Equipment may be acquired through UNDP however,
  the administration must issue a call for tenders
• IB can help with call for tenders on an
  exceptional basis only resulting administrative
  costs must be covered by project budget
• Administrative expenses for acquisition of
  equipment through the UNDP are to be paid by
  project budget
• Project formulation missions by Regional
  Advisorsare to be included in project budgets

25
Misunderstandings QSF objectives and performance

• Aim of any QSF project must necessarily be
  improvement of quality of service acquisition of
  equipment, or hiring consultants are not
  objectives in themselves
• Performance indicators must have a direct link
  with project objectives and must be quantified
• Measurement of project results must be based on
  objective performance indicators

26
What has QSF brought to UPU and administrations?

• Greater focus on quality of service
• Greater discipline in use of terminal dues funds
• Greater sense of mutual responsibility towards
  quality by all postal administrations
• Secure, steady source of funding
• Major innovation in the financing of postal
  development cooperation

27
2. Bucharest Congress QSF decisions
28
Main Bucharest Congress decisions

• QSF should be continued throughout Bucharest
  Congress period actually to 2012
• Four country categories Industrialized countries
  (ICs) Net contributor countries (NCCs)
  Developing countries (DCs) and Least developed
  countries (LDCs)
• Classification deferred for NCCs that received
  less than 65,000 in QSF funds in 2002
• Payments to DCs and LDCs are increased, while
  payments to NCCs are reduced
• NCCs and DCs now pay LDCs
• POC to study criteria for country classification

29
Beijing QSF system Who pays whom
Pay to ?
Receive from ?
of a terminal dues rate of 3.427 SDRs per
kilogram ...
30
Bucharest QSF system Who pays whom
Pay to ? ? ?
Receive From ? ? ?
of a terminal dues rate of 3.727 SDRs per
kilogram ...
31
Changes to Deed of Trust and Manuals

• For the Deed of Trust
• Bucharest provisions concerning terminal dues
  rates
• Bucharest decision on country classification
  four categories of countries
• Various necessary editorial updates (dates, etc.)
• For the Project Management Manual
• Simplification of forms and procedures
• For the Financial Management Manual
• New rules based on Bucharest Congress decisions

32
Timelines for revision of QSF documents

• Board to complete drafting revisions to Deed of
  Trust in July in New Delhi
• Formal proposal to be presented to POC Management
  Committee in Bern in October 2005
• If approved, proposed revised documents go to
  April 2006 POC for consideration

33
3. Challenges ahead
34
Three main challenges for QSF

• Manage transition from Beijing Congress to
  Bucharest system
• Communication with postal administrations
  explain Board decisions and seek views of
  stakeholders through workshops in Bern and
  presentations at Restricted Union meetings
• Explore reliable, global measurement systemsand
  evaluation methods to gauge successof QSF
  projects

35
Yourquestions or concerns?
36
3. Questions and Answers
37
4. Introduction to workshop content
38
Training programme

• 1. Opening of workshop
• 2. Presentation on QSF
• 3. Questions and answers
• 4. Introduction to workshop contents
• 5. QSF Structure
• 6. Current and new QSF financial rules
• QSF financial rules under Beijing
• QSF financial rules under Bucarest
• Comparison between 2 systems
• 7. Working procedures and documents
• Billing procedures
• Who does what?
• Overview of various QSF documents
• 8. QSF financial management manual
• Overview of important rules
• Main changes introduced by Bucarest

• 9. Rules for use of QSF funds
• How to obtain funding for QSF projects
• Procedures for disbursement of funds related to
  projects
• Accounting procedures related to QSF projects
• 10. Practical cases (working teams)
• Introduction
• Practical exercises on expedited regular
  billing current and new systems
• Review of exercises
• 11. QSF Financial operating report
• Income
• Expenditure
• Management fees
• Fund management
• Other issues
• 12. Questions and answers
• 13. Terminal dues session
• 14. Closing of workshop

39
5. QSF Structure
40
Beijing Structure
International Bureau (IB)
41
Bucharest structure
International Bureau (IB)
42
6. Current and new QSFfinancial rules
43
Beijing System
44
Beijing System

• QSF is maintained by
• 7.5 increase in terminal dues rate
• 3.427 SDR per kilo
• Mail flows from industrialized countries (ICs) to
  DCs
• Increase calculated during 2001 2005 period
• EXCEPTION mail subject to revision mechanism, M
  bags and bulk mail

45
Beijing System

46
Beijing System
Industrialized countries (ICs)
Mail flow from IC to DC
7.5
Developing countries(DCs)
47
Beijing System

• Quality of service concerns the following
  sectors
• Access to services (ATS)
• Speed and reliability (SPR)
• Security (SEC)
• Liability and treatment of inquiries (LTI)
• Customer satisfaction (CUS)
• Costing and pricing systems (CPS)
• Quality development plan (QDP).

48
Bucharest System
49
Bucharest Congress

• Bucharest Congress evaluation
• 3 years of actual activity 170 projects
• Financial resources vital component in UPUs
  development cooperation system
• Effective management of resources collected
• Regional cooperation 12 regional projects
• Extending Trusts duration to 2009 is
  consonantwith Bucharest World Postal Strategy
• Level of annual financing must be preserved.

50
Bucharest Congress

• Bucharest Congress decided
• QSF will continue over period of 2006-2009
• Date for dissolving Trust is now
• 31 December 2012
• Funds objectives will remain same for period
  2006-2009.

51
Bucharest Congress

• Classification of countries (new UNDP
  classification)
• Congress decided
• Postal administrations in transitional terminal
  dues system and entitled to QSF benefits
• Postal administrations in transitional terminal
  dues system but not entitled to QSF benefits
  unless they prove they are entitled to UNDP TRAC
  1 resources
• Postal administrations listed as NCCs and
  entitled to a reduced QSF benefit to offset their
  own contribution to Fund for LDCs
• Postal administrations listed as NCCs
  onlycontribute QSF to LDCs.

52
Bucharest Congress

• Classification of countries (new UNDP
  classification)
• Congress instructed CA to
• Readmit temporarily to QSF benefits any
  administration that proves hardship resulting
  from factors outside its control
• Follow development of new classification and
  submit revised lists to next Congress
• Defer implementation of reclassification forNCCs
  that received less than 65,000 USD in2002 from
  QSF.

53
Bucharest Congress

• Classification of countries (new UNDP
  classification)
• From 1 January 2006, 4 categories will exist
• Industrialized countries (ICs)
• Net contributor countries (NCCs)
• Developing countries (DCs)
• Least developed countries (LDCs)

54
Bucharest Congress
55
Bucharest Congress
56
Bucharest Congress
57
Bucharest Congress
58
Bucharest Congress
59
Bucharest Congress
60
Bucharest Congress
61
Bucharest Congress
Applicable rates, as from January 2006, are

• NCC 1
• DC 8
• LDC 16.5

8
IC
DC
16.5
16.5
1
LDC
16.5
NCC
62
Bucharest Congress
63
EXAMPLE
2007 billing for a DC reclassified as an LDC
2, possibly 3, different rates may apply to this
single country
64
Comparison and effects

• four categories of administrations instead of
  two
• three rates of billing instead of one (or six
  instead of two, if we include advance payments)
• two categories of administrations receiving
  funds, but also making payments
• Option of asking CA for a temporary
  reclassification
• For three years (2006-2008), two systems will be
  running in parallel, which entails calculations
  based on four rates and six lists of
  administrations

65
Comparison and effects

• Large volume of documents received and processed
  for billing purposes from 6,000 to more than
  14,000 ! (120 additional administrations will now
  be required to pay contributions to 50 LDCs, i.e.
  50 x 120 x 2 12,000)
• Increase in volume of documents to be processed,
  requires an adjustment in QSF Team staffing
• In principle, total annual contributions to Fund
  should remain same (flows between DCs and NCCs
  and LDCs are not yet known).

66
7. Working procedures and documents
67
Documents and procedures

• Settlors and Creditors should send
• The name
• Postal and e-mail addresses
• Telephone and fax numbers.

68
Documents and procedures

• Director of Finance
• UPU International Bureau
• Weltpostrasse 4
• 3000 BERNE 15
• SWITZERLAND
• E-mail faqs-finances_at_upu.int
• Tel. [phone] or 41 31 350 31 11
• Fax [phone]

69
Documents and procedures

• All QSF payments should be made to
• Number of account
• in USD 0207-399 479-32
• in EUR 0207-399 479-32-1
• in CHF 0207-399 479-31
• Name of payee
• UPU International Bureau - QSF

70
Documents and procedures

• Address of bank
• Credit Suisse First Boston
• Bärenplatz 8
• 3000 BERNE 1
• SWITZERLAND
• SWIFT CRESZHZZ30A

71
Billing

• Types of billing
• Expedited billing (optional)
• Regular billing (compulsory)

72
Billing Expedited Billing diagram
73
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
74
CN 61
Amount determining 2.A or 2.K for the QSF,
depending on the postal administration preparing
the account.
75
CN 61
Do not forget the place, date and signatures!
76
CN 64
Enter the amount from box 2.A or 2.K of the CN 61
in one or the other box below, depending on the
postal administration preparing the statement.
Do not forget the place, date and signatures!
77
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
78
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 7.5 of the
80 of the amount subject to application of the
rate)
CN 64bis
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
79
Billing Expedited Billing

• Calculation
• 80 x 7.5 6

80
UNIVERSAL POSTAL UNION INTERNATIONAL BUREAU
CN 64bis
81
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 7.5 of the
80 of the amount subject to application of the
rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
82
Billing Expedited Billing
CN 64bis forms are prepared on

• 31 March
• 30 June
• 30 September

83
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 7.5 of the
80 of the amount subject to application of the
rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
Acknowledgment of receipt of the funds
84
UNIVERSAL POSTAL UNION INTERNATIONAL BUREAU
Invoice
85
Billing Expedited Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 7.5 of the
80 of the amount subject to application of the
rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
receives copies of the invoices
receives and pays the invoices within 6 weeks
Acknowledgment of receipt of the funds
86
Interest Invoice
87
Billing Expedited Billing

• Calculation of interest
• Number of days elapsed from 17 June to 5 July
• 19 days
• Formula for calculating interest on overdue
  payments
• Amount X Rate X Number of days elapsed
• 100 X 360
• Example 100,000.00 SDR X 6 X 19 316.67 SDR
• 100 X 360

88
Billing Expedited Billing
WHO DOES WHAT?

Developing country
Industrialized country
Documents
International Bureau
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 7.5 of the
80 of the amount subject to application of the
rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
receives copies of the invoices
receives and pays the invoices within 6 weeks
Acknowledgment of receipt of the funds
receives an acknowledgement of receipt of the
funds
sends an acknowledgement of receipt of the funds
89
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

Documents
NCC, DC and LDC
International Bureau
IC, NCC and DC
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
90
CN 61
Amount determining 2.A or 2.K for the QSF,
depending on the postal administration preparing
the account.
91
CN 61
Do not forget the place, date and signatures!
92
CN 64
Enter the amount from box 2.A or 2.K of the CN 61
in one or the other box below, depending on the
postal administration preparing the statement.
Do not forget the place, date and signatures!
93
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

NCC, DC and LDC
International Bureau
IC, NCC and DC
Documents
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 1, 8 and
16,5 of the 80 of the amount subject to
application of the rate)
CN 64bis
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
94
Billing Expedited Billing (as of 2006)

• Calculation
• 80 x 1 0.8 (NCCs)
• 80 x 8 6.4 (DCs)
• 80 x 16.5 13.2 (LDCs)

95
CN64 bis
96
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

Documents
NCC, DC and LDC
International Bureau
IC, NCC and DC
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 1, 8 and
16,5 of the 80 of the amount subject to
application of the rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
97
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

Documents
NCC, DC and LDC
International Bureau
IC, NCC and DC
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 1, 8 and
16,5 of the 80 of the amount subject to
application of the rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
Acknowledgment of receipt of the funds
98
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

Documents
NCC, DC and LDC
International Bureau
IC, NCC and DC
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 1, 8 and
16,5 of the 80 of the amount subject to
application of the rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
receives copies of the invoices
receives and pays the invoices within 6 weeks
Acknowledgment of receipt of the funds
99
Billing Expedited Billing (as of 2006)
WHO DOES WHAT?

Documents
NCC, DC and LDC
International Bureau
IC, NCC and DC
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the last known year
receives the CN 61 / CN 64 forms
prepares the CN 64bis (calculating 1, 8 and
16,5 of the 80 of the amount subject to
application of the rate)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices for the instalments owed
on the basis of the CN 64bis accepted. It sends
the invoices to the Settlor, and copies to the
Creditors
INVOICE
receives copies of the invoices
receives and pays the invoices within 6 weeks
Acknowledgment of receipt of the funds
sends an acknowledgement of receipt of the funds
receives an acknowledgement of receipt of the
funds
100
Billing Regular Billing diagram
101
CN 61
Amount determining 2.A or 2.K for the QSF,
depending on the postal administration preparing
the account.
102
CN 61
Do not forget the place, date and signatures!
103
CN 64
Enter the amount from box 2.A or 2.K of the CN 61
in one or the other box below, depending on the
postal administration preparing the statement.
Do not forget the place, date and signatures!
104
Billing Regular Billing
WHO DOES WHAT?

Developing country
Documents
International Bureau
Industrialized country
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
105
Billing Regular Billing
WHO DOES WHAT?

Documents
Developing country
International Bureau
Industrialized country
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 7.5 of the
amount subject to application of the rate, and
deducting any amount already billed under
expedited billing)
CN 64bis
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
106
CN 64bis
107
Billing Regular Billing
WHO DOES WHAT?

Developing country
Industrialized country
Documents
International Bureau
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 7.5 of the
amount subject to application of the rate, and
deducting any amount already billed under
expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
108
Billing Regular Billing
WHO DOES WHAT?

Developing country
Industrialized country
Documents
International Bureau
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 7.5 of the
amount subject to application of the rate, and
deducting any amount already billed under
expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
Acknowledgment of receipt of the funds
109
Invoice
110
Credit note
111
Billing Regular Billing
WHO DOES WHAT?

Developing country
International Bureau
Industrialized country
Documents
( IB)
(Settlor)
(Creditor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 7.5 of the
amount subject to application of the rate, and
deducting any amount already billed under
expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
receives and pays the invoices within 6 weeks
receives copies of the invoices
Acknowledgment of receipt of the funds
112
Billing Regular Billing
WHO DOES WHAT?

Developing country
International Bureau
Industrialized country
Documents
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 7.5 of the
amount subject to application of the rate, and
deducting any amount already billed under
expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
receives and pays the invoices within 6 weeks
receives copies of the invoices
Acknowledgment of receipt of the funds
sends an acknowledgement of receipt of the funds
receives an acknowledgement of receipt of the
funds
113
Billing and Collection of Funds
114
Final CN 64bis
115
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

NCC, DC and LDC
International Bureau
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
116
CN 61
Amount determining 2.A or 2.K for the QSF,
depending on the postal administration preparing
the account.
117
CN 61
Do not forget the place, date and signatures!
118
CN 64
Enter the amount from box 2.A or 2.K of the CN 61
in one or the other box below, depending on the
postal administration preparing the statement.
Do not forget the place, date and signatures!
119
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

NCC, DC and LDC
International Bureau
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
CN 64bis
INVOICE
Acknowledgment of receipt of the funds
120
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

IC, NCC and DC
NCC, DC and LDC
International Bureau
Documents
( IB)
(Creditor)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 1, 8 and
16,5 of the amount subject to application of the
rate, and deducting any amount already billed
under expedited billing)
CN 64bis
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
121
CN 64bis
122
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

International Bureau
NCC, DC and LDC
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 1, 8 and
16,5 of the amount subject to application of the
rate, and deducting any amount already billed
under expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
INVOICE
Acknowledgment of receipt of the funds
123
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

International Bureau
NCC, DC and LDC
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 1, 8 and
16,5 of the amount subject to application of the
rate, and deducting any amount already billed
under expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
INVOICE
Acknowledgment of receipt of the funds
124
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

NCC, DC and LDC
International Bureau
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 1, 8 and
16,5 of the amount subject to application of the
rate, and deducting any amount already billed
under expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
receives and pays the invoices within 6 weeks
INVOICE
receives copies of the invoices
Acknowledgment of receipt of the funds
125
Billing Regular Billing (as of 2006)
WHO DOES WHAT?

NCC, DC and LDC
International Bureau
IC, NCC and DC
Documents
(Creditor)
( IB)
(Settlor)
CN 61 / CN 64
sends the IB the CN 61 / CN 64 forms accepted
for the same billing year
receives the definitive CN 61 / CN 64 forms
prepared
prepares the CN 64bis (calculating 1, 8 and
16,5 of the amount subject to application of the
rate, and deducting any amount already billed
under expedited billing)
CN 64bis
accepts the CN 64bis (tacitly after 1 month)
sends the CN 64bis forms to the Settlor
prepares the invoices on the basis of the CN
64bis accepted. It sends the invoices to the
Settlor, and copies to the Creditors
receives and pays the invoices within 6 weeks
INVOICE
receives copies of the invoices
receives an acknowledgement of receipt of the
funds
Acknowledgment of receipt of the funds
sends an acknowledgement of receipt of the funds
126
UNIVERSAL POSTAL UNION INTERNATIONAL BUREAU
Final CN 64bis
127
UNIVERSAL POSTAL UNION INTERNATIONAL BUREAU
Critical Path of QSF Billing
128
Billing Procedures at a glance

• IB receives over 10,000 forms CN 61/CN 64. From
  2006, this figure will increase to over 23,000
• IB prepares around 6,000 bills. From 2006, around
  14,000 bills will be prepared
• Upon receipt of funds, all bills are individually
  entered in accounting programme
• The International Bureau sends 170 individual
  statements every quarter (680 per year).

129
Regular Billing Follow up letter
130
Regular Billing Follow up letter

• Australia, Austria, Denmark, Finland, France,
  Germany, Netherlands, New Zealand, Portugal,
  Switzerland.

131
Regular Billing Follow up letter
132
Regular Billing Follow up letter
133
Regular Billing Follow up letter
134
Regular Billing Follow up letter
135
Regular Billing Follow up letter
136
Regular Billing Individual Statement
Period 01.01 31.12.2004 - DC
Projected capital
137
Regular Billing Individual Statement
Period 01.01 31.12.2004 - DC
Projected capital
138
Regular Billing Individual Statement
Period 01.01 30.09.2006 - LDC
Projected capital
139
Regular Billing Individual Statement
Period 01.01 30.09.2006 NCC/DC
Projected capital
140
QSF Accounting Principles

• Financial management of the QSF is the
  responsibility of the Board of Trustees
• Accounts must be complete, true, clear,
  up-to-date, organized systematically, organized
  rationally and verifiable at a later date
• QSF accounts are in USD and separate from other
  IB accounts
• Income
• Billing
• Interests

141
QSF Accounting Principles

• Costs
• Trust management costs
• Project costs
• Capital per country
• General capital
• Accounts receivable
• Liquid assets
• External auditor
• Obligatory
• Independent
• Free of charge

142
8. QSF Financial Management Manual
143
QSF Financial Management Manual
Important Articles

• Article 1
• Role of Fund in financial matters
• 1 Financial management of the QSF, in accordance
  with article 1 of the Deed of Trust, shall be the
  responsibility of the Board of Trustees which, as
  such, shall oversee billing of contributions,
  budgetary and financial operations, expenditure
  commitments, the optimization and security of
  liquid assets and the preparation of financial
  statements in accordance with the accounting
  standards currently applied to the Union's
  various accounts.

144
QSF Financial Management Manual

• Article 3
• Guiding principles
• 1 QSF funds shall become available only after a
  quality of service improvement project has been
  accepted by the Board of Trustees.
• 2 Regional projects combining resources from at
  least two countries in the same region shall be
  financed when the project has been accepted by
  the Board of Trustees. In such cases, a country
  shall be designated to act as lead country of the
  project and an account opened to cover all the
  expenses related to the project (see Project
  Management Manual (PMM) 3.5).
• 3 Any creditor may, at its sole and absolute
  discretion, assign the benefit of its individual
  entitlements, in whole or in part, to another
  creditor or to other creditors situate in the
  region or subregion to which it belongs, to fund
  projects of this or these other creditor(s).

145
QSF Financial Management Manual

• Article 5
• Currency of account
• 1 Currency of billing bills shall be made out in
  SDR, as they are for terminal dues. In the case
  of advance payments, the bill for the year's
  balance shall also be denominated in SDR. This
  amount shall be equal to the amount owed for the
  year in question in SDR, less the sum of the
  advances billed in SDR.
• 2 Currency of settlement of bills payment may be
  made in the currency chosen by the Settlor. The
  amount of the bill shall first have been
  converted from SDR into the chosen currency, at
  the most recent published value of the SDR rate
  in this currency.
• The amount of the bills settled shall be paid
  into one of the QSF bank accounts opened for this
  purpose and, if necessary, converted by the bank,
  at the rate of the day of payment, into the
  currency of the bank account in question. Any
  bank charges and exchange commission shall be
  paid by the QSF.

146
QSF Financial Management Manual

• Article 5 (contd)
• Currency of account
• 3 Currency of account The currency of account
  shall be the currency in which the accounts are
  held, i.e. USD. Country and project accounts
  shall be denominated in USD. Payments and bills
  may be denominated in other currencies, but shall
  be entered into the accounts in USD.

147
QSF Financial Management Manual

• Article 8
• Regular and expedited billing
• 1 The amount of the mandatory contributions to be
  billed shall be determined by article 4. Billing
  shall be carried out annually, from 2006 onwards.
  Form CN 64bis shall serve as the basic billing
  document. It shall be accepted beforehand by the
  Settlor.
• 2 Two systems of billing shall be used regular
  billing and expedited billing.

148
QSF Financial Management Manual

• Article 10
• Penalties for overdue payments
• 1 The amounts of bills not received by the
  International Bureau within six weeks of their
  dispatch shall be chargeable with interest at the
  rate of 6 per annum reckoned from the day
  following the day of expiry of the said period.
  In principle, interest on overdue payments shall
  be billed separately.

149
QSF Financial Management Manual

• Article 12
• Investment of available funds
• 1 The QSF treasury shall be based on a
  centralized system of interest-bearing
  investments interest on which shall be paid in
  proportion to the average annual balances of the
  creditor accounts, after deduction of management
  costs.
• 3 The Board of Trustees shall divide the
  available funds between short-term investments
  and other investments.
• 4 Short-term investments shall be the
  responsibility of the International Bureau,
  responsible for QSF management.
• 6 Investment policy shall be based on the
  security and liquidity of funds and normal
  efficacy in investment strategies.

150
QSF Financial Management Manual

• Article 13
• Monitoring of expenditure on projects
• 5 Only expenditure on projects duly approved by
  the Board of Trustees shall be charged to the
  Fund.
• 6 The disbursements relating to these
  expenditures shall be charged to the budget items
  of the corresponding projects.
• 7 Total expenditure on each project shall not
  exceed the resources assigned to it and
  collected.
• 8 All disbursements must be supported by
  documentary evidence duly signed by the
  authorized persons and no disbursement shall be
  made if the credit is not available.
• 11 Any project may be the subject of subsequent
  checking and financial appraisal. To facilitate
  such checks, all financial and accounting
  documents relating to projects must be retained.

151
QSF Financial Management Manual

• Article 14
• Closure of project accounts
• 1 The balance of budgetary credits for national
  projects entirely completed before the QSF is
  dissolved shall be re-allocated to the Creditors
  in question.
• 2 The balance of budgetary credits for regional
  projects entirely completed before the QSF is
  dissolved shall be re-allocated to the Creditors
  in question in proportion to their contributions
  to these projects.

152
QSF Financial Management Manual

• Article 15
• Trust management costs
• 1 Management costs shall comprise
• a All costs or expenses incurred by the Trustees
  in managing and administering the affairs of the
  Trust, whether collectively or individually,
  other than the Trustees own travel costs or
  management or administrative fees.
• b The International Bureau's administration
  charges arising from its management of the QSF.
• c Costs and expenses arising from monitoring and
  evaluating projects funded by the QSF, other than
  the costs and expenses provided for in the
  project budgets.
• All the above costs shall be paid first from
  interest on investments or any other gain or
  revenue (including interest on overdue payments)
  from the trust funds, and then from the capital
  on a pro rata basis of the total annual
  settlements due (amount of annual billing) to
  each creditor.

153
QSF Financial Management Manual

• Article 17
• Confidentiality
• 1 Information on billing of contributions and
  payment thereof shall be strictly confidential.
• 2 Information on a given billing or payment of a
  contribution shall be furnished only to the
  Settlor and Creditors involved in this billing.
• 3 The information referred to in paragraphs 1 and
  2 shall be communicated only to the persons
  officially designated by the Settlors and
  Creditors.
• 4 Information considered confidential shall not
  be communicated to other QSF bodies except as
  required by the Board of Trustees.
• 5 The information referred to in paragraphs 1 and
  2 shall only be transmitted by conventional
  registered or electronic mail, and not by fax.

154
QSF Financial Management Manual

• Article 21
• Dissolution
• 1 In case of dissolution of the Trust, the
  balance of these bank accounts, following
  repayment of Settlors' assets, shall be paid into
  the CHF technical cooperation account and
  assigned to the financing of projects to improve
  the quality of the international postal service,
  in accordance with article 8.3 of the QSF
  Statutes.
• 2 In case of dissolution of the Trust, the
  remaining credit balance of projects which are
  entirely completed as regards their financial
  aspects shall be paid into the CHF technical
  cooperation account and assigned to the financing
  of projects to improve the quality of the
  international postal service.

155
QSF Financial Management Manual - NEWS
New Provisions

• Article 4
• Maintenance of Fund
• 1 The Fund shall be maintained by mandatory
  contributions payable by all countries and
  territories, with the exception of the least
  developed countries, by voluntary contributions,
  by income from investments and by interest on
  overdue mandatory payments.
• 2 The mandatory contribution of an industrialized
  country, a developing country or a net
  contributor country in favour of a least
  developed country shall represent 16.5 of the
  total amount of terminal dues payable to the
  least developed country by the industrialized,
  developing or net contributor country.

156
QSF Financial Management Manual - NEWS
New Provisions

• Article 4
• Maintenance of Fund
• 3 The mandatory contribution of an industrialized
  country in favour of a developing country shall
  represent 8 of the total amount of terminal dues
  payable to the developing country by the
  industrialized country.
• 4 The mandatory contribution of an industrialized
  country in favour of a net contributor country
  shall represent 1 of the total amount of
  terminal dues payable to the net contributor
  country by the industrialized country.
• 5 The total amount of terminal dues payable to a
  Settlor country to a Creditor country shall be
  equal to 3.727 SDR, multiplied by the weight in
  kilogrammes of the mail dispatched by the Settlor
  country to the Creditor country, excluding mail
  subject to the revision mechanism, M bags and
  bulk mail.

157
QSF Financial Management Manual - NEWS
New Provisions

• Article 10bis
• Clearing of bills not paid within six weeks using
  assets
• 1 Countries or territories that have not paid
  their outstanding bills within a period of six
  weeks shall have the sums owed deducted
  automatically from their QSF assets.
• 2 For countries and territories without
  sufficient QSF assets, all funds subsequently
  paid into the QSF assets or any other asset or
  sum owed by the International Bureau may be used
  to regularize these bills. Interest on overdue
  payments shall be automatically payable in
  respect of these late payments.

158
QSF Financial Management Manual - NEWS
New Provisions

• Article 12bis
• QSF assets
• 1 The creditor postal administration shall
  ensure, for the sake of security, that the QSF
  budget requested for its project does not exceed
  a certain percentage of the available QSF assets.
  This reserve will enable account to be taken of
  any withdrawals made on QSF assets, relating to
  the Trust's project evaluation costs or
  administrative costs. This percentage may be
  revised each year by the Board of Trustees. It is
  currently 96.

159
QSF Financial Management Manual - NEWS
New Provisions

• Article 15bis
• Exchange differences and other costs relating to
  securities transactions
• 1 Realized differences The amount of realized
  exchange differences and other realized costs
  relating to securities transactions shall be
  distributed each year, at the closing of
  accounts, among the beneficiary countries in
  proportion to the sums received.

160
QSF Financial Management Manual - NEWS
New Provisions

• Article 15bis (contd)
• Exchange differences and other costs relating to
  securities transactions
• Unrealized differences In keeping with the
  prudence principle, whereby unrealized
  expenditure, but not unrealized profits, should
  be accounted for, unrealized exchange losses and
  other unrealized costs relating to securities
  transactions shall be charged each year to the
  beneficiary countries at the closing of accounts
  in proportion to the amounts received, except
  where there is a provision to offset these
  losses.

161
QSF Financial Management Manual - NEWS
New Provisions

• Article 15bis (contd)
• Exchange differences and other costs relating to
  securities transactions
• (contd) Exchange gains and other costs relating
  to securities transactions shall be charged to
  the beneficiary countries in proportion to the
  amounts received only when these gains have
  actually been realized, except in cases where
  there has been a change in the status of the
  beneficiary countries, the method of calculating
  contributions or any other change.

162
QSF Financial Management Manual

• During the years 2006 to 2008 the QSF Financial
  Management Manual rules, based on Beijing
  Congress, will still be applicable.

163
9. Rules for use of QSF funds
164
QSF Projects Disbursement

• Introduction
• Payment Conditions
• UNDP/non-UNDP
• Disbursement methods
• The forms
• Final budget and calculation of the balance
• Accounting procedures
• Questions?

165
QSF Projects Disbursement

• Introduction
• The Team
• Disbursement ONLY

166
QSF Projects Disbursement

• 2. Payment conditions

Ref Notice of unconditional approval
167
QSF Projects Disbursement

• 3. UNDP/non-UNDP

Ref. project application form
168
QSF Projects Disbursement

• 4. Disbursement methods
• Payment to the postal administration
• Payment to a supplier
• Payment to a supplier through the UNDP

169
QSF Projects Disbursement

• 5. The forms
• Project Change Request (PCR)
• Request for Payment (RfP)
• Acknowledgement of Receipt of the funds

170
QSF Projects Disbursement - PCR
171
RfP
172
A/R
173
QSF Projects Disbursement

• 6. Final Budget
• To be provided with the final report
• With original final invoices
• Calculation of the balance

174
Calculation of the balance
QSF Projects Disbursement
Effective costs (max. approved QSF budget) -
Advances already paid (incl. bank charges UNDP
fees)
BALANCE
175
QSF Projects Disbursement

• 7. Accounting Procedures
• Credits are paid in the currency chosen by the
  creditor country
• The total project amount is blocked and deducted
  from the countrys available capital
• 1 of the total project amount (max. 5,000 USD)
  is deducted from the countrys capital

176
QSF Projects Disbursement

• 7. Accounting Procedures
• Bank charges are payable by the project
• If the total amount spent exceeds the initial
  budget the difference is deducted from the
  countrys capital
• If the total amount spent is less than the
  initial budget the difference is paid back into
  the countrys capital

177
UNIVERSAL POSTAL UNION INTERNATIONAL BUREAU
QSF Projects Individual Statement
178
QSF Projects Disbursement
8. Questions?
179
10. Practical cases