15 August 1962.
I have the honour to refer to the discussions that took place on 13 and 14 August 1962 at the United Nations Headquarters between representatives of the Government of Indonesia, the Government of the Netherlands and the Secretariat concerning certain financial arrangements which are envisaged in connexion with the United Nations Administration of West New Guinea (West Irian).
In response to the request of the representatives of the two Governments these arrangements are set forth below.
The Secretary-General will prepare, in consultation with the two Governments, a budget covering the total anticipated costs involved in its administration of the Territory, and will request the two Governments to make advances of funds in such currencies and at such time(s) as may be required to cover the anticipated costs.
The funds made available by the Governments to the Organization will be treated as “trust funds” in accordance with United Nations Financial Regulations 6.6 and 6.7 and will be administered in accordance with the established United Nations financial regulations and rules relating to trust funds, reserve and special accounts, and, in particular, United Nations Financial Regulations 10.1 (d), 10.2 and 11.3 relating to the arrangements in respect of (a) the maintenance of an internal financial control to provide for an effective current examination and/ or review of financial transactions in order, to ensure the regularity of the receipt, custody and disposal of the funds, the conformity of obligations and expenditures with the purposes and rules relating to the trust funds, and the economic use of these resources; (b) providing that no obligations shall be incurred until allotments or other appropriate authorizations have been made in writing under the authority of the Secretary-General and (c) maintaining a separate special account for all funds received in trust from the Governments.
As soon as possible after the termination of the United Nations responsibility for administration of the Territory an audited statement of the income and expenditures arising from and in connexion with its administration of the Territory will be rendered to the two Governments, and any balance of funds in the trust fund that are not required to cover commitments entered into by the Organization in this connexion will be refunded in equal shares to the two Governments.
If, after preparation of the initial budget, unforeseen developments should occur giving rise to the need for additional funds from the two Governments, the Secretary-General would prepare a supplemental budget in consultation with the two Governments, and request such additional deposits in the trust fund as would be required.
It may be anticipated that the budget estimates would consist of two major parts, the first relating to what may be described as the normal territorial operations and accounts, and the second relating to expenses to be incurred by the United Nations for staff and other costs (salaries, United Nations pension contributions, insurance, travel expenses, communications costs, etc.) Which may not be dealt with appropriately as part of the normal territorial operations, The second part of the budget would also include the costs of any security personnel that might be required and for which no provision has been made in the existing butget for the Territory.
It is my understanding that the representatives of the two Governments participating in the discussions expressed agreement with the arrangements set forth above, but I would be pleased to have you advise me of your Government's concurrence regarding them.
Accept, Sirs, the assurances of my highest consideration.
(sd.) U THANT,
Dr. J. H. van Roijen
Ambassador Extraordinary and Plenipotentiary
of the Netherlands to the United States
Mr. C. W. A. Schurmann
Permanent Representative of the Netherlands
to the United Nations
711 Third Avenue
New York 17, N.Y.