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Zionist Congress ההסתדרות הציונית העולמית The World Zionist Organization THE OFFICE OF THE COMPTROLLER ANNUAL REPORT for 2010 and 2011 to THE ZIONIST GENERAL COUNCIL XXXVI/3 Jerusalem, June 2012 The Office of the Comptroller: 14 Hillel St., P.O.B. 7063, Jerusalem 91070 Tel: 972-2-6204500 Fax: 972-2-6204545 [email protected] Members of the Zionist General Council, I am honored to submit to the Zionist General Council (XXXVI/3) an Annual Report on the activities of the Office of the Comptroller for the years 2010 and 2011. The volume includes reports that were discussed at the Subcommittee for the Comptroller's Reports of the Zionist General Council Standing Committee for Budget and Finance. The response of the Chairman of the Zionist Executive to the reports is included. The Comptroller's recommendations should be thoroughly reviewed by the controlled bodies and implemented thereafter in order to improve ways of management, use of human resources, and funds allocated to them. I would like to thank Mrs. Hana Melamed, Chairperson of the Control Subcommittee and the members of the Subcommittee for their assistance in pursuing the implementation of my recommendations, as well as the Controlled bodies for their cooperation. Thanks go also to my staff for their thorough work. Asaf Sela Comptroller Jerusalem, June 2012 2 Message of the Chairperson of the Subcommittee for Control The World Zionist Organization Standing Committee for Budget and Finance The Comptroller of the National Institutions has been reviewing the activities of the World Zionist Organization for decades. Since the 36th Zionist Congress, and following the election of the Chairman of the Zionist Executive, the Comptroller and his staff have made a great effort to submit to the members of the Subcommittee for Control and to the World Zionist Organization, reports for review so that it will be possible to correct what needs to be improved. The dedicated work of the Comptroller and his staff in preparing the reports in detail and in caring to implement and improve matters for proper management and empowerment of the World Zionist Organization and its affiliated bodies, should be appreciated. I would like to thank the members of the Subcommittee and all those involved for their dedicated work. Hana Melamed June 2012 Table of Contents Activities of the Office of the Comptroller During the Period Covered by the Report .................................................. 11 List of Reports Prepared in the Years 2003–2012 ..................................... 15 Comptroller's Reports: The 36th Zionist Congress ........................................................................ 17 Introduction ................................................................................................ 19 Budget and Expenditure for the Zionist Congress ..................................... 20 Contracting and Current Expenses ............................................................. 25 Participation Fees ....................................................................................... 29 Response of the Chairman of the Executive .............................................. 31 The World Zionist Unions – Use of World Zionist Organization Allocation ...................................... 33 Introduction ................................................................................................ 35 Unions – General Background ................................................................... 37 Procedures and Operational Interface between WZO and the Unions ...... 40 Use of Allocations by the Unions .............................................................. 53 Follow-up on Implementation of the Comptroller's 2008 Audit ............... 70 Appendix – Funding the World Zionist Unions Procedure ....................... 73 Response of the Chairman of the Executive .............................................. 79 The Building at 17 Kaplan Street, Tel Aviv ........................................ 181 Introduction .............................................................................................. 183 Description of the Property ...................................................................... 184 The Property Transfer Agreement ........................................................... 186 Management of the Building ................................................................... 187 The Rental Situation and the Agreement with the Lessees ...................... 189 Finance ..................................................................................................... 191 Response of the Chairman of the Executive ............................................ 195 Department for Diaspora Activities – Herzl Museum ........................................................................................ 197 Introduction .............................................................................................. 199 Operation of the Museum ........................................................................ 100 Manpower ................................................................................................ 102 Budget and Finance .................................................................................. 106 Conclusion ............................................................................................... 114 Response of the Chairman of the Executive ............................................ 117 The Unit for Zionist Shlichut – The Shlichim Setup ................................................................................ 119 Introduction .............................................................................................. 121 The Shlichim Setup – Background ........................................................... 123 Procedures ................................................................................................ 129 Recruitment of Shlichim and Determination of their Salaries ................. 136 Monthly Salary and Current Payments .................................................... 142 Cash Flow and Bookkeeping Entries ....................................................... 152 Response of the Chairman of the Executive ............................................ 159 Keren Kayemeth LeIsrael – Voluntary Retirement in 2009 .............................................................. 161 Introduction .............................................................................................. 163 Background .............................................................................................. 166 Decision Making ...................................................................................... 172 The Retirement Program .......................................................................... 179 Financial Implications of the Retirement Program .................................. 187 Results of the Retirement Program .......................................................... 191 Organizational Structure .......................................................................... 196 Keren Kayemeth LeIsrael – The Education and Youth Division ...................................................... 203 Introduction .............................................................................................. 205 General Background ................................................................................ 208 Employment of Freelancers and Counselors ........................................... 213 Contractual Arrangements with Suppliers ............................................... 222 Field Centers ............................................................................................ 228 Utilization of Budget and Collection ....................................................... 232 Information Systems ................................................................................ 244 Keren Kayemeth LeIsrael Museum ......................................................... 247 Keren Hayesod – Procurement and Contracts .................................................................. 251 Introduction .............................................................................................. 253 Keren Hayesod – General Background .................................................... 256 Procedures ................................................................................................ 260 Contractual Arrangements with Suppliers ............................................... 266 The Process of Placing Procurement Orders ........................................... 271 Input and Approval of Invoices and the Making of Payments ................ 282 Management of the Procurement Budget ................................................ 287 Response of the Chairman of the Executive ............................................ 293 Keren Hayesod – High Priority Projects ............................................................................ 295 Summary .................................................................................................. 297 Introduction .............................................................................................. 300 The Project Handling Process .................................................................. 302 The Project Types .................................................................................... 310 Description of High Priority Projects ...................................................... 312 Income for
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