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    The Big Picture Will ICANN approve a realistic budget?
    posted by tbyfield on Tuesday July 20 2004, @02:24PM

    Bruce Levinson writes "ICANN's key task at their Kuala Lumpur meeting will be to approve a budget. The question is whether the budget ICANN approves will be realistic, i.e. whether revenues collected will cover expenses. There are indications that ICANN's may not be able to count on actually achieving the revenues called for in their proposed budget. The Council of European National Top Level Domain Registries (CENTR) has already informed ICANN that the "budget figures and the contribution asked from ccTLDs is unrealistic and inappropriate."



    Although CENTR members made clear their willingness to fund their fair share of ICANN/IANA and to provide expert technical assistance and proven software, they are sharply critical of the proposed budget. Two key points that CENTR raises are:

    1) Many of the "Identified Priorities" in the proposed budget "are outside of ICANN's core mission." CENTR goes on to recommend that "ICANN/IANA should focus on doing a few administrative tasks well and not seek to make decisions..."

    2) The budget for the IANA function has increased by almost 20-fold since 1996 even though the actual workload has "remained fairly static." CENTR notes that last year's IANA budget of $2.8 million "was already proven to be unattainable and unsustainable, and the draft budget 2004/5...seems guaranteed to follow the same path... In particular, the proposed increase of contribution from ccTLD Registries to $5m has generated a lot informed criticism..."

    ICANN has a history of developing budgets based on non-realistic revenue expectations. As ICANNFocus has previously noted, almost one-third of ICANN's net assets in 2003 consisted of accounts receivable that remained unpaid for more than 180 days. If exceptions had not been made to the organization's stated accounting policy, these long overdue invoices would have been written off as bad debt. Furthermore, the amount of unpaid invoices that would normally have been written off almost doubled between December 2002 and December 2003.

    ICANN's reliance on unrealistic revenue expectations and accounting exceptions pose a threat to the organization's long term viability. Moreover, by failing to maintain their own financial integrity, ICANN's actions pose a threat to stakeholders dependent on the organization."

     
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      Related Links  
    · IANA
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    · More The Big Picture stories
    · Also by tbyfield
     
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