ITER ORGANIZATION

2014 FINANCIAL REPORT

w w w . i t e r. o r g
FINANCE
AT A GLANCE

587 Staff

€1,673
Property, Plant & Equipment
Million

€11
Intangible Assets
Million

€202
Cash Contributions received for 2014
Million

€185
In-Kind Contributions
Million

€78
Employee Benefits
Million

€201
Total Commitments
Million

00 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

ITER ORGANIZATION
2014 FINANCIAL REPORT

In 2014, the project celebrated a number of

milestones both at the ITER site in Saint Paul-lez-
Durance, France, where the buildings of the ITER
installation are rising, and in China, Europe, India,
Japan, Korea, Russia and the United States, where
component fabrication is underway in the factories
of the ITER Members

CONTENTS
FOREWORD BY THE DIRECTOR-GENERAL 03
CERTIFICATE 04
STATEMENT FROM THE DIRECTOR-GENERAL 04
INDEPENDENT AUDITORS’ REPORT 05
FINANCIAL STATEMENT DISCUSSION AND ANALYSIS 06
FINANCIAL STATEMENTS 2014 10
A. FINANCIAL STATEMENTS 2014 PREPARED ON AN ACCRUAL BASIS 12
Statement of Financial Position as at 31 December 2014 14
Statement of Financial Performance for the Year ended 31 December 2014 14
Cash Flow Statement for the Year ended 31 December 2014 15
Statement of Changes in Net Assets/Equity for the Year ended 31 December 2014 15
B. BUDGET EXECUTION STATEMENT 2014 17
Budgetary Outturn 2014 18
Income Execution 2014 18
Payments Execution 2014 19
Commitments Execution 2014 19
C. NOTES TO THE 2014 FINANCIAL STATEMENTS 21
Notes to the Financial Statements 2014 prepared on an Accrual Basis (A) 22
Notes to the Budget Execution Statement 2014 (B) 40
Reconciliation: Cash Flow Statement - Budget Outturn 52

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 01

FOREWORD BY THE
DIRECTOR-GENERAL

An olive branch for an important milestone: in August 2014 work

ends on the B2 basemat slab – the actual floor of the Tokamak
Complex. Work can now begin on the walls.

02 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

FOREWORD BY THE
DIRECTOR-GENERAL

The ITER Project is one of the most ambitious international science collaborations in
the history of mankind. The seven ITER Members represent 35 nations, half the world’s
population and nearly 85 percent of its gross industrial product. As the newly appointed
Director-General of the ITER Organization, I am conscious of the great trust that has been
placed in me to lead the project forward to the critical phases of assembly and installation.
Despite being a relatively young organization, formally established in 2007, the ITER
Organization has already put in place the tools and the processes for responsible
budget management and careful planning. The Financial Statements for the year
ending 31 December 2014 presented in the following pages have been drawn up in
compliance with the International Public Sector Accounting Standards (IPSAS) and ITER
Project Resource Management Regulations, and audited by the experts of the Financial
Audit Board. The policy of the ITER Organization in the matter of its finances – as well as
in every other sector of its activity – is continuous improvement in project
management through the rigorous evaluation of processes, practices and staff training.
In 2014, the project celebrated a number of milestones both at the ITER site in
Saint Paul-lez-Durance, France, where the buildings of the ITER installation are rising,
and in China, Europe, India, Japan, Korea, Russia and the United States, where
component fabrication is underway in the factories of the ITER Members. The first
completed components were delivered to the ITER site; the final element of the
Tokamak Complex foundations – the B2 basemat slab – was poured; a large on-site
workshop for cryostat assembly was finalized; and work began on the metal
structure of the Assembly Building and the concrete walls of the Tokamak Complex.
A total of 104 out of 139 Procurement Arrangements have been signed by the ITER
Organization for the different work packages of ITER construction, representing 90.5% of
the project’s total in-kind value; this means that a significant part of ITER activity is now
clearly also in the hands of industry. Manufacturing has started on the longest-lead items
for ITER (the toroidal field magnets, the cryostat and the vacuum vessel) and the first
exceptionally sized components are expected to travel along the ITER Itinerary in 2015.
In the years ahead, the assembly of the ITER machine – with up to one million
components – will be one of the most complex engineering endeavours ever
undertaken. To meet the challenge, I am convinced that the ITER Organization and the
seven ITER Domestic Agencies must act as an integrated team. I am progressively
implementing the action plan I proposed to the ITER Council, which was unanimously
approved by all partners. This action plan will result in some drastic changes with
regard to the organization and the conduct of this project. But implementing new
approaches and new procedures is inevitable if we want to succeed.
The energetic potential of fusion, its sustainability, and the fact that the
process produces no greenhouse gas emissions or long-lived nuclear waste makes
it one of the prime candidates for truly changing the energy horizon for the
generations to come. ITER is the key step between
today's smaller-scale experimental fusion devices and
the demonstration fusion power plants of the future.
Together, the central ITER Organization team and
the seven Domestic Agencies are committed to fulfilling
the agreed scope of the ITER Project and opening the
way to the industrialization of fusion energy.

Bernard Bigot
Saint Paul-lez-Durance, May 2015

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 03

CERTIFICATE AND
STATEMENT FROM THE DIRECTOR-GENERAL

CERTIFICATE

The Financial Statements of the ITER Organization have been prepared in accordance
with the internal Project Resource Management Regulations (PRMR) and the
International Public Sector Accounting Standards (IPSAS).
We hereby certify that, based on the information provided by the Authorizing
Officer, we have reasonable assurance that these accounts present a true and fair
view of the financial transactions in the year 2014 and of the financial position of the
ITER Organization in all material aspects at the end of 2014.
We are not aware of any un-recorded liabilities.

24 February 2015 24 February 2015

Lionel Rigaux Kattalai Ramachandran Sriram
Accounting, Treasury & Systems Section Leader Director for Finance, Budget
Accounting Officer & Management Systems

STATEMENT FROM THE DIRECTOR-GENERAL

I, the undersigned, Director-General of the ITER Organization, in my capacity as

Authorizing Officer:
• Declare that the information contained in this report gives a true and fair view.
• State that I have reasonable assurance that the resources have been used for their
intended purpose and in accordance with the principles of sound financial
management, and that the control procedures put in place give the necessary
guarantees concerning the legality and regularity of the underlying transactions.
This reasonable assurance is based on my own judgement and on the information
at my disposal.
• Confirm that I am not aware of anything not reported here which could harm the
interests of the ITER Organization.

24 February 2015
Osamu Motojima
The Director-General
Authorizing Officer

04 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 INDEPENDENT
AUDITORS’ REPORT

INDEPENDENT AUDITORS’ REPORT

Reference: ICS/2015/OUT/0032 (R4ZPBP) To: Chair of the ITER Council

Subject: Independent Auditors’ Report 3 April 2015

Dear Chair of the ITER Council,

We have audited the accompanying financial statements of the ITER International Fusion Energy Organization (here-in-after
IO), established under the Agreement on the Establishment of the ITER International Fusion Energy Organization for the
Joint Implementation of the ITER Project (here-in-after ITER Agreement) as of and for the year ended 31 December 2014.
The IO’s management is responsible for the preparation and fair presentation of these financial statements in
accordance with the Project Resource Management Regulations (here-in-after PRMR), International Public Sector
Accounting Standards, and for such internal control as management determines is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our
audit in accordance with Article 17 of the ITER Agreement, the External Financial Audit Procedures, the relevant
articles of the PRMR, and the International Standards of Auditing (here-in-after ISA). These rules, regulations, and
standards require that we comply with ethical requirements to plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The audit procedures selected depend on the auditor’s judgment, including the assessment of risks
of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in
order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
The financial statements of the IO as of and for the year ended 31 December 2014 have been examined in
accordance with the aforementioned rules, regulations, procedures, and standards. We have obtained all the information
and explanations that we required and we certify, as a result of our audit, that in our opinion the financial statements give
a true and fair view of the state of affairs of the IO. We have provided a separate Management Letter dated 03rd April
2015 which describes certain issues identified during our audit that warrant the attention of the IO’s management.

Mr. R.A. Rajeev, Chair of FAB

Republic of India
Ms. Shufan Zhao Mr. Toshiyuki Kimura
People’s Republic of China Japan
Mr. Ciaran Spillane
European Union
Ms. Yeon-Soo Cho Ms. Susan May
Rebublic of Korea United States of America
Mr. Sergei Iugai
St. Paul-lez-Durance, France Russian Federation
CC: Director-General of ITER Organization,
Chair of the ITER Council Management Advisory Committee (MAC)

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 05

FINANCIAL STATEMENT
DISCUSSION AND ANALYSIS

FINANCIAL STATEMENT
DISCUSSION AND ANALYSIS
This section of the ITER Organization’s (IO) annual
Financial Report presents management’s discussion and
analysis of the Financial Statements for the year ended
31 December 2014 in accordance with the International
Public Sector Accounting Standards (IPSAS)
recommended practice guideline 2 Financial Statement
Discussion and Analysis, issued on 16 July 2013.
The Financial Statement Discussion and Analysis is not
part of the IO’s Financial Statements; however it should be
read together with the IO’s Financial Statements on pages
11 to 53 of this report.
The 2013 Financial Statements were audited and
thereafter approved by the ITER Council in June 2014.

OVERVIEW
The Financial Statements have been drawn up in
accordance with the IPSAS and the Project Resource
Management Regulations (PRMR) of the IO. The Financial
Statements are therefore in compliance with both In India, manufacturing activities on the cryostat base progress well in 2014.
(Pictured: one of the six 60° base segments, tier 2.) Photo: ITER India
regulations and standards.
Under Articles 7 and 9 of the ITER Agreement, the
Director-General and the staff of the IO shall prepare IO are inter-related with the accounting policy
and submit to the ITER Council the annual Financial choice concerning revenue from Members;
Statements by the end of February of the year following • Statement of Changes in Net Assets/Equity provided
the last day of the reporting period. for the record (not impacted during the Construction
The functional currency used by the IO is the Euro. Phase);
The Financial Statements set out the basis of • Cash Flow Statement which provides information
preparation of the information contained herein and about the IO’s liquidity and solvency, including cash in
include explanations on the differences between the and cash out;
IPSAS and PRMR schedules in accordance with the PRMR. • Budgetary Statements prepared on a modified cash
The Financial Statements show in particular the: basis as required by the PRMR;
• Statement of Financial Position which provides • Notes to the Financial Statements making them easier
information about the: to understand and to compare with the Financial
- Assets of the Organization (cash; recoverables; Statements of similar entities:
prepayments; property, plant and equipment; These Notes comprise a summary of significant
intangible assets and other financial assets); accounting policies used:
- Liabilities of the Organization (payables; employee - Basis of preparation;
benefits liabilities and deferred revenues). - Specific accounting policies;
• Statement of Financial Performance presented on an - Disclosure of the information required by IPSAS that
accrual basis of accounting, recognizing revenue in is not presented on the face of the Statement of
the period it is earned and expenses when they Financial Position, Statement of Financial
occurred, regardless of when the associated cash is Performance, Statement of Changes in Net
received or paid. In view of the specific nature of the Assets/Equity, or Cash Flow Statement.
Organization, which has in essence only one • Reconciliation between the Cash Flow Statement and
objective, i.e. the operation of an experimental the Budget Outturn.
facility, all costs shall be considered to be incurred in Revenue from the Members constitutes revenue
order to construct and bring the asset to a condition from non-exchange transactions. Contributions from
enabling operations to commence (‘net costs of IO Members which are used to acquire property, plant and
activities capitalized’). The capitalization of equipment and intangible assets are taken back to
costs/values will cease once these assets are utilized revenue over the period of the utilization of the related
in the Operation Phase. The consequences of this assets and are labelled ‘Deferred contributions from
capitalization criterion on the annual results of the Members’ in the Statement of Financial Performance.

06 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 FINANCIAL STATEMENT
DISCUSSION AND ANALYSIS

ABOUT THE ITER ORGANIZATION DAs/Members) and secondments of staff. Both of them
The ITER Organization provides and promotes are directly recognized in the Statement of Financial
cooperation on the ITER Project among its Members, Position, upon receipt of their delivered milestones or
these being the European Union (represented by work performed (‘credit request mechanism’).
Euratom), Japan, the People’s Republic of China, the PA milestones recorded as Asset under construction
Republic of India, the Republic of Korea, the Russian have been split into two categories, either as Advance
Federation and the United States of America. for milestones related to assets produced without
This international project aims to demonstrate the transfer of control/responsibilities and risks from a DA to
scientific and technological feasibility of fusion energy the IO, or as capital work in progress for milestones
for peaceful purposes, an essential feature of which related to assets produced with transfer of
would be achieving sustained fusion power generation. control/responsibilities and risks from the DA to the IO.
The purpose, functions and other organizational The measurement basis applied for cash transactions
aspects of the IO are set out in the ‘Agreement on the is at historical cost. Fixed assets and contributions arising
Establishment of the ITER International Fusion Energy from PAs are measured and accounted at their agreed
Organization for the Joint Implementation of the ITER values (as defined in the ITER Agreement). However, they
Project’ (the ‘ITER Agreement’, http://www.iaea.org/ do not reflect the actual costs incurred by the DAs in
Publications /Documents/Infcircs/2007/infcirc702.pdf). relation to their own procurements.
The ITER Agreement was signed by the Members in Paris on The ‘Common Fund’ is the initial ‘Trust Fund’ created by
21 November 2006 and has an initial duration of 35 years. the International Atomic Energy Agency (IAEA) to launch
The IO has an international legal personality including the ITER Project in 2006. These advances of funds were
the capacity to conclude agreements with States and/or allocated to their respective Members as per the agreed
international organizations, and is governed by a Council sharing (total amount received between 2006 and 2008:
composed of representatives from each of its Members. EUR 3,830,595 split into EUR 1,741,644 for Euratom, and
The Council elects from among its Members a Chair EUR 348,158 for each of the other Members).
and Vice-Chair who shall each serve for a term of one The Financial Statements show tabulations in
year and who may be re-elected up to three times for a thousands of Euro, which could cause minor differences
maximum period of four years. due to rounding.
The four phases of the ITER Project are construction, The address of the IO Headquarters is Route de
operation, exploitation and de-activation Vinon-sur-Verdon, CS 90 046, 13067 Saint Paul-lez-
(decommissioning) of the ITER facilities in accordance Durance Cedex, France. The land on which the ITER
with prescribed technical objectives and specifications Project is being constructed has been provided free of
and supplemental technical requirements that may be charge by the French State through the ‘Commissariat à
necessary. The decommissioning of the IO facility will be l’Energie Atomique’ (CEA) for the duration of the ITER
financed by the Members upon completion of the Project (initially foreseen to end in October 2042).
project and will be carried out by the Host State.
The resources to carry out the construction of the CONSTRUCTION CONTRACTS AND PARTNERSHIPS
project comprise contributions in kind and in cash from The Partnership Arrangement with the Principality of
the Members, as per the following sharing: 45.46% for Monaco concluded for ten years in 2008 included a
Euratom and 9.09% for the others. contribution of EUR 5.50 million for post-doctorate
The cost estimates for the Construction and fellowships and the organization of conferences on
Operation Phases have been quantified using the IUA scientific and technical subjects related to ITER.
unit of currency (IUA is the ITER Unit of Account and In 2013 work started on two arrangements signed
one IUA was equal to USD 1,000 in January 1989). The with the US-DA for the completion of the final design of
conversion rate from IUA to Euro is revised annually by the Tokamak Cooling Water System and the
the Director-General and reported to the Management procurement of the piping for this system (TCWS).
Advisory Committee thereon. In 2014 the IO signed an arrangement with the US-DA
Contributions from the Members or their respective for the procurement of the Steady-State Electrical
Domestic Agency (DA) are provided in cash and in kind. Network High Voltage Substation Structures (SSEN).
The Procurement Arrangements (PAs) are Financial resources for the execution of these
Contributions/Arrangements in kind, foreseen in the ITER arrangements are being provided separately by the US-
Agreement and signed between the IO and each DA to the IO, outside the ITER Council-approved IO
Member. They are called ‘long-term in-kind contributions’. budget. These arrangements do not modify the sharing
‘Short-term in-kind contributions’ are related to Task of responsibilities under the Procurement Arrangements
Agreements (contracts between the IO and the signed between the IO and the US-DA.

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 07

FINANCIAL STATEMENT
DISCUSSION AND ANALYSIS

Revenue received and associated costs incurred by losses arising from a wide variety of causes associated
the IO are included in the Statement of Financial with its processes, personnel, technology and
Performance in the year of receipt and expenditure. infrastructure (including site preparation and construction
Any excess of revenue over associated costs is shown of the experimental asset), and from external factors such
as payable in Note A9. as those arising from legal and regulatory requirements,
The costs incurred by the IO arising from the environmental factors and on account of accepted
construction contracts and partnerships are therefore standards of corporate behaviour.
not considered part of the construction cost of the In 2011, the Internal Control Standards were
experimental equipment. adopted as a means of providing a framework of
Details of these construction contracts and partnerships sufficient assurance on the proper execution of its
are disclosed on Note A15. activities. The standards based on the Committee of
Sponsoring Organizations of the Treadway
FINANCIAL STATEMENTS HIGHLIGHTS Commission (COSO) framework cover aspects such as
The highlight on the ITER construction site in 2014 was ethical values, staff evaluation, objective indicators for
the completion of the Tokamak Complex basemat (B2 performance, organizational structure, management
slab) in August. This milestone brings to an end four supervision and monitoring and business continuity.
years of work to construct the ground support structure Requirements under these aspects are defined and
and walls of the Tokamak Complex and opens the way measured periodically. Compliance with the
for wall construction to begin. requirements of the internal control standards was
Also during the year, the 35-metre extension to the assessed to be 96% in 2014.
ITER Headquarters building was finalized, work ended The process of risk assessment is interwoven with
on the Cryostat Workshop, a second full-scale test of the the process of contract awards and all the major
ITER Itinerary was conducted successfully, and work to contracts awarded invariably have to be accompanied
erect warehouse facilities for component storage began by risk assessment and management documents that
in four locations on the ITER site. are evaluated by the technical responsible officers.
Some 90.53% of the Project’s in-kind value has now A Risk Register is maintained in the Project Office,
been committed through 104 Procurement Arrangements. which outlines the nature of risk, its likelihood, impact
Manufacturing is underway in all Domestic Agencies and frequency of occurrence. In addition, each
and the first arrivals of completed components (for ITER’s Procurement Arrangement has associated Risk
Steady State Electrical Network) began in September. Management Plans, which are updated periodically.
Based on recommendations from the 2013 Based on an assessment of the nature of risk, and the
Management Assessment the ITER Organization accompanying factors, necessary mitigating strategies
continues to implement actions to mitigate delay in the are put in place.
schedule, including reduced bureaucracy to support An exercise for the current year has also been carried
process simplification and acceleration and improvement out to develop risk registers at the micro levels of
of ITER Organization-Domestic Agency collaboration at Sections and Divisions in the critical technical
a working level. Close monitoring of monthly schedule directorates; this aims to capture and manage the
performance against the 2014 Annual Work Plan will emerging risks at the appropriate level of hierarchy.
provide the benchmarking necessary for the development Simultaneously, an IO-DA Risk Task Force has been setup
of the project’s long-term Realistic Schedule. to update the Project Risk Register, in conjunction with
the development of the updated Long-Term Schedule.
RISKS AND UNCERTAINTIES An organization-wide review of the risk portfolio is
The ITER Organization is now closing its eighth carried out annually and based on the risk assessment
financial year and is still a relatively young organization exercise, mitigating strategies in terms of audit plans are
as well as being an incredibly huge project to build. developed for the ensuing period. The Risk Assessment
Systems and procedures that have evolved over a period exercise is comprehensive in nature covering major
of time are documented and disseminated. Procedures technical, administrative, financial and information
are in place for imparting mandatory training courses to technology, and quality assurance processes. The
the new entrants as well as refresher trainings courses. corrective actions as a follow-up to the audits are
During the last years several measures were taken to monitored and reported regularly.
manage risks with an aim to transfer, mitigate, avoid or An Ethics Committee comprising officials and staff
completely eliminate these risks. The aim of the exercise representatives has been constituted to reinforce
is to keep them at an acceptable level. ethical standards in conduct; it meets periodically to
The IO is confronted with the risk of direct or indirect deliberate and advise on important matters.

08 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 FINANCIAL STATEMENT
DISCUSSION AND ANALYSIS

CUMULATIVE POSITION STATEMENT BY MEMBER ON 31 DECEMBER 2014

Amounts in thousands of Euro
Agreed Contributions in Cash Contributions in Kind
sharing (cash and short-term in kind) (Procurement Arrangements) Total Contributions
Euratom (*) 45.46% 525,651 45.47% 143,344 29.16% 668,995 40.61%
People’s Republic of China 9.09% 105,413 9.12% 30,317 6.17% 135,730 8.24%
Republic of India 9.09% 104,626 9.05% 25,875 5.27% 130,501 7.92%
Japan (*) 9.09% 105,247 9.10% 128,367 26.13% 233,614 14.18%
Republic of Korea 9.09% 106,739 9.23% 91,519 18.63% 198,258 12.04%
Russian Federation 9.09% 104,554 9.05% 52,796 10.75% 157,350 9.55%
United States of America 9.09% 103,703 8.97% 19,045 3.88% 122,748 7.45%
Total 1,155,933 491,263 1,647,196

CONTRIBUTIONS IN CASH (CASH AND SHORT-TERM IN KIND) CONTRIBUTIONS IN KIND (PROCUREMENT ARRANGEMENTS)
9% 46% 4% 29%

9% 11%

9% 19%

9% 26%

9% 5%

9% 6%

CUMULATIVE POSITION BY MEMBER

1,800
Million €

1,600

1,400

1,200

1,000

800

600

400

200

0
2007 2008 2009 2010 2011 2012 2013 2014
(*) Cumulative credits granted to Japan include a contribution from the European Union corresponding to IUA 37,198 amounting to EUR 60.92 million (including
IUA 14,919 for deliverables achieved in 2014) for procurements for which the procurement responsibility has been transferred to Japan within the framework of
the transferred procurement responsibilities from Euratom to Japan.

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 09

FINANCIAL STATEMENTS 2014
OF THE ITER ORGANIZATION

On the hill behind the ITER construction site, work is underway

on a 10,000 m² storage centre and logistics platform – one of
four storage facilities planned to house components during the
assembly phase.

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FINANCIAL STATEMENTS 2014
OF THE ITER ORGANIZATION

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 11

A. FINANCIAL STATEMENTS 2014
PREPARED ON AN ACCRUAL BASIS

Work begins in September to frame out the Assembly Building.

Six thousand tonnes of steel (220 pillar segments) and 85,000
bolts will be integrated into the building's structure.

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A. FINANCIAL STATEMENTS 2014
PREPARED ON AN ACCRUAL BASIS

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 13

A. FINANCIAL STATEMENTS 2014
PREPARED ON AN ACCRUAL BASIS

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2014

Amounts in thousands of Euro
Notes 31.12.2014 31.12.2013
ASSETS
Current assets 200,438 192,853
Cash and cash equivalents A3 146,558 129,339
Recoverables from non-exchange transactions A4 34,466 32,534
Receivables from exchange transactions A5 17,958 29,946
Prepayments A6 1,457 1,035

Non-current assets 1,668,363 1,308,953

Property, plant and equipment A7 1,661,118 1,304,659
Intangible assets A8 7,243 4,290
Other financial assets 2 4
TOTAL ASSETS 1,868,802 1,501,807

LIABILITIES
Current liabilities 122,063 142,943
Payables A9 119,810 140,666
Employee benefits liabilities A10 2,253 2,277
Non-current liabilities 1,746,738 1,358,864
Deferred revenue A11 1,746,738 1,358,864
TOTAL LIABILITIES 1,868,802 1,501,807

NET ASSETS / EQUITY

Brought forward surplus - -
Statement of Financial Performance - -
TOTAL NET ASSETS / EQUITY - -

STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 DECEMBER 2014

Amounts in thousands of Euro
Notes 2014 2013
Revenue
Deferred contributions from Members A11 3,314 3,770
Construction contracts and partnerships A12 2,702 651
Other revenue A12 91 8
Total Revenue 6,107 4,430

Expenses
Employee benefits A13 76,632 69,873
Other expenses A14 20,307 47,273
Depreciation of property, plant and equipment A7 3,029 3,036
Amortization of intangible assets A8 285 734
Total Expenses 100,253 120,916
Net costs of ITER Organization activities capitalized A7 94,145 116,486

Surplus / (deficit) for the period - -

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 A. FINANCIAL STATEMENTS 2014
PREPARED ON AN ACCRUAL BASIS

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2014

Amounts in thousands of Euro
Notes 2014 2013
Cash flow from operating activities
Surplus / (deficit) for the period - -
Depreciation of property, plant and equipment A7 3,029 3,036
Amortization of intangible assets A8 285 734
Disposals A7 - 15
Changes in:
- other financial assets 3 (0)
- recoverables from non-exchange transactions A4 (1,932) 107
- receivables from exchange transactions A5 11,988 (9,838)
- prepayments A6 (422) 35
- payables A9 (20,856) 76,216
- employee benefits liabilities A10 (24) 105
- deferred revenue A11 199,408 155,910
Net cash flows from operating activities 191,479 226,321

Cash flow from investing activities

Acquisitions of property, plant and equipment A7 (171,021) (180,389)
Acquisitions of intangible assets A8 (3,239) (1,627)
Net cash flows from investing activities (174,260) (182,016)

Cash flow from financing activities

Cash flow from financing activities - -
Net cash flows from financing activities - -

Net (decrease)/increase in cash and cash equivalents 17,219 44,305

Cash and cash equivalents at 1 January 129,339 85,034
Cash and cash equivalents at 31 December A3 146,558 129,339

STATEMENT OF CHANGES IN NET ASSETS/EQUITY FOR THE YEAR ENDED 31 DECEMBER 2014
Amounts in thousands of Euro
2014 2013
Balance at 1 January - -
Surplus/(deficit) - -
Net assets / equity at 31 December - -

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B. BUDGET EXECUTION
STATEMENT 2014

In the din and heat of the hot rolling mill at Industeel-Le Creusot, in
central France, steel ingots are transformed into plates that will be
shipped to industries in Korea, India, Russia and Europe. The plant
has already booked some 10,000 tonnes of steel plates for ITER.

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B. BUDGET EXECUTION
STATEMENT 2014

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B. BUDGET EXECUTION
STATEMENT 2014

BUDGETARY OUTTURN 2014

Amounts in thousands of Euro
2014 2013
Total Income Execution 207,799 157,234
Total Payments Execution 197,099 192,181
Total Budgetary Outturn 10,701 (34,947)

INCOME EXECUTION 2014

Amounts in thousands of Euro
Initial Total Final Total Total Income Total Income Total Results
Income Budget Income Budget in 2014 in 2013 and Carry
2014 2014 Forward to 2015
Budget Headings 1 2 3 4 5=3-2
Article 711 Contribution from Euratom 100,639 89,977 92,124 70,574 2,146
Article 712 Contribution from the People's Republic of China 20,123 17,991 17,991 14,269 -
Article 713 Contribution from the Republic of India 20,123 17,991 18,229 13,677 237
Article 714 Contribution from Japan 20,123 17,991 17,991 13,836 -
Article 715 Contribution from the Republic of Korea 20,123 17,991 18,658 15,339 667
Article 716 Contribution from the Russian Federation 20,123 17,991 17,991 14,917 -
Article 717 Contribution from the United States of America 20,123 17,991 19,224 16,480 1,232
Chapter 71 Contributions 221,380 197,926 202,209 159,093 4,282
Article 721 Internal Tax from Professional Staff 13,115 11,001 11,919 11,145 918
Article 722 Internal Tax from Technical Staff 3,279 2,900 2,967 2,492 67
Chapter 72 Internal tax 16,394 13,901 14,886 13,637 986
Article 731 Financial interest 750 3,235 1,585 3,235 (1,650)
Article 732 Exchange rate Income - - 60 - 60
Chapter 73 Financial Income 750 3,235 1,645 3,235 (1,590)
Article 741 Cancellation of Appropriations from the current year - - - - -
Article 742 Cancellation of Appropriations from previous years - - - - -
Article 743 Monaco Partnership 550 550 550 350 -
Article 744 Excess Income from previous years - - (11,491) (19,089) (11,491)
Article 749 Miscellaneous income - 8 - 8 (8)
Chapter 74 Other Income 550 558 (10,941) (18,731) (11,499)
Title VII Income 239,074 215,620 207,799 157,234 (7,821)
Total Income 239,074 215,620 207,799 157,234 (7,821)

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 B. BUDGET EXECUTION
STATEMENT 2014

PAYMENTS EXECUTION 2014

Amounts in thousands of Euro
Initial Total Final Total Unused Total Total Payment Total Payments Total Payments Unused Total
Payments Payments Payment Appropriations and Credit and Credit Payment
Budget 2014 Budget 2014 Appropriations 2014 Notifications Notifications Appropriations
brought forward 2014 2013 carried forward
from 2013 to 2015
Budget Headings 1 2 3 4=2+3 5 6 7=4-5
Article 111 Direct Investment 63,639 46,493 11,290 57,783 49,119 46,681 8,664
Article 112 Test Blanket Module 974 601 792 1,393 782 554 611
Article 113 IO Reserve 10,620 13,229 5,989 19,218 - - 19,218
Title I Direct Investment (Fund) 75,233 60,323 18,071 78,394 49,901 47,235 28,493
Article 211 Research & Development 13,904 13,079 2,470 15,549 10,125 12,794 5,424
Title II R&D Expenditure 13,904 13,079 2,470 15,549 10,125 12,794 5,424
Article 311 Professional staff salary costs 63,761 61,013 1,437 62,450 57,304 55,173 5,146
Article 312 Technical Support staff salary costs 20,429 18,678 137 18,815 18,367 15,734 448
Article 313 Travel and subsistence 2,949 3,275 397 3,672 2,266 2,481 1,406
Article 314 Secondment allowances - - - - - - -
Article 315 Removal expenses 475 576 73 649 561 721 88
Article 316 Promotions 425 678 7 685 498 453 187
Article 317 Awards 425 111 85 196 187 205 10
Chapter 31 Staff Expenditure 88,464 84,330 2,136 86,467 79,182 74,767 7,284
Article 321 General services 8,543 8,659 818 9,477 7,972 7,291 1,504
Article 322 Administrative services 1,810 6,841 931 7,772 5,963 3,200 1,809
Article 323 Equipment 1,514 5,081 368 5,449 4,232 2,707 1,217
Article 324 External specialized services 46,780 32,985 17,696 50,681 39,723 44,188 10,958
Article 325 IO Reserve 2,828 4,322 22,185 26,507 - - 26,507
Chapter 32 Organizational Expenditure 61,474 57,888 41,999 99,886 57,891 57,385 41,995
Title III Direct Expenditure 149,938 142,218 44,135 186,353 137,073 132,153 49,279
Total Expenditure 239,074 215,620 64,676 280,296 197,099 192,181 83,197
Total Expenditure (without reserve) 225,626 198,069 36,502 234,570 197,099 192,181 37,472

COMMITMENTS EXECUTION 2014

Amounts in thousands of Euro
Initial Total Final Total Unused Total Available Decommitments Total Total Unused
Commitments Commitments Commitment Commitment and Transfers Commitments Commitments Commitment
Budget 2014 Budget 2014 Appropriations Appropriations of previous 2014 2013 Appropriations
brought forward 2014 years' Total carried forward
from 2013 Commitments to 2015
Budget Headings 1 2 3 4=2+3 5 6 7 8=4+5-6
Article 111 Direct Investment 66,326 57,292 12,726 70,018 1,146 57,046 62,319 14,118
Article 112 Test Blanket Module 484 315 1,019 1,334 - 662 1,010 672
Article 113 IO Reserve 10,771 6,327 1,211 7,538 - - - 7,538
Title I Direct Investment (Fund) 77,581 63,934 14,956 78,890 1,146 57,708 63,330 22,328
Article 211 Research & Development 2,686 1,537 5,302 6,840 480 4,976 4,288 2,343
Title II R&D Expenditure 2,686 1,537 5,302 6,840 480 4,976 4,288 2,343
Article 311 Professional staff salary costs 63,761 61,013 1,437 62,450 - 57,304 55,173 5,146
Article 312 Technical Support staff salary costs 20,429 18,678 137 18,815 - 18,367 15,734 448
Article 313 Travel and subsistence 2,960 3,015 188 3,203 747 2,960 3,223 990
Article 314 Secondment allowances - - - - - - - -
Article 315 Removal expenses 475 541 114 654 12 514 654 152
Article 316 Promotions 425 678 7 685 - 498 453 187
Article 317 Awards 425 111 85 196 - 187 205 10
Chapter 31 Staff Expenditure 88,475 84,035 1,968 86,003 758 79,830 75,442 6,932
Article 321 General services 8,083 6,110 739 6,849 3,168 9,824 6,775 194
Article 322 Administrative services 1,329 9,134 598 9,732 426 9,685 3,003 473
Article 323 Equipment 1,311 3,166 334 3,500 82 3,115 22,405 466
Article 324 External specialized services 41,813 32,418 3,578 35,996 5,743 36,328 52,516 5,411
Article 325 IO Reserve 2,996 2,883 2,676 5,559 - - - 5,559
Chapter 32 Organizational Expenditure 55,532 53,711 7,924 61,636 9,419 58,952 84,699 12,103
Title III Direct Expenditure 144,007 137,746 9,893 147,639 10,178 138,782 160,140 19,035
Total Expenditure 224,274 203,218 30,150 233,369 11,804 201,466 227,758 43,707
Total Expenditure (without reserve) 210,506 194,008 26,264 220,272 11,804 201,466 227,758 30,610

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C. NOTES TO THE 2014
FINANCIAL STATEMENTS

A second ITER Itinerary test convoy event is successfully staged in

April to test the global logistics and management of the
transport operations that will bring the largest ITER components
from their Mediterranean docking point to the ITER site, some
104 km distant. The maritime leg of the journey – four hours of
barge transport across inland waterways (pictured) – was also
successfully validated.

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C. NOTES TO THE 2014
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C. NOTES TO THE 2014
FINANCIAL STATEMENTS

NOTES TO THE FINANCIAL STATEMENTS 2014 PREPARED ON AN ACCRUAL BASIS (A) NOTES TO THE FINANCIAL STATEMENTS 2014
A1 Basis of Preparation 22 PREPARED ON AN ACCRUAL BASIS (A)
A2 Significant Accounting Policies 23
A3 Cash and Cash Equivalents 28
NOTE A1 - BASIS OF PREPARATION
A4 Recoverables from Non-Exchange Transactions 29
A5 Receivables from Exchange Transactions 30 The 2014 Financial Statements have been prepared in
A6 Prepayments 30 accordance with the International Public Sector
A7 Property, Plant and Equipment 31 Accounting Standards (IPSAS) and the ITER Project
A8 Intangible Assets 31 Resource Management Regulations (PRMR), the
A9 Payables 33 former being published by the International Public
A10 Employee Benefits Liabilities 33 Sector Accounting Standards Board (IPSASB) of the
A11 Deferred Revenue 34 International Federation of Accountants (IFAC).
A12 Other Revenue 36 The measurement basis applied for cash transactions
A13 Employee Benefits 36 is at historical cost. Fixed assets and contributions arising
A14 Other Expenses 37
from Procurement Arrangements (PAs) are measured
A15 Construction Contracts and Partnerships 39
and accounted at their agreed values (as defined in the
NOTES TO THE BUDGET EXECUTION STATEMENT 2014 (B) ITER Agreement). However, they do not reflect the actual
B1 Budget Execution 40 costs incurred by the Domestic Agencies in relation to
B2 Members’ Contributions 41 their own procurements.
B3 Cash Breakdown 42 The amount of revenue deferred is directly correlated
B4 Suspense Accounts 43 with the amount of costs capitalized. Specifically, the full
B5 Statement of Unpaid Commitments 44 cost capitalization approach, adopted by the IO, implies
B6 Long-Term In Kind / Procurement Arrangements 45 that related Members’ contributions are deferred to the
B7 Cumulative Budgets and Executions 47 same extent and the fixed asset depreciation and write
B8 Earmarked Funds 50 back of the deferred revenue should be equivalent
during the operating life of the asset. During the
RECONCILIATION: CASH FLOW STATEMENT – BUDGET OUTTURN 52
Construction Phase, certain costs like the depreciation
and amortization of the activated non-current assets, are
expensed to the Statement of Financial Performance and
also an equivalent amount of Members’ contributions is

A prototype bottom correction coil in-cryostat feeder has been successfully manufactured
and qualified in China. This is the biggest component in the magnet feeder system (outer
dimensions: 16 m x 8 m x 4 m). Photo: ITER China

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 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

shown as revenue recorded in the Statement of Financial

Performance. Because of the nature of the IO, the impact
of either partial or full cost capitalization is generally
without consequences on the net result of the
organization during the Construction Phase.
Development costs are capitalized as part of the cost
of the experimental equipment to the extent that such
costs can be measured reliably, the product or process is
technically feasible, future service potential is probable,
and the entity has sufficient resources, and intends to
complete the development and to use the asset.
Expenditure on property, plant and equipment
relating to the construction of the experimental
equipment is recognized as an asset on the basis that
future economic benefits or service potential associated
with the item will flow to the IO and that the cost or fair
value of the item has been measured reliably. Such In Japan, workers prepare 40- to 100-kg "billets" of niobium-tin alloy that will be
expenditure is incurred in accordance with the IO’s transformed into millimetre-thin superconducting strands for ITER's toroidal field or
objectives and therefore is considered to meet the central solenoid coils. Photo: ITER Japan
‘service potential’ criteria.
The ‘effects of exchange rate changes on the balance Use of Estimates and Judgements
of cash held in foreign currencies in 2013’ has been The preparation of the Financial Statements in
removed from the bottom of the Cash Flow Statement conformity with IPSAS requires management to make
for the Year ended 31 December 2013 and is now judgements, estimates and assumptions that affect the
shown together with the related items (recoverables in application of accounting policies and the reported
Note A4 and payables in Note A9). amounts of assets, liabilities, revenue and expenses.
The budgetary statements are prepared on a Actual results may differ from these estimates. Estimates
modified cash basis as required by the PRMR and the and underlying assumptions are reviewed on an
reconciliation is provided on page 52. ongoing basis. Revisions of the accounting estimates
are recognized in the period in which the estimates are
NOTE A2 - SIGNIFICANT ACCOUNTING POLICIES revised and in any future periods affected.
Foreign Exchange Accounting
The Financial Statements are presented in thousands Property, Plant and Equipment
of Euro, which is the IO’s functional currency. Items of property, plant and equipment (PPE) are
Transactions in foreign currencies are converted recorded at historical cost, after deduction of
into Euro at exchange rates prevailing on the dates of accumulated depreciation and accumulated impairment
the transactions; the exchange rates used are the ones losses. PPE includes the costs associated with the
applicable for that month, published by the European construction of the experimental machine together with
Commission (http://ec.europa.eu/budget/inforeuro/). associated infrastructure costs comprising buildings,
Realized and unrealized gains and losses resulting fixtures and fittings, IT equipment, furniture and
from the settlement of such transactions and from the re- transport equipment necessary to conduct the project.
conversion at the reporting date of assets and liabilities The cost of a PPE item comprises its purchase price,
denominated in foreign currencies are recognized in the including import duties, any non-refundable purchase
Statement of Financial Performance. The spot rates used taxes and attributable costs of bringing the asset to
at year end are those published by the European Central working condition for its intended use. Examples of
Bank (http://www.ecb.int/stats/exchange/). these costs are those of site preparation, initial delivery
As indicated in the section ‘Revenue Recognition’, and handling costs, installation costs, and professional
the revenue of the IO comes mainly from Members’ fees such as those for architects and engineers.
contributions to finance the phases of the ITER Additionally, administration and other general costs
Project. The cost estimates of the Construction and attributable to the acquisition of the asset or costs of
Operation Phases have been determined using the bringing the asset to its working condition are included
IUA unit of currency. in the cost of the asset. The costs of self-constructed
The applied conversion rate for IUA in 2014 was 1 assets include costs of materials and any other costs
IUA equals EUR 1,683.39 (versus EUR 1,660.15 in 2013). directly attributable to bringing the asset to a working

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C. NOTES TO THE 2014
FINANCIAL STATEMENTS

Nearly 4,000 tonnes of steel rebar are set into place to reinforce the Tokamak Complex basemat.
The central, most technically challenging part of the basemat is poured in nine segments.

24 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

condition for its intended use. Purchased software that such indication exists, the recoverable service amount of
is integral to the functionality of the related equipment the asset is estimated in order to determine the extent
is capitalized as part of that equipment. of any impairment loss. Any impairment loss is charged
PPE related to in-kind contributions from Members against the Statement of Financial Performance in the
are initially recorded at agreed values with Members year concerned.
using the Euro/IUA conversion rate prevailing for the In particular, the impairment reviews relating to the
year of the contribution. PA milestones recorded as Asset experimental assets will take into account technological
under construction have been split into two categories, developments, changes in the major assumptions of the
either as Advance for milestones related to assets IO, and any unforeseen difficulties which may require a
produced without transfer of control/responsibilities and revision of the asset’s depreciation life applied or an
risks from a Domestic Agency (DA) to the IO, or as Capital impairment charge to write down to the recoverable
Work in Progress (CWIP) for milestones related to assets service amount of the asset.
produced with transfer of control/responsibilities and
risks from the DA to the IO. Accrued values at year end Intangible Assets
are also recorded as PPE under construction at reception Expenditure on intangible assets relating to the
of the milestone. experimental equipment is recognized as an asset if it
Upon completion of the experimental equipment is probable that future economic benefits or service
Construction Phase, and once operations have potential associated with the item will flow to the IO
commenced, the costs of decommissioning and and if the cost or fair value of the item can be measured
removing the reactor and restoring the site on which reliably. Such expenditure is incurred in accordance
it is located will be incorporated into the cost of the with the objectives of the IO and is considered to meet
experimental equipment. Such costs of dismantling ‘service potential’ criteria.
will be based on the estimated cost at current value. Intangible assets relating to in-kind contributions
Concerning the experimental equipment under from Members are initially recorded at values agreed
construction, and given its technical nature and the with the Members using the Euro/IUA conversion rate
intrinsic difficulty in identifying separate useful lives to prevailing for the year of the contribution.
such costs, related expenditure is capitalized as a single Other intangible assets acquired by the IO which have
component and depreciated over a uniform period. finite useful lives, are measured at cost less accumulated
Depreciation is recognized in the Statement of amortization and accumulated impairment losses.
Financial Performance on a straight-line basis over the Intangible assets expenditure is capitalized only
estimated useful life of each part of an item of PPE.
Depreciation of the experimental equipment will be
recorded at the start of the Operation Phase.
The estimated useful lives of PPE in line with general
conventions are as follows:
• Buildings 30 years
• Plant and equipment experimental assets 20 years
• Fixtures and fittings 10 - 20 years
• Furniture 8 years
• Transport equipment 4 years
• IT, telecom equipment 2 - 5 years
Depreciation methods, useful lives and residual
values are reviewed on each reporting date.
In accordance with the IO’s rules, acquisitions of PPE
which are individually below 3 IUA are expensed directly
to the Statement of Financial Performance. When such
expenses are incurred and the aggregate of these costs
exceeds 3 IUA, the costs may be capitalized even though
some of the individual items/materials are less than 3 IUA.

Impairment
The carrying values of PPE and intangible assets are Surrounding the central reaction chamber of the ITER Tokamak are all of the systems that
will work together to create a 150-million-degree plasma: magnet, heating and current
reviewed for impairment if events or changes in drive, diagnostic, cryogenic, cooling, fuelling, vacuum and power supply systems.
circumstances indicate that they may be impaired. If

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C. NOTES TO THE 2014
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Employee Benefits
The IO has set up a defined contribution pension plan, a
medical insurance scheme and a life and invalidity
insurance scheme:
• Defined contribution pension plan
The IO has a defined contribution pension plan for
its employees, which is a post-employment benefit
plan under which it pays fixed contributions into a
separate entity and will have no legal or constructive
obligation to pay further amounts. Obligations for
contributions to such defined pension contribution
plans are recognized as employee benefit expenses
when they are due.
• Short-term benefits
The IO has contracted out a medical insurance scheme
and a life and invalidity insurance scheme. Monthly
contributions to these schemes are deducted from the
employees’ remuneration and supplemented by a
contribution from the IO. These employer
contributions are expensed in the period when the
employees have rendered the related services.
Termination benefits are payable to employees under
certain circumstances prescribed in the Staff Regulations
Six stories high, made of 800 tonnes of steel, two identical Sector Sub-Assembly tools of the ITER Organization (hereinafter Staff Regulations).
will work in concert to equip the nine sectors of the vacuum vessel before their transfer The amount of the termination benefits payable depends
to the Tokamak Pit. on the length of service of the employee in question.
Termination benefits are recognized as an expense upon
when it increases the future economic benefits or service termination of the employment contract for one of the
potential embodied in the specific asset to which it reasons stipulated in the Staff Regulations.
relates. All other expenditure, including expenditure on
internally generated goodwill and licenses, is recognized Revenue Recognition
in the Statement of Financial Performance as incurred. IO revenue comprises contributions from the Members,
Amortization is recognized in the Statement of miscellaneous income, internal tax, financial income,
Financial Performance on a straight-line basis over the revenue from construction contracts, exchange rate
estimated useful life of intangible assets from the date gains, donations and the contribution resulting from the
that they are available for use. The estimated useful life Partnership Arrangement with the Principality of Monaco.
is as follows:
• Software 2 - 5 years • Contributions from the Members
Amortization methods, useful lives and residual Contributions from the Members are determined
values are reviewed on each reporting date. annually, based on estimates of the required level of
Acquisitions of intangible assets which are individually operating and capital payments for that year. These
under 3 IUA are expensed directly to the Statement of contributions are recorded as revenue in the year for
Financial Performance. which they are requested. Any contribution which
has not been fully paid up by Members at year-end
Inventories is shown within recoverables from non-exchange
Inventories (spares) are measured at the lower of cost transactions (Note A4). Contributions received from
and net realizable value except where received in kind Members which at year-end exceed amounts
from our Members. In such case inventories are requested are shown within payables (Note A9).
measured at their agreed value. The cost of inventories Members’ Contributions are made in the form of
is based on the first-in first-out principle, and includes either cash or in-kind contribution. In-kind contributions
expenditure incurred in acquiring the inventories, comprise the providing of assets, other goods and
conversion costs and other costs incurred in bringing services, and seconded staff. Revenue recorded relating
them to their existing location and condition. No to in-kind contributions is measured at the agreed value
inventories were recorded at 31 December 2014. (ITER Agreement) of the asset or service contributed.

26 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

Revenue used to acquire tangible or intangible date of First Plasma throughout the Operation Phase
assets is deferred and written back to revenue in the by regular annual payments. Upon achievement of the
Statement of Financial Performance over the period date of First Plasma, the Decommissioning Fund will
of utilization of the related asset. be established accordingly.
The construction of some assets may take place No such provision had been recorded at 31
in the country of a Member over several years. Upon December 2014 as the experimental equipment is still
attainment of certain milestones, Members’ at the Construction Phase.
contributions relating to PPE are recorded within the
assets under construction. • Employee Benefits
Provisions related to employee benefits are recorded
• Internal Tax in Note A10.
An Internal Tax is applied to the basic salary of IO
employees and collected monthly by the IO. This • Contingent Liabilities
revenue is deferred and will be used for salaries, related There are cases pending before the Tribunals but it
benefits and infrastructure. should not represent a liability at this time. In the
opinion of the IO Legal Affairs, the final outcome of
• Financial Income these claims is not determinable and, accordingly,
Financial Income is an income generated by the cash these items are not recorded in the accounts.
held on secured fixed-term deposits in the banks. Settlements, if any, resulting from the resolution of
This revenue is deferred and will be used whenever these claims will be accounted for in the year in which
required and agreed by the ITER Council. the liability is determined.

Construction Contracts Segment Reporting

As the outcome of the IO’s construction contracts The IO considers that currently all its activities are linked
cannot be estimated reliably, the revenue and costs to a single ‘Construction’ segment.
from fixed price construction contracts are recognized
based on the following method: Financial Instruments
(a) Revenue shall be recognized only to the extent of The IO has very little exposure to financial risks as most
contract costs incurred; and of its financial assets are kept in Euro. Cash balances on
(b) Contract costs shall be recognized as an expense in deposits are held in secure interest-bearing bank
the period in which they are incurred. accounts or short fixed-term deposits. The Japanese Yen
and US Dollar bank accounts are valued in Euro using
Related Parties official year-end exchange rates prevailing on the
The IO is governed by its seven Members and works reporting date. Term deposits are all held to maturity
closely with their representative DAs. All transactions (maximum two weeks).
made between the IO and the DAs are by essence all
intended to build ITER’s facilities. No material-related Events After the Reporting Date
party transaction was identified in 2014. No favourable or unfavourable event occurred after the
reporting date.
Provisions
A provision is recognized if, as a result of a past event,
the IO has a present legal or constructive obligation that
can be estimated reliably, and provided it is probable
that an outflow of economic benefits or service potential
will be required to settle the obligation. Provisions are
determined by discounting the expected future cash
flows at a rate that reflects current market assessments
of the time value of money and the risks specific to the
liability.

• Asset Decommissioning / Site Restoration

In light of the PRMR provisions, Members shall Work is underway in Korea on full-scale prototypes of the vacuum vessel thermal shield.
contribute jointly, through the Budget of the IO, to the Photo: ITER Korea
accumulation of the Decommissioning Fund from the

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C. NOTES TO THE 2014
FINANCIAL STATEMENTS

NOTE A3 - CASH AND CASH EQUIVALENTS

Amounts in thousands of Euro
31.12.2014 31.12.2013
Cash at bank - Euro accounts 32,453 21,073
HSBC France 32,433 21,053
BNP Paribas France 20 20

Cash at bank - JP Yen account 198 236

HSBC France 198 236

Cash at bank - US Dollar accounts 167 166

HSBC France 25 23
HSBC USA 155 174
HSBC USA, Cheques issued and not yet disbursed (14) (30)

Fixed term deposits with banks - Euro accounts 113,740 107,864

BNP Paribas France 51,154 89,283
Crédit Mutuel France 62,586 18,582
Total Cash and Cash Equivalents 146,558 129,339

The IO’s cash and cash equivalent balances arise from Members’ contributions, financial income and other
income including the annual contribution from the Partnership Arrangement with the Principality of Monaco
and revenue from the other arrangements.
The high level of cash at year end takes into account the EUR 75.35 million received in advance from the
Members (detailed in Note A9).
Cash balances on deposits are held in secure interest-bearing bank accounts or fixed-term deposits. The
Japanese Yen and US Dollar bank accounts are valued in Euro using official year-end exchange rates prevailing
on 31 December 2014.
In 2014 Financial Income of EUR 1.58 million was realized by the IO. This amount represents an average rate of
return of 1.18% of the average daily available cash balance (invested). In comparison, the average 2014 Eonia®
(Euro OverNight Index Average) index was 0.10%.
As the IO is financed by public funds, the investments are limited to low-risk opportunities (only secured
deposits/investments are allowed).

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 C. NOTES TO THE 2014
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NOTE A4 – RECOVERABLES FROM NON-EXCHANGE TRANSACTIONS

Amounts in thousands of Euro
31.12.2014 31.12.2013
Members' cash contributions yet to be received 12,517 -
Euratom - -
People’s Republic of China - -
Republic of India 12,517 -
Japan - -
Republic of Korea - -
Russian Federation - -
United States of America - -

Accrued Members' in-kind contributions 8,219 21,027

Euratom 3,762 10,793
People’s Republic of China 202 -
Republic of India 1,136 210
Japan 2,567 -
Republic of Korea - 6,475
Russian Federation - 818
United States of America 551 2,730

Other recoverables from non-exchange transactions 13,730 11,507

EU Domestic Agency 387 675
CN Domestic Agency - -
IN Domestic Agency 137 4
JA Domestic Agency - -
KO Domestic Agency - -
RF Domestic Agency - 4
US Domestic Agency 653 755
Personnel - Advances - 19
VAT receivable 12,529 9,957
Other 24 92
Total Recoverables from Non-Exchange Transactions 34,466 32,534

‘Accrued Members’ in-kind contributions’ corresponds to short-term (EUR 4.31 million) and/or long-term (EUR 3.91
million) in-kind deliverables received by the IO but not formally credited at the reporting date. The counterpart is
accrued in payables and shown in Note A9.
Other recoverables have been recorded mainly for suspense accounts payments for EU-DA (EUR 387 thousand),
IN-DA (EUR 137 thousand) and US-DA (EUR 653 thousand).
The IO is exempted from taxes (corporate income, business licence and Value-Added Tax (VAT)). VAT invoiced by
French suppliers for purchasing goods and services is recovered by requesting the reimbursement from the
French Ministry of Foreign Affairs (the amount already requested at reporting date was EUR 6.14 million, the
amount to be requested was EUR 5.49 million and the VAT on accruals was EUR 0.91 million).

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C. NOTES TO THE 2014
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NOTE A5 - RECEIVABLES FROM EXCHANGE TRANSACTIONS

Amounts in thousands of Euro
31.12.2014 31.12.2013
Down payment to suppliers 17,958 19,046
Accrued interest 0 2
Construction contracts - 10,897
Total Receivables from Exchange Transactions 17,958 29,946

‘Down payment to suppliers’ is showing the open amount paid to suppliers to mainly finance their long-lead
procurement items (Cryostat, Vacuum Vessel, etc.). Where material, these amounts are covered by bank guarantees.
‘Accrued interest’ is financial income generated during the reporting period but not yet cashed (cash on deposits
is held in secure interest-bearing bank accounts or fixed-term deposits).

NOTE A6 - PREPAYMENTS
Amounts in thousands of Euro
31.12.2014 31.12.2013
Maintenance licences 745 80
Licence fees 408 412
Subscriptions 154 191
Maintenance and repair 94 307
Insurance 24 23
Communication 9 5
Training provider 6 1
Other 18 15
Total Prepayments 1,457 1,035

Prepayments correspond to expenditures incurred in 2014 for which the acquired services relate to 2015 or beyond.

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NOTE A7 - PROPERTY, PLANT AND EQUIPMENT

Amounts in thousands of Euro
Land and Fixtures Vehicles, ‘Machine’ under construction
buildings and fittings IT telecom,
office Activities
equipment, costs Direct Capital work
furniture capitalized investment Advances in progress Total
Cost
Balance 31.12.2012 32,493 485 7,393 624,311 58,491 154,272 101,513 978,960
Additions 48 73 272 116,486 63,510 73,854 80,641 334,884
Disposals - (6) (37) - - - - (43)
Transfers 21,333 - - - - - (21,333) -
Balance 31.12.2013 53,874 552 7,628 740,798 122,001 228,127 160,821 1,313,801

Additions 63 25 533 94,145 76,255 111,644 76,822 359,488

Disposals - - - - - - - -
Transfers 8,431 - - - (8,010) - (421) -
Balance 31.12.2014 62,368 577 8,161 834,943 190,246 339,771 237,223 1,673,289

Accumulated Depreciation
Balance 31.12.2012 (2,175) (127) (3,831) (6,133)
Depreciation of the year (1,677) (39) (1,320) (3,036)
Write back (disposals) - 2 27 28
Balance 31.12.2013 (3,852) (165) (5,125) (9,142)

Depreciation of the year (1,890) (46) (1,094) (3,029)

Write back (disposals) - - - -
Balance 31.12.2014 (5,742) (210) (6,218) (12,170)

Net Carrying Amount

Balance 31.12.2013 50,022 387 2,503 740,798 122,001 228,127 160,821 1,304,659
Net variation 6,604 (21) (561) 94,145 68,245 111,644 76,401 356,459
Balance 31.12.2014 56,626 367 1,943 834,943 190,246 339,771 237,223 1,661,118

The PPE transferred during the reporting period from ‘Direct investment’ and ‘Capital work in progress’ to buildings is the
Headquarters extension.
The former column ‘Direct investment in kind’ has been split into ‘Capital work in progress’ and ‘Advances’ in order to better
reflect the evolution and deliveries of the Procurement Arrangements and Task Agreements.
NOTE A8 - INTANGIBLE ASSETS
Amounts in thousands of Euro
Intangible assets under
Computer software development (computer software) Total
Cost
Balance 31.12.2012 4,155 2,464 6,619
Additions 341 1,287 1,627
Disposals - - -
Transfers - - -
Balance 31.12.2013 4,495 3,751 8,246

Additions 279 2,960 3,239

Disposals - - -
Transfers - - -
Balance 31.12.2014 4,774 6,710 11,485

Accumulated amortization
Balance 31.12.2012 (3,222) (3,222)
Amortization of the year (734) (734)
Write back (disposals) - -
Balance 31.12.2013 (3,956) (3,956)

Amortization of the year (285) (285)

Write back (disposals) - -
Balance 31.12.2014 (4,241) (4,241)

Net carrying amount

Balance 31.12.2013 539 3,751 4,290
Net variation (6) 2,960 2,954
Balance 31.12.2014 533 6,710 7,243

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In December, prototype fast discharge resistor modules are successfully tested in Russia.
These modules are designed to rapidly discharge the energy stored in the magnet system
in the case of a sudden loss of superconductivity. Photo: ITER Russia

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NOTE A9 - PAYABLES
Amounts in thousands of Euro
31.12.2014 31.12.2013
Advance Payments on Members’ Contributions 75,349 74,944
Euratom 42,733 18,059
People's Republic of China 9,185 9,330
Republic of India - 3,128
Japan 2,132 3,746
Republic of Korea 2,069 18,283
Russian Federation 17,464 17,986
United States of America 1,767 4,411

Other Payables 44,462 65,722

Creditors (suppliers and accrued charges) 15,825 22,415
Task Agreements (accruals) 4,313 14,232
Procurement Arrangements (accruals) 3,905 6,795
Construction contracts and partnerships 20,078 21,836
Personnel - travel costs 247 346
Other 94 97
Total Payables 119,810 140,666

‘Advance Payments on Members’ Contributions’ corresponds to cash received by the IO exceeding the requested
amount due at reporting date.
‘Creditors (suppliers and accrued charges)’ is the cost recognized in the 2014 Financial Statements but not yet
paid as at 31 December 2014.
‘Task Agreements (accruals)’ and ‘Procurement Arrangements (accruals)’ represent the values recognized in the
2014 Financial Statements but not yet formally credited as at 31 December 2014. The counterpart is shown
under in Note A4.
‘Construction contracts and partnerships’ relates to the amounts deferred at the reporting date. Related costs
and revenue are not considered part of the construction costs of the experimental equipment but should be
reported as performed by the IO. Open balances on the reporting date were EUR 179 thousand for the Monaco
Partnership Arrangement, EUR 19.90 million for the US-DA Arrangements.
‘Personnel - travel costs’ is the year-end unpaid costs related to travel undertaken by staff during the reporting year.
‘Other’ relates to administrative management agreements. In 2013, they were reported under ‘Partnerships and
Agreements’ and ‘Unrealized losses / foreign currency exchange rate’.

NOTE A10 - EMPLOYEE BENEFITS LIABILITIES

Amounts in thousands of Euro
31.12.2014 31.12.2013
Accrued untaken leave 1,386 1,382
Social benefits 867 894
Total Employee Benefits Liabilities 2,253 2,277

‘Accrued untaken leave’ represents vacation entitlement accrued by staff during the reporting year. Untaken
annual leave is carried forward to the following year with a maximum of 14 days per staff.
‘Social benefits’ is the amount outstanding for social security and pension schemes.

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NOTE A11 - DEFERRED REVENUE AT 31 DECEMBER 2014

Amounts in thousands of Euro
Cash Short-term in kind
Seconded staff and Task Agreements
End of 2013 2014 End of 2014 End of 2013 2014 End of 2014
Deferred contributions
Euratom (*) 373,165 79,337 452,502 67,394 5,755 73,149
People’s Republic of China 84,006 17,991 101,998 3,415 - 3,415
Republic of India 81,988 18,216 100,204 4,455 (32) 4,422
Japan (*) 86,382 17,991 104,373 874 - 874
Republic of Korea 80,189 17,195 97,384 8,556 800 9,356
Russian Federation 83,362 17,991 101,353 3,201 - 3,201
United States of America 63,012 17,530 80,542 23,646 (485) 23,161
Deferred contributions 852,103 186,253 1,038,356 111,540 6,037 117,577

Other deferred revenue

Internal tax 69,828 14,886 84,714
Donations 22,400 - 22,400
Financial income 7,285 1,583 8,868
Other deferred revenue 99,513 16,469 115,982

Write back to revenue

Total deferred revenue 951,616 202,722 1,154,338 111,540 6,037 117,577

(*) Cumulative credits granted to Japan include a contribution from the European Union corresponding to IUA
37,198 amounting to EUR 60,92 million (including IUA 14,949 for deliverables achieved in 2014) for procurements
for which the procurement responsibility has been transferred to Japan within the framework of the transferred
procurement responsibilities from Euratom to Japan.

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 C. NOTES TO THE 2014
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Total cash Long-term in kind Total

including cash, seconded staff and Task Agreements Procurement Arrangements
End of 2013 2014 End of 2014 End of 2013 2014 End of 2014 End of 2013 2014 End of 2014

440,559 85,092 525,651 110,779 32,565 143,344 551,338 117,657 668,995

87,421 17,991 105,413 6,103 24,214 30,317 93,524 42,206 135,730
86,442 18,184 104,626 19,015 6,860 25,875 105,457 25,044 130,501
87,255 17,991 105,247 93,750 34,617 128,367 181,005 52,609 233,614
88,745 17,994 106,739 49,583 41,936 91,519 138,328 59,930 198,258
86,563 17,991 104,554 16,248 36,548 52,796 102,811 54,539 157,350
86,658 17,045 103,703 13,356 5,690 19,045 100,013 22,735 122,748
963,643 192,290 1,155,933 308,834 182,429 491,263 1,272,477 374,719 1,647,196

69,828 14,886 84,714 69,828 14,886 84,714

22,400 - 22,400 22,400 - 22,400
7,285 1,583 8,868 7,285 1,583 8,868
99,513 16,469 115,982 99,513 16,469 115,982

(13,126) (3,314) (16,440)

1,063,156 208,759 1,271,915 308,834 182,429 491,263 1,358,864 387,875 1,746,738

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NOTE A12 - OTHER REVENUE

Amounts in thousands of Euro
2014 2013
Exchange rate gains 91 -
Fixed asset sales proceeds - 8
Construction contracts and partnerships 2,702 651
Total Other Revenue 2,793 659

‘Exchange rate gains’ is generated by realized exchange rate transactions and shown in this Note whereas the
losses are in Note A14.
‘Construction contracts and partnerships’ is the revenue dedicated to specific projects, construction contracts
(TCWS and SSEN) and the Monaco Partnership Arrangement (MCP). Details can be found in Note A15.

NOTE A13 - EMPLOYEE BENEFITS

Amounts in thousands of Euro

The personnel costs are detailed in the table below:

Professional staff Technical support staff Total
2014 2013 2014 2013 2014 2013
Wages and salaries 43,380 40,296 14,000 11,842 57,379 52,138
Pension funds 6,075 5,643 1,979 1,660 8,054 7,303
Medical care insurance 1,085 1,008 353 296 1,438 1,304
Life and invalidity insurances 434 403 141 119 575 522
Other employee benefits 5,961 5,851 2,350 2,031 8,311 7,882
Accrued untaken leave (3) 35 7 (20) 4 14
Awards 128 128 65 78 193 205
Indemnities for loss of job 25 73 - - 25 73
On call duty indemnity 48 - 48 -
Seconded staff 1,824 2,093 45 1,868 2,093
Bonus for temporary assignment 0 18 0 18
Trainees 86 28
Occupational medicine / infirmary 218 123
Social activities 74 43
Other (canteen) 227 220
Total 58,908 55,546 18,987 16,005 78,500 71,965
Total excluding seconded staff 57,084 53,453 18,943 16,005 76,632 69,873

An internal tax is applied to basic salary costs including overtime and night work. This tax is collected by the IO by
withholding it from the monthly salary payments. No liability is recorded for the amounts withheld as the internal tax
is not paid to external organizations or authorities. Amounts withheld are/will be used for salaries, related benefits
and infrastructure of the IO. ‘Employee benefits’ presents the gross costs including the corresponding internal tax.
The seconded staff costs are directly capitalized and values credited to their respective Members (short-term in kind).
The IO has set up a defined pension contribution scheme with an external company. Contributions equal to 7% of
gross basic salary are deducted from employee remuneration and are supplemented by a contribution from the
IO of 14% of gross basic salary.
Medical and life insurance schemes have also been set up with an external provider. Medical insurance employee
contributions amount to 1.25% of gross basic salary supplemented by an IO contribution of 2.5% of gross basic
salary. Life and invalidity insurance employee contributions amount to 0.5% of gross basic salary supplemented
by an IO contribution of 1% of gross basic salary.
The aggregate gross remuneration of the Director-General and the three Directors of Department was EUR 1.14
million (EUR 1.13 million in 2013).

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 C. NOTES TO THE 2014
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On 31 December 2014 the IO had a total of 587 staff members in the following categories:
Professional staff Technical support staff Total
31.12.2014 31.12.2013 31.12.2014 31.12.2013 31.12.2014 31.12.2013
ITER Organization staff 337 313 238 188 575 501
Seconded staff 11 14 1 12 14
Sub-total within cap(*) 348 327 239 188 587 515
Others (postdoctoral and IO staff recruited 13 5 9 - 22 5
for work on TCWS Arrangements)
Total 361 332 248 188 609 520

(*) The cap for the number of staff is 565 plus a temporary increase of 54 posts (36 posts for three years and 18
posts for five years).

NOTE A14 – OTHER EXPENSES

Amounts in thousands of Euro
2014 2013
Electricity 663 604
Furniture and equipment 467 279
Telecom and IT equipment 278 153
Small fitting-out premises 149 100
Office supplies 137 101
Water 107 126
Software 90 115
Other 15 22
Total supplies and consumables 1,906 1,502

External services 9,039 34,985

Maintenance and repairs 2,586 2,199
Travel and related costs (staff) 2,566 3,003
Licence yearly fees 872 737
Documentation and seminar expenses (conferences) 713 821
Temporary staff / other personnel 649 1,032
Removal expenses 578 825
Travel and related costs (external) 377 646
Post and telecommunication 352 301
Rental of equipment and buildings 171 243
Communication costs 166 217
Receptions and representation costs 155 249
Insurance 95 153
Exchange rate losses 31 55
Transport of goods 22 36
Bank charges 2 3
Other 25 266
Total external services and other expenses 18,401 45,772
Total Other Expenses 20,307 47,273

The decrease in the External services is mainly due to the recruitment of new staff but also to an improved deliverable
based contract policy.

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The Tokamak Cooling Water System includes major components such as pressurizers, heat
exchangers, pumps, tanks and drying equipment, plus 33 kilometres of piping.

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NOTE A15 – CONSTRUCTION CONTRACTS AND PARTNERSHIPS

Amounts in thousands of Euro

Construction Contracts Partnership

TCWS SSEN MCP
Total amounts of revenue agreed in the arrangements 95 598 393 5 500

At 01.01.2013
Revenue recognized to date 2,006
Costs incurred to date (2,006)
Advances requested to date 2,350
Advances received to date (2,350)
Gross amount due to date -

At 31.12.2013
Employee benefits recognized in the period - (403)
Other expenses recognized in the period - (249)
Costs incurred in the period - (651)
Revenue recognized in the period - 651
Costs incurred to date - (2,658)
Revenue recognized to date - 2,658
Surplus (or deficit) recognized to date - -
Advances requested in the period 21,794 350
Advances received in the period (10,897) (350)
Gross amount due 10,897 -
Unused at 31.12.2013 21,794 42

At 31.12.2014
Employee benefits recognized in the period (1,669) - (415)
Other expenses recognized in the period (619) - 1
Costs incurred in the period (2,288) - (414)
Revenue recognized in the period 2,288 - 414
Costs incurred to date (2,288) - (3,071)
Revenue recognized to date 2,288 - 3,071
Surplus (or deficit) recognized to date - -
Advances requested in the period - 393 550
Advances received in the period (10,897) (393) (550)
Gross amount due - - -
Unused at 31.12.2014 19,506 393 179

Advances requested to date 21,794 393 3,250

Advances received to date (21,794) (393) (3,250)
Not requested to date 73,804 - 2,250

‘TCWS’ relates to the two arrangements signed with the US-DA for the completion of the final design of the
Tokamak Cooling Water System and the procurement of the piping for this system, ‘SSEN’ relates to arrangement
with the US-DA for the procurement of the Steady-State Electrical Network High Voltage Substation Structures
and ‘MCP’ relates to the Partnership Arrangement with the Principality of Monaco.
Revenues have been recognized only to the extent of contract costs incurred in the period. There are no recognized
surpluses or losses estimated to date. All costs and revenues are directly allocated to their related Arrangement.

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NOTES TO THE BUDGET EXECUTION STATEMENT available Payment Appropriations for 2014 were EUR
2014 (B) 280.30 million. This included EUR 45.73 million in the IO
Reserve that was set aside to address project risks that
NOTE B1 - BUDGET EXECUTION may materialize during construction.
The Project Resource Management Regulations of the The 2014 Payments Execution shows a total payments
ITER Organization (PRMR) and its Implementing execution of EUR 197.10 million which includes Cash
Measures require the preparation of certain schedules Payments of EUR 181.14 million and Short-Term In-Kind
and notes for inclusion in the Financial Statements. Payments, via credit notifications, of EUR 15.96 million.
The primary budgetary schedules following the Excluding the IO Reserve, which is not part of the
requirements from the PRMR are shown from pages 17 planned budgets, the underrun in Payments for 2014
to 19, reflecting the Budget Outturn, Income, was EUR 37.47 million or 15.97% of the related
Payments and Commitments Executions against their Payments Appropriations. This was due to delays in
respective budgets. Supplementary information the preparation and execution of contracts for the
required under the PRMR is provided in Notes B1 to B8. Tritium Plant, Machine Assembly, and the In-Vessel
The establishment of these schedules is governed by Coils. Progress in some Task Agreements signed with
the basic principles of equilibrium, specification, the DAs was slower than expected, resulting in delays
annuality, budget accuracy, Unit of Account, universality, in issuing the corresponding credit notifications.
sound financial management and transparency. Furthermore, underruns occurred in staffing-related
At its thirteenth meeting in November 2013, the budgets due to staff turnover, unfilled staff positions,
ITER Council adopted Commitments, Income and delays in recruitment of the CAD Core Team, and
Payments Budgets for 2014, at the level of EUR 224.27 lower-than-expected travel expenditures.
million for Commitments and EUR 239.07 million for
Payments and Income. The Commitments, Payments Commitments
and Income Budgets and the financial schedules are Considering a final Commitments Budget in 2014 of
subdivided into Titles, Chapters and Articles. EUR 203.22 million and Unused Commitment
Throughout 2014, the Director-General approved Appropriations brought forward from 2013 of EUR 30.15
several budgetary transfers within the limits of his mandate. million, the available Commitment Appropriations for
All schedules for Income, Payments and Commitments 2014 were EUR 233.37 million. This included EUR 13.10
are shown in tables formatted as approved by the ITER million of remaining funds in the IO Reserve that was
Council. They show the cumulative figures of the Cash earmarked for addressing project risks that may occur
and Short-Term In-Kind (covering Task Agreements and during construction.
Seconded Staff) transactions per Budget Article. In 2014, there were decommitments against
previous years' commitments, constituting a reduction
Income of the value of contracts signed between 2007 and
The Cash Contributions from the Members and assigned 2013 due to contracts being either settled at a lower
revenue from Arrangements are considered as Income in value than agreed or cancelled. The total amount of
the year for which they are called regardless of their date these decommitments equals EUR 11.80 million.
of receipt by the IO, as has been done in previous years. In provision of Article 78b B. – Title IX of the
Other sources of income are registered in the year in Implementing Measures of the PRMR it is confirmed
which they are realized or received. that no other liabilities existed to pay the open
There has been a shortfall in the total Income 2014 commitments as at the end of the financial years 2010
coming from the carry forward of the Excess Income to 2013.
from previous years of EUR 11.49 million, effectively When combined with decommitments, the total
reducing the total Income Budget Execution for the year commitments execution for 2014 equals EUR 189.66
leaving a negative result of EUR 7.82 million to carry million.
forward to 2015. This negative balance corresponds to a Excluding the IO Reserve, which is not part of the
negative result of EUR 6.10 million for the Short-Term In- planned budgets, an uncommitted balance of EUR
Kind Income together with a negative result of EUR 1.72 30.61 million or 13.90% of the related Commitment
million for the Cash Income. Appropriation was due to delays in the preparation of
contracts in Magnets, Vacuum Vessel, Cryogenics, and
Payments Machine Assembly. In addition, underruns on staff-
Considering a final Payments Budget in 2014 of EUR related costs resulted from staff turnover, unfilled staff
215.62 million and Unused Payment Appropriations positions, delays in the recruitment of the CAD Core
brought forward from 2013 of EUR 64.68 million, the Team, and lower-than-expected travel expenditures.

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 C. NOTES TO THE 2014
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NOTE B2 - MEMBERS’ CONTRIBUTIONS

Cash Contributions
Amounts in thousands of Euro
Brought forward from 2013 Requested for 2014 Received in 2014 Carry forward to 2015
Members 1 2 3 4=1-2+3
Euratom 18,059 79,337 104,011 42,733
People's Republic of China 9,330 17,991 17,846 9,185
Republic of India 3,128 18,216 2,572 (12,517)
Japan 3,746 17,991 16,377 2,132
Republic of Korea 18,283 17,195 980 2,069
Russian Federation 17,986 17,991 17,469 17,464
United States of America 4,411 17,530 14,885 1,767
Total 74,944 186,253 174,141 62,832

Per the established practice, the Members’ Cash Contributions have been accounted in full as Income of the year, in
accordance with the budget, regardless of the cash received. Consequently, over and underpayments have been
carried forward as cash liabilities to/from these Members.

Short-Term In-Kind Contributions

Amounts in thousands of Euro
Brought forward from 2013 Requested for 2014 Received in 2014 Carry forward to 2015
Members 1 2 3 4=1-2+3
Euratom (6,612) 10,640 12,786 (4,465)
People's Republic of China 166 - - 166
Republic of India (857) (225) 12 (620)
Japan - - - -
Republic of Korea 826 797 1,464 1,493
Russian Federation (692) - - (692)
United States of America (3,327) 461 1,694 (2,095)
Total (10,497) 11,673 15,956 (6,215)

The Members’ Short-Term In-Kind Contributions are recognized when credited. Over and underpayments have
been carried forward as Short-Term In-Kind liabilities to/from these Members.

Total Contributions
Amounts in thousands of Euro
Brought forward from 2013 Requested for 2014 Received in 2014 Carry forward to 2015
Members 1 2 3 4=1-2+3
Euratom 11,447 89,977 116,797 38,267
People's Republic of China 9,496 17,991 17,846 9,351
Republic of India 2,270 17,991 2,584 (13,137)
Japan 3,746 17,991 16,377 2,132
Republic of Korea 19,109 17,991 2,444 3,561
Russian Federation 17,294 17,991 17,469 16,772
United States of America 1,084 17,991 16,579 (328)
Total 64,447 197,926 190,096 56,617

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NOTE B3 - CASH BREAKDOWN

Amounts in thousands of Euro

Cash balance at 31 December 2013 129,369

Cheques issued in 2013 and not yet disbursed at 31 December 2013 (30)
Cash and cash equivalent at 31 December 2013 129,339

2014 Contributions from the Members 99,880

Advances on 2015 contributions 74,260
Earmarked Funds contributions 22,187
Monaco Partnership 550
Internal tax 14,886
Interest from bank 1,585
Miscellaneous Income -
Exchange rate income 60
Total cash Income 213,409

Payments against budget 181,143

Payments against Earmarked Funds 2,175
Movements in Suspense Accounts 12,889
Total disbursement 196,207

Cash balance at 1 January 2014 129,369

Total cash Income 213,409
Total disbursement 196,207
Balance in cash 146,572

Cash balance at 31 December 2014 146,572

Cheques issued in 2014 and not yet disbursed at 31 December 2014 (14)
Cash and cash equivalents at 31 December 2014 146,558

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NOTE B4 – SUSPENSE ACCOUNTS

Amounts in thousands of Euro
Situation at Movements Situation at
Third Party 1 January 2014 in 2014 31 December 2014
EU Domestic Agency (705) 242 (463)
IN Domestic Agency (4) (132) (136)
RF Domestic Agency (4) 4 -
US Domestic Agency 10,172 (10,749) (578)
Total Domestic Agencies 9,458 (10,635) (1,176)
Administrative fees 79 31 110
VAT to be reimbursed (9,048) (2,576) (11,624)
ITER Organization Staff (19) 19 -
Sickness Insurances and Pension Funds 894 (25) 869
Others (29) 297 269
Total Other (8,121) (2,254) (10,376)
Total 1,337 (12,889) (11,552)

The EU-DA suspense account shows a final balance of EUR 463 thousand from which the main part corresponds to
the amounts paid by the IO and not yet recovered at the end of 2014 further to the ‘Agreement on site cooperation’
and the ‘Agreement to make available offices for Fusion for Energy staff and its contractors’.
The IN-DA suspense account shows a final balance of EUR 136 thousand corresponding to the amounts paid by the
IO and not yet recovered at the end of 2014 further to the ‘Agreement on the Health, Safety and Environmental
Coordination of the IN-DA Worksite Area’ and the ‘Agreement on the provision of areas of the ITER Site to ITER - India’.
The US-DA suspense account shows a final balance of EUR 578 thousand of US tax paid in advance by the IO on
behalf of the US staff. The movement of EUR 10.75 million is mainly due to the transfer, from the Suspense Accounts
to an Earmarked Fund, of the amounts received in relation to the Arrangements for the Tokamak Cooling Water
System (TCWS).
‘Sickness Insurances and Pension Funds’ shows a final balance of EUR 869 thousand including EUR 495 thousand
related to the sickness insurance and pension scheme of the IO staff, and a negative amount of EUR 1.36 million
related to the IO seconded staff social contributions (sickness and pension).

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NOTE B5 - STATEMENT OF UNPAID COMMITMENTS

Amounts in thousands of Euro

Decommitments
Unpaid Total Total and Transfers of Unpaid Total
Commitments Commitments previous years' Total Payments Commitments
1 January 2014 2014 Total Commitments 2014 31 December 2014
Budget Headings 1 2 3 4 5=1+2-3-4
Article 111 Direct Investment 146,392 57,046 1,146 49,119 153,174
Article 112 Test Blanket Module 757 662 - 782 636
Article 113 IO Reserve - - - - -
Title I Direct Investment (Fund) 147,149 57,708 1,146 49,901 153,810
Article 211 Research & Development 20,093 4,976 480 10,125 14,464
Title II R&D Expenditure 20,093 4,976 480 10,125 14,464
Article 311 Professional staff salary costs - 57,304 - 57,304 -
Article 312 Technical Support staff salary costs - 18,367 - 18,367 -
Article 313 Travel and subsistence 977 2,960 747 2,266 924
Article 314 Secondment allowances - - - - -
Article 315 Removal expenses 185 514 12 561 127
Article 316 Promotions - 498 - 498 -
Article 317 Awards - 187 - 187 -
Chapter 31 Staff Expenditure 1,162 79,830 758 79,182 1,051
Article 321 General services 8,460 9,824 3,168 7,972 7,142
Article 322 Administrative services 1,798 9,685 426 5,963 5,094
Article 323 Equipment 20,695 3,115 82 4,232 19,496
Article 324 External specialized services 48,671 36,328 5,743 39,723 39,532
Article 325 IO Reserve - - - - -
Chapter 32 Organizational Expenditure 79,623 58,952 9,419 57,891 71,265
Title III Direct Expenditure 80,785 138,782 10,178 137,073 72,316
Total Expenditure 248,027 201,466 11,804 197,099 240,590

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NOTE B6 – LONG-TERM IN KIND / PROCUREMENT ARRANGEMENTS

2007 - 2013 Procurement Arrangements
Commitments Notifications
Members IUA IUA KEUR
Euratom 932,814 68,550 110,779
People's Republic of China 269,879 3,735 6,103
Republic of India 260,653 11,543 18,849
Japan 443,058 58,464 93,750
Republic of Korea 254,898 26,490 43,773
Russian Federation 213,012 9,355 15,429
United States of America 186,518 8,350 13,356
Total 2,560,832 186,487 302,039

2014 Procurement Arrangements

Commitments Notifications
Members IUA IUA KEUR(*)
Euratom 10,053 19,417 32,565
People's Republic of China 739 14,264 24,012
Republic of India (1,215) 3,500 5,890
Japan (571) 19,045 32,050
Republic of Korea (811) 28,411 47,746
Russian Federation 45,060 22,224 37,366
United States of America (125) 3,380 5,690
Total 53,129 110,241 185,319
(*) based on actual completion date

Cumulative Procurement Arrangements

Commitments Notifications
Members IUA IUA KEUR
Euratom 942,867 87,967 143,344
People's Republic of China 270,617 17,999 30,115
Republic of India 259,437 15,043 24,739
Japan 442,487 77,509 125,800
Republic of Korea 254,087 54,901 91,519
Russian Federation 258,072 31,579 52,796
United States of America 186,393 11,730 19,045
Total 2,613,960 296,729 487,358

The Procurement Arrangements shown in this Note constitute the Long-Term In-Kind contributions from the
Members to the IO recorded at values as agreed between the IO and the Members. These contributions are
valued using the ITER Unit of Account (IUA) and recorded in Euro.

IUA Exchange rates

Periods 1 IUA =
2014 EUR 1,683.39
2013 EUR 1,660.15
January 1989 USD 1,000.00

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 45

C. NOTES TO THE 2014
FINANCIAL STATEMENTS

When opened, the heat treatment furnace at the General Atomics plant in Poway,
California (US) is 12 metres tall and can hold one central solenoid module at a time. Heat
treatment at 650 degrees Celsius makes the niobium-tin and copper conductor
superconducting. Photo: US ITER

46 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

NOTE B7 - CUMULATIVE BUDGETS AND EXECUTIONS

Income
Amounts in thousands of Euro
Cumulative Total Cumulative Total
Income Budgets Income Executions
up to End 2014 up to End 2014
Budget Headings 1 2
Article 711 Contribution from Euratom 524,613 520,148
Article 712 Contribution from the People's Republic of China 104,898 105,064
Article 713 Contribution from the Republic of India 104,898 104,278
Article 714 Contribution from Japan 104,898 104,898
Article 715 Contribution from the Republic of Korea 104,898 106,391
Article 716 Contribution from the Russian Federation 104,898 104,206
Article 717 Contribution from the United States of America 104,898 102,803
Chapter 71 Contributions 1,154,004 1,147,789
Article 721 Internal Tax from Professional Staff 70,438 69,957
Article 722 Internal Tax from Technical Staff 20,081 14,757
Chapter 72 Internal tax 90,519 84,714
Article 731 Financial interest 7,785 8,868
Article 732 Exchange rate Income 200 1,081
Chapter 73 Financial Income 7,985 9,948
Article 741 Cancellation of Appropriations from the current year 800 1,111
Article 742 Cancellation of Appropriations from previous years 3,746 6,135
Article 743 Monaco Partnership 3,250 3,250
Article 744 Excess Income from previous years - (67,118)
Article 745 Shortfall Income from previous years (73) -
Article 749 Miscellaneous income 3,839 3,898
Chapter 74 Other Income 11,561 (52,724)
Title VII Income 1,264,069 1,189,727
Total Income 1,264,069 1,189,727

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 47

C. NOTES TO THE 2014
FINANCIAL STATEMENTS

Payments
Amounts in thousands of Euro
Cumulative Total Cumulative Total
Payments Budgets Payments Executions
up to End 2014 up to End 2014
Budget Headings 1 2
Article 111 Direct Investment 179,777 171,013
Article 112 Test Blanket Module 3,004 2,393
Article 113 IO Reserve 19,218 -
Title I Direct Investment (Fund) 201,999 173,406
Article 211 Research & Development 110,596 103,216
Title II R&D Expenditure 110,596 103,216
Article 311 Professional staff salary costs 368,997 363,841
Article 312 Technical Support staff salary costs 93,586 93,128
Article 313 Travel and subsistence 19,963 18,324
Article 314 Secondment allowances 692 692
Article 315 Removal expenses 3,683 3,565
Article 316 Promotions 2,527 2,340
Article 317 Awards 891 881
Chapter 31 Staff Expenditure 490,340 482,771
Article 321 General services 46,312 43,788
Article 322 Administrative services 28,250 25,781
Article 323 Equipment 32,170 30,509
Article 324 External specialized services 327,895 314,751
Article 325 IO Reserve 26,507 -
Chapter 32 Organizational Expenditure 461,134 414,829
Title III Direct Expenditure 951,474 897,601
Total Expenditure 1,264,069 1,174,223

48 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

Commitments
Amounts in thousands of Euro
Cumulative Total Cumulative Total
Commitments Budgets Commitments Executions
up to End 2014 up to End 2014
Budget Headings 1 2
Article 111 Direct Investment 338,304 324,186
Article 112 Test Blanket Module 3,702 3,030
Article 113 IO Reserve 7,538 -
Title I Direct Investment (Fund) 349,544 327,216
Article 211 Research & Development 120,086 117,743
Title II R&D Expenditure 120,086 117,743
Article 311 Professional staff salary costs 368,986 363,841
Article 312 Technical Support staff salary costs 93,576 93,128
Article 313 Travel and subsistence 20,253 19,263
Article 314 Secondment allowances 692 692
Article 315 Removal expenses 3,845 3,693
Article 316 Promotions 2,527 2,340
Article 317 Awards 891 881
Chapter 31 Staff Expenditure 490,770 483,838
Article 321 General services 52,121 51,927
Article 322 Administrative services 31,345 30,872
Article 323 Equipment 50,446 49,980
Article 324 External specialized services 358,649 353,238
Article 325 IO Reserve 5,559 -
Chapter 32 Organizational Expenditure 498,120 486,016
Title III Direct Expenditure 988,889 969,854
Total Expenditure 1,458,520 1,414,813

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 49

C. NOTES TO THE 2014
FINANCIAL STATEMENTS

NOTE B8 – EARMARKED FUNDS

Budgetary Outturn 2014
Amounts in thousands of Euro
2014 2013
Total Income Execution 22,187 -
Total Payments Execution 2,175 -
Total Budgetary Outturn 20,012 -

Income Execution 2014

Amounts in thousands of Euro
Initial Total Final Total Total Total Total Results and
Income Budget Income Budget Income in Income in Carry Forward
2014 2014 2014 2013 to 2015
Budget Headings 1 2 3 4 5=3-2
Article 711 Contribution from Euratom - - - - -
Article 712 Contribution from the People's Republic of China - - - - -
Article 713 Contribution from the Republic of India - - - - -
Article 714 Contribution from Japan - - - - -
Article 715 Contribution from the Republic of Korea - - - - -
Article 716 Contribution from the Russian Federation - - - - -
Article 717 Contribution from the United States of America 22,187 22,187 22,187 - -
Total Income 22,187 22,187 22,187 - -

Payments Execution 2014

Amounts in thousands of Euro
Unused Total Unused Total
Payment Payment
Initial Total Final Total Appropriations Total Payment Total Total Appropriations
Payments Payments brought forward Appropriations Payments Payments carried forward
Budget 2014 Budget 2014 from 2013 2014 2014 2013 to 2015
Budget Headings 1 2 3 4=2+3 5 6 7=4-5
Article 111 Direct Investment 1,665 38 - 38 - - 38
Article 112 Test Blanket Module - - - - - - -
Article 113 IO Reserve 577 26 - 26 - - 26
Title I Direct Investment (Fund) 2,242 64 - 64 - - 64
Article 211 Research & Development - - - - - - -
Title II R&D Expenditure - - - - - - -
Article 311 Professional staff salary costs 696 1,560 - 1,560 1,197 - 362
Article 312 Technical Support staff salary costs 701 538 - 538 417 - 121
Article 313 Travel and subsistence 30 30 - 30 30 - -
Article 314 Secondment allowances - - - - - - -
Article 315 Removal expenses 68 52 - 52 52 - -
Article 316 Promotions 7 3 - 3 3 - -
Article 317 Awards 7 6 - 6 6 - -
Chapter 31 Staff Expenditure 1,508 2,189 - 2,189 1,705 - 483
Article 321 General services - 5 - 5 5 - -
Article 322 Administrative services - 63 - 63 63 - -
Article 323 Equipment 334 351 - 351 17 - 334
Article 324 External specialized services 155 385 - 385 385 - -
Article 325 IO Reserve - 470 - 470 - - 470
Chapter 32 Organizational Expenditure 489 1,274 - 1,274 470 - 804
Title III Direct Expenditure 1,998 3,463 - 3,463 2,175 - 1,288
Total Expenditure 4,239 3,526 - 3,526 2,175 - 1,351
Total Expenditure (without reserve) 3,662 3,031 - 3,031 2,175 - 856

50 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

 C. NOTES TO THE 2014
FINANCIAL STATEMENTS

Commitments Execution 2014

Amounts in thousands of Euro
Unused Total Decommitments Unused
Commitment Available and Transfers Commitment
Initial Total Final Total Appropriations Commitment of previous Total Total Appropriations
Commitments Commitments brought forward Appropriations years' Total Commitments Commitments carried forward
Budget 2014 Budget 2014 from 2013 2014 Commitments 2014 2013 to 2015
Budget Headings 1 2 3 4=2+3 5 6 7 8=4+5-6
Article 111 Direct Investment 3,145 - - - - - - -
Article 112 Test Blanket Module - - - - - - - -
Article 113 IO Reserve 577 19 - 19 - - - 19
Title I Direct Investment (Fund) 3,722 19 - 19 - - - 19
Article 211 Research & Development - - - - - - - -
Title II R&D Expenditure - - - - - - - -
Article 311 Professional staff salary costs 696 1,560 - 1,560 - 1,197 - 362
Article 312 Technical Support staff salary costs 701 538 - 538 - 417 - 121
Article 313 Travel and subsistence 30 32 - 32 - 32 - -
Article 314 Secondment allowances - - - - - - - -
Article 315 Removal expenses 68 72 - 72 - 72 - -
Article 316 Promotions 7 3 - 3 - 3 - -
Article 317 Awards 7 6 - 6 - 6 - -
Chapter 31 Staff Expenditure 1,508 2,211 - 2,211 - 1,727 - 483
Article 321 General services - 5 - 5 - 5 - -
Article 322 Administrative services - 102 - 102 - 102 - -
Article 323 Equipment 334 354 - 354 - 20 - 334
Article 324 External specialized services 155 748 - 748 - 748 - -
Article 325 IO Reserve - 135 - 135 - - - 135
Chapter 32 Organizational Expenditure 489 1,344 - 1,344 - 875 - 469
Title III Direct Expenditure 1,998 3,555 - 3,555 - 2,602 - 952
Total Expenditure 5,719 3,573 - 3,573 - 2,602 - 971
Total Expenditure (without reserve) 5,142 3,420 - 3,420 - 2,602 - 818

‘Earmarked Funds’ is dedicated to the realization of specific signed Arrangements between the ITER Organization
and the United States of America ITER Project Office:
• Arrangement for Procurement of the Piping Systems for the Tokamak Cooling Water System (TCWS);
• Arrangement for Completion of the Final Design for the TCWS;
• Arrangement for Procurement of the Steady-State Electrical Network High Voltage Substation Structures (SSEN).
They are not part of the ITER Council-approved IO budget.
In 2014, the TCWS Income amounted to EUR 21.79 million and the SSEN Income amounted to EUR 393 thousand.
The 2014 Earmarked Funds Execution shows a Payments Execution of EUR 2.17 million and a Commitments
Execution of EUR 2.60 million which includes TCWS Commitments and Payments only.

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 51

C. NOTES TO THE 2014
FINANCIAL STATEMENTS

RECONCILIATION: CASH FLOW STATEMENT - BUDGET OUTTURN

In the 2014 Financial Statements, the schedules prepared in accordance with the IPSAS and its Statement of
Financial Performance particularly take into account accruals whereas the schedules prepared in accordance with
the PRMR and its Budget Result Statement do not. The differences between the two statements are shown in the
Basis differences of the Reconciliation below.

‘Entity difference’ comes from the variation of the revenue received and associated costs incurred by the IO for the
Budget Earmarked Funds. These costs and revenue are included in the Statement of Financial Performance but
outside the ITER Council-approved IO budget.

Amounts in thousands of Euro

Notes 2014 2013
Budget Outturn Page 18 10,701 (34,947)
Basis differences (13,494) 79,252
Cash contributions requested B2 (186,253) (144,480)
Cash contributions received B3 99,880 116,267
Advance contributions received B3 74,260 74,944
Cheques N-1 paid in N B3 30 88
Cheques N unpaid at 31.12.N B3 (14) (30)
Movements in suspense accounts B3 (12,889) 13,375
Excess Income from Previous Years B7 (art744) 11,491 19,089

Entity differences 20,012 -

Budget Outturn Earmarked Funds B8 20,012 -
Total 17,219 44,305
Net (decrease)/increase in cash and cash equivalents Page 15 17,219 44,305

‘Cash contributions requested’ corresponds to the amount of cash contributions requested from the Members
for the current year.
‘Cash contributions received’ corresponds to the amount received in cash in the current year from the Members
following the call for contributions.
‘Advance contributions received’ corresponds to the amount of cash contributions received in the current year
from the Members in excess of the cash contributions for the current year.
‘Cheques N-1 paid in N’ corresponds to the cheques issued in previous year(s) and disbursed in the current year.
‘Cheques N unpaid at 31.12.N’ corresponds to the cheques issued in the current year and not disbursed yet at the
end of the current year.
‘Movements in suspense accounts’ corresponds to the balance of disbursements of cash received or paid from/to
third parties not related to the budgetary execution.
‘Excess Income from previous years’ corresponds to the unrealized income budget carried forward from the
previous year.
‘Budget Outturn Earmarked Funds’ corresponds to the balance between income execution and payment
execution for Earmarked Funds for the current year.

52 I TER O RG ANIZ ATION 2 014 F INANC IAL R EPORT

The Cryostat Workshop is equipped with a gantry crane and
officially inaugurated in November. In this 100-metre-long
manufacturing facility, the Indian Domestic Agency will begin
assembling and welding the ITER cryostat sections in 2015.

ITER OR GAN IZ ATIO N 2014 FINANCIAL REPO RT 53

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