Maemura Akinori: Dear members, the second session of the morning is starting. Please get back to your seat, so we can start the second session, please. Thank you very much.

I think we should go ahead.

The morning second session starting with the reports from the Executive Council.

Let's have James Spenceley, our treasurer, to deliver to you his treasurer report.

Thank you very much, James.

James Spenceley: Thank you, all. This is the full year report for the APNIC finances. APNIC has a reporting period from 1 January to 31 December each year.

The annual accounts were audited again the year by Ernst & Young. Ernst & Young are one of the big four or five global accounting firms. We had an operating surplus of 3.25 million. That was well ahead of budget. Operating revenue was 17.6 million. As you can see, the budget there was 16.4 million, so that was 7 per cent above budget.

Most of that increase above budget was down to the IP resource application fee, so that's really a result of the final /8 policy, we are seeing more members join, more members joining means more new allocations, more new allocations shows us an increase in IP resource application fees. You can see that was probably the largest portion at 1.24 million above budget.

Operating expenses were 14.4 million. They were actually below budget. So a great job to the Secretariat, to Richard and Paul specifically, for managing that to below budget. That was 8 per cent below budget, which was originally 15.7 million.

Travel itself was the largest reduction from budget. That was down 600,000. Most of that, in fact the large portion of that, was due to the lack of take-up on the cost recovery training program, so we are expecting that to take a little bit longer to really get traction. While there was a reduction in the budget there for travel, there was also a reduction in the cost recovery part of the revenue side of that budget.

Statement of income: you can see the budget on your right-hand side there. IP resource application fee, we budgeted a little bit under 1 million and that came in at 2.2 million, so that was the large increase I talked about.

Interest income was percentage size higher at 42 per cent, but not a material difference. Membership fees, which is obviously the largest category and is the most ongoing in terms of revenue, was 3 per cent higher than budget, so broadly in line at 14.3 million versus 13.9 million.

As you can see, sundry income there is probably the stand-out below budget, at 75 per cent under budget and sundry income really is the income we were estimating from the cost recovery training that led for the travel expenses to be below budget.

In summary, you can see the original budget was 16.45 million. The actuals were 17.6 million, so 7 per cent above in terms of revenue.

A little bit more detail here: as you can see most of the categories were under budget. The budget in general was 15.58 million for 2012. The actual budget came in at 14.4. So also 7 per cent, but this time 7 per cent under budget.

The big line items there are meeting and training expenses, again, and the travel expenses were the big line items and that's to do with the cost recovery training.

Computer expenses, down very slightly, depreciation down slightly, really the rest of them are the small line items there.

Operating surplus: you can see the details there. We budgeted for an operating surplus of 2.35 million. The actual surplus was 3.2 million. When you add in some income tax benefit that we received, it was 3.25 million.

Here you can see the statement of financial position. On the right-hand side is the 2011 period. You can see current assets have increased from 10 million to 16 million, a great result for the financial stability of APNIC and non-current assets really haven't changed that much. Non-current is quite high there as a result of the office building that APNIC owns in Brisbane.

You can see total assets increased from 20 to 25 million, so 24 per cent increase. Total liabilities increased from 8.9 to 10.5 million, so 17 per cent increase. Overall, a strong result in the balance sheet of APNIC is continuing to strengthen year to year.

This is a graph that I put up every half year. It really just shows -- the blue line being the current assets, so basically just the cash that APNIC holds; the red part of the bar graph as non-current assets, excluding property, so that's investments, long-term investments, things that aren't necessarily cash in the bank, but are equivalent to cash in the bank.

The green part is the carrying cost or the cost at acquisition of the property in Brisbane. We haven't adjusted that for market. We believe that the property has increased in market value, but for the purposes of comparison and certainty in the audited accounts, we have kept that on book at the purchase value.

You can see that the operating expenses were in that sort of mid-14 million, that's the line, operating expenses increased. But you can see that the now for the first time we are back to a position where we have at least one year of cash in the bank compared to expenses for that period.

On that topic, at the APNIC retreat in December, the EC retreat, we put quite a lot of scrutiny into the coming budget. Made a number of changes to the budget. But we also set ourselves a target goal of one and a half year's worth of cash reserves. We are defining cash reserves as the blue part of the chart in cash and cash equivalents in the red part.

The EC determined that, going forward, to give APNIC the best level of financial stability, that should be equal to one and a half times the expenses, so that's the line on the chart there. That's our goal and we are certainly, as you can see, tracking a lot stronger than periods where we had a big cash deficit compared to expenses.

Any questions on the year that was?

Maemura Akinori: Any questions, comments?

Andy Linton: I have a question about the initial registration fee. I have asked this before at previous meetings and I'm going to ask it again. You are talking about a large, large cash cow here and when the original allocation fee stuff was set up, it was set up to do quite a complicated assessment of people's requirements and tick documents and look at all that stuff and now effectively for new member, it's, "I would like a /22, please," and you hand it out.

I'm concerned about this, because I do a lot of work in developing countries and I do appreciate that there's a 50 per cent discount for those, but next week I'm going to be in Myanmar talking to the universities there and realistically, that first fee for them will be $2,700 for their first /22. That, for people in those countries is a lot of money for them to find, so, you know, I challenge you on this one.

I notice that the fee schedule actually was posted 21 February, so it hasn't changed. This is one that I think that the community needs to think about. We are not a for-profit organization and that cash cow needs to be looked at.

James Spenceley: Okay. Thanks, Andy.

Probably I could have changed the order of my slides to present this part first, but challenge duly accepted and challenge resolved. At the December retreat we resolved to address the resource allocation fee, so actually you'll see that in the next part, which is the budget for 2013.

Andy Linton: Excellent. I thank you and I look forward to seeing that. Thank you, James. Excellent.

Brajesh Jain (ISPAI): I strongly accept the wordings of Andy about the consideration of the membership fee for the new members. But at the same time, after going through the financials of 2010, 2011 and 2012, what we are finding in the operating surplus increase after the tax, in 2010 it was 73 per cent, in 2011 it was 923 per cent and in 2012 it is 27 per cent, as per your annual report, what you have submitted through the online today.

Everybody knows that telecom industry is going under very high pressure due to this low margin and financial expenditure increasing day by day. It is high time to reconsider those things, what we have reconsidered, when in 2007 and 2008, I'm don't exactly know the date, APNIC has revised their fee structure from US dollars to Australian dollars, with a factor of .8 of US dollars.

We know that APNIC is a non-profit organization. I will request for rationalization of the fees, looking towards the very bad situation of the telecom sector. During the Cambodia meeting, I requested during the AMM, and I think James, you have assured that by December you will be able to take some decision and it will be conveyed in the month of February, and today is March. We are waiting for your favourable decision towards the industry, so that the survival of the industry can be there.

Because if APNIC is considering reducing their expenditure, we, telecom companies are also considering for reducing our expenditure from here and there. At that time, APNIC, as a non-profit organization, I will request to the community to please reconsider about the fees once again, so that the burden on the individual member should be reduced. Thank you.

James Spenceley: I suppose, in broad terms, I'll address the concept of fees and the way that I look at it as treasurer and I think the EC also looks at it. We have to balance a number of different issues that really have a big impact on the industry.

The first issue is obviously the financial stability of APNIC. I think that was the reason -- I wasn't on the EC at the time it was changed from US dollars to Australian dollars. But I know the reason behind that was to secure the amount of revenue on an ongoing basis in relation to the costs in the same currency.

APNIC for a number of years had a very difficult budget process, because you would find that you couldn't budget for what the income exchange rate was likely to be when it was in US dollars, whereas 80 to 90 per cent of the costs were in Australian dollars. It's very difficult to apply a sliding exchange rate or to have your income in one currency and your costs in another.

I mentioned that one of the goals as treasurer is to have a financially secure APNIC. I think the second goal we have is to make sure that we don't underprice or overprice the resources or membership and the resources.

If we suddenly make APNIC membership free, we would have a large impact on the number of people joining; the number of people joining means that the last /8 wouldn't necessarily be allocated to the right people and on demand. There is a fine balancing act between cost of membership, financial security for APNIC and, in reality, the correct allocation of the final resources.

I definitely addressed your concern about the Australian dollar appreciation at the last meeting. We did address it at the December meeting. I didn't necessarily give a commitment to announce a change on that, but we have addressed it and we are looking at ways to address the economies where currency has been a negative impact in terms of costs or fee increases.

I would also point out APNIC, apart from I think it was three years ago now, has not raised fees. We have CPI increases in Australia in broad ranges of 2 to 4 per cent. APNIC as an organization absorbs those cost increases. We aren't actually increasing the fees. But your point has been definitely heard on the exchange rate input. It is a complicated issue and certainly one we are considering and looking towards the Secretariat and the finance department to provide us some input.

It's definitely not closed, we just don't have a resolution for it at the moment.

Any further questions?

Okay.

Maemura Akinori: Questions or comments? Then go ahead.

James Spenceley: I'll move to the budget for 2013. The budget activity really is just a ground up budget prepared by the Secretariat. Initially it's prepared entirely by the Secretariat, then passed to the APNIC EC and to me as treasurer. We take huge amount of input from the APNIC survey, the EC strategy and guidance and also the core operations of APNIC.

It's a detailed, bottom-up approach to doing the budget. We have some very strong data and systems for tracking the number of members, the changes over time, number of closed members, so we use that data to actively predict how many members we think we'll have in the forward year. This isn't a budget where we take last year's budget and add or take off 5 per cent. It is built up from the ground up every year.

One of the things we heard from Andy at the Phnom Penh meeting was that the initial resource allocation fee was too high. Certainly the result we saw in the financial performance really indicated that to us, that we were starting to see too much money come in from that resource application fee. So we have taken that on board, and at the December meeting we agreed to reduce that by 50 per cent. So there will be a 50 per cent discount for all new members joining and taking resources from 1 March.

Just to be clear, that's a 50 per cent discount on the initial resource application fee. Membership is unaffected by that change.

That will have a revenue impact of around $1 million. That will be a reduction in revenue for APNIC of $1 million in 2013. But it's certainly a move that the APNIC EC felt was needed and required and would broaden the ability for us to provide resources to people who needed it, certainly in developing or less developed countries.

Membership fees: we have taken an estimated growth of 750 new members in 2013. To give you the equivalent statistic from 2012, we had 646 member growth. We are expecting and have budgeted for an increase in members and that's a trend that has been consistent for the last -- well, actually since forever. We do expect to have more members.

We have assumed a growth in associate members moving into new tiers, into higher tiers. That's where they actually shift from having no resources to having resources. That's a common thread each year. People join as an associate, get their resources and then, on their anniversary date, they move up a membership category.

We have also assumed a growth in very small and small tiers. That's the members moving into those tiers from associate. Around 9 per cent of all new members are from the least developing countries. They still retain their 50 per cent discount.

We talked a little bit at the last meeting about the transfer fees. We announced those fees and what we assumed would be, you know, certainly an amount of revenue for that year. We have assumed and provided for 75,000 of transfer registration revenue for the 2013 budget; not significant, but we certainly may see that increase in future years.

The projected revenue for 2013. The actual for 2012 was 17.6 million. So for the first time in a while, we're actually seeing a very slight increase in revenue for the 2013 year, 17.695 million. Basically the same revenue year on year. We're seeing the decrease of 35 per cent in the top line there of IP resource application fee. That's the $1 million impact as we talked about. Then an increase in the membership fees as we see more members continuing to join.

I think that's a good result. We are keeping revenues stable while reducing the hurdle to join for new members.

The projected expenses: some details there for those who are interested. Probably the bigger increases are the larger categories, clearly. Salaries and personnel increases 6 per cent. We have had some rigorous debate at the EC with the Secretariat on the appropriate level of increase in cost. We came to the conclusion that is the right number. That's a factor of, I think two new staff members, as well as natural CPI increases in salaries for the staff members themselves.

Really they're the big changes in costs, across the year. You'll see the actual for 2012 was 14.4 million. The budget now for 2013 is 15.9 million. The combination of that will result in a $1.7 million surplus. We'll see total revenue of 17.69 million and total expenses of 15.9 million. So we'll see $1.7 million surplus.

You can see there a graph from 1996 onwards of the revenue of APNIC in each year. That's the blue line. The expenses are the red line. You can see there are a number of years there really from sort of 2003 till 2010 where revenue was either the same or in fact lower than expenses, so there was very little surplus created during that period.

Since my time as treasurer, and the APNIC EC has taken the view that we don't really understand the period in the next 10 years that we are going into, so now is the time for APNIC to create a solid financial foundation. So you'll see that revenue has been increasing and we have been keeping expenses somewhat limited compared to revenue.

We are focused very much on creating a sustainable and financially sound APNIC that will outlast the next 10, 15, 20 years. Our goal shifted from the historical APNIC EC target of one year's worth of cash and cash equivalents, in terms of expenses, to one and a half years. At that point, I think when we reach that one and a half years, we will reassess again.

There is a level of uncertainty with the final /8 and moving into a world where we stop allocating resources as often or to as many new members, what happens to both the revenue and the cost basis of APNIC.

Really, that's the end of the budget presentation. Again, we are expecting a surplus for 2013 and that's on target to reach our one and a half years of surplus operating expenses and I think we will be on target to achieve that.

Any questions from the audience on the budget for 2013?

Maemura Akinori: Any questions, comments?

James Spenceley: Thanks, Andy. Challenge accepted and resolved. Cheers.

Maemura Akinori: Thank you very much.

I brought myself to the podium to deliver you the Executive Council report. This is, as usual, I am now showing you the line-up of the Executive Council and I would like to have all the members from the Executive Council make an introduction of themselves. Paul, please.

Paul Wilson: Thanks, Akinori. I don't think it's necessary for me to say too much.

As I mentioned before, APNIC has the structure, according to the bylaws, that the Director General, who is appointed by the EC, then has an ex officio position, which is a voting position on the EC, so I am a full member and participate in all of the EC meetings, providing regular reports and also participating in decision making.

I think you all know me and I hope to know everyone here better and better, as time goes on. Thanks.

Che-Hoo Cheng: Hi, I'm Che-Hoo Cheng. I'm one of the elected EC members from Hong Kong. One of my full-time work is Hong Kong Internet Exchange, HKIX, and I think some of you are participants.

Wei Zhao: Hello. I'm Wei Zhao, also name as Wendy, some old friends call me Wendy. I'm elected member from China and currently I'm with CNNIC and my daily job as employee of CNNIC is IP services and external cooperation, which I have stand up and point out early in the morning.

Yes, I'm standing up for another election. I think all the EC members are willing to open their ears to members to get feedback and talk to us about your expectations of APNIC service and community. Thank you.

James Spenceley: James Spenceley. I just introduced myself as treasurer of the EC, so I'll do that again. I have been on the EC for four years. I run a company in Australia called Focus Communications where I'm the CEO. We deal with a whole bunch of similar issues around currency and budgets and financial reporting. So it's something I feel quite comfortable with. But I very much enjoy meeting new members and old members alike. So if you see me at lunch, please come and say hello -- I'd love to get you know me more. Thank you.

Ma Yan: Good morning, everyone. My name is Ma Yan from Beijing University of Communication, working in university, so I have a lot of training, not only to my university, but also in China and also we are helping the APNIC training teams working around the region. So this is my very important part of the activity with APNIC and also as APNIC EC member, we are not only working for the current operation, but also we are looking forward to the near future.

So we have the visions discussed also cooperation with members to hear from the members, what's your expectation, what's your view towards the future: how APNIC can really serve the new members in the future development of the Internet in our region.

So thank you for all your support in the past and also looking forward to work with all of you in the coming future. Thank you.

Gaurab Raj Upadhaya: I am Gaurab Raj Upadhaya. I'm an existing EC member since the last two years. I work for Limelight Networks as director of international networking and in my day job I run a network for Limelight in Asia plus do stuff for the rest of the world. That's it. Thank you.

Kenny Huang: Good morning, everyone. My name is Kenny Huang. I'm an existing EC member of APNIC. I'm running for EC already two years. I'm the board director of TWNIC and also Chair of international committee member and also founder of ISOC Taipei. Thank you for coming and thank you for enjoying the time with us. Thank you.

Maemura Akinori: Thank you very much, everyone. I should not forget myself. My name is Akinori Maemura. I'm from JPNIC, running international registry in Japan. My responsibility at JPNIC is the other side of JPNIC, which is promoting the Internet of Things, for example, policy research for the ICANN and some other organization for the Internet governance thing and doing the PR or promotion event kind of thing.

But I am really happy to do the Executive Council job, additionally to my responsibility.

Functions of the APNIC Executive Council. This is quite the same slide I have been using for a long time. This was pretty much covered by Ma Yan. We are doing some kind of oversight of the APNIC Secretariat job. We are elected by the APNIC members and representing the members to govern, make some governance of the APNIC.

We have had five Executive Council meetings since APNIC 34. As you notice in December, we have a two-day meeting, which actually consists of the retreat meeting, where not only for our resolution, but doing consolidation on future APNIC business which was held in Fukuoka face to face.

We had big discussion about EC's conduct. We are now changing. First big change is we decided at the December Executive Council meeting to change the meeting schedule. We traditionally, since its beginning, have been doing the monthly teleconference for the Executive Council meeting. We changed that to have not telephone conference but face-to-face meeting, not monthly, but quarterly face-to-face meeting. That is a change for us to concentrate more, make more concentration on considering the future business or some strategy or direction kind of thing, rather than doing oversight of the Secretariat business.

We believe that it will deliver us the more preferable direction for the APNIC and we actually have the season of quite big change for the entire Internet of Things and we are now going to the IPv6 era, so various aspects we need to have changed and have better coordination for that, so we changed ourselves to do something different.

We are doing some coordination activities. For example, APNIC has entered to an MOU with RIPE NCC for the training material, RPKI tool, business management and Whois evolution. That kind of thing is pretty much shared by the RIRs, so we are doing the similar business and we can say we are doing some friendly competition, "We are better," that kind of thing. That's really good and also, of course, coordination activity is quite necessary for us.

We had joint board meeting with LACNIC in October 2012 in Montevideo, Uruguay, where the LACNIC office is located. At the time, LACNIC was celebrating its 10-year anniversary. One of our purposes was to join the celebration of LACNIC's 10th birthday.

Corporate documents: I think you remember that we were working on revising the membership agreement and so we had extensive review process for the NIR member agreement to engage the NIR people to the discussion for having the better coordination definition.

Right now, "NIR member agreement" was the original title of that document, but we change it to have better representation of the relationship to be "APNIC and NIR member relationship agreement". I think this brand new title represents much better for describing the relationship between National Internet Registries and APNIC.

Membership fees: some of them have been already covered by the treasurer's report. Setting the fees, that is the EC's responsibility, and we had some discussion in the previous APNIC meeting regarding the IP resource application fee. Then, after that discussion, Executive Council was under consideration to change that and finally we decided that we reduce the IP resource application fee by 50 per cent. That's now being effective, as of today.

As James said, that there are no other fee changes this time.

Financial objectives: this is pretty well covered by the treasurer's report. But the important point is that we have decided to target the cash reserves for APNIC Secretariat business, from the current level of 12 months cash reserves, cash reserve that is equivalent to 12 months operating expenses, to 18 months. That will benefit in the increased stability for APNIC's business operations and that's actually had been advised, had been recommended several years ago by our expert input.

Since then, we are trying to have better coordination of the APNIC's business and we determined to have our own office and it had been already benefiting, have the additional efficiency for the APNIC's business operation and still we are now enjoying the strong membership growth and the revenues along with that.

We decided to target the new standard of the operations stability. We target it to be done by 2017, means four or five years.

Other responsibility of the Executive Council is to appoint one ASO Address Council member. The Executive Council has reappointed Andy Linton to this position, the Executive Council appointee to the ASO Address Council for the year 2013.

I would like to appreciate much for Andy's service, and we are very happy to have him appointed to that position. Thank you, Andy.

Member engagement: as I said, we are now in the season of change and the Executive Council has intensive discussion for that. We are representing the members to consider the good direction of the APNIC, so we must have the input from the members.

You are already familiar with the names and faces of the Executive Council members, so please come up to us, any of us, to express what you feel about the APNIC business.

Thank you very much. Our activities are quite transparent. At www. apnic.net/ec, there is the Executive Council page where all minutes, once approved by the Executive Council, are available for your reference. Please have a look at it and if you have any question or comments, please let me know. We are happy to hear them. Thank you very much.

Any questions or comments?

Good. Thank you very much.

I would like to pass the microphone to Philip Smith for the next agenda item, which is the APNIC History Project. We are now turning 20. We have a bunch of history, it should be compiled and organised, and that's all about Philip's presentation. Thank you, Philip.

Philip Smith: Good morning, everybody. This is just a brief presentation that Gerard Ross put together and he asked me if I could share this with you. I think it's very much a call for information and sharing the status of, I suppose, the activity that Gerard has been working with us over the last three or four months.

This is the APNIC History Project, and we have had a few history projects on the way being discussed at APRICOT this week. So, as Akinori said, we are just about to start celebrating our 20 years and we are hoping the community can help us do that.

Really the project is trying to document and celebrate the achievements and of course the personalities behind the 20 years of APNIC. I have been in the region for 15 years now and there has certainly been quite a colourful past over that particular time. We are really trying to fill in some of the gaps, really from APNIC's start in 1993.

Right now, Gerard has prepared a draft chapter for the second book of Kilnam Chon's Asia Internet History Project. So he's really covering the 1992 to 1995 stage. It covers APNIC pre-history, its formation and the early years.

Specifically, a lot of information has been drawn from multiple archival sources, personal correspondence, there have been a lot of emails that Gerard has relied on to build the picture of these early years. The url is hard to see on the screen there, but to try and fit it all on to one line, it's a Google site. You can see it on the presentation that you can download from the website.

Please have a look at it. Gerard welcomes any feedback, corrections, alterations, different perspectives, anything is very welcome.

The outline of the draft currently is looking roughly like this. How the IP addressing outgrew the early registration model, the emergence of the Regional Internet Registry models. As you know, RIPE NCC started in 1992. There was this seminal meeting of CCIRN in Tokyo which brought together the new RIPE NCC's reps, Jun Murai, Kilnam Chon. Out of that grew the launch of the APNIC experiment. That was in September 1993.

The APNIC experiment was very much a distributed model. JPNIC provided the budget, space and the hardware; KRNIC provided information services; AUNIC provided DNS related services; and APNIC staff was a mailing list, very much a mailing list of people from all across the region. It kind of reminds me of the early .uk domain, which was also a mailing list, that I participated in in my early Internet days.

Outline of draft 3: the experiment ran until July 1994 and an interim APNIC followed after that. By the end of 1995, there were real staff. APNIC meetings had begun. APRICOT was launched in January 1996 and David Conrad, as the DG of APNIC, was one of the motivators of APRICOT happening.

But there were still quite a few challenges remaining as the organization developed. It needed a more robust organizational structure and a stable funding model.

The coming chapters -- as you see, Gerard has quite a bit of work ahead of him. The organizational development and the move to Australia, policy evolution, key milestones, APNIC's role in regional development, Internet governance and of course covering the profiles of key contributors.

We, maybe that's Gerard, but we all, APNIC as well, we need you to please send comments, stories, anecdotes, documents, media, in fact anything that you have of mementos or copies of mementos or anything that you remember, archives, whatever, please send them to history@apnic.net. We really appreciate anything you can share with us.

Of course, please take a look at the chapter in the book that Gerard has been writing.

Our aim is to have all this together and ready in time for the APNIC meeting in Xian, so we can have part of our celebration there. So a call to the community: if you have anything you can share, please share it sooner, the greater the chance we can get you as part of APNIC's 20 years. Many thanks.

I don't know if there are any questions or feedback. I'll hand back to the Chair.

APPLAUSE

Maemura Akinori: Even now, if you have any questions or comments.

Okay. APNIC staff was the mailing list is very impressive.

Actually, we are running very, very early, much earlier than we planned. So I'm now still wondering what we should do, but I would like to invite Tin Wee for the reminder for the election voting.

Tin Wee Tan: Thank you very much. I'm very pleased to note that many people have rushed out to the voting desk to submit their votes. However, there may be a few of you who have not yet done so. So just a very gentle reminder before lunchtime to please cast your vote before you go and have your lunch.

The voting desk outside is manned by Connie and George and they are anxiously waiting for your ballots to be inserted into that box, just outside this hall. We will close the election at 2 o'clock local time as scheduled. But still please try to deposit your ballots before lunch to avoid a rush, a mad rush at shortly before 2 pm.

We would also like to request the election scrutineers, Mark Kosters, are you here? And Emilio Madaio. I will hunt you guys down later on. The scrutineers should be at the voting desk by 2 pm. So with that, thank you very much.

Anything I need to add, George?

No? Okay. Then happy voting. Thank you very much, Chairman.

Maemura Akinori: Thank you very much, Tin Wee.

All right. Still we are running very early. I would like to ask Andy, are you ready for the reporting on the SIG? Sorry, it may be a sudden request for you, but I'm sure you can do that.

Thank you very much.

Andy Linton: This was the bit I was worried about, that the slides would be here.

We had three sessions in the Policy SIG meeting, one on Wednesday and two yesterday. We had a number of informational presentations, and I'll just go through those very quickly for you.

We had a presentation from the Secretariat about the creation of route objects in the APNIC Whois. That was to do with some contradictions, if you like, between the creation of route objects in the Whois Database and the ROA objects which are sort of precursor to some of the RPKI work.

Really, it was so that it would be brought to the attention of the community and see what the feeling from the community was and there was an indication that people felt it was something we should progress and explore some more.

There was a paper presented on policy options for encouraging membership of an NIR, which analysed some of the possible ways that people might behave or do things, and the author was seeking comment and feedback and presented that paper.

There was a question about the role of the APNIC Secretariat in the PDP and the question that was asked was: would the community support Secretariat input to the policy process?

In the past, members of the Secretariat have actually proposed policy proposals. That in recent years has not been the case, and now we're at the point where we're asking, is that always the best option? Again, more exploration of that, probably on the mailing list and just see where we go with that.

We also discussed in there that potentially another way for information to come to the members of the Policy SIG community would be for slightly more detailed reports on the impact of policy on the activities of the Secretariat. If we produce a policy which looks on paper to be good but has some unexpected impact on the way things work, then we should hear more about that.

That's one for the Chairs to take on board and ask for more detailed information and we'll do that.

Then the Chairs actually raised some questions about clarification of our APNIC policy development process. We have a document. Our numbered prop-101 was the thing that made it come into being, so it was actually our first numbered document. It has a number of things in there which are in conflict -- is probably too strong -- but there's some discrepancies between it and our SIG guidelines. Some of the definitions are slightly different and so on. We flagged some issues and talked about some proposed changes and edits to that policy development process.

Probably the most significant one, I think, for the AMM was that one of the things we talked about was that if we accept these proposed changes, in the future, when we bring policy proposals that we have reached consensus on to this meeting, it will be as a report and not to seek further consensus for this meeting. But that's yet to be developed. That's not what we have got to, but that's one for people to think about who are here today, who weren't there yesterday.

We had two proposals, prop-105 which was about the distribution of returned IPv4 address blocks. We anticipate that at some time in the near future, we may see -- and a lot of conjecture in there -- some address blocks coming back via the global policy process and IANA and so on to us.

There was the observation that potentially that block could be treated in a different way from the final /8 policy, and that there was perhaps an opportunity to give members an additional final block -- perhaps another /22. There was some debate that, given the increase in the number of members, as James reported, we may not be in the position to have enough addresses to give everyone a /22, so we are going to take that back to the mailing list and talk about trying to devise some sort of algorithm that would give us a fair and equitable distribution of those addresses to our members.

Our other proposal, our final proposal was prop-106, restricting excessive IPv4 address transfers under the final /8 block. The thrust of this was we do see some transfers between people who have got a /22 from the final /8 and they are transferring them to other people. It's not clear whether there's some sort of manipulation of the process and people are getting these and then flicking them on to someone else.

The proposal was to find a way to get the Hostmasters to manage, police, you know, discourage, whatever. It talked about confirming if the transfer matched the spirit of the final /8 policy. The discussion on that was that actually asking the Hostmasters to implement something that talked about whether it matched the spirit was a difficult task for the Hostmasters to do, because it was relatively undefined what the process would be.

The meeting came to the conclusion that this didn't reach consensus, and that proposal has now been abandoned. But we have agreed that this is an issue we'll keep a watching brief on and see what happens.

That's my report from yesterday.

Maemura Akinori: Thank you very much.

Andy Linton: Any questions or issues?

Maemura Akinori: No questions or comments?

Something is happening on the stage.

APPLAUSE

Andy Linton: Thank you for all your support at the meetings and so on. I have one here and one for Masato, so I'll give it to you shortly.

Maemura Akinori: Thank you. Still we are running very early, but I think we should have the lunch break. But before that, I would like to have an open microphone time before lunch. If you have any question or comment, you are quite welcome to come up to the microphone to say something.

Izumi Okutani: It's sort of related to the earlier report in our Policy SIG and I recall that there was some discussions about how we should run the Policy SIG elections so I'm interested in considering the process in the future and as a little bit of a new issue that I would like to bring up is that we have less focus on Policy SIG discussions and don't have as much policy proposals as we used to.

We now have three Chairs and Co-chairs, but I'm not sure if we need this many people. I mean, we have three, but maybe for others, if we don't have as many discussions as we used to, maybe we can bring down the number to, like, for example, two and would like to hear thoughts from the floor and what other people think about this idea.

Maemura Akinori: Thank you, Izumi. Interesting topic. If any other people have questions or comments on Izumi's comment, please. Or SIG chairs, if you have any comments?

Andy Linton: I think it's a reasonable thing for us to contemplate. One of the questions that was raised in prop-103 at the last meeting was: do we have a growing bureaucracy and sort of process that gets top heavy, so maybe perhaps this is a way to tackle that. I would like to hear how we deal with that at the next meeting, because we're due to have an election for Chair and Co-chair at the next meeting, so I'd like to hear what the community would like to do about something like that.

Maemura Akinori: Okay. Thank you. Any other comments?

Okay.

Manoj Misra (ISPAI): This is just a suggestion regarding some financial disclosure, where we are discussing about the transparency about the information. This morning we have noted that this has been just circulated before the starting of meeting. As a term of good governance, it is necessary that the financial statement may be circulated well before, where the members can examine and make, you know, well informed comments or suggestion to the EC or the appropriate forum.

I have one suggestion regarding the financial disclosure. Like when we are indicating the information about the financial statement, we have just mentioned about our balance sheet and P&L account, the receipts and payment account. For a international financial reporting system, it is necessary that respective disclosure may also be included, so that members may know how much expenditure, however there is some main category of expenditure has been disclosed under the received and payment account, but perhaps it is not mentioned suppose in the salary account. What various components have been paid? How much is paid for the salary? How much paid for the pension and other benefits.

Being a transparent part, it is necessary that the annexures may also be included and it will help for the further transparency of the APNIC. So that is my suggestion for future thing, which appropriately EC may consider further. Thank you.

James Spenceley: Great feedback. We actually do have a formal annual report that includes the financial information which is prepared to a public company standard, so that's a reporting entity standard and would answer all of those questions. So Richard, do we have -- is Richard in the room? Yes. No?

Sanjaya, do you have a link to the annual report?

Sanjaya: Yes, I should have reported in my presentation earlier. The annual report, the 2012 annual report has been published, so you have the detailed financial report there. It's on www.apnic.net/report.

Manoj Misra (ISPAI): Just a clarification. I have seen that it is published today, it is, like the annual report, it is available for today. My question was that before a meeting, it may be there is some circulation time as part of transparency and governance, that the financial information or the agenda item must be available well before seven days. This is the international best practices, like yesterday I was seeing, so I have found that the annual report of 2011 was available, but for the 2012 was not available. It is available two days morning. So transparency part, as good governance, and James may explain further on this issue, as an international reporting practice, it is also necessary, you must circulate well before. Further, that is nothing.

James Spenceley: I will take that on board and we'll make sure we publicize the financial reporting broader and ahead of meetings. Thank you.

Maemura Akinori: Paul, do you have something?

Paul Wilson: Thank you for the question. It should be noted as well that the APNIC EC at their meetings do examine the financial reports on a regular basis, whether they're monthly or quarterly, and that those reports are also available with the APNIC EC minutes.

It is honestly very early in the new financial year, less than two months into the new financial year, that we do provide the audited financial reports. I have to say, I believe that's a very fine performance on the part of the APNIC finance team. So I don't think it is realistic to have the final audited reports really any earlier than they are achieved here at this meeting.

However, there are draft end of year reports presented to the EC earlier, for instance at the beginning of the year, and those are also available on the EC website. So it's www.apnic.net/ec, and you go from there into meeting minutes and documents. Thank you.

Maemura Akinori: Thank you. I think it's well clarified.

Any other questions or comments?

Masato Yamanishi (Softbank BB Corp): Softbank, and also I'm a Co-chair on Policy SIG. My comment is about the number of Co-chairs. Since I'm one of the Co-chairs, so I don't want to say much about it, but currently we have a small technical problem to reduce the number of Co-chairs, because the terms of two Co-chairs is not same, so mine will end next year, but Skeeve will end this year. So I would like to propose aligning these two terms as first step.

For example, we can make one year in next election, so it means both Co-chair, the term of both Co-chair will end at 2014. So in 2014, we can elect only one Co-chair, then we can reduce the number.

Maemura Akinori: Thank you, Masato.

Dean Pemberton (InternetNZ): I think that they're very good points brought up by both Izumi and Masato about both the workload and the terms of the Chairs and Co-chairs. I would urge the EC to look into this and see if there are some changes that need to be made there. Thank you.

Maemura Akinori: Thank you very much.

Sanjeev Gupta (DCS1): A general question: is having two or four or five Co-chairs of the Policy SIG costing us anything? Is there a downside to it? Is it causing coordination problems? Would the Chairs wish to --

Maemura Akinori: I think Andy is answering that.

Andy Linton: I think the thing that costs is the personal cost. The Chair and Co-chairs having to attend this meeting and they typically have to do that under their own funding and, you know, there's two weeks a year of lost income or they have to take holiday or whatever it is. So it is difficult. Certainly I find it a challenge to do that. That's a cost to the community in that sense.

Our job as Chairs at this stage is not particularly arduous, given the number of proposals we're getting. The original reason for going to three Chairs, from my understanding, I have asked the question why we went from two Chairs to three Chairs, was that at the time that was happening there was a very high workload of a lot of proposals coming to the Policy SIG, therefore, it just was too much work for people to do. That work has been cut back, and personally I would rather not see us in any of our activities make work and make bureaucracy for the sake of it. I think it's an idea worth thinking about.

Maemura Akinori: Thank you, Andy.

Izumi Okutani: With my NIR SIG hat, I think it's a matter of balance. We used to have three Chairs in NIR SIG as well, but we felt it's like a small SIG and we don't need to get this many people involved, so we reduced it to two. That's why I felt it might be the direction that Policy SIG worth considering.

Brajesh Jain (ISPAI): I feel that we should also look into the fact that why the policy proposals are coming down and there is a seemingly lack of interest and in that sense, I would suggest that the number of Co-chairs probably should not be reduced, rather the offer should be there to motivate people to put up policy, probably the nature of policy may change, because Internet is changing. There should be a lot of active dialogue which these policies generate. Thank you.

Maemura Akinori: Thank you very much. I'm really happy to have this kind of active discussion and the Policy SIG conduct is quite essential for our business. I think that discussion will be much, much better to be done among the Policy SIG, so I wish, but Masato, if you have quite short comment.

Masato Yamanishi (Softbank BB Corp): Yes. I totally agree with Andy, because especially in Policy SIG, Chair and Co-chair should have many decision in just one or two seconds. What I presented in Policy SIG session, we are trying to have more discussion time, but still we should do decision, we should decide many things very quickly, like, let me say, a strange thing but I used to work as a referee of soccer and actually it's very similar. Referee of soccer should decide many things, just within just one second. Policy SIG Co-chair and Chair also. Anyway, so also let me make one correction.

Even though Dean said this decision should be decided by the EC, but actually current SIG guidelines said that the deciding number of Co-chair is the Chair's responsibility.

Maemura Akinori: Thank you very much.

I think we are ready for lunch. Before that, I think Sunny will make some housekeeping notice.

Sunny Chendi: Thank you, Chair. I have got three housekeeping notes to make. One is we have a closing dinner tonight and we still have a few tickets available if you would like. If you didn't get a ticket, if you like or if you paid for the closing dinner and didn't get a ticket, you can get it from the desk outside.

The other one is the lunch is at The Line Restaurant downstairs where we usually had every day so far.

The third one is, once again, please do take the survey to help us provide and improve our Conferences. It's published on the website, as you can see. Click on the button. While you are here attending the AMM, do complete it, so we can get your feedback and we can constantly improve our Conference as per your requirements.

Thank you very much and let's proceed for the lunch and come back at 2 pm. Thank you.

Maemura Akinori: Thank you very much. I would like to add some comments. The survey is really important for us. A survey is a very good means for us to hear your voice, to improve the meeting and as well we quite strongly depend on the membership survey to hear how our membership collectively feel about APNIC's business conduct. It is quite crucial. Please help us by submitting your comments to survey, so we can have the greater meeting.

Lunch break. Thank you very much.

APPLAUSE