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Board Finance Committee (BFC) Minutes

BFC Attendees: Sébastien Bachollet, Cherine Chalaby (Chair), Chris Disspain, and George Sadowsky.

Other Board attendees: Steve Crocker

Staff Members Present: Akram Atallah – Chief Operating Officer; Xavier Calvez – Chief Financial Officer; Samantha Eisner, Juan Ojeda, Amy Stathos and Diane Schroeder.

The following is a summary of discussions, actions taken and actions identified:

  1. Minutes. The BFC approved the minutes of the prior meeting in March 2012.

  2. Contingency Fund, Operating Fund and Reserve Fund Update. Noted that the estimate for the CEO Succession costs have been updated to closer to 0.6 million, and discussed other revisions to the contingency fund. Also reviewed the status of the operating and reserve funds as items for regular reporting to the BFC.

    • Action:

      • Schedule discussion of size of reserve fund for future BFC Meeting.

  3. Budget. The BFC reviewed the draft budget in advance of the public posting, and provided specific comments and questions for consideration prior to posting, including discussion of how the annual budgeting process coincides with the strategic planning work. The BFC also discussed the presentation of the budget related to the New gTLD Program as separate from the rest of the ICANN budget. Also discussed budgeting for professional services and how budgeting for risk assessment could be revised. Discussed work ongoing to refine the revenue recognition practices as related to new gTLDs, including reliance on third-party assessments of best practices. Noted need to be consistent in presentation of variance between the budget for FY13 and the forecast for FY12. Discussed the process for assessments of the requests from ACs and SOs and the need to use criteria to analyze each request. Noted the components of the Board support budget and other specific project or budget items, such as Contractual Compliance and IDN work, as well as some questions regarding the meetings budget. Discussed that there may be a need to have a broader discussion of the format and presentation of the budget in the future.

    • Action:

      • BFC members to provide additional questions by email.

      • Staff to revise budget in line with BFC comments.

  4. Any other business. The BFC began a discussion on the potential for the use of a foundation to handle additional funds generated through the New gTLD Program.

    • Action:

      • Foundation item to be placed on future BFC agenda.

Domain Name System
Internationalized Domain Name ,IDN,"IDNs are domain names that include characters used in the local representation of languages that are not written with the twenty-six letters of the basic Latin alphabet ""a-z"". An IDN can contain Latin letters with diacritical marks, as required by many European languages, or may consist of characters from non-Latin scripts such as Arabic or Chinese. Many languages also use other types of digits than the European ""0-9"". The basic Latin alphabet together with the European-Arabic digits are, for the purpose of domain names, termed ""ASCII characters"" (ASCII = American Standard Code for Information Interchange). These are also included in the broader range of ""Unicode characters"" that provides the basis for IDNs. The ""hostname rule"" requires that all domain names of the type under consideration here are stored in the DNS using only the ASCII characters listed above, with the one further addition of the hyphen ""-"". The Unicode form of an IDN therefore requires special encoding before it is entered into the DNS. The following terminology is used when distinguishing between these forms: A domain name consists of a series of ""labels"" (separated by ""dots""). The ASCII form of an IDN label is termed an ""A-label"". All operations defined in the DNS protocol use A-labels exclusively. The Unicode form, which a user expects to be displayed, is termed a ""U-label"". The difference may be illustrated with the Hindi word for ""test"" — परीका — appearing here as a U-label would (in the Devanagari script). A special form of ""ASCII compatible encoding"" (abbreviated ACE) is applied to this to produce the corresponding A-label: xn--11b5bs1di. A domain name that only includes ASCII letters, digits, and hyphens is termed an ""LDH label"". Although the definitions of A-labels and LDH-labels overlap, a name consisting exclusively of LDH labels, such as"""" is not an IDN."