13/06/2026
NEFC Continues Discussions on Standardising Sub-National Chart of Accounts in IFMS
The National Economic and Fiscal Commission (NEFC) has continued its engagement with the Department of Prime Minister & NEC, Department of Prime Minister and NEC, Department of Treasury and the Department of Finance to progress discussions on the standardisation of the Sub-National Chart of Accounts (CoA) within the Integrated Financial Management System (IFMS).
A meeting held on the 12th June 2026 between the three agencies focused on advancing Key Focus Area 3 – Public Finance Management Systems, particularly the need to establish a uniform Chart of Accounts structure across provincial and local-level governments to improve budgeting, expenditure tracking, monitoring, and financial reporting.
The discussions form part of broader efforts to strengthen public financial management and ensure greater transparency and accountability in the use of national government grants transferred to provinces and other sub-national governments.
The Public Finance Management Act provides for fiscal transfers from the National Government to sub-national administrations to fund essential services and development programs. However, despite the introduction of the Integrated Financial Management System, challenges remain in effectively monitoring and reporting on the use of these funds.
The issue was first highlighted in the NEFC's 2021 Quarterly Budget Reviews, where provincial administrations expressed strong interest in standardising program and activity expenditure codes within the IFMS to improve financial reporting and accountability.
NEFC officials noted that the standardisation of the Chart of Accounts is a critical component of strengthening Intergovernmental Financing Arrangements and improving fiscal oversight between the National Government and sub-national administrations.
A Government Finance Statistics (GFS) Mission Report conducted in 2014 also identified the need for a common budgeting and reporting template to enhance efficiency and effectiveness in budgeting, monitoring, and reporting. International experiences from countries implementing IFMS, supported through IMF-initiated GFS missions, have demonstrated the benefits of adopting a standardised Chart of Accounts framework that links national and sub-national financial reporting systems.
Current challenges identified during discussions include the continued use of legacy Public Government Accounting System (PGAS) codes transferred into IFMS, inconsistencies in sector, program and activity codes across provinces, and misunderstandings surrounding the Chart of Accounts structure between national and sub-national levels.
These issues have particularly affected provincial sector and program officers who often face difficulties identifying the correct sector, program and activity codes when preparing budgets and financial reports.
To address these challenges, the agencies are exploring the rollout of regional workshops involving provincial administrations, sector agencies, Treasury, Finance and IFMS representatives. The workshops will focus on building a common understanding of the Chart of Accounts framework, promoting a standardised approach to coding and reporting, and supporting the adoption of an updated reporting structure within IFMS.
The initiative is expected to improve the consistency and quality of financial information across all levels of government, enabling better monitoring of public expenditure and supporting informed decision-making for service delivery and development outcomes.
The NEFC remains committed to working collaboratively with key stakeholders to strengthen public finance management systems and ensure greater accountability, transparency and effectiveness in the management of public resources throughout Papua New Guinea.