Chart of Accounts: a critical Element of the Public Financial Management Framework; by Julie Cooper and Sailendra Pattanayak; imf technical Notes and Manuals tnm/11/03; October 17, 2011

• General purpose financial reporting. This includes the preparation of financial state-
ments and reports in accordance with national and/or international accounting standards 
(such as the International Public Sector Accounting Standards, IPSAS). General pur-
pose financial reports are prepared to provide their users (e.g., parliament, public and 
creditors/donors) with information about the financial reporting entity (Box 2) which 
is useful for making and evaluating decisions about the allocation and use of resources. 
When general purpose financial reports meet this objective, they will also be a means—
in addition to budget reporting—by which managers of public resources discharge their 
accountability to those users.
• Statistical reporting. Statistical reports (e.g., GFS reports) are generated to facilitate 
macroeconomic analysis and surveillance, and international comparisons, as well as for 
reporting to international organizations such as the IMF. Data used for statistical report-
ing should be generated from the underlying accounting system via a well-designed 
6
Budgetary accounting is only one element of a government accounting system, but it is the most crucial for both 
formulating policy and supervising budget implementation. 
7
This is discussed in further detail in Section IV.

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Box 3. Budgetary Accounting vs. General Financial Accounting – Case of France
Article 27 of the French Organic Budget Law (loi organique relative aux lois de finances, LOLF)
of 2001 stipulates that “the central government shall keep accounts of budgetary receipts and
expenditures (comptabilité budgétaire) and general purpose accounts (comptabilité generale)
for all of its transactions.”
Budgetary accounts (comptabilité budgétaire). Budgetary accounting has traditionally
played a very important role in France (and also countries in Francophone Africa that have
been influenced by this tradition). Article 28 of the French Organic Budget Law (LOLF) of 2001
stipulates that budgetary receipts and expenditure payments shall be recognized on a cash
basis. Article 8 stipulates that appropriations comprise commitment appropriations and cash
appropriations. Budgetary accounting in France tracks government expenditure and revenue
operations in order to verify whether they are in line with parliamentary authorizations with a view
to enforcing accountability for proper execution of the Budget Law. Thus budgetary account-
ing only tracks/reports expenditure and revenue transactions and does not track or report on
government liabilities and assets. It produces a budget execution report, but does not produce
a balance sheet. It is, therefore, a flow-based accounting system based on single entry. The
coverage of budgetary accounting is limited to only those transactions that are strictly “budget-
ary,” i.e., formally authorized in the Budget Law. The accounting classification used in budgetary
accounting reflects the nomenclature used in the budget. The scope and type of authorization
given by parliament also determines the stages at which the expenditure and revenue trans-
actions are recognized (and accounted for) in budgetary accounting. For example, expenditure
appropriations in the case of France are authorized at two levels: (i) autorisation d’engagement
or authorization for commitments, which could be multiyear; and (ii) credit de paiement or au-
thorization for payments during the budget year. Therefore, the system of budgetary accounting
records both commitments and payments during the budget execution cycle.
General purpose accounts (comptabilité générale). Article 30 of the French Organic Budget
Law (LOLF) of 2001 states that the general purpose financial statements (based on comptabilité 
générale) are to be based on the accrual accounting principle. Transactions are entered for the
financial year to which they are related, independently of the date of payment or receipt. One of
the broad objectives of the reform process was that central government general accounts would
reflect the model in the French chart of accounts (plan comptable) for the private sector.
1
Con-
sequently, the French Organic Budget Law stipulates that the accounting rules for the central
government are the same as those for business, except when differences are warranted by the
specific nature of the central government’s activity. The General Account (Compte Général de 
l’Etat, CGE) is a document issued each year along with the Budget Review Act (Loi de Règle-
ment). The Budget Review Act, prepared from budgetary accounts, records the execution of the
preceding year’s budget whereas the CGE is a report which describes the budget transactions
for the year, cash transactions, and the results of the accounting entries, presented in the form of
a balance sheet and a statement of revenue and expenditure. Accrual accounting makes it pos-
sible to present financial information in the CGE for a more reliable assessment of the govern-
ment’s assets and financial position. In particular, it enables the reporting of fixed assets such as
property, plant and equipment and receivables and payables (posted to the financial year for the
purpose of true and fair accounts).
The linkage between the budgetary accounting system and the general purpose ac-
counting system is an important objective. The principle adopted is that these two different

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COA. A COA that is compatible with the IMF Government Finance Statistics Manual 
(GFSM) is, therefore, desirable to ensure that the economic classification used in the 
COA is the same as (or at least could easily be mapped to)
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the GFSM.