Project Information Document-Integrated Safeguards Data Sheet - ADDITIONAL FINANCING FOR THE PROJECT TO STRENGTHEN PUBLIC FINANCIAL MANAGEMENT - P176041 (English)

The main agencies responsible for National Government PFM are the Department of Finance and Administration (DoFA); Overseas Development Assistance (ODA), Compact Management Division, and Personnel under the President’s Office; Congress; and the Office of the National Public Auditor (ONPA). [...] Recent assessments, including the 2016 Public Expenditure and Financial Accountability (PEFA) assessment of the National Government and a 2015 performance audit by the ONPA identified critical shortcomings in the current PFM systems and processes, particularly the financial management information system (FMIS) in use. [...] Recent technical assistance from the Asian Development Bank (ADB-TA) has supported a review of the financial management (FM) regulatory framework for the National Government to align with the requirements of the Uniform Guidance. [...] The resulting loss of institutional knowledge is evident, especially in the quality of data input and in the lack of consistent application of accounting principles in basic operations. [...] It is based around the mutual principles of the Amended Compact which are to ‘promote the economic advancement, budgetary self- reliance, and economic self-sufficiency’ of the FSM.