PFM Reform: Introduction of new Budget and Accounting Classification System (BACS) in Bangladesh

Md. Abdur Rahman Khan FCMA

Joint Secretary
Finance Division, Ministry of Finance

Abstract
Bangladesh Government has been pursuing its PFM reform activities since its independence. One of the reform
outcomes was to design and develop 13 digit Chart of Accounts in 1998 under the RIBEC project. Since this13 digits
code was not capable of dealing with further reform of PFM system it has been abandoned and replaced by a newly
designed and developed 56 digits Budget and Accounting Classification System (BACS). This study considered the
effectiveness of the new BACS and found it quite effective to produce improved PFM outcome. The new Chart of
Account follows the fundamental principles to be followed in its design and development. It is capable of - adopting
accrual accounting system in government; implement International Public Sector Accounting Standard (IPSAS),
produce General Finance Statistics (GFS) as per IMF requirement and produce COFOG report as per United Nations
requirement. Further research areas on the implementation of BACS have been identified. This paper also highlighted
on some challenges faced by the stakeholders during the implementation of new BACS and recommended some
measures to be undertaken to address these challenges.

PART I
INTRODUCTION
Background
Public Financial Management (PFM) reform is a key factor for improving the governance, accountability and
transparency in Bangladesh (Finance Division, MoF, 2018). Successive Governments have been continuing Public
Financial Management (PFM) reform activities since the independence of Bangladesh. However, the present phase of
PFM reform as reported by Finance Division, MoF (2017) began with the formation of Committee on Reform in
Budgeting and Expenditure Control (CORBEC) in 1989. On the basis of recommendation of this committee Reform in
Budgeting and Expenditure Control (RIBEC) project funded by DFID was launched in 1995 and ended in June 2002.
RIBEC has introduced 13 digits new digital classification chart in 1998 to facilitate automation process of government
accounting system in Bangladesh. Thereafter, Financial Management Reform Program (FMRP) was launched in 2003
and continued its operation until September 2009. FMRP launched in-house grown Integrated Budget and Accounting
System (iBAS) software for automating government budget and accounting functions across the country. iBAS was a
Local Area Network (LAN) based automated system that established links with DCA/DAO/CAO offices throughout the
country. This project was followed by Deepening of Medium Term Budgetary Framework (DMTBF) and Strengthening
of Financial Accounting Projects under Strengthening Public Expenditure Management Program (SPEMP) in April
2009 funded by multi-donor Trust Fund. The new Budget and Accounting Classification System (BACS) was
developed and upgraded version of Integrated Budget and Accounting System (iBAS++) has been designed under these
projects. However, the newly developed 56 digits BACS and (iBAS++) were not implemented until July 2018. After the
end of the SPEMP program, GoB continued the reform initiative under GoB funded Public Expenditure Management
Strengthening Program (PEMSP) since 2014. Under this program, the government of Bangladesh implemented newly
developed Budget and Accounting Classification System (BACS) along with the advanced version of Integrated Budget
and Accounting system (iBAS++) in 2018. Many experts consider introduction of BACS and iBAS++ as a land mark
events of PFM reforms in Bangladesh. Part I of this article provides some back ground and introduction regarding the
study. Part II briefly reviewed the available literatures on the Chart of Account. Part III briefly described the
methodology of the study. Findings of the study including reasons for abandoning 13 digits codes, structure of the new
BACS, strength of new BACS, implementation challenges, further research requirement and recommendations are
briefly stated in Part IV of this article. A brief conclusion has also been included at the end of this report.

Objective/Research Question
Although reform is a continuous process, a pertinent question may be raised as to why it was necessary to abandon the
existing 13 digits coding system within 20 years of its implementation.

The specific objectives of this study are:

a. to find out the root causes that compelled the government to abandon the 13 digits budget and accounting
classification system within 20 (twenty) years of its introduction in Bangladesh; and
b. to examine the strengths and weaknesses of new 56 digits BACS and find out any challenge (if any) that the users
are facing during implementation of new BACS in budgeting, accounting and reporting process.

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 PART II
THE CONCEPTUAL AND THEORETICAL FRAMEWORK

Importance of Public Financial Management (PFM) system

A variety of stakeholders use government financial data for different purposes such as formulating policy and making
decisions on sectoral allocation of funds, monitoring the performance of various government programs, establishing
accountability for budgetary compliance and analyzing overall economic impact of government policies. Citizens and
civil societies generally ask some basic questions regarding public finance, such as, where the resources came from, for
what purpose they were applied, who was responsible for resource mobilization and utilization, and what was achieved.
PFM scholars like Jacobs et al (2009) and Saxena et al (2014) suggest that a well organized and systematic
classification of budget and accounts is supposed to address these questions and allow a meaningful analysis of the
government’s use of public resources. Cooper and Pattanayek (2011) argued that timely delivery of specific financial
information on government activities is an important function of an effective accounting and reporting system. They
also suggest that a well functioning PFM framework should include an effective accounting and financial reporting
system to support fiscal policy analysis and budget management. The accounting and reporting system should capture,
classify, record, and communicate relevant, reliable, and comparable financial information for proper budgetary
accounting and diverse reporting including reporting of actual against approved budget estimates. It should also be
capable of producing general purpose financial reporting and adequate management information and statistical
reporting.

The Chart/Code of Accounts (COA)

Chart of Accounts, Code of Accounts (CoA) and Classification Chart are synonymous terms often used in accounting
and public finance literature. Cooper and Pattanayek (2011) termed Chart of Accounts (CoA) as a critical element of
Public Financial Management (PFM) for classifying, recording and reporting information on financial plans,
transactions and events in a systematic and consistent way. Saxena et al (2014) considered CoA as the linchpin of a
government’s accounting and reporting system and serves as a key tool to meet its business requirements. Budget and
Accounting Classification Manual (FD, MoF, 2017) termed the newly developed 56 digits CoA as Budget and
Accounting Classification System (BACS). CoA establishes basic foundation of general ledger based double entry
accrual accounting system. Configuration of CoA represents the hierarchical structure of groups of classifications
(segments) of information requirement. Each segment has discrete information and can be combined with the others to
create financial reports and enforce controls with a view to meeting the needs of various users and complying with the
laws and regulations in the PFM area. For effective management, the CoA should cover all transactions flows and
balances (stocks) of the reporting entity for budget management and general purpose financial reporting (Saxena et al,
2014).

Cooper and Pattanayek (2011) observed that the CoA’s definition and use in government systems are influenced by
different PFM tradition. Countries have developed different approaches to address the information requirements of
governments and as a result actual practices differ across countries. This is also due to the fact that each country based
on its legal and administrative tradition, needs to have system that caters to specific control and information
requirements for government budget management. Since constitution of Bangladesh distinguishes between charged
expenditure (not voted) and other expenditure (voted) and therefore Bangladesh CoA must be able to comply with this
constitutional requirement. This compliance may not be required for many other jurisdictions.

Major objectives of Chart of Accounts (CoA)

Saxena et al (2014) suggest that an ideal CoA should meet the following seven major objectives:

Control: CoA need to focus on various control mechanism such as budget appropriation control e.g. budget versus
actual; fund control e.g. consolidated fund and other special fund such as public accounts of the republic and other
fiduciary control.
Accountability: Under the PFM system the government is accountable to general public at large through parliamentary
accountability mechanism. Executive agencies such as ministries, divisions and departments are accountable against
their allocated responsibility to the government. This can be achieved by tracking the transactions related to each
administrative entity through an appropriate audit trail. CoA configuration need to respond to these accountability
requirements.

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Budget management: It refers to formulation, execution, reporting and day to day monitoring of budget.
Implementation of comprehensive system of budgetary accounting for tracking budget allocations and their uses at each
stage of the expenditure cycle should cover any increase or decrease of budget allocations during the year through
supplementary budget authorizations, expenditure commitments and other financial obligations.

Financial planning and Management: For effective financial planning, cash management, and assets and liabilities
management CoA design must focus how the assets and liabilities should be categorized and, at what aggregated level
the cash and liquid assets should be monitored.

Management Information: All line agencies may not require same level of detail and disaggregated information for
day to day decision making, therefore it may not be necessary to track such information for the whole of government.
Rather, the individual line agency should be able to track such detail information by using their own detailed accounts
codes as long as these are linked to higher level codes which are used for consolidation of accounting data across the
whole of reporting entity.

General Purpose Financial Reporting: The accounting system should be able to prepare financial statement and
reports in accordance with national and international accounting standards such as International Public Sector
Accounting Standards (IPSAS). General purpose financial statements need to be prepared for different users such as
public, parliament, creditors/ donors with adequate information regarding the financial reporting entity.

Statistical reporting: Statistical reports such as General Finance Statistics (GFS) need to be generated for macro
economic analysis, international comparisons and reporting to international organizations such as IMF. A Chart of
Accounts compatible with the IMF General Finance Statistics Manual (GFSM) is therefore, desirable for ensuring auto
generation of GFS compliant report from the same accounting information.

Key Principles and Factors for Designing the Chart of Accounts

Saxena et al (2014) identified three basic principles of classifications of chart of accounts. These are homogeneity,
independence and comprehensiveness. Cooper and Pattanayek (2011) also agreed to these three basic principles and
added some more factors that need to be considered in designing a CoA. These principles and factors are briefly
discussed below:

Comprehensiveness: The CoA should be comprehensive enough to capture all required information and needs to
reflect not only the budget framework but also the accounting framework. Budget classification should not be different
and should be embedded in government accounting classification. The accounting and reporting system should be the
primary source of financial information for reporting on budget execution. However, the accounting and reporting
system may have additional classification to meet the financial management needs and comply with accounting
standards.
Adequate granularity: The segments and sub-segments of CoA should be designed to facilitate many possible
combinations of data elements necessary for control and reporting purpose. Each segment should have sufficient data to
meet all control and accountability, management, and reporting needs of various stakeholders.

Independence: Each classification should have defining characteristics that are different from and independent of the
others.

Avoiding redundancy: There is no need for independent segment in the CoA if the related information could be
derived from another segment. Where there are multiple classifications, it is useful to explore the relationship between
those classifications. The requirement of GFS classification can be derived from economic classification and the United
Nations Classification of Function of Government (COFOG) can often be derived either from the administrative
classification or the program classification. It also helps to reduce the volume of data capture which in turn reduces the
chances of data input error.

Homogeneity: Each of the classification schemes should have a unique set of defining characteristics to which every
transaction must comply. Homogeneous numbering system and structure helps make CoA user friendly and reduces
chances of coding errors.

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Unified Framework: A unified CoA is configured with a hierarchical set of linked codes based on parent-child
relationships, with lower level codes being used by individual accounting units and higher level codes used for
consolidation of financial information.
Sometimes individual accounting units require some flexibility in designing their own specific accounting codes at a
detailed level to capture specific information for internal management and control of their units. However, the CoA
framework should be unified to ensure that at least the information at the aggregated levels uses the same accounting
classification to ensure consistency between the two sets of accounting data.

Scalability: The CoA should be flexible for future additions and changes as far as possible. It should be capable of
capturing additional data in future, particularly when such information has been identified as part of an ongoing PFM
reform program. Providing room for growth can help ensure a CoA remains relevant for a long period of time as the
business environment, regulatory requirement and reporting needs evolve.

Standard Classification of Government Fiscal Operations

Jacobs et al (2009) argues that governments typically classify fiscal data on more than one attribute. Cooper and
Pattanayek (2011) also agreed to this notion and identified the following classifications that are essential for
controlling, managing and reporting on the implementation of government budget:

Administrative classification: CoA has to be classified according to the administrative unit responsible for collecting
revenues and utilizing funds (e.g., the ministry of education, health, etc., and at a lower level, schools and hospitals
etc.). A typical administrative classification is organized into multiple levels of hierarchy, such as ministries,
departments, divisions, and cost centers. It is usually the main basis for establishing accountability in budget
management. Bangladesh budgetary system requires parliamentary votes for appropriations by different administrative
ministries and therefore requires such administrative classification
.
Economic classification: Transactions are classified on the basis of the economic nature of resources (e.g., pay and
allowances, goods and services, transfers, subsidies, etc.). Economic classification is the basis for macroeconomic
analysis, monitoring of fiscal aggregates, and micro-level control over the use of resources. This classification is
fundamental to input-based budgeting structures. Economic classification also forms the base for structuring financial
statements.

Functional classification: Transactions are classified on the basis of their broad purpose or objectives (e.g.,
education, health, defense, agriculture, energy etc.). Functional classification is useful for policy formulation and
analysis, resource allocation decisions at the macro-level, historical analysis of public spending and cross-country
comparisons.

Program classification: Transactions are classified in accordance with government’s policy objectives. Program is a
group of activities carried out to meet a specific policy objective. Programs typically identify the goals and policies
that the government spending is expected to serve (e.g., preventive healthcare for all) and are usually sub-divided into
homogenous activities (e.g., vaccination) required to meet the goals. A program classification transparently establishes
a government’s policy priorities, as reflected in the budgetary allocations, and forms the basis for monitoring and
evaluating performance by allowing the specification of measurable program targets in terms of outputs and outcomes.

Geographic classification: Captures transactions on the basis of locations where revenues were generated and
expenditures were incurred (e.g., regional distribution of tax collections, location of the beneficiaries of government
subsidies and transfers, etc.). A geographic classification is useful in inter-regional analysis, particularly in studying
the regional impact of government policies.

Source of Financing Classification: Governments also use source of financing classification to associate expenses
with the funds that financed them and classification of beneficiaries of government transfers and subsidies.
Saxena et al (2014) made a cautionary note that successful implementation of a multi-segment classification system
depends on the level of automation achieved in transaction processing and accounting. Given that computerized and
automated integrated budget and accounting system (iBAS) has been in use since 2010, implementation of multi-
segment classification system should not face any major difficulty in Bangladesh.

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 PART III
METHODOLOGY

Issues Identified for the Study

As mentioned in PART 1 the major objective of this study is to find out the root causes that compelled the government
to abandon the 13 digits budget and accounting classification system within 20 (twenty) years of its introduction in
Bangladesh; and to examine the strengths and weaknesses of new 56 digits BACS and find out any challenge (if any)
that the users are facing during implementation of new BACS in budget preparation, budget execution, accounting and
reporting process.
This study tries to find the answers of the following questions:
 Whether BACS classifications were made in accordance with Government Finance Statistics Manual
(GFSM) or not?
 Whether GFS reports generated from iBAS++ system is in accordance with IMF requirement?
 Whether budget sectors included in BACS match with the United Nations Classification of Function of
Government (COFOG) classification?
 Whether the new BACS would support program budgeting in future?

Methods of Collecting Information

The study is explorative in nature. Data and information were collected from both primary and secondary sources. PFM
documents published by the Ministry of Finance such as PFM Reform Strategy 2016-2021, PFM Action Plan 2018-23,
Budget and Accounting Classification Manual 2017, Annual Development Plan (ADP) published by the Planning
Commission, annual budget documents, documents relating to 13 digits codes, technical notes provided by IMF
missions regarding 56 digits new Budget and Accounting Classification System (BACS) were analyzed as a secondary
source of data.
Key personnel who played important roles in planning and designing BACS and the key persons who are playing
important roles in implementing new BACS were interviewed. A semi-structured face to face interview questionnaire
has been prepared for this purpose and shown in Appendix-1. Some key stakeholders of new BACS were also
interviewed to get their feedback regarding the benefits, user friendliness and difficulty (if any) faced by them during
the preparation and execution of budget, accounting of actual transactions and generating reports for decision making
purpose under the new system.

In order to ensure spontaneous participation in the interview declaration was given that to the effect that confidentiality
would be maintained. Findings from the interviews would be reported in a manner where specific statements could not
be attributed to particular individual or group.

Interview Guide
The interview guide shown in Appendix-1 was prepared for conducting face-to-face interview with the stakeholders
from Ministry of Finance, Office of the Comptroller and Auditor General of Bangladesh (OCGA), Controller General of
Accounts (CGA) and Strengthening Public Expenditure Management Program (SPEMP). These questions dictated the
topic or issues and were followed up by supplementary questions for more clarification and in-depth understanding.
Duration of each interview was of one hour to one and haft-hours. Detailed notes were taken during interviews. Since
interviews have a long and practical experiences on PFM reforms in Bangladesh, some interviewees were directly
engaged in designing the new Budget and Accounting Classification System (BACS) and other interviews are working
in the field levels for implementation of BACS it is expected that they would be able to give authentic input regarding
the limitations of old 13 digits code, strength and weaknesses of new BACS and challenges faced by them during the
implementation stage.

Scope of the Study

The scope of this study was quite limited. It only focuses on overall design of the Chart of Accounts (CoA) but did not
conduct detailed study on each of the nine segments of CoA. Each segment of CoA demand specific and detailed study
for evaluating effectiveness of each segment of the coding system. Moreover, chart of account is only one aspect of
Public Financial Management (PFM) system. Other integral parts of this system such as macro economic framework,
resource mobilization, debt management, planning and budget process, public sector performance management have
significant effect on the outcome of the PFM system.

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 PART IV
FINDINGS OF THE STUDY
Structure of 13 Digits Code
Documents related to 13 digits Chart of Accounts (CoA) which was developed by RIBEC and replaced previous
major head-minor head account classification system in 1998 has been studied thoroughly. The 13 digits coding
structure and its uses are shown in the following two tables:

Four levels 13 digit coding structure

Level 1 Level 2 Level 3 Level 4
(Legal) (Organizational) (Operational) (Economic)
1 digit 4 digits 4 digits 4 Digits
Examples
1-Consolidated Fund 1211-Land Revenue
Receipts
2-Charged Expenditures 0101-President’s Office 4601-Staff Salary

3-Other Expenditure 2721-Medical Colleges 0047-Cox’s Bazar 4501-Officer’s Salary

Medical College
5-Development 2711- Directorate of 5011-Establishment of 6821- Furniture Purchase
Expenditure Health Kushtia Medical College

Abandonment of 13 digits code

As shown in Appendix-1, the first interview question was asked to identify the reasons for abandoning this 13 digits
code in 2018. Technical notes documents provided by the three IMF technical assistance missions in 2009, 2011 and
2014 have been thoroughly studied. All the respondents agreed to the fact that Bangladesh could not reform its public
financial management (PFM) keeping the 13 digits code in place. They have mentioned some fundamental defects in
designing the coding system and explained them with practical examples. All three IMF missions, on the other hand,
categorically identified the weaknesses of 13 digits coding system. Based on the response from interviewees and
technical notes of the IMF missions, most important disadvantages of the 13 digits coding system can be summarized
below:
Not properly designed: Did not follow basic principles applicable for designing a chart of account primarily for
government budget and accounting purpose but eventually for overall public finance management.

Analytical information not available: The existing code comprises four segments of classification namely: legal code
(1 digit); institution (4 digits); function (4 digits); economic (4 digits). Except the legal code, each of the other segments
provides two levels of disaggregation, but the overall structure do not facilitate multiple combinations of data elements
necessary for control and reporting purpose. The segments do not have the capacity to generate sufficient data to meet
all control and accountability and reporting requirements of various stakeholders.

Improper grouping and alignment of accounts: Groups that were placed within level-1 are not homogenous. For
example, Consolidated Fund receipts and Development Expenditures are two separate issues and should not remain in
same segment. As a result, data from these two groups cannot be consolidated.

Existence of numerous redundant accounts:

745 codes out of existing 1590 codes were redundant. These codes were created to meet specific demand which has no
relevance at present. These redundant codes need to be cleaned up.

Limited room for expansion: The coding system have 4 levels with 13 pre-defined codes, which are fixed in nature
and cannot be increased or decreased. This coding system does not have any specific code for capturing own source for
budgeting. In addition to spending grant money, the autonomous bodies and state owned enterprises (SoE) also spend
money from their own source. Around 200 autonomous bodies and state owned enterprises (SoE) remained outside the
purview of government budget and accounting system. Since no code is available for own source funding in 13 digits
code, this coding system would fail to include extra budgetary entities into the whole of government budgetary system.

6
Not consistent with modern accounting standard:

The 13 digits code is not consistent with the modern reporting standards such as International Public Sector Accounting
Standards (IPSAS), Government Finance Statistics (GFS), etc., and therefore extensive manual data manipulation is
involved in producing fiscal reports. This potentially limits the accuracy, detail and timeliness of these reports.

No fund classification: Although Bangladesh constitution and the Public Money and Budget Management Act, 2009
(PMBMA) use the concept of a fund i.e. consolidated fund and public accounts of the republic, the existing 13-digit
classification does not include a fund classification. Fund classification helps to identify different sources of fund for
implementing one single program.

Above mentioned limitations in designing the 13 digits chart of account (CAO) have had long lasting impact on the
ability of the PFM system and eventually failed to provide required financial information for making key decisions and
therefore had to be abandoned. All the key stakeholders who were interviewed considered designing the new BACS as
quite relevant and a milestone initiative in the field of PFM reform in Bangladesh.

Broad Structure of new Budget and Accounting Classification System (BACS)

Budget & Accounting Classification Manual, 2017 has been thoroughly studied for understanding the new Budget and
Accounting Classification System (BACS). Responses from the interviewees who were engaged in designing and
implementing the new BACS also helped further in-depth understanding of the author. Overall structure of the 56 digits
new BACS is shown in next sections.

Overall Structure of BACS

The overall structure of the new BACS comprises of 9 segments which are divided into three parts- Core Part,
Additional Part and Reporting Part. The ‘Core Part’ has 37 digits and four segments. These segments are Organization
(13), Operation (9), Fund (8) and Economic (7) digits. In fact, core segments are those that involve a user of the
accounting system to describe their transactions through providing input into the system. This way transaction are
posted or recorded in the general ledger. The overall structure is shown in the following table:

Table showing overall Structure of the new Budget and Accounting Classification system
Type Segment Name Digits Purpose
Core Posted Organization 13 Identifies organization type (Budgetary central government,
Segments extra-budgetary central government, local government, public
non-financial institutes, public financial institutes),
Ministry/Division/Department/unit
Operation 9 Operating (General, Special, Support, Transfer to local
Government)/ Development (ADP/non-ADP) and more details
for development program, scheme and projects
Fund 8 Consolidated fund and Public account of the republic and further
details of consolidated fund such as general fund, specific
foreign fund and foreign grant
Economic 7 Economic nature of transactions such as tax revenue, pay &
allowances, goods and services etc
Additional Mode of Financing 1 Project financing such as reimbursable project aid through GoB
Posted (RPA through GoB), RPA through special account, Direct
Segments Project Aid (DPA)
Location 9 Location of transaction Union/ Thana/ District/ Division
Non posted Authorization 1 Parliamentary requirement, charged expenditure and other
(derived/ expenditure (voted)
reporting) COFOG 4 United Nationals Classification of function of Government
Segments (COFOG) in 10 categories
Budget Sector 4 Bangladesh Government’s own sector classifications (14 Sector)
Identify purpose of transaction in accordance with IMF’s
Classification of Function of Government (CO
Total Number of Codes 56

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 Pictorial representation of New Budget and Accounting Classification (BACS)
Posted Segments Non-posted Segments
(Require data entry) (No data entry is required
Core Part Additional Part Reporting Part
(4 parts, 37 digits) (2 parts 10 digits) (3 parts, 9 digits)
Organizational Operational Fund Economic Mode of Location Authorizatio COFOG Budget
(13 digits) (9 digits) (8 (7 digits) Financing (9 digits) n (4 digits) Sector
digits) (1 digit) (1 digit) (4 digits)

Organizational Segment
Organizational segment is hierarchical in nature. First one digit is for Public Sector Entity, next two digits are for
Ministry/Division, next two digits are for Directorate or Department, next two digits are for Subordinate
Office/Institutional and last six digits are for the Institutional Unit at the bottom of the hierarchy. First digit of this 13
digits segment has been kept for public sector. It is a new dimension of BACS that encompasses the comprehensiveness
principle of chart of account. The key benefit of identifying the type of public entity is that it will enable recording of
the budgets and accounts in iBAS++ of a broader set of government entities beyond the budgetary central government. A
new element at the start of the administrative segment can identify the type of public entity e.g. 1-Budgetary Central
Government, 2- Extra-budgetary Central Government, 3- Local Government, 4&5-Other General Government, 6- Non-
financial Public Corporations and 7-Public Financial corporations. Using this additional coding element for the type of
organization, coverage of accounts may be extended to include all autonomous bodies, local governments and state
owned enterprises (SOE) and, to enable implementation of IPSAS and reporting GFS for the general government.

Levels of organizational segment Mode of Financing

Location (9 digits)
Organizational
(13 digits)

Budget Sector
Authorization
Operational

Economic

(4 digits)

(4 digits)
(9 digits)

(8 digits)

(7 digits)

COFOG
(1 digit)

(1 digit)
Fund

Public Sector
(1 digit)
Ministry/Division
(2 digits)
Directorate/Department
(2 digits)
Subordinate
office/Institutional Unit
Group
(2 digits)
Institutional Unit
(6 digits)

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Operation Segment

Operation segment allows budget and accounting data to be captured on the basis of operations. It has four dimensions
such as Activity, Sub-Activity, Task/Scheme/Project Group and Task/Scheme/Project. First one digit is for defining the
activity either 1-Operating Activity or 2- Development Activity. Next one digit is for Sub-Activities. Sub-Activities
under Operating Activity are 1-General Activity, 2-Special Activity, 3-Support Activity, 4- Transfer to Local
Governments. Sub-Activities under Development Activity are 1-Non-annual Development Program and 2-Annual
Development Program. Next 5 digits are for Task/Scheme/Project Group. Next two digits are for specific
Task/Scheme/Project.

Levels of operation segment

Mode of Financing

Location (9 digits)
Operational
(9 digits)
Organizational

Budget Sector
Authorization
(13 digits)

Economic

(4 digits)

(4 digits)
(8 digits)

(7 digits)

COFOG
(1 digit)

(1 digit)
Fund

Activity
(1 digit)
Sub-Activity
(1 digit)
Task/Scheme/Project Group
(5 digits)
Task/Scheme/Project
(2 digits)

Fund Segment The purpose of the Fund Segment is to identify and control where funds will be drawn from at the time
payment is made. This segment distinguishes between transactions of the Consolidated Fund and transaction of the
Public Accounts of the republic. Within the Consolidated Fund, the fund segment also distinguishes between
transactions using fund that are not restricted. Previous 13 digits classification system did not have this Fund Segment.
First one digit is for Type such as 1-Consolidated Fund, 2-Public Account of the Republic and 3-General Fund. Next
one digit is for Sub-Type such as 1-General Fund, 2-Specific Foreign Grant, 3-Specific Foreign Loan. Next three digits
are to capture data regarding the source of fund such as GoB, Foreign Government’s Organizations/International
Organizations etc. Next three digits are to capture specific component/agreements related to that funding.

Levels of Fund segment

Mode of Financing

Location (9 digits)
(8 digits)
Organizational

Budget Sector
Authorization
Fund
Operational
(13 digits)

Economic
(9 digits)

(7 digits)

(4 digits)

(4 digits)
COFOG
(1 digit)

(1 digit)

Type
(1 digit)
Sub-Type
(1 digit)
Source
(3 digit)
Component/Agreement
(3 digits)

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Economic Segment The purpose of economic segment is to facilitate accounting, reporting and control in accordance
with international standards. It also provides data about Government receipts and payments in a form useful for macro-
economic modeling and preparation of the national accounts. First one digit is for ‘Type’ that indentifies each of the
major elements, such as revenues, recurrent expenditures, assets etc. Next one digit is for ‘Category’ which provides
high level aggregation of each major element, such as Tax Revenues, Non-Tax Revenues etc. under ‘Revenue’ head and
Compensation of Employees, Goods and Services etc. under ‘Expenditure’ head. Next one digit is for Sub-Category that
provides aggregation of sub-elements of each major element. Next one digit is for ‘Item’ which provides the breakdown
of each sub-element. Next one digit is for ‘Sub-Item’ that provides lower level information for the head of
ministries/institutions to analyze plan and monitor the revenue /expenditure. Next two digits are ‘Detail’ that provide
information for decision makers to further disaggregated form.

Levels of Economic segment

Mode of Financing

Location (9 digits)
Economic
(8 digits)

(7 digits)
Organizational

Budget Sector
Authorization
Fund
Operational
(13 digits)

(9 digits)

(4 digits)

(4 digits)
COFOG
(1 digit)

(1 digit)
Type
(1 digit)
Category
(1 digit)
Sub-Category
(1 digit)
Item
(1 digit)
Sub-Item
(1 digit)
Detail
(2 digits)

Level-1 aggregated level reports by economic segment will give following information for the users:

Economic Segment (7 digits)

Level-1 (01 digit)
Code Type Mode of Transactions
1 Revenue Cash inflow
2 Capital Receipt Cash inflow
3 Recurrent Expenditure Cash outflow
4 Capital Expenditure Cash outflow
5 Holding Gains/Losses Gains and Losses in Assets and Liabilities
6 Volume Change Gains and Losses in Assets and Liabilities
7 Assets Inflows, Outflows and Stock of Assets
8 Liabilities Inflows, Outflows and Stock of Liabilities
9 Net Assets/Equity Assets minus Liabilities

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Mode of Financing Segment

Mode of financing segment is created to indicate various financing mechanisms available for government projects. This
new segment has designed a single digit code to know whether projects are supported directly by government or receive
finance from foreign sources.

Levels of Mode of Financing Segment

Mode of Financing

Location (9 digits)
Economic
(8 digits)

(7 digits)
Organizational

(1 digit)

Budget Sector
Authorization
Fund
Operational
(13 digits)

(9 digits)

(4 digits)

(4 digits)
COFOG
(1 digit)
1-RPA through GoB
2-RPA through Special
Account
3-DPA

Location Segment

Location segment allows whole of government expenditure and receipt reports to be prepared by location e.g. by
Divisions, Districts, Upazilla and Union Parishad. It will provide useful analytical information for inter-regional
comparison of government spending.

Levels of Location Segment

Mode of Financing

Location (9 digits)
Economic
(8 digits)

(7 digits)
Organizational

(1 digit)

Budget Sector
Authorization
Fund
Operational
(13 digits)

(9 digits)

(4 digits)

(4 digits)
COFOG
(1 digit)

Division
(2 digits)
District
(2 digits)
Upazila
(2 digits)
Union
(3 digits)

11
Authorization Segment

The purpose of authorization segment is to differentiate between Charged Expenditure and Other Expenditure. This
differentiation is a constitutional requirement and therefore included in the new BACS.

Levels of Authorization Segment (Derived Segment)

Location (9 digits)

Authorization
Organizational

Economic

Financing

Budget Sector
(8 digits)

(7 digits)

Mode of

(1 digit)

(1 digit)
Fund
Operational
(13 digits)

(4 digits)

(4 digits)
(9 digits)

COFOG
1-Charged Expenditure
2-Other Expenditure
(Voted)

COFOG Segment
This segment has been included in the new BACS to generate reports in compliance with the Classification of Functions
of Government (COFOG) as suggested by the Statistics Division of the United Nations. This will facilitate to generate
COFOG report from iBAS++ system.

Levels of COFOG Segment (Derived Segment)

Location (9 digits)

Authorization
Organizational

Economic

Financing

Budget Sector
(4 digits)
(8 digits)

(7 digits)

Mode of

COFOG
(1 digit)

(1 digit)
Fund
Operational
(13 digits)

(4 digits)
(9 digits)

Major Function
(2 digits)
Minor Function
(1 digit)
Detail Function
(1 digit)

12
Budget Sector Segment

In addition to the COFOG functional grouping a separate segment has been included in the new BACS to group planned
expenditure by budget sectors. Nine of the budget sectors are aligned to COFOG with economic function expanded to
fourteen budget sectors.

Levels of Budget Sector Segment (Derived Segment)

Location (9 digits)

Budget Sector
Authorization
Organizational

Economic

Financing
(8 digits)

(7 digits)

(4 digits)

(4 digits)
Mode of

COFOG
(1 digit)

(1 digit)
Fund
Operational
(13 digits)

(9 digits)

Sector
(2 digits)
Sub-Sector
(2 digits)

Strengths of new Budget and Accounting Classification System

Critical analysis of Budget & Accounting Classification Manual, other related documents and information gathered
from the interview suggested the following key characteristics of the new Budget and Accounting classification system:

Whole of Government Comprehensive Coverage

With nine mutually exclusive and independent segments the new BACS become comprehensive. Inclusion of ‘Public
Sector’ as the first digit of organizational segment made BACS capable of encompassing all other extra budgetary
entities such as local governments, autonomous bodies and state owned enterprises (SoE) into a broader set of
government entities beyond the budgetary central government. The new element of ‘Public Sector’ at the start of the
administrative segment can identify the type of public entity.

Multi-Dimensional Classification System

The new BACS has multiple dimensional classification frameworks. It has administrative or organizational dimension
that would ensure availability of budget and accounting for ensuring financial control and administrative accountability.
With operational segment the government can identify and group the transactions to provide information on the exact
cost of the government policy objectives and delivery of services. Fund segment has been included in BACS to identify
all the cash inflows and outflows from Consolidated Fund and Public Accounts of the Republic. Economic segment of
BACS is now capable of capturing more detail information in multiple disaggregated and aggregated levels. Inclusion
of locations segment in BACS is new dimension that allows policy makers to analyze government revenue and
expenditure on geographical basis. Inclusion of derived segments such as Authorization, COFOG and Budget Sector
would meet national and international requirements for producing financial and statistical reports.

Capable of generating diverse and detailed level of information

The hierarchical and parent-children relationship types of organization structure is capable of generating diverse and
very detailed information that can be used by the decision makers in effectively performing day to day activities of each
and every level of the organization. BACS can generate activity reports by the most bottom level of budgetary units
under any Ministry and Division. For example, different types of aggregated reports for the purpose of budgetary
control can by generated by the Ministry of Primary and Mass Education at Secretariat level. These reports can also be
generated by Directorate of Primary Education that would give aggregate information for whole directorate. Another
level of aggregated information can be generated by using ‘Government Primary School’ group code. Here all relevant
information regarding revenue and expenditures generated/incurred by all primary schools in Bangladesh will be
available. Finally, if we want to know the revenue and expenditure detail of the lowest tier administrative unit, for
example a specific primary school say ‘Choto Nilgonj Government Primary School’ BACS is capable of generating this
report through iBAS++ instantly.

13
Capable of implementing accrual accounting system

BACS is on general ledger framework that allows the system to record transactions on double entry basis. This would
allow Bangladesh to move forward with the implementation of accrual accounting system without needing any
structural changes to the classification codes.

Third party payments such as Direct Project Aid can be differentiated and reported separately

With the inclusion of ‘Mode of Financing’ segment the new BACS become capable to capture third party payments
such as Direct Project Aid (DPA) in the iBAS++ system. It would give the comprehensive of government expenditures
including payments made by third party donor countries through project aid.

Capable of producing IPSAS compliant reports

The six segments multi-dimensional coding structure with three additional derived segments the new BACS is now
capable of generating the following IPSAS compliant reports:

 Cash flow statement classified according to operating, investing and financial activities as specified in
IPSAS 2 Cash Flow Statement;
 Statement of financial operations showing the results of the operating performance of the government and
the resulting surplus or deficit;
 Statement of financial position showing financial assets and liabilities under present accounting basis
evolving a complete disclosure of all assets in future;
 Statement of changes in net assets/ equity showing value and volume changes to assets and liabilities that
are not related to a transaction entered into the government

Capable of producing GFS compliant reports

IMF Government Finance Statistics Manual (GFSM) has been extensively followed in designing the structure of BACS
and it is therefore supposed to generate GFS compliant report. However this study found some deviations from GFS
Manual which would be discussed in later part of this paper.

New BACS is capable of adopting with the integration of (operating + development budget)

The benefit of distinguishing between development and non-development expenditures is eroding. Modern integrated
financial management system is therefore favouring integration of both operating and development budget into one
single unitary budgetary system. Once the government decides to integrate both operating and developing budget into
one operating budget, the new BACS is capable of implementing this decision.

Capable of generating consolidated reporting

Since BACS followed a unified classification structure it enables all government entities i.e. budgetary and extra
budgetary to share data for aggregation of data within the system. This would help to produce consolidated reports
covering the whole of Government.

Capable of establishing parliamentary control

Parliament allocates funds through the annual Appropriation Act, which requires accountability and controls on
subsequent spending. The authorization classification which has been included in new BACS can be used to present
the combined demands for grant and appropriations to ensure transparency and accountability of public spending.

Capable of implementing program budgeting

Inclusion of separate coding structure for ‘Scheme’ under operation segment would allow the government to go for
implementation of program budget in future.

Implementation Issues and Challenges

Although benefits of BACS are evident from the study the new chart of account is not fully free from
implementation challenge. During the interview some of the key stakeholders raised number of issues that are
hindering smooth implementation of the new coding system. These are briefly discussed in the following

14
paragraphs.

Long and Complex Coding System

General perception among filed level users of BACS is that it is long and quite complex. On this complexity issue
interview responses came up with mixed reactions. One group of respondent thinks that complexity issue would be
taken care of by the computerized iBAS++ software system. This group believes that users do not require knowing the
detail mechanism of coding structure. They only require their user ID and password to get into the iBAS ++ system and
the system would automatically map most of coding structure in the system. Moreover the requirement of data entry in
iBAS++ is very limited. Most of the users only require inputting data that relates with economic codes only which user
can easily get from iBAS++ platform. This platform is very user friendly that provides require information in many
ways.

Ownership Issue

The new Budget and Accounting Classification System has been developed by an internal team of Strengthening Public
Expenditure Management Program (SPEMP) with the help of few international experts. Three IMF technical missions
have also advised MoF in designing an appropriate chart of accounts for budgeting and accounting purpose. Concerned
has been raised in regarding lack of ownership of this system by important stakeholder. It is argued that preparation and
amendment of Chart of Accounts is a core function of the CGA office but its contribution in designing and developing
the BACS is quite insignificant. CGA’s technical staffs are not well aware of the structural architecture of this new
chart of accounts and therefore chances of committing mistakes in administering this sophisticated system is quite high.

Capacity Development Issue

Although training and capacity development programs are continuous organized by SPEMP office it is not adequate
compared to the training requirements. Under the new BACS and iBAS++ system all Drawing and Disbursement Offices
(DDO) including the lowest level field office across the country become budget holder and require using the BACS and
iBAS++ systems. Training all the relevant officials dealing public finance remain a challenge. Frequent transfer of
officials and staff to and from budget sections and wings in all ministerial/divisional, departmental and unit levels made
the capacity development issue even worse.

Economic codes classification-inconsistent with GFSM

Although Chart of Accounts differs in different jurisdiction to meet their own requirement, countries usually follow
Government Finance Statistic Manual (GFSM) in designing an effective Chart of Account. Bangladesh also took
GFSM as a standard framework. Following table compares the economic code nomenclatures and numbering designed
in BACS and GFSM framework.
Economic Code comparison: BACS vs. GFS Manual 2014
BACS, 2018 GFS Manual 2014
Group Group
economic Nomenclature economic Nomenclature
code code
1 Revenue 1 Revenue
2 Capital Receipts 2 Expenses
3 Recurrent Expenditure 3 Transactions in Assets and Liabilities
4 Capital Expenditure 4 Holding Gain/ Loss of assets and liabilities
5 Holding Gain/ Loss 5 Volume Change of assets and liabilities
6 Volume Change 6 Stock positions in assets and liabilities
7 Assets 7 Total Expenditure as per COFOG classification
8 Liabilities 8 Net financial worth
9 Net Assets/Equity 9 Net worth and its changes

GFSM framework has allocated (1) for all revenue but BACS divided revenue in two categories i.e. revenue (1) and
capital receipts (2). GFSM defines (2) for all expenses whereas, BACS divided expenditure in two categories i.e.
recurrent expenditure (3) and capital expenditure (4). Due to this significant difference between BACS and GFSM
coding designs BACS and iBAS++ are not able to automatically generate GFS reports.

15
Continuous changes of Chart of Account

Once the design of Chart of Account is complete and the codes are implemented these should remain constant until the
CoA is amended. If CoA is amended it should not even applied unless all stakeholders are properly appraised regarding
the amendment. It is observed that although the new BACS and iBAS ++ has been implemented from July 2018 and
budgets for the FY 2018-19 and 2019-20 were prepared and executed under new BACS and iBAS++ systems, the
organizational and economic codes are getting changed regularly without intimating the stakeholders. One example of
such code change may be worthwhile to mention here. The nomenclature for economic code 3632104 as printed in
2018-19 original budget book and revised budget book of Ministry of Cultural Affairs was ‘Research Grant’ but the
nomenclature of the same economic code 3632104 become ‘Grant for Construction of Building and Structure’ in 2019-
20 budget document of the same ministry. This kind of change would seriously hamper the integrity of data and such
data would lose its reliability and be meaningless and incomparable.

BACS has not yet been implemented for revenue receipts

BACS could not be implemented for capturing revenue even after two years of its implementation. Till to date all
revenues are being deposited by the citizens and taxpayers are using 13 digits old codes in deposit forms and challans.
This unusual delay is seriously undermining the reform process.

Limited coverage of public sector entities

Out of 8 budgetary and extra budgetary organizations under ‘Public Sector’ only one i.e. Budgetary Central
Government is currently in use. All other public sector entities such as extra budgetary autonomous bodies, local
governments, public non-financial corporations and public financial corporations are still outside the coverage of
government budgetary and accounting system. As a result whole of government budgetary control and accountability
not yet been established.

Different functional classifications are in use

Inconsistency has been observed in using different types of functional classifications in various types of budget
documents. BACS follows a separate classification for government functions following 10 categories specified by
United Nations. Another 14 categories of Budget Sector classification has also been included in derived segment of
BACS. On the other hand Planning Commission has classified government functions in 17 categories. A comparison of
government functions included in BACS and UN COFOG has been shown in Appendix-2. Another category of
government functions as mentioned by the Planning Commission in its Annual Development Program (ADP) has been
shown in appendix-3.

While the difference between COFOG classification and a separate budget sector classification for the purpose of
meeting government requirement is understandable, it is not clear why the budget sector classified in BACS differ from
Planning Commission classification. It has been reported that functional reports could not be generated from iBAS++
because of these inconsistency.

All accounting and management reports are not available

Full benefit of BACS and iBAS++ could not yet been capitalized as because templates for numerous accounting and
management report could not yet been finalized in iBAS ++ system.

Difficulties in preparing appropriation accounts

Appropriations accounts could not be centrally generated from iBAS++ system. Currently appropriations accounts are
separately prepared by the individual Chief Accounts Officer of different ministries or Divisions and these separate
appropriation accounts need to be compiled manually.

Relevance, Efficiency, Effectiveness and Sustainability

Findings of this study as discussed earlier support that reform for improvement of PFM system of Bangladesh was not
possible with continuation of 13 digits chart of accounts. It was therefore essential to abandon the 13 digits coding

16
system introduced in Bangladesh in 1998 and designing a new Budget and Accounting Classification System in line
with international standard was significant and quite relevant for further reform of PFM system in Bangladesh.

BACS was implemented as part of overall PFM reform process under the Strengthening Public Expenditure
Management Program with the technical assistance from IMF and no significant extra cost was required for this
purpose. In that context introduction of BACS can be considered efficient as well. Although there are implementation
challenges as discussed earlier the study identified significant strengths in BACS that certainly improved the overall
effectiveness of PFM system in Bangladesh.

Since BACS design requires further refinement for making proper alignment with GFSM, COFOG and ADP document
the author is a bit skeptical regarding long term sustainability of BACS in its present form. The new chart of account
needs to be modified to meet the future demand and this sort of modification is possible without abandoning BACS like
previous 13 digit codes. The new BACS is flexible in nature and is scalable for future adjustment.

Further Research Area Identified

The BACS that has been introduced in Bangladesh in July 2018 is less than two years old system. This study suggest
that BACS could not yet been fully implemented and significant challenges on the way to full implementation of BACS
remained to be addressed. Successful implementation of BACS is greatly depends on the proper design and
implementation of automated iBAS++ system. Generation of adequate accounting and management reports could be
automatic output if reporting templates are properly programmed in iBAS ++ system. This may require additional skill
and deployment of additional work force. A thorough research should be done to identify the reporting requirements of
various stakeholders and to verify how many of them have been designed in iBAS ++ system and how many are yet to be
developed. Specific research may be conducted to examine how far the BACS complies with international norms and
find the areas where modification of BACS is required to make it as much compatible as possible with the international
best practices such as International Public Sector Accounting Standards (IPSAS) and Government Finance Statistics
Manual (GFSM). Another feasibility study may also be conducted for taking preparation to implement accrual
accounting system in government accounting system of Bangladesh.

Recommendations

Although significant improvement has already been done in PFM reform area by the implementation of new chart of
account in Bangladesh, more coordinated effort is required from all stakeholders for maximizing the benefits from the
new system. In this regard the following short term, medium term and long term actions are recommended:

Short Term

Comprehensive training programs needs to be continued on BACS and iBAS++systems;

i. In order to ensure proper stewardship, building ownership and making the reform sustainable, special measure
is required to engage as many officials and staffs as possible from the controller general of accounts (CGA)
office in BACS and iBAS++ reform process;
ii. Further work is required to reduce the inconsistencies between BACS and GFSM in respect of designing
economic coding system;
iii. Immediate measure need to be undertaken to agree with a uniform functional categorization of budget sector
by the Planning Commission and Ministry of Finance;
iv. No organizational, operational, fund or economic code should be changed or amended without proper
consultation with the stakeholders and without knowledge of the concerned authority;
v. Although revenue codes are available in BACS but these are not yet been used rather the old four digits
economic codes are still used by the stakeholders. This is giving wrong message to the stakeholders regarding
the reform process and therefore new revenue codes should be implemented without any delay.

Mid Term

i. Extra budgetary government organizations such as autonomous bodies, local governments, state owned
enterprises (SoE), non-financial public corporations, financial public corporations should be included in the
overall government budgeting and accounting process. Gradual expansion strategy by including these public

17
 institutions in to the whole of government budgetary process one after another might be followed for this
purpose;
ii. Need to take necessary preparatory actions for adopting IPSAS standard in government accounting system of
Bangladesh;
iii. Initiate preparatory works to move into accrual accounting system.

Long Term

i. Implement IPSAS standards in government accounting as much as possible;

ii. Implement full accrual accounting system in whole government accounting system of Bangladesh.

Conclusion
Transparency and accountability are the two most important factors for an effective public financial management
(PFM) system. All public spending must be done in transparent way to ensure value for taxpayers’ money and all
executive responsible for spending public money for achieving specific outcome must also be accountable to the
citizens of the country. Proper budget and accounting are therefore remaining the two centre points of this
accountability framework. Without proper budgeting process accountability framework cannot be established. In this
regard chart of account plays most important role as it is the backbone of this overall process. Public financial
management reform process in Bangladesh is progressing quite well since mid 1980s and further strengthened at the
beginning of this decade with starting automation of overall budget and accounting process through iBAS. This PFM
reform process has got further strengthened with the introduction of improved version of iBAS ++ and introduction of
new budget and accounting classification system. The new BACS more or less followed basic principles of formulation
of chart of account and aligned with internationally best practices. The less than two years old iBAS++ and BACS are
currently facing few implementation challenges which are manageable. Public Financial Management (PFM) system
will significantly improved after full implementation of new BACS in all public sector entities of Bangladesh.

APPENDIX-1

Interview guide for conducting face to face semi-structured interviews with the key stakeholders of the new
Budget and Accounting Classification System (BACS) in Bangladesh

1. In your opinion why GoB required abandoning 13 digit charts of accounts which Bangladesh has just introduced
just 20 years ago?
2. Do you think the new 56 digits code complies with the requirements of International Public Sector Accounting
Standard (IPSAS), IMF’s Government Finance Statistics Manual (GFSM) and United Nations Classification of
Functions of the Government (CoFoG)?
3. Whether the new 56 digits code is capable of generating Whole of Government Accounts (WGA)? What are the
biggest challenges for preparation of WGA under the new BACS?
4. Planning Commission prepared the ADP dividing all government activities in 17 economic sectors. Adopting 10
COFOG sectors in line with the UN the new BACS added another segment with 14 sectors to meet the local
context. What is the explanation regarding this inconsistency? What should be the next course of action to remove
this difference?
5. The biggest advantage of 56 digits new code is said to be the ability of generating numerous reports that will assist
all levels of management in taking effective decisions. Whether the users are now easily getting these reports from
iBAS++ system and using them in taking management decisions?
6. Long coding system may tends to committing mistakes, thus may lead to wrong classification of income and
expenditure. Taking last two years’ implementation experience into account, how big you think the risk is?
7. Do you think new BACS is user friendly? What challenges are you facing in implementing this 56 digits new code
in your tasks related to budget preparation, execution, accounting and reporting?

18
 Appendix-2

Government Functions comparison- BACS vs. COFOG

BACS Budget Sectors COFOG Sectors
1 General Public Service 1 General Public Service
2 Defense 2 Defense
3 Public Order and Safety 3 Public Order and Safety
4 Industrial and Economic Services
5 Agriculture
4
6 Power and Energy Economic Affairs
7 Transport and Communications
8 Local Government and Rural Development
9 Environmental Protection 5 Environmental Protection
10 Housing and Community Amenities 6 Housing and Community Amenities
11 Health 7 Health
12 Recreation, Culture and Religion 8 Recreation, Culture and Religion
13 Education and Technology 9 Education
14 Social Protection 10 Social Protection

Appendix-3
Government functions as categorized in ADP by the Planning Commission
1 Agriculture
2 Rural Development and Rural Institution
3 Water Resources
4 Industry
5 Power
6 Oil, Gas and Natural Resources
7 Transport
8 Communications
9 Physical planning, water supply and housing
10 Education and Religion
11 Sports and Culture
12 Health, nutrition, population and family planning
13 Public Relations
14 Social welfare, women affairs and youth development
15 Public administration
16 Science, information and communication technology
17 Labour and employment

REFERENCES
1. Bangladesh Government Press (2009), The Public Money and Budget Management Act, 2009 (Act no 40 of 2009)
2. Cooper, J. and Pattanayek, S. (2011), Chart of Account: A Critical Element of the Public Financial Management
Framework, Fiscal Affairs Division, IMF.
3. Finance Division, MoF, Public Expenditure Management Strengthening Program (2017), Budget & Accounting
Classification Manual.
4. Finance Division, MoF (2018), Public Financial Management (PFM) Action Plan 2018-2023.
5. Fiscal Affairs Division, IMF (2014), Government Finance Statistics Manual, 2014.
6. Jacobs, D., Helis, J., and Bouley, D. (2009), Budget Classification, Fiscal Affairs Division, IMF.
7. Planning Commission, Ministry of Planning (2019), Annual Development Plan (ADP) 2019-2020.
8. Saxena, S., Gentry, D., Kauffmann, K. and Lwin, T. (2014, Designing a New Budget and Accounting
Classification, Fiscal Affairs Division, IMF.

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