## 2.31 GFS within Fiscal Analysis and Policymaking

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---

### Summary Details
- Task Team Responsible: Fiscal Analysis and GFS
- Communication TT (TT4)
- Authors of Discussion Note: Dane Mead, Isabel Rial, James Ebdon, Luis Reyes, Bruno Rocha
- Core purpose: Explore improvements to GFS guidance for fiscal analysis and policymaking and present draft recommendations.

### Key findings on GFS role and user feedback
- User views:
  - Strong support for expanded guidance on using GFS in fiscal analysis and policymaking, with a significant minority preferring separate supplementary information.
  - Quantitative feedback: "42 out of 72 respondents supported expanded guidance to be included within the updated GFSM. 25 other respondents were also supportive of expanded guidance but wanted it provided outside of the GFSM."
- GFS and Public Financial Management (PFM):
  - GFS is an internationally recognized framework supporting core PFM functions: budgeting, accounting, reporting, forecasting, and risk management.
  - Countries that embed GFS typically achieve better fiscal data, risk oversight, and policy coherence.
- International fiscal analysis and surveillance:
  - GFS ensures consistent, comparable fiscal data for cross-country analysis and IMF surveillance.
  - GFS underpins IMF initiatives including the Fiscal Transparency Code and the Fiscal Risk Assessment Tool, and enables IMF Article IV consultations and the Fiscal Monitor.
- GFS supplementary information:
  - Items such as provisions, contingent liabilities, guarantees, and tax relief measures are mostly excluded from core GFS and can improve fiscal risk assessment and debt sustainability analysis when reported as supplementary information.

### Introduction: purpose and framework
- GFS provides a standardized, comprehensive framework to record public sector finances based on accrual principles and harmonized with the SNA, BoP, and MFS for accurate measurement of government revenues, expenditures, assets, and liabilities.
- GFS includes a Statement of Sources and Uses of Cash to support liquidity and financing analysis for countries that primarily use cash reporting.
- The Discussion Note considers whether existing GFS guidance can be improved to better support fiscal analysis and policymaking.

### Existing guidance and gaps (Issue A)
- Current GFSM 2014 content:
  - Chapter 1: short description on Uses of the GFS Framework outlining how policymakers and analysts can use GFS to assess government performance and financial position and combine/compare with other macroeconomic datasets.
  - Annex of Chapter 4: overview of Using GFS for Fiscal Analysis, including the context of use, available fiscal indicators, and indicators requiring integration between GFS and additional data.
- Identified limitations:
  - Annex focuses on using GFS Codes to calculate indicators, with limited practical guidance on how indicators improve PFM or support fiscal analysis.
  - Some indicators are dated (example: ‘policy lending’ legacy from GFSM 1986) and may conflict with GFSM 2014 guidance; the current list may lack indicators more commonly used today.

### Integration of GFS and Public Financial Management (Issue B)
- Roles and channels:
  - Enables better budget management and fiscal policy choices.
  - Facilitates more credible fiscal forecasting, improving medium-term planning and long-term debt sustainability.
  - Enables more proactive fiscal risk management.
- Dual reporting feature:
  - Integration of cash and accrual fiscal data ensures consistency across accrual and cash data for main fiscal categories and supports countries maintaining cash-based budgeting while using accrual data for a comprehensive view.
  - GFS introduces a complete government balance sheet including financial and nonfinancial assets and liabilities and broader coverage of public entities and transactions (examples: public employees pension funds, state-owned enterprises, contingent liabilities).
- Balance sheet and forecasting:
  - GFS identifies long-term assets and liabilities that may not have immediate cash implications, enabling more accurate long-term fiscal forecasting and improved MTFFs and long-term macroeconomic models.
  - The World Bank’s and IMF’s Debt Sustainability Analysis (DSA) relies heavily on comprehensive, timely, and high-quality GFS data on integrated stocks and flows.
- Fiscal risk management:
  - GFS public sector balance sheet prescribes reporting of all public sector assets and liabilities, expanding coverage to public corporations, PPP-related liabilities, and state guarantees often treated as memorandum items.
  - Expanded coverage helps shift from descriptive reporting of fiscal risks to proactive fiscal risk management.
- Relationship with other standards:
  - Managing PFM systems may require reporting under both GFS and accounting standards (e.g., IPSAS / national GAAP); full application of GFS must account for statutory reporting needs.
  - GFSM Update Research Project 2.32 discusses the role of balance sheet analysis for GFS; recommendations from Discussion Notes 2.31 and 2.32 are interrelated and complementary.

### Country examples illustrating GFS integration (Box 1)
- Georgia:
  - Introduced a new GFS-aligned chart of accounts, IFMIS, SOE Health Check Tool, and a public sector balance sheet approach.
  - Reclassification of hundreds of public entities into central government affected main fiscal aggregates in 2021.
  - A fiscal risks management function was created in the Ministry of Finance in 2020; an update of the Fiscal Transparency Evaluation in 2023 took stock of progress.
- Ecuador:
  - Between 2020-2023 amended its Public Financial Management Law aligning fiscal reporting to GFS principles, improving integration of budget execution and financial statements.
- Cabo Verde:
  - Extended coverage to public corporations, implemented the SOE Health Check Tool using GFS-aligned income and balance sheet statements, and automated fiscal reporting in IFMIS.
- Liberia and Kosovo:
  - Used GFS as a guide for post-conflict PFM reforms, developing new charts of accounts and financial reporting systems to support their MTFFs, improving fiscal discipline and donor confidence.
- Source data for examples: IMF & World Bank Technical Assistance Reports, country specific.

### Public resource management and balance sheet approach
- Reliable GFS data strengthens public resource management by compiling assets, liabilities, revenues, and expenditures into consistent stocks and flows, enabling public sector balance sheets to reveal current and long-term fiscal risks and opportunities.
- GFSM Update Research Project 2.32 addresses integration of public resource management and GFS more directly.

### GFS links with international fiscal analysis and surveillance (Issue C)
- GFS enables standardized, comparable fiscal and debt data across countries, forming a foundation for the IMF’s Fiscal Affairs Department to evaluate government operations and develop analytical tools and recommendations.
- Fiscal Transparency Code (FTC):
  - FTC comprises four pillars: (i) fiscal reporting; (ii) fiscal forecasting and budgeting; (iii) fiscal risk analysis and management; and (iv) resource revenue management.
  - GFS supports FTC by supplying standardized language and structures for fiscal reporting and fiscal risk disclosure, aligning definitions of public sector and subsectors.
  - GFS recommendations to include contingent liabilities and off-budget transactions support the FTC’s emphasis on fiscal risk disclosure.

### Recommendations and proposed approach
- Structural recommendation:
  - Remove Annex 4 from the GFS Manual but retain Fiscal Indicators as an appendix or as supplementary reference material, with a targeted review of the Fiscal Indicators to ensure ongoing relevance.
- Guidance expansion:
  - Expand guidance to support the use of GFS in fiscal analysis and policymaking, covering a wide range of use cases, tools, and resources explored in the Discussion Note.
- Placement and timing:
  - Move the expanded guidance into supplementary formats outside of the GFS Manual; format, platform, and approach should adapt to emerging best practice and stakeholder feedback.
  - Preparation of supplementary guidance would likely follow release of the new GFS Manual, subject to available resources and prioritization.

### The IMF’s Fiscal Risk Assessment Tool (FRAT) — overview and links to GFS
- FRAT provides a high-level portfolio perspective on a wide range of fiscal risks to which governments are typically exposed.
- FRAT uses GFS-aligned data to assess fiscal exposure and to generate actionable insights for risk mitigation, contingency planning, and management of fiscal buffers.
- FRAT is a starting point for fiscal risk analysis; more detailed quantification is supported by specific tools in the IMF's Fiscal Risk Toolkit.

### Tools in the IMF Fiscal Risk Toolkit (examples cited)
- SOE tools:
  - State-Owned Enterprise (SOE) Health Check Tool (SOE-HCT) and SOE Stress Test Tool (SOE-ST): evaluate fiscal costs and risks from public corporations; rely on GFS and IFRS mapping to consolidate public corporations accounts into the public sector balance sheet.
- DGAT:
  - Discrete Guarantee and Loan Assessment Tool (DGAT): quantifies potential calls on government guarantees and loans, drawing on GFS classification for contingent liabilities and other economic flows.
- PFRAM:
  - PPP Fiscal Risk Assessment Model (PFRAM): estimates the impact of public-private-partnerships on public sector net worth, including fixed assets, liabilities (both firmed and contingent), and long-term fiscal commitments (i.e., government’ future payments and revenue).

### Role of GFS in IMF surveillance and monitoring
- GFS contributes to the IMF’s Fiscal Monitor by enabling cross-country comparisons of fiscal indicators and trends; the Fiscal Monitor also utilizes other source data, which may sometimes differ from GFS figures.
- During Article IV consultations, the GFS framework aids surveillance by providing standardized fiscal data used to identify potential vulnerabilities and inform policy discussions.
- GFS identifies gaps where fiscal information may be incomplete or inconsistent, guiding efforts to improve data quality and coverage.
- GFS data are used to generate key indicators for the United Nations Sustainable Development Goals (SDGs) using data from the GFS Yearbook (GFSY) database.
- Integrating the IMF’s Fiscal Monitor with the GFSY potentially combines policy insights with statistical data, enhancing monitoring of SDG progress at the national level.

### Data adequacy and quality assurance frameworks
- The IMF’s Data Adequacy Assessment for Article IV consultations evaluates whether member countries provide sufficient data for economic surveillance, reviewing availability, timeliness, and coverage of fiscal and debt statistics; the assessment identifies specific gaps when data are insufficient and offers recommendations for improvement.
- The IMF uses the Data Quality Assessment Framework (DQAF) for Government Finance Statistics (GFS) and Public Sector Debt Statistics (PSDS) to evaluate integrity, methodological soundness, accuracy, reliability, serviceability, and accessibility of fiscal data.
- The DQAF supports assessment of data compilation and dissemination, prioritization of capacity-building, and encouragement of best practices to ensure compliance with international standards.

### Importance of GFS supplementary information for fiscal analysis (Issue D)
- Supplementary information outside the core GFS accounts—such as provisions, contingent liabilities, guarantees, and tax relief measures—is critical for understanding fiscal risks, debt sustainability, and the true financial position of the public sector.
- Integrating supplementary items into fiscal analysis leads to:
  - More credible fiscal forecasting;
  - Proactive risk management; and
  - Improved policy coherence.
- Provisions:
  - Frequently excluded from the main GFS framework per GFSM 2014 because of recognition and measurement complexities.
  - The only explicit provisions noted are “provisions for calls under standardized guarantees,” considered liabilities; others (e.g., provisions by the creditor for bad debts or expected losses) are not recorded in macroeconomic statistics (paragraph A3.33).
  - Recent research and updates to international standards (such as the SNA and BPM) acknowledge that some provisions are explicitly reflected in GFS while others remain outside the core accounts; guidance should evolve to consider explicit inclusion where material.
- Contingent liabilities and guarantees:
  - Generally excluded from the main reporting framework but best practice recommends recording them as memorandum items for fiscal monitoring and sustainability analysis.
  - Tracking guarantees and indemnities in PPPs, central government guarantees to subnational governments and SOEs, and other contingent liabilities brings hidden or off-budget liabilities to light and enables proactive management of fiscal shocks.
- Tax relief measures:
  - Not always systematically captured within GFS but can substantially impact government revenue and fiscal balances; supplementary reporting on tax relief is essential for evaluating fiscal policy effectiveness.

### Options identified to address guidance and scope issues
- Option 1: Maintain the current guidance
  - Maintain the current GFSM 2014 guidance on fiscal analysis and policymaking, relying on widely available information sources outside GFSM 2014.
  - Rationale: efficient path forward and avoid diverting resources from higher priority GFSM 2014 updates.
- Option 2: Update current guidance within GFSM 2014
  - Update existing guidance to better support use of GFS within fiscal analysis and policymaking in response to community feedback.
  - Potential updates could include:
    - Expanding and contemporizing the ‘Uses of the GFS Framework’ section in Chapter 1;
    - Expanding and contemporizing the ‘Using GFS for Fiscal Analysis’ section in Chapter 4 Annex; and
    - Reviewing and updating the set of fiscal indicators in the Chapter 4 Annex, including those requiring integration between GFS and additional data.
  - Additional structural options:
    - Combine the ‘Uses of the GFS Framework’ section into the Chapter 4 Annex; or
    - Move expanded guidance into a new Appendix.
- Option 3: Update and move guidance outside of GFSM 2014 (supplementary information)
  - Update guidance as in Option 2 but place expanded guidance outside the core GFSM 2014 as separate supplementary information.
  - Advantages:
    - Supports a streamlined core manual focused on essential concepts and principles;
    - Makes materials available separately for users specifically interested in fiscal analysis and policymaking;
    - Allows greater flexibility for more frequent updates and adaptation for different audiences and delivery mediums.
  - Risks:
    - Requires dedicated resources and expertise to prepare and maintain the supplementary information over time.
  - Suggested content for supplementary information:
    - Topics from the Background and Issues section, including the PFM framework, fiscal forecasting and fiscal sustainability, and use of the Fiscal Transparency Code and Fiscal Risk Assessment Tool.
  - Example platform: the ICMStat Compilers Hub as a community platform to share such information with a compiler audience.

### Draft recommendations (complementary)
- Recommendation addressing Issue A:
  - Recommend removing the Annex of Chapter 4 from the GFS Manual but retaining Fiscal Indicators as an appendix or as supplementary reference material; the Fiscal Indicators would be reviewed and updated to ensure ongoing relevance.
  - Rationale: supports reducing the scope of the GFS Manual to focus on essential concepts and principles.
- Recommendations to address Issues B, C, and D:
  - Recommend expanding guidance to support the use of GFS in fiscal analysis and policymaking, covering a wide range of use cases, tools and resources explored in the Discussion Note.
  - Recommend moving the expanded guidance into supplementary formats that sit outside the GFS Manual, with format, platform, and presentation adapted to emerging best practice, stakeholder feedback and user needs.
  - Timing/prioritization: This supplementary guidance would likely be prepared following the release of the new GFS Manual, pending available resources and prioritization.

### Governance and consultation context
- Preliminary views of the GFSAC:
  - An earlier version of the discussion note was discussed at the GFSAC meeting of January 2026; the current version addresses suggestions made by GFSAC members at that meeting and the task team recommendations are consistent with the preliminary views of most GFSAC members.
- Selected questions for Global Consultation:
  - Issue A: Do you agree with the recommendation to remove the Annex of Chapter 4 from the GFS Manual but retain Fiscal Indicators as an appendix or as supplementary reference material?
  - Issue B: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on the integration of GFS and PFM?
  - Issue C: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on the GFS links with international fiscal analysis and surveillance?
  - Issue D: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on GFS supplementary information to support fiscal analysis?

*Source: GFSM 2014 Update Consultation: March 2026 — Discussion Note 2.31 (Fiscal Analysis and GFS Task Team) and Discussion Note 18 (The IMF’s Fiscal Risk Assessment Tool).*

### 2.31 GFS within Fiscal Analysis and Policymaking

### 2.31 GFS within Fiscal Analysis and Policymaking

### Summary Details
- Task Team Responsible: Fiscal Analysis and GFS
- Communication TT (TT4)
- Authors of Discussion Note: Dane Mead, Isabel Rial, James Ebdon, Luis Reyes, Bruno Rocha
- Core purpose: Explore improvements to GFS guidance for fiscal analysis and policymaking and present draft recommendations.

### Key findings on GFS role and user feedback
- Users demonstrate strong support for expanded guidance on using GFS in fiscal analysis and policymaking, while a significant minority prefer separate supplementary information.
- Public Financial Management:
  - GFS is an internationally recognized framework supporting core PFM functions: budgeting, accounting, reporting, forecasting, and risk management.
  - Countries that embed GFS typically achieve better fiscal data, risk oversight, and policy coherence.
- International Fiscal Analysis and Surveillance:
  - GFS ensures consistent, comparable fiscal data for cross-country analysis and IMF surveillance.
  - GFS underpins IMF initiatives including the Fiscal Transparency Code and the Fiscal Risk Assessment Tool, and enables IMF Article IV consultations and the Fiscal Monitor.
- GFS Supplementary Information:
  - Items such as provisions, contingent liabilities, guarantees, and tax relief measures are mostly excluded from core GFS and can improve fiscal risk assessment and debt sustainability analysis when reported as supplementary information.
- Quantitative feedback:
  - According to Summary of Responses to Consultation on Proposals to Advance the GFSM Update, 42 out of 72 respondents supported expanded guidance to be included within the updated GFSM. 25 other respondents were also supportive of expanded guidance but wanted it provided outside of the GFSM.

### Introduction: purpose and framework
- GFS provides a standardized, comprehensive framework to record public sector finances based on accrual principles and harmonized with the SNA, BoP, and MFS for accurate measurement of government revenues, expenditures, assets, and liabilities.
- GFS includes a Statement of Sources and Uses of Cash to support liquidity and financing analysis for countries that primarily use cash reporting.
- The Discussion Note considers whether existing GFS guidance can be improved to better support fiscal analysis and policymaking.

### Existing guidance and gaps (Issue A)
- GFSM 2014 currently contains:
  - Chapter 1: a short description on Uses of the GFS Framework outlining how policymakers and analysts can use GFS to assess government performance and financial position and combine/compare with other macroeconomic datasets.
  - Annex of Chapter 4: overview of Using GFS for Fiscal Analysis, including:
    - The context of using GFS within fiscal analysis.
    - What fiscal indicators are available from the GFS framework.
    - What fiscal indicators require integration between GFS and additional data.
- Limitations identified:
  - The Annex focuses on how particular GFS Codes can be used to calculate indicators, with limited practical guidance on how these fiscal indicators improve PFM or support fiscal analysis.
  - Some indicators are dated (example: ‘policy lending’ legacy from GFSM 1986) and may conflict with GFSM 2014 guidance; the current list may lack indicators more commonly used today.

### Integration of GFS and Public Financial Management (Issue B)
- GFS supports all core PFM functions and acts as a backbone for PFM reforms across the budget cycle, ensuring comparability, credibility, and accountability.
- Channels through which GFS strengthens PFM:
  - Enables better budget management and fiscal policy choices.
  - Facilitates more credible fiscal forecasting, improving medium-term planning and long-term debt sustainability.
  - Enables more proactive fiscal risk management.
- Dual reporting feature:
  - Integration of cash and accrual fiscal data ensures consistency across accrual and cash data for main fiscal categories and supports countries maintaining cash-based budgeting while using accrual data for a comprehensive view.
  - GFS introduces a complete government balance sheet including financial and nonfinancial assets and liabilities and broader coverage of public entities and transactions (examples listed: public employees pension funds, state-owned enterprises, contingent liabilities).
- Balance sheet and forecasting:
  - GFS identifies long-term assets and liabilities that may not have immediate cash implications, enabling more accurate long-term fiscal forecasting and improved MTFFs and long-term macroeconomic models.
  - The World Bank’s and IMF’s Debt Sustainability Analysis (DSA) relies heavily on comprehensive, timely, and high-quality GFS data on integrated stocks and flows.
- Fiscal risk management:
  - GFS public sector balance sheet prescribes reporting of all public sector assets and liabilities, expanding coverage to public corporations, PPP-related liabilities, and state guarantees often treated as memorandum items.
  - This expanded coverage helps shift from descriptive reporting of fiscal risks to proactive fiscal risk management.
- Relationship with other standards:
  - Managing PFM systems may require reporting under both GFS and accounting standards (e.g., IPSAS / national GAAP); full application of GFS must account for statutory reporting needs.
  - GFSM Update Research Project 2.32 discusses the role of balance sheet analysis for GFS; recommendations from Discussion Notes 2.31 and 2.32 are interrelated and complementary.

### Country examples illustrating GFS integration (Box 1)
- Georgia:
  - Introduced a new GFS-aligned chart of accounts, IFMIS, SOE Health Check Tool, and a public sector balance sheet approach.
  - Reclassification of hundreds of public entities into central government affected main fiscal aggregates in 2021.
  - A fiscal risks management function was created in the Ministry of Finance in 2020; an update of the Fiscal Transparency Evaluation in 2023 took stock of progress.
- Ecuador:
  - Between 2020-2023 amended its Public Financial Management Law aligning fiscal reporting to GFS principles, improving integration of budget execution and financial statements.
- Cabo Verde:
  - Extended coverage to public corporations, implemented the SOE Health Check Tool using GFS-aligned income and balance sheet statements, and automated fiscal reporting in IFMIS.
- Liberia and Kosovo:
  - Used GFS as a guide for post-conflict PFM reforms, developing new charts of accounts and financial reporting systems to support their MTFFs, improving fiscal discipline and donor confidence.
- Source data for examples: IMF & World Bank Technical Assistance Reports, country specific.

### Public resource management and balance sheet approach
- Reliable GFS data strengthens public resource management by compiling assets, liabilities, revenues, and expenditures into consistent stocks and flows, enabling public sector balance sheets to reveal current and long-term fiscal risks and opportunities.
- GFSM Update Research Project 2.32 addresses integration of public resource management and GFS more directly.

### GFS links with international fiscal analysis and surveillance (Issue C)
- GFS enables standardized, comparable fiscal and debt data across countries, forming a foundation for the IMF’s Fiscal Affairs Department to evaluate government operations and develop analytical tools and recommendations.
- Fiscal Transparency Code (FTC):
  - FTC is the international standard for disclosure about public finances and comprises four pillars: (i) fiscal reporting; (ii) fiscal forecasting and budgeting; (iii) fiscal risk analysis and management; and (iv) resource revenue management.
  - GFS supports FTC by supplying standardized language and structures for fiscal reporting and fiscal risk disclosure, aligning definitions of public sector and subsectors.
  - GFS recommendations to include contingent liabilities and off-budget transactions support the FTC’s emphasis on fiscal risk disclosure.

### Recommendations and proposed approach
- Remove Annex 4 from the GFS Manual but retain Fiscal Indicators as an appendix or as supplementary reference material, with a targeted review of the Fiscal Indicators to ensure ongoing relevance.
- Expand guidance to support the use of GFS in fiscal analysis and policymaking, covering a wide range of use cases, tools, and resources explored in the Discussion Note.
- Move the expanded guidance into supplementary formats outside of the GFS Manual. The format, platform, and approach should adapt to emerging best practice and stakeholder feedback; preparation would likely follow release of the new GFS Manual, subject to available resources and prioritization.

*Source: Discussion Note 2.31, GFSM 2014 Update Consultation: March 2026 (Fiscal Analysis and GFS Task Team).*

### 18.      The IMF’s Fiscal Risk Assessment Tool (FRAT)

### 18.      The IMF’s Fiscal Risk Assessment Tool (FRAT)

### Overview of FRAT
- The IMF’s Fiscal Risk Assessment Tool (FRAT) provides a high-level portfolio perspective on a wide range of fiscal risks to which governments are typically exposed.
- FRAT provides a starting point for fiscal risk analysis by helping countries identify the largest and most important sources of fiscal risks.
- FRAT uses GFS-aligned data to assess fiscal exposure and to generate actionable insights for risk mitigation, contingency planning, and management of fiscal buffers.
- More detailed quantification of risks is supported by specific tools in the IMF's Fiscal Risk Toolkit.

### Tools in the IMF Fiscal Risk Toolkit (examples cited)
- The State-Owned Enterprise (SOE) Health Check Tool (SOE-HCT) and SOE Stress Test Tool (SOE-ST):
  - Evaluate fiscal costs and risks arising from public corporations.
  - Rely on GFS and IFRS mapping to consolidate public corporations accounts into the public sector balance sheet.
- The Discrete Guarantee and Loan Assessment Tool (DGAT):
  - Quantifies potential calls on government guarantees and loans, drawing on GFS classification for contingent liabilities and other economic flows.
- The PPP Fiscal Risk Assessment Model (PFRAM):
  - Estimates the impact of public-private-partnerships on the public sector net worth, including fixed assets, liabilities (both firmed and contingent), and long-term fiscal commitments (i.e., government’ future payments and revenue).

### Role of GFS in IMF surveillance and monitoring
- GFS contributes to the IMF’s Fiscal Monitor by enabling cross-country comparisons of fiscal indicators and trends; the Fiscal Monitor also utilizes other source data, which may sometimes differ from GFS figures.
- During Article IV consultations, the GFS framework aids surveillance by providing standardized fiscal data used to identify potential vulnerabilities and inform policy discussions.
- The GFS framework identifies gaps where fiscal information may be incomplete or inconsistent, guiding efforts to improve data quality and coverage for more reliable fiscal analysis and decision-making.
- GFS data are used to generate key indicators for the United Nations Sustainable Development Goals (SDGs) using data from the GFS Yearbook (GFSY) database.
- Integrating the IMF’s Fiscal Monitor with the GFSY potentially combines policy insights with statistical data, enhancing monitoring of SDG progress at the national level.

### Data adequacy and quality assurance frameworks
- The IMF’s Data Adequacy Assessment for Article IV consultations evaluates whether member countries provide sufficient data for economic surveillance, reviewing availability, timeliness, and coverage of fiscal and debt statistics; the assessment identifies specific gaps when data are insufficient and offers recommendations for improvement.
- The IMF uses the Data Quality Assessment Framework (DQAF) for Government Finance Statistics (GFS) and Public Sector Debt Statistics (PSDS) to evaluate:
  - Integrity, methodological soundness, accuracy, reliability, serviceability, and accessibility of fiscal data.
- The DQAF supports assessment of data compilation and dissemination, prioritization of capacity-building, and encouragement of best practices to ensure compliance with international standards.

### Importance of GFS supplementary information for fiscal analysis (Issue D)
- Supplementary information outside the core GFS accounts—such as provisions, contingent liabilities, guarantees, and tax relief measures—is critical for understanding fiscal risks, debt sustainability, and the true financial position of the public sector.
- Integrating supplementary items into fiscal analysis (via GFS-aligned reforms, dedicated risk management functions, or supplementary statements) leads to:
  - More credible fiscal forecasting;
  - Proactive risk management; and
  - Improved policy coherence.
- Provisions:
  - Frequently excluded from the main GFS framework per GFSM 2014 because of recognition and measurement complexities.
  - The only explicit provisions noted are “provisions for calls under standardized guarantees,” considered liabilities; others (e.g., provisions by the creditor for bad debts or expected losses) are not recorded in macroeconomic statistics (paragraph A3.33).
  - Recent research and updates to international standards (such as the SNA and BPM) acknowledge that some provisions are explicitly reflected in GFS while others remain outside the core accounts; guidance should evolve to consider explicit inclusion where material.
- Contingent liabilities and guarantees:
  - Generally excluded from the main reporting framework but best practice recommends recording them as memorandum items for fiscal monitoring and sustainability analysis.
  - Tracking guarantees and indemnities in PPPs, central government guarantees to subnational governments and SOEs, and other contingent liabilities brings hidden or off-budget liabilities to light and enables proactive management of fiscal shocks.
- Tax relief measures:
  - Not always systematically captured within GFS but can substantially impact government revenue and fiscal balances; supplementary reporting on tax relief is essential for evaluating fiscal policy effectiveness.

### Options identified to address guidance and scope issues
- Option 1: Maintain the current guidance
  - Maintain the current GFSM 2014 guidance on fiscal analysis and policymaking, relying on widely available information sources outside GFSM 2014.
  - Rationale: efficient path forward and avoid diverting resources from higher priority GFSM 2014 updates.
- Option 2: Update current guidance within GFSM 2014
  - Update existing guidance to better support use of GFS within fiscal analysis and policymaking in response to community feedback.
  - Potential updates could include:
    - Expanding and contemporizing the ‘Uses of the GFS Framework’ section in Chapter 1;
    - Expanding and contemporizing the ‘Using GFS for Fiscal Analysis’ section in Chapter 4 Annex; and
    - Reviewing and updating the set of fiscal indicators in the Chapter 4 Annex, including those requiring integration between GFS and additional data.
  - Additional structural options:
    - Combine the ‘Uses of the GFS Framework’ section into the Chapter 4 Annex; or
    - Move expanded guidance into a new Appendix.
- Option 3: Update and move guidance outside of GFSM 2014 (supplementary information)
  - Update guidance as in Option 2 but place expanded guidance outside the core GFSM 2014 as separate supplementary information.
  - Advantages:
    - Supports a streamlined core manual focused on essential concepts and principles;
    - Makes materials available separately for users specifically interested in fiscal analysis and policymaking;
    - Allows greater flexibility for more frequent updates and adaptation for different audiences and delivery mediums.
  - Risks:
    - Requires dedicated resources and expertise to prepare and maintain the supplementary information over time.
  - Suggested content for supplementary information:
    - Topics from the Background and Issues section, including the PFM framework, fiscal forecasting and fiscal sustainability, and use of the Fiscal Transparency Code and Fiscal Risk Assessment Tool.
  - Example platform: the ICMStat Compilers Hub as a community platform to share such information with a compiler audience.

### Draft recommendations (complementary)
- Recommendation addressing Issue A:
  - Recommend removing the Annex of Chapter 4 from the GFS Manual but retaining Fiscal Indicators as an appendix or as supplementary reference material; the Fiscal Indicators would be reviewed and updated to ensure ongoing relevance.
  - Rationale: supports reducing the scope of the GFS Manual to focus on essential concepts and principles.
- Recommendations to address Issues B, C, and D:
  - Recommend expanding guidance to support the use of GFS in fiscal analysis and policymaking, covering a wide range of use cases, tools and resources explored in the Discussion Note.
  - Recommend moving the expanded guidance into supplementary formats that sit outside the GFS Manual, with format, platform, and presentation adapted to emerging best practice, stakeholder feedback and user needs.
  - Timing/prioritization: This supplementary guidance would likely be prepared following the release of the new GFS Manual, pending available resources and prioritization.

### Governance and consultation context
- Preliminary views of the GFSAC:
  - An earlier version of the discussion note was discussed at the GFSAC meeting of January 2026; the current version addresses suggestions made by GFSAC members at that meeting and the task team recommendations are consistent with the preliminary views of most GFSAC members.
- Questions for Global Consultation (selected issues):
  - Issue A: Do you agree with the recommendation to remove the Annex of Chapter 4 from the GFS Manual but retain Fiscal Indicators as an appendix or as supplementary reference material?
  - Issue B: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on the integration of GFS and PFM?
  - Issue C: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on the GFS links with international fiscal analysis and surveillance?
  - Issue D: Do you agree with the recommendation to provide, outside of the GFSM as supplementary material, expanded guidance on GFS supplementary information to support fiscal analysis?

---


_Source: https://www.imf.org/-/media/files/data/statistics/gfsm/global-consultations/group-1/discussion-note-231-gfs-in-fiscal-analysis-policymaking-consultation-march2026.pdf_