A 72-year long "administrative oversight" has been settled in Canberra, with the United States posthumously awarding an Australian airman with a Silver Star for courage.

Edward 'Mobs' Mobsby was the only Australian onboard a US plane which was shot down while on a mission over Papua New Guinea in 1942.

The four other men onboard were all posthumously awarded the Silver Star medal, the third highest award the US Department of Defence can present for gallantry.

But confusion between the Australian and US air forces meant that until today Flying Officer Mobsby missed out.

In a statement the US Air Force said it was thankful the matter could finally be cleared up.

"Awarding the Silver Star to RAAF Flying Officer Edward Thompson Mobsby corrects a 72-year administrative oversight," the statement said.

"By formally presenting Flying Officer Mobsby's family with his Silver Star we have an opportunity to recognise and acknowledge the gallantry and courage he exhibited alongside his American crew members so many years ago."

Edward Mobsby's family including daughter Jenny Read (centre) at his grave in Papua New Guinea. ( Supplied: Peter DeGaris )

Both air forces made the assumption that the other country would award a medal to Mobsby's family, and it was not until the planes wreckage was recovered in 2010 that his family again ramped up their push for recognition.

"Confusion among the services contributed to why he wasn't awarded the Silver Star at the time," the US Air Force statement said.

"But we are extremely thankful for the stalwart efforts of Jenny Read [Edward Mobsby's daughter] who revived the quest for her father's award."

Ms Read from Adelaide along with her twin sister Rae Rayner from Geelong were both in Canberra for the presentation at the Australian War Memorial.

"We've been overwhelmed," Ms Read said.

"We his children, grand children, great-grandchildren and our extended families are so very proud and grateful for this amazing day."

Ms Read says the aircraft was shot down near Buna, Papua New Guinea on July 26, 1942.

"In December 2010 we were informed that the wreckage... had been positively identified as the plane in which my father was shot down," she said.

"It was located in a small village called Isoge, only a short distance from Kokoda."

The US Air Force says today's ceremony in Canberra was about righting a wrong.

"This award is one of the highest decorations for valour that can be awarded in our armed forces and we are thankful to finally be able to honour Flying Officer Mobsby's gallantry in action against the enemy."