1996R2223 — EN — 07.08.2003 — 008.001 — 1
This document is meant purely as a documentation tool and the institutions do not assume any liability for its contents
►B COUNCIL REGULATION (EC) No 2223/96
of 25 June 1996
on the European system of national and regional accounts in the Community
(OJ L 310, 30.11.1996, p. 1)
Amended by:
Official Journal
No page date
►M1 Council Regulation (EC) No 448/98 of 16 February 1998 L 58 1 27.2.1998
►M2 Commission Regulation (EC) No 1500/2000 of 10 July 2000 L 172 3 12.7.2000
►M3 Regulation (EC) No 2516/2000 of the European Parliament and of the
Council of 7 November 2000L 290 1 17.11.2000
►M4 Commission Regulation (EC) No 995/2001 of 22 May 2001 L 139 3 23.5.2001
►M5 Regulation (EC) No 2558/2001 of the European Parliament and of the
Council of 3 December 2001L 344 1 28.12.2001
►M6 Commission Regulation (EC) No 113/2002 of 23 January 2002 L 21 3 24.1.2002
►M7 Regulation (EC) No 359/2002 of the European Parliament and of the
Council of 12 February 2002L 58 1 28.2.2002
►M8 Regulation (EC) No 1267/2003 of the European Parliament and of the
Council of 16 June 2003L 180 1 18.7.2003
NB: This consolidated version contains references to the European unit of account and/or the ecu, which from 1 January 1999
should be understood as references to the euro — Council Regulation (EEC) No 3308/80 (OJ L 345, 20.12.1980, p. 1) andCouncil Regulation (EC) No 1103/97 (OJ L 162, 19.6.1997, p. 1).
▼B
COUNCIL REGULATION (EC) No 2223/96
of 25 June 1996
on the European system of national and regional accounts in the
Community
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community, andin particular Article 213 thereof,
Having regard to the draft Regulation submitted by the Commission,Having regard to the opinion of the European Parliament (
1),
Having regard to the opinion of the European Monetary Institute (2),
Having regard to the opinion of the Economic and Social Committee (3),
(1) Whereas the implementation and supervision of Economic and
Monetary Union require comparable, up-to-date and reliable
information on the structure and developments in the economic
situation of each country and/or region;
(2) Whereas the Commission must play a part in the administration ofEconomic and Monetary Union and, in particular, report to the
Council on the progress made by the Member States in fulfilling
their obligations for the achievement of Economic and MonetaryUnion;
(3) Whereas economic accounts are a basic tool for analysing theeconomic situation of a country and/or region on condition thatthey are drawn up on the basis of a single set of principles that arenot open to differing interpretations;
(4) Whereas the Commission must use aggregates of nationalaccounts for Community administrative and, in particular,budgetary calculations;
(5) Whereas in 1970 an administrative document entitled ‘EuropeanSystem of Integrated Economic Accounts’ (ESA) was published,covering the field governed by this Regulation, which had beendrawn up solely by the Statistical Office of the EuropeanCommunities and on its responsibility alone; whereas thatdocument was the outcome of several years' work by the
Statistical Office of the European Communities, together with
Member States' national statistical institutes, to devise a system ofnational accounts meeting the requirements of the EuropeanCommunities' economic and social policy, and whereas itconstituted the Community version of the United Nations System
of National Accounts which had been used by the Community up
to that time;
(6) Whereas in order to update the original text a second edition ofthe document was published in 1979 (hereinafter referred to as
‘ESA Second edition’) (
4);
(7) Whereas the United Nations Statistical Commission adopted in
February 1993 the new System of National Accounts (SNA) so
that the results in all member countries of the United Nations
should be internationally comparable;
(8) Whereas attention should be paid in the case of environmentalaccounts to the communication from the Commission to the
European Parliament and the Council of 21 December 1994
entitled ‘Directions for the European Union on environmentalindicators and green national accounting’;1996R2223 — EN — 07.08.2003 — 008.001 — 2
(1) OJ No C 287, 30. 10. 1995, p. 114.
(2) Opinion delivered on 21. 6. 1995 (not yet published in the Official Journal).
(3) OJ No C 133, 31. 5. 1995, p. 2.
(4) Eurostat: ‘European System of Integrated Economic Accounts’ (ESA),
second edition, Statistical Office of the European Communities, Luxembourg,
1979.
▼B
(9) Whereas the Community cooperates with third countries to
mutual advantage, particularly those in the European Economic
Area (EEA);
(10) Whereas a European System of Accounts must be established tomeet the requirements of Economic and Monetary Union and will
have to be used for compiling the national and regional accounts
provided for by Community legislation;
(11) Whereas the results of the accounts and tables of all the MemberStates drawn up according to the system set up by this Regulation
must be made available by the Commission to users on precise
dates, particularly with regard to monitoring the economicconvergence and achieving the closest coordination of theMember States' economic policies;
(12) Whereas the system set up by this Regulation is gradually toreplace all other systems as a reference framework of commonstandards, definitions, classifications and accounting rules fordrawing up the accounts of the Member States for therequirements of the Community, so that results that are
comparable between the Member States can be obtained;
(13) Whereas these statistical results, must be accessible to citizens in
accordance with the principle of transparency;
(14) Whereas the system established by this Regulation, whichconstitutes a version of the SNA adapted to the structures ofthe Member States' economies, must follow the layout of the SNAso that the Community's data are comparable with those compiled
by its main international partners;
(15) Whereas the dates must be grouped according to broad category
of the accounts and tables, and whereas only the informationessential to the requirements of the Community must be processed
and communicated to the Commission on precise dates;
(16) Whereas, however, in view of the volume and size of the accounts
concerned, the level of detail and the geographical coverage, aswell as the situation in this respect in the Member States, certain
extra periods of time for forwarding data shall be granted
exceptionally and temporarily to Member States which objec-tively are unable to meet the deadlines laid down by thisRegulation;
(17) Whereas a decision on how financial intermediation servicesindirectly measured (Fisim) are to be broken down should betaken at a later date;
(18) Whereas, according to the principle of subsidiarity, the creation ofcommon statistical standards so that comparable information canbe produced is a task that can only be dealt with effectively atCommunity level and whereas such standards will be imple-mented in each Member State under the aegis of the organizationsand institutions responsible for compiling official statistics;
(19) Whereas it is necessary to set up a procedure to adapt and updatethe provisions of this Regulation in cooperation with theStatistical Programme Committee of the European Community
(SPC), established by Council Decision 89/382/EEC, Euratom (
1);
whereas that adaptation procedure will be limited to amendmentswhich do not increase own resources;
(20) Whereas the Statistical Programme Committee and the
Committee on Monetary, Financial and Balance of Payments
Statistics (CMFB), established by Decision 91/115/EEC (2), have
declared themselves in favour of the draft of this Regulation;1996R2223 — EN — 07.08.2003 — 008.001 — 3
(1) OJ No L 181, 28. 6. 1989, p. 47.
(2) OJ No L 59, 6. 3. 1991, p. 19.
▼B
(21) Whereas Council Directive 89/130/EEC, Euratom of 13 February
1989 on the harmonization of the compilation of gross national
product at market prices (GNPmp) (1) stipulates that GNPmp can
be comparable only if the definitions and accounting rules of theEuropean System of Integrated Economic Accounts are applied,and whereas Council Regulation (EEC, Euratom) No 1553/89 of29 May 1989 on the definitive uniform arrangements for the
collection of own resources accruing from value added tax (
2)
provides that, in order to calculate the weighted average rate ofVAT, the breakdown of transactions liable to tax shall be effectedby means of national accounts prepared in accordance with theEuropean System of Integrated Economic Accounts, and whereas
for those instruments, and in the context of Council Regulation
(EC) No 3605/93 of 22 November 1993 on the application of theProtocol on the excessive deficit procedure (
3), Council Decision
94/728/EC, Euratom of 31 October 1994 on the system of theEuropean Communities' own resources (
4) and Council Decision
94/729/EC of 31 October 1994 on budgetary discipline (5), a
transitional period for implementing the system set up by this
Regulation should be provided,
HAS ADOPTED THIS REGULATION:
Article 1
Purpose
1. The purpose of this Regulation is to set up the European System of
Accounts 1995 hereinafter referred to as ‘ESA 95’, by providing for:
(a) a methodology on common standards, definitions, classifications and
accounting rules, intended to be used for compiling accounts andtables on comparable bases for the purposes of the Community,together with results as required under the terms of Article 3;
(b) a programme for transmitting for Community purposes on precise
dates the accounts and tables compiled according to the ESA 95.
2. Taking into account Articles 7 and 8, this Regulation shall apply to
all Community acts that refer to the ESA or its definitions.
3. This Regulation does not oblige any Member State to use the ESA
95 in compiling accounts for its own purposes.
Article 2
Methodology
1. The methodology of the ESA 95 referred to in Article 1 (1) (a) is
set out in Annex A.
2. Amendments to the ESA 95 methodology which are intended to
clarify and improve its content shall be adopted by CommissionDecision in accordance with the procedure provided for in Article 4,provided that they do not change its underlying concepts, do not requireadditional resources for their implementation and do not cause anincrease in own resources.
3. In accordance with the relevant provisions of the Treaty, the
Council shall, not later than 31 December 1997, take a decision onintroducing the system for breaking down the financial intermediation
services indirectly measured (Fisim) described in Annex I of Annex A,
and shall, if appropriate, adopt the necessary measures for theimplementation thereof.1996R2223 — EN — 07.08.2003 — 008.001 — 4
(1) OJ No L 49, 21. 2. 1989, p. 26. Directive as last amended by the 1994 Act of
Accession.
(2) OJ No L 155, 7. 6. 1989, p. 9.
(3) OJ No L 332, 31. 12. 1993, p. 7.
(4) OJ No L 293, 12. 11. 1994, p. 9.
(5) OJ No L 293, 12. 11. 1994, p. 14.
▼B
Article 3
Transmission to the Commission
1. The Member States shall transmit to the Commission (Statistical
Office) the accounts and tables set out in Annex B within the time limits
specified for each table.
The extra periods of time granted to certain Member States in
accordance with Annex B shall expire not later than 1 January 2005.
The Commission, after consulting the Statistical Programme Committee,
shall report to the Council not later than 1 July 2003 on the applicationof the extra periods of time granted in order to verify whether they arestill justified. This report shall, if necessary, be accompanied by aCommission proposal again granting extra periods of time to those
Member States requiring them.
2. The Member States shall transmit the results of Annex B,
including the data which have been declared confidential by Member
States in accordance with national legislation or practice concerning
statistical confidentiality, under the provisions of Council Regulation(Euratom, EEC) No 1588/90 of 11 June 1990 on the transmission of datasubject to statistical confidentiality to the Statistical Office of theEuropean Communities (
1), which governs the confidential treatment of
information.
Within the limits set in Article 2 (2), any changes — new tables,
countries and/or regions concerned — in the data requested from theMember States may be the subject of Commission Decisions in
accordance with the procedure provided for in Article 4.
Article 4
1. The Commission shall be assisted by the Statistical Programme
Committee (hereinafter referred to as ‘the Committee’).
2. Where reference is made to this Article, Articles 4 and 7 of
Decision 1999/468/EC shall apply, having regard to the provisions ofArticle 8 thereof.
The period laid down in Article 4(3) of Decision 1999/468/EC shall be
set at three months.
3. The Committee shall adopt its rules of procedure.
Article 5
The Committee's tasks
The Committee shall examine all matters that are raised by its chairman
relating to the implementation of this Regulation either on his own
initiative or at the request of a Member State.
Article 6
Cooperation with other committees
1. On all matters falling within the competence of the Committee on
Monetary, Financial and Balance of Payments Statistics (CMFB), the
Commission shall request the opinion of that Committee in accordance
with Article 2 of Decision 91/115/EEC.
2. The Commission shall communicate to the Committee on Gross
National Product, set up by Directive 89/130/EEC, Euratom any
information concerning the implementation of this Regulation whichis necessary for the performance of its duties.1996R2223 — EN — 07.08.2003 — 008.001 — 5
(1) OJ No L 151, 15. 6. 1990, p. 1. Regulation as amended by the 1994 Act of
Accession.▼M3
▼B
▼B
Article 7
Date of application and of first transmission of data
1. The ESA 95 shall be applied for the first time to data established in
accordance with Annex B to be transmitted in April 1999.
2. The data shall be transmitted to the Commission (Statistical
Office) in accordance with the time limits laid down in Annex B.
3. In accordance with paragraph 1, until the first transmission based
on the ESA 95, Member States shall continue to send to the Commission(Statistical Office) the accounts and tables established by applying theESA second edition.
4. Without prejudice to Article 19 of Council Regulation (EEC,
Euratom) No 1552/89 of 29 May 1989 (
1) implementing Decision 88/
376/EEC, Euratom on the system of the Communities' own resources,
the Commission and the Member State concerned shall check that this
Regulation is being applied and shall submit the outcome of thosechecks to the Committee provided for in Article 4 (1) of this Regulation.
Article 8
Transitional provisions
1. For budgetary and own resources purposes and by way of
derogation from Article 1 (2) and Article 7, the European system ofintegrated economic accounts in force within the meaning of Article 1(1) of Directive 89/130/EEC, Euratom and the legal acts relating thereto,
in particular Regulations (EEC, Euratom) No 1552/89 and No 1553/89
and Decisions 94/728/EC, Euratom and 94/729/EC, shall be the ESAsecond edition while Decision 94/728/EC, Euratom remains in force.
1a. For the purpose of determination of the VAT-based own resource,
and by way of exception from paragraph 1, the Member States may use
data based on the new European system of integrated economic accounts
(ESA 95) while Decision 94/728/EC, Euratom remains in force.
2. For the purpose of the Member States' reports to the Commission
under the excessive deficit procedure laid down in Regulation (EC)No 3605/93, the European system of integrated economic accounts shallbe the ESA second edition until the 1 September 1999 reports.
3. Application of the ESA second edition as laid down in paragraphs
1 and 2 of this Article shall be ensured by adjusting the data received by
virtue of Article 7 (1) on the basis of the ESA 95 to take account of thechanges resulting from any differences in concepts, definitions ornomenclatures between the ESA second edition and the ESA 95.
Implementation of this principle shall be established in accordance with
the procedure laid down in Article 6 of Council Directive 89/130/EEC,
Euratom by December 1996 at the latest.
Article 9
This Regulation shall enter into force on the 20th day following its
publication in the Official Journal of the European Communities .1996R2223 — EN — 07.08.2003 — 008.001 — 6
(1) OJ No L 155, 7. 6. 1989, p. 1. Regulation as last amended by Regulation
(EEC, Euratom) No 2729/94 (OJ No L 293, 12. 11. 1994, p. 5).▼M7
▼B
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ANNEX A
EUROPEAN SYSTEM OF ACCOUNTS
ESA 1995
CONTENTS
CHAPTER 1. GENERAL FEATURES
THE USES OF THE ESA
Framework for analysis and policyEight characteristics of ESA concepts
The 1995 ESA and the 1993 SNA
The 1995 ESA and the 1970 ESA
THE ESA AS A SYSTEM
Statistical units and their groupings
Institutional units and sectors
Local kind of activity units and industries
Resident and non-resident units; total economy and rest of the world
Flows and stocks
Flows
Transactions
Properties of transactions
Interactions versus intra-unit transactionsMonetary versus non-monetary transactions
Transactions with and without counterparts
Rearranged transactions
Rerouting
PartitioningRecognizing the principal party to a transaction
Borderline cases
Other changes in assets
Other changes in the volume of assets and liabilities
Holding gains and losses
Stocks
The system of accounts and the aggregates
Rules of accounting
Terminology for the two sides of the accounts
Double entry/quadruple entryValuation
Special valuations concerning products
Valuation at constant prices
Time of recording
Consolidation and netting
Consolidation
Netting
Accounts, balancing items and aggregates
The sequence of accounts1996R2223 — EN — 07.08.2003 — 008.001 — 7
▼B
The goods and services account
The rest of the world accountBalancing itemsAggregates
The input-output framework
CHAPTER 2. UNITS AND GROUPING OF UNITS
THE LIMITS OF THE NATIONAL ECONOMY
THE INSTITUTIONAL UNITS
THE INSTITUTIONAL SECTORS
Non-financial corporations (S.11)
Subsector: Public non-financial corporations (S.11001)Subsector: National private non-financial corporations (S.11002)Subsector: Foreign controlled non-financial corporations (S.11003)
Financial corporations (S.12)
Subsector: The central bank (S.121)Subsector: Other monetary financial institutions (S.122)Subsector: Other financial intermediaries, except insurance corporations and
pension funds (S.123)
Subsector: Financial auxiliaries (S.124)Subsector: Insurance corporations and pension funds (S.125)
General government (S.13)
Subsector: Central government (S.1311)Subsector: State government (S.1312)
Subsector: Local government (S.1313)
Subsector: Social security funds (S.1314)
Households (S.14)
Subsector: Employers (including own-account workers) (S.141 + S.142)Subsector: Employees (S.143)Subsector: Recipients of property incomes (S.1441)Subsector: Recipients of pensions (S.1442)Subsector: Recipients of other transfer incomes (S.1443)Subsector: Others (S.145)
Non-profit institutions serving households (S.15)
Rest of the world (S.2)
Sector classification of producer units for main standard legal forms of
ownership
LOCAL KIND-OF-ACTIVITY UNITS AND INDUSTRIES
The local kind-of-activity unitThe industry
CLASSIFICATION OF INDUSTRIES1996R2223 — EN — 07.08.2003 — 008.001 — 8
▼B
UNITS OF HOMOGENEOUS PRODUCTION AND HOMOGENEOUS
BRANCHES
The unit of homogeneous productionThe homogeneous branch
THE CLASSIFICATION OF HOMOGENEOUS BRANCHES
CHAPTER 3. TRANSACTIONS IN PRODUCTS
PRODUCTION AND OUTPUT
Principal, secondary and ancillary activitiesOutput (P.1)Time of recording and valuation of output
INTERMEDIATE CONSUMPTION (P.2)
Time of recording and valuation of intermediate consumption
FINAL CONSUMPTION (P.3, P.4)
Final consumption expenditure (P.3)Actual final consumption (P.4)Time of recording and valuation of final consumption expenditureTime of recording and valuation of actual final consumption
GROSS CAPITAL FORMATION (P.5)
Gross fixed capital formation (P.51)
Time of recording and valuation of gross fixed capital formationChanges in inventories (P.52)Time of recording and valuation of changes in inventoriesAcquisitions less disposals of valuables (P.53)
IMPORTS AND EXPORTS OF GOODS AND SERVICES (P.6 AND P.7)
Imports and exports of goods (P.61 and P.71)Imports and exports of services (P.62 and P.72)
TRANSACTIONS IN EXISTING GOODS
CHAPTER 4. DISTRIBUTIVE TRANSACTIONS
COMPENSATION OF EMPLOYEES (D.1)
Wages and salaries (D.11)
Wages and salaries in cash
Wages and salaries in kind
Employers' social contributions (D.12)
Employers' actual social contributions (D.121)Employers' imputed social contributions (D.122)
TAXES ON PRODUCTION AND IMPORTS (D.2)
Taxes on products (D.21)
Value added type taxes (VAT) (D.211)Taxes and duties on imports excluding VAT (D.212)Taxes on products, except VAT and import taxes (D.214)
Other taxes on production (D.29)1996R2223 — EN — 07.08.2003 — 008.001 — 9
▼B
Taxes on production and imports paid to the institutions of the European Union
SUBSIDIES (D.3)
Subsidies on products (D.31)
Import subsidies (D.311)Other subsidies on products (D.319)
Other subsidies on production (D.39)
PROPERTY INCOME (D.4)
Interest (D.41)
Interest on deposits, loans and accounts receivable and payable
Interest on securities
Interest on bills and similar short-term instrumentsInterest on bonds and debentures
Interest rate swaps and forward rate agreements
Interest on financial leases
Other interestTime of recording
Distributed income of corporations (D.42)
Dividends (D.421)
Withdrawals from the income of quasi-corporations (D.422)
Reinvested earnings on direct foreign investment (D.43)Property income attributed to insurance policy holders (D.44)Rents (D.45)
Rents on land
Rents on sub-soil assets
CURRENT TAXES ON INCOME, WEALTH, ETC. (D.5)
Taxes on income (D.51)
Other current taxes (D.59)
SOCIAL CONTRIBUTIONS AND BENEFITS (D.6)
Social contributions (D.61)
Actual social contributions (D.611)
Imputed social contributions (D.612)
Social benefits other than social transfers in kind (D.62)
Social security benefits in cash (D.621)Private funded social benefits (D.622)
Unfunded employee social benefits (D.623)
Social assistance benefits in cash (D.624)
Social transfers in kind (D.63)
Social benefits in kind (D.631)
Social security benefits, reimbursements (D.6311)
Other social security benefits in kind (D.6312)Social assistance benefits in kind (D.6313)
Transfers of individual non-market goods or services (D.632)1996R2223 — EN — 07.08.2003 — 008.001 — 10
▼B
OTHER CURRENT TRANSFERS (D.7)
Net non-life insurance premiums (D.71)
Non-life insurance claims (D.72)
Current transfers within general government (D.73)
Current international cooperation (D.74)
Miscellaneous current transfers (D.75)
Current transfers to NPISHsCurrent transfers between households
Fines and penalties
Lotteries and gambling
Payments of compensation
GNP based fourth own resource
Other
ADJUSTMENT FOR THE CHANGE IN THE NET EQUITY OF HOUSE-
HOLDS IN PENSION FUNDS RESERVES (D.8)
CAPITAL TRANSFERS (D.9)
Capital taxes (D.91)
Investment grants (D.92)Other capital transfers (D.99)
CHAPTER 5. FINANCIAL TRANSACTIONS
CLASSIFICATION OF FINANCIAL TRANSACTIONS
Monetary gold and special drawing rights (SDRS) (F.1)
Monetary gold (F.11)Special drawing rights (SDRS) (F.12)
Currency and deposits (F.2)
Currency (F.21)
Transferable deposits (F.22)
Other deposits (F.29)
Securities other than shares (F.3)
Securities other than shares, excluding financial derivatives (F.33)
Short-term securities other than shares, excluding financial derivatives
(F.331)
Long-term securities other than shares, excluding financial derivatives
(F.332)
Financial derivatives (F.34)
Loans (F.4)
Short-term loans (F.41)
Long-term loans (F.42)
Shares and other equity (F.5)
Shares and other equity, excluding mutual funds shares (F.51)
Quoted shares, excluding mutual funds shares (F.511), and unquoted
shares, excluding mutual funds shares (F.512)
Other equity (F.513)
Mutual funds shares (F.52)
Insurance technical reserves (F.6)
Net equity of households in life insurance reserves and in pension funds
reserves (F.61)
Net equity of households in life insurance reserves (F.611)1996R2223 — EN — 07.08.2003 — 008.001 — 11
▼B
Net equity of households in pension funds reserves (F.612)
Prepayments of insurance premiums and reserves for outstanding claims
(F.62)
Other accounts receivable/payable (F.7)
Trade credits and advances (F.71)Other accounts receivable/payable, excluding trade credits and advances
(F.79)
Memorandum item: direct foreign investment (F.m)
ACCOUNTING RULES FOR FINANCIAL TRANSACTIONS
Valuation
Time of recording
Compiling financial transactions from changes in balance sheets
Annex 5.1: Link with measures of money
CHAPTER 6. OTHER FLOWS
CONSUMPTION OF FIXED CAPITAL (K.1)
ACQUISITIONS LESS DISPOSALS OF NON-FINANCIAL NON-PRODUCED
ASSETS (K.2)
OTHER CHANGES IN ASSETS (K.3 to K.12)
OTHER CHANGES IN VOLUME (K.3 to K.10 AND K.12)ECONOMIC APPEARANCE OF NON-PRODUCED ASSETS (K.3)ECONOMIC APPEARANCE OF PRODUCED ASSETS (K.4)
NATURAL GROWTH OF NON-CULTIVATED BIOLOGICAL RESOURCES
(K.5)
ECONOMIC DISAPPEARANCE OF NON-PRODUCED ASSETS (K.6)
CATASTROPHIC LOSSES (K.7)
UNCOMPENSATED SEIZURES (K.8)OTHER VOLUME CHANGES IN NON-FINANCIAL ASSETS N.E.C. (K.9)OTHER VOLUME CHANGES IN FINANCIAL ASSETS AND LIABILITIES
N.E.C. (K.10)
CHANGES IN CLASSIFICATIONS AND STRUCTURE (K.12)
Changes in sector classification and structure (K.12.1)
Changes in classification of assets and liabilities (K.12.2)
NOMINAL HOLDING GAINS/LOSSES (K.11)
Neutral holding gains/losses (K.11.1)Real holding gains/losses (K.11.2)
Holding gains by type of financial asset
Currency and deposits (AF.2)Loans (AF.4) and other accounts receivable/payable (AF.7)Securities other than shares (AF.3)Shares and other equity (AF.5)
Insurance technical reserves (AF.6)
Financial assets in foreign currency
CHAPTER 7. BALANCE SHEETS
TYPES OF ASSETS
Non-financial produced assets (AN.1)Non-financial non-produced assets (AN.2)Financial assets and liabilities (AF)
VALUATION OF ENTRIES IN THE BALANCE SHEETS1996R2223 — EN — 07.08.2003 — 008.001 — 12
▼B
General valuation principles
NON-FINANCIAL ASSETS (AN)
Produced assets (AN.1)
Fixed assets (AN.11)
Tangible fixed assets (AN.111)Intangible fixed assets (AN.112)
Inventories (AN.12)Valuables (AN.13)
Non-produced assets (AN.2)
Tangible non-produced assets (AN.21)
Land (AN.211)Subsoil assets (AN.212)Other natural assets (AN.213 and AN.214)
Intangible non-produced assets (AN.22)
Financial assets and liabilities (AF)
Monetary gold and SDRs (AF.1)Currency and deposits (AF.2)
Securities other than shares (AF.3)
Loans (AF.4)Shares and other equity (AF.5)Insurance technical reserves (AF.6)Other accounts receivable/payable (AF.7)
Memorandum items
Consumer durables (AN.m)Direct foreign investment (AF.m)
Financial balance sheets
Annex 7.1: Definition of each asset category
Annex 7.2: A map of entries from opening balance sheet to closing balance sheet
CHAPTER 8. SEQUENCE OF ACCOUNTS AND BALANCING ITEMS
SEQUENCE OF ACCOUNTS
Current accountsProduction account (I)Distribution and use of income accounts (II)
Primary distribution of income accounts (II.1)
Generation of income account (II.1.1)
Allocation of primary income account (II.1.2)
Entrepreneurial income account (II.1.2.1)Allocation of other primary income account (II.1.2.2)
Secondary distribution of income account (II.2)Redistribution of income in kind account (II.3)Use of income account (II.4)
Use of disposable income account (II.4.1)Use of adjusted disposable income account (II.4.2)
Accumulation accounts (III)
Capital account (III.1)
Change in net worth due to saving and capital tranfers account (III.1.1)1996R2223 — EN — 07.08.2003 — 008.001 — 13
▼B
Acquisitions of non-financial assets account (III.1.2)
Financial account (III.2)
Other changes in assets account (III.3)
Other changes in volume of assets account (III.3.1)Revaluation account (III.3.2)
Neutral holding gains and losses account (III.3.2.1)Real holding gains and losses account (III.3.2.2)
Balance sheets (IV)
Opening balance sheet (IV.1)
Changes in balance sheet (IV.2)
Closing balance sheet (IV.3)
REST OF THE WORLD ACCOUNTS (V)
Current accounts
External account of goods and services (V.I)External account of primary incomes and current transfers (V.II)
External accumulation accounts (V.III)
Capital account (V.III.1)
Financial account (V.III.2)Other changes in assets account (V.III.3)
Balance sheets (V.IV)
GOODS AND SERVICES ACCOUNT (0)INTEGRATED ECONOMIC ACCOUNTSAGGREGATES
Gross domestic product at market prices (GDP)
Operating surplus of the total economy
Mixed income of the total economyEntrepreneurial income of the total economyNational income (at market prices)National disposable incomeSavingCurrent external balance
Net lending (+) or borrowing (−) of the total economy
Net worth of the total economy
MATRIX PRESENTATION
Matrix presentation of ESA accountsProperties of accounting matricesAdaptation of the reduced format matrix to specific types of analysis
CHAPTER 9. INPUT-OUTPUT FRAMEWORK
SUPPLY AND USE TABLESTABLES LINKING THE SUPPLY AND USE TABLES TO THE SECTOR
ACCOUNTS
SYMMETRIC INPUT-OUTPUT TABLES
CHAPTER 10. PRICE AND VOLUME MEASURES
SCOPE OF PRICE AND VOLUME INDICES IN THE ACCOUNTS SYSTEM
The integrated system of price and volume indicesPrice and volume indices for other aggregates1996R2223 — EN — 07.08.2003 — 008.001 — 14
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GENERAL PRINCIPLES OF MEASURING PRICE AND VOLUME INDICES
Definition of prices and volumes of market productsDifferences in quality and differences in pricePrinciples for non-market services
Principles for value added and GDP
PROBLEMS IN THE APPLICATION OF THE PRINCIPLES
General applicationApplication to specific flows
Flows of goods and market services
Flows of non-market servicesTaxes and subsidies on products and importsConsumption of fixed capitalCompensation of employees
Stocks of produced fixed assets and inventories
Measures of real income for the total economy
CHOICE OF INDEX NUMBER FORMULAE AND THE BASE YEARINTERSPACIAL PRICE AND VOLUME INDICES
CHAPTER 11. POPULATION AND LABOUR INPUTS
TOTAL POPULATIONECONOMICALLY ACTIVE POPULATION
EMPLOYMENT
EmployeesSelf-employed personsEmployment and residence
UNEMPLOYMENT
JOBS
Jobs and residence
TOTAL HOURS WORKEDFULL-TIME EQUIVALENCE
EMPLOYEE LABOUR INPUT AT CONSTANT COMPENSATION
CHAPTER 12. QUARTERLY ECONOMIC ACCOUNTS
CHAPTER 13. REGIONAL ACCOUNTS
REGIONAL TERRITORY
UNITS AND RESIDENCEMETHODS OF REGIONALIZATIONAGGREGATES BY INDUSTRY
HOUSEHOLD ACCOUNTS
ANNEXES
I. FINANCIAL INTERMEDIATION SERVICES INDIRECTLY MEASURED (Fisim)
Changes to be made in the ESA chapters if Fisim is to be allocated
II. LEASING AND HIRE PURCHASE OF DURABLE GOODS
Definitions
LeasingOperating leasing
Financial leasing1996R2223 — EN — 07.08.2003 — 008.001 — 15
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Hire purchase
Treatment in the accounts
Operating leasing
Financial leasing
Hire purchase
III. INSURANCE
IntroductionDefinitions
Social insurance
Social security schemes of government
Private funded social insurance schemes
Unfunded social insurance schemes operated by employers
Other insurance
Other life insurance
Other non-life insurance
Reinsurance
Insurance auxiliaries
Treatment in the accounts
Social insurance
Social security schemes of government
Private funded social insurance schemes
Unfunded social insurance schemes operated by employers
Other insurance
Other life insurance
Other non-life insurance
Reinsurance
Insurance auxiliaries
Insurance numerical example
IV. CLASSIFICATIONS AND ACCOUNTS
Classifications
Classification of institutional sectors (S)
Classification of transactions and other flowsClassification of balancing items (B)
Classification of assets (A)
Regrouping and coding of industries (A), products (P) and investments (fixed capital
formation) (Pi)
Classification of individual consumption by purpose (Coicop)
Classification of the functions of the government (Cofog)
Accounts
Tables
2.1 Sectors and sub-sectors2.2 The type of producer, the principal activities and functions classified by sector
2.3 Sector classification of producer units for main standard legal forms of ownership
3.1 The distinction between market producers, producers for own final use and other non-market
producers for institutional units
3.2 Institutional units, local KAUs and output and the distinction between market, for own final use
and other non-market1996R2223 — EN — 07.08.2003 — 008.001 — 16
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3.3 The distinction market, for own final use and other non-market for local KAUs and their output
3.4 The treatment of transportation of exported goods3.5 The treatment of transportation of imported goods
5.1 Classification of financial transactions
8.1 Synoptic presentation of the accounts, balancing items and main aggregates
8.2 Account I: Production account
8.3 Account II.1.1: Generation of income account
8.4 Account II.1.2.: Allocation of primary income account
8.5 Accounts II.1.2.1: Entrepreneurial income and II.1.2.2: Allocation of other primary income8.6 Account II.2: Secondary distribution of income account
8.7 Account II.3: Redistribution of income in kind account
8.8 Account II.4.1: Use of disposable income account
8.9 Account II.4.2: Use of adjusted disposable income account
8.10 Account III.1.1: Change in net worth due to saving and capital transfers account
8.11 Account III.1.2: Acquisition of non-financial assets account
8.12 Account III.2: Financial account8.13 Account III.3.1: Other changes in volume of assets account
8.14 Account III.3.2: Revaluation account
8.15 Account IV: Balance sheets
8.16 Full sequence of accounts for rest of the world (external transactions account)
8.17 Account 0: Goods and services account8.18 Integrated economic accounts
8.19 Matrix presentation of the full sequence of accounts and balancing items for the total economy
8.20 Schematic presentation of a Social Accounting Matrix
8.21 Example of a more detailed Social Accounting Matrix
8.22 Example of a detailed submatrix: Net value added (basic prices)
9.1 A simplified supply table
9.2 A simplified use table9.3 A simplified combined supply and use table
9.4 A simplified symmetric input-output table (product by product)
9.5 A supply table at basic prices, including a transformation into purchaser's prices
9.6 A use table at purchaser's prices
9.7 A simple trade and transport margins table
9.8 A simple taxes less subsidies on products table
9.9 A use table for imports9.10 A use table at basic prices for domestic output
9.11 Table linking the supply and use tables to the sector accounts
9.12 A symmetric input-output table at basic prices (product by product)
9.13 A symmetric input-output table for domestic output (product by product)
A.I.1 Effect of allocating Fisim to institutional sectors, including changes for non-market producersA.I.2 Effect of allocating Fisim to nominal sector only
A.III.1 Social security schemes of Government
A.III.2 Private funded social insurance schemes
A.III.3 Unfunded schemes operated by employers
A.III.4 Other life insurance
A.III.5 Other non-life insurance1996R2223 — EN — 07.08.2003 — 008.001 — 17
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A.IV.1 Account 0: Goods and services account
A.IV.2 Full sequence of accounts for the total economy
A.IV.3 Full sequence of accounts for non-financial corporationsA.IV.4 Full sequence of accounts for financial corporations
A.IV.5 Full sequence of accounts for general government
A.IV.6 Full sequence of accounts for householdsA.IV.7 Full sequence of accounts for non-profit institutions serving households1996R2223 — EN — 07.08.2003 — 008.001 — 18
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CHAPTER 1
GENERAL FEATURES
1.01. The European System of National and Regional Accounts (1995 ESA, or
simply: ESA) is an internationally compatible accounting framework for a
systematic and detailed description of a total economy (that is a region,
country or group of countries), its components and its relations with other
total economies.
The 1995 ESA, replaces the European System of Integrated Economic
Accounts published in 1970 (1970 ESA; a second, slightly modified,
edition appeared in 1978).
The 1995 ESA is fully consistent with the revised world-wide guidelines
on national accounting, the System of National Accounts (1993 SNA, or
simply: SNA; these guidelines have been produced under the joint
responsibility of the United Nations, the IMF, the Commission of the
European Communities, the OECD and the World Bank). However, the
ESA is focused more on the circumstances and data needs in the European
Union. Like the SNA, the ESA is harmonized with the concepts and
classifications used in many other, social and economic statistics. Cases in
point are statistics on employment, statistics on manufacturing and
statistics on external trade. The ESA can therefore serve as the centralframework of reference for the social and economic statistics of the
European Union and its Member States.
1.02. The ESA framework consists of two main sets of tables:
(a) the sector accounts (
1);
(b) the input-output framework (2) and the accounts by industry (1).
The sector accounts provide, by institutional sector, a systematic
description of the different stages of the economic process: production,
generation of income, distribution of income, redistribution of income, use
of income and financial and non-financial accumulation. The sector
accounts also include balance sheets to describe the stocks of assets,
liabilities and net worth at the beginning and the end of the accounting
period.
The input-output framework and the accounts by industry describe in
more detail the production process (cost structure, income generated and
employment) and the flows of goods and services (output, imports,
exports, final consumption, intermediate consumption and capital
formation by product group).
The ESA encompasses concepts of population and employment (3). These
concepts are relevant for both the sector accounts and the input-output
framework.
The ESA is not restricted to annual national accounting, but applies also to
quarterly accounts (4) and regional accounts (5).
THE USES OF THE ESAFramework for analysis and policy
1.03. The ESA framework can be used to analyse and evaluate:
(a) the structure of a total economy. Cases in point are:
1. value added and employment by industry;
2. value added and employment by region;
3. income distributed by sector;
4. imports and exports by product group;
5. final consumption expenditure by product group;
6. fixed capital formation and fixed capital stock by industry;
7. the composition of the stocks and flows of financial assets by type
of asset and by sector.1996R2223 — EN — 07.08.2003 — 008.001 — 19
(1) See chapter 8: ‘Sequence of accounts and balancing items’.
(2) See chapter 9: ‘The input-output framework’.
(3) See chapter 11: ‘Population and labour inputs’.
(4) See chapter 12: ‘Quarterly economic accounts’.
(5) See chapter 13: ‘Regional accounts’.
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(b) Specific parts or aspects of a total economy. Cases in point are:
1. banking and finance in the national economy;
2. the role of government;3. the economy of a specific region (in comparison to that of the
nation as a whole).
(c) The development of a total economy over time. Cases in point are:
1. the analysis of GDP growth rates;
2. the analysis of inflation;3. the analysis of seasonal patterns in household expenditure on the
basis of quarterly accounts;
4. the analysis of the changing importance of particular types of
financial instruments over time, e.g. the increased importance of
options;
5. the comparison of the industrial structures of the national economy
over the long term, e.g. over a period of 30 years.
(d) A total economy in relation to other total economies. Cases in point
are:
1. the comparison of the roles of government in the Member States of
the European Union;
2. the analysis of the interdependencies between the economies of the
European Union;
3. the analysis of the composition and destination of the exports of
the European Union;
4. the comparison of GDP growth rates or disposable income per
capita in the European Union and in the United States and Japan.
1.04. For the European Union and its Member States, the figures from this
framework play a major role in formulating and monitoring their social
and economic policy.
Furthermore, there are some very important specific uses:
(a) for monitoring and guiding European monetary policy: the criteria of
convergence for the European Monetary Union have been defined in
terms of national accounts figures (government deficit, government
debt and GDP);
(b) for granting monetary support to regions in the European Union: the
expenditure for the Structural Funds of the European Union is partly
based on regionalized national accounts figures;
(c) for determining the own resources of the European Union. The latter
depend on national accounts figures in three ways:
1. the total resources for the European Union are determined as a
percentage of the Member States' gross national products (GNP);
2. the third own resource of the European Union is the VAT own
resource. The contributions by the Member States for this resource
are largely affected by national accounts figures, because they are
used to calculate the average VAT rate;
3. the relative sizes of the contributions by the Member States for the
fourth own resource of the European Union are based on their
gross national products.
Eight characteristics of ESA concepts
1.05. In order to establish a good balance between data needs and data
possibilities, the concepts in the ESA have eight important characteristics.
They are:
(a) internationally compatible;
(b) harmonized with those in other social and economic statistics;
(c) consistent;
(d) operational;
(e) different from most administrative concepts;
(f) well-established and fixed for a long period;
(g) focused on describing the economic process in monetary and readily
observable terms;
(h) flexible and multi-purpose.1996R2223 — EN — 07.08.2003 — 008.001 — 20
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1.06. The concepts are internationally compatible because:
(a) for European Union Member States, the ESA is the standard for
submitting national accounts data to all international organizations.
Only in the national publications is strict adherence to the ESA not
obligatory;
(b) the concepts in the ESA are in all respects consistent with those in the
world-wide guidelines on national accounting, i.e. the SNA.
International compatibility of concepts is crucial when comparing
statistics for different countries.
1.07. The concepts are harmonized with those in other social and economic
statistics because:
(a) the ESA employs many concepts and classifications (e.g. NACE rev.
1) that are also used for the other social and economic statistics of
European Union Member States, e.g. in statistics on manufacturing,
statistics on external trade and statistics on employment; conceptual
differences have been kept to a minimum. Furthermore, these
European Union concepts and classifications are also harmonized
with those of the United Nations;
(b) like the SNA, the concepts in the ESA are also harmonized with those
in the major international guidelines on some other economic
statistics, in particular the IMF Balance of Payments Manual
(BPM), the IMF Government Finance Statistics (GFS), the OECD
Revenue Statistics and the ILO resolutions on the concepts of
employment, hours worked and labour costs.
This harmonization with other, social and economic statistics greatly aids
the linkage to and comparison with these figures. As a consequence, better
national accounts figures can be compiled. Furthermore, the information
contained in these specific statistics can now be better related to the
general statistics on the national economy, i.e. the national accounts
figures like GNP or value added per industry and sector.
1.08. The identities in the accounting framework enforce the consistency of the
concepts used to describe the different parts of the economic process
(production, income distribution, use of income, accumulation). As a
result of this internal consistency, statistics from different parts of the
accounting framework can be usefully related to each other. So, for
example, the following ratios can be calculated:
(a) productivity figures, such as value added per hour worked (this figure
requires consistency between the concepts of value added and hours
worked);
(b) national disposable income per capita (this ratio requires consistency
between the concepts national disposable income and population);
(c) fixed capital formation as a percentage of fixed capital stock (this
ratio requires consistency between the definitions of these flows and
stocks);
(d) government deficit and debt as percentages of gross domestic product
(these figures require consistency between the concepts of govern-
ment deficit, government debt and gross domestic product).
This internal consistency of concepts also allows some estimates to be
derived by residual, e.g. saving can be estimated as the difference between
disposable income and final consumption expenditure (1).
1.09. The concepts in the ESA are operational concepts since they are designed
with their measurement in mind. The operational character of the concepts
is revealed in several ways:
(a) some activities or items have only to be described when significant in
size. This pertains, for example, to own-account production of goods
by households: weaving cloth and the production of pottery are not to
berecorded as production, because these types of production are
deemed to be insignificant for European Union countries. Another
case in point is that small inexpensive tools and appliances are only
recorded as fixed capital formation when the purchaser's expenditure
on such durables exceeds ECU 500 (at 1995 prices) per item (or,
when bought in quantities, for the total amount bought); when this
expenditure does not exceed this threshold, these items are recorded
as intermediate consumption;1996R2223 — EN — 07.08.2003 — 008.001 — 21
(1) See chapter 8: ‘Sequence of accounts and balancing items’.
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(b) some concepts are accompanied by clear indications of how to
estimate them. For example, in defining capital consumption
reference is made to linear depreciation and for estimating fixed
capital stock the Perpetual Inventory Method is recommended.
Another case in point is the valuation of own-account production:
in principle, it should be at basic prices, but if necessary the basic
prices may be approximated by adding up the various costs involved;
(c) some simplifying conventions have been adopted. For example, by
convention, the collective services provided by government are all
final consumption expenditure;
(d) the concepts are harmonized with those in social and economic
statistics used as inputs for compiling the national accounts.
1.10. However, at the same time, the concepts are not always easy to put into
operation as they usually diverge in some respects from those employed in
administrative data sources. Cases in point are business accounts, data on
various types of taxes (VAT, personal income tax, import levies, etc.),
social security data and data from supervisory boards on banking and
insurance. These administrative data often serve as inputs for compiling
the national accounts. In general, they will therefore have to be
transformed in order to comply with the ESA.
The concepts in the ESA usually differ in some respects from their
administrative counterparts because:
(a) administrative concepts differ between countries. As a consequence,
international compatibility cannot be attained through administrative
concepts;
(b) administrative concepts change over time. As a consequence,
comparability in time cannot be attained through administrative
concepts;
(c) the concepts underlying administrative data sources are usually not
consistent with each other. However, linking and comparing data,
which is crucial for compiling national accounts figures, is only
possible with a consistent set of concepts;
(d) the administrative concepts are generally not optimal for economic
analysis and the evaluation of economic policy.
Nevertheless, sometimes, administrative data sources meet the data needs
of national accounts and other statistics very well, because:
(a) concepts and classifications originally devised for statistical purposes
may also be adopted for administrative purposes, e.g. the classifica-
tion of government expenditure by type;
(b) administrative data sources may explicitly take account of the
(separate) data needs of statistics; this applies, for example, to the
Intrastat system for providing information about deliveries of goods
between European Union Member States.
1.11. The main concepts in the ESA are well-established and fixed for a long
period, because:
(a) they have been approved as the international standard for the next
decades;
(b) in the successive international guidelines on national accounting most
of the basic concepts have hardly been changed.
This conceptual continuity reduces the need to recalculate time series and
to learn new concepts. Furthermore, it limits the vulnerability of the
concepts to national and international political pressure. For these reasons,
the national accounts figures have been able to serve as an objective data
base for economic policy and analysis for decades.
1.12. The ESA concepts are focused on describing the economic process in
monetary and readily observable terms. For the most part, stocks and
flows that are not readily observable in monetary terms, or that do not
have a clear monetary counterpart are not taken into account.
This principle has not been applied strictly, because account should also
be taken of the requirement of consistency and the various data needs. Forexample, consistency requires that the value of collective services
produced by government is recorded as output, because the payment of
compensation of employees and the purchase of all kinds of goods and
services by government are readily observable in monetary terms.
Furthermore, for the purposes of economic analysis and policy, describing
the collective services of government in relation to the rest of the national
economy increases also the usefulness of the national accounts as a whole.1996R2223 — EN — 07.08.2003 — 008.001 — 22
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1.13. The scope of the concepts in the ESA can be illustrated by considering
some important borderline issues.
The following fall within the production boundary of the ESA (see
paragraphs 3.07. to 3.09.):
(a) production of indiviual and collective services by government;
(b) the own-account production of housing services by owner-occupiers;
(c) production of goods for own final consumption, e.g. of agricultural
products;
(d) own-account construction, including that by households;
(e) the production of services by paid domestic staff;
(f) breeding of fish in fish farms;
(g) production forbidden by law, e.g. prostitution and production of
drugs;
(h) production from which the revenues are not declared in full to the
fiscal authorities, e.g. clandestine production of textiles.
The following fall outside the production boundary:
(a) domestic and personal services produced and consumed within the
same household, e.g. cleaning, the preparation of meals or the care of
sick or elderly people;
(b) volunteer services that do not lead to the production of goods, e.g.
caretaking and cleaning without payment;
(c) natural breeding of fish in open seas.
In general, the ESA records all outputs that result from production within
the production boundary. However, there are some specific exceptions to
this rule:
(a) the outputs of ancillary activities are not to be recorded; all inputs
consumed by an ancillary activity — materials, labour, consumption
of fixed capital, etc. — are treated as inputs into the principal or
secondary activity which it supports;
(b) outputs produced for intermediate consumption in the same local
kind-of-activity unit (KAU, see paragraph 1.29.) are not to be
recorded; however, all outputs produced for other local KAUs
belonging to the same institutional unit are to be recorded as output.
The accounting logic of the ESA implies that if activities are regarded as
production and their output is to be recorded, then the concomitant
income, employment, final consumption, etc. are also to be recorded. For
example, as the own-account production of housing services by owner-
occupiers is recorded as production, so is the income and final
consumption expenditure it generates for these owner-occupiers. The
reverse holds when activities are not recorded as production: domestic
services produced and consumed within the same household do not
generate income and final consumption expenditure and according to the
ESA concepts, no employment is involved.
The ESA also contains many specific conventions, e.g.:
(a) the valuation of government output;
(b) the valuation of the output of insurance services and financial
intermediation services indirectly measured;
(c) recording all the collective services provided by government as final
consumption expenditure and none as intermediate consumption;
(d) recording the use of financial intermediation services indirectly
measured as the intermediate consumption of a nominal sector or a
nominal industry.
1.14. The concepts in the ESA are multi-purpose: for a great range of uses the
ESA concepts will be acceptable, though they may need to be
supplemented for some uses (see paragraph 1.18.).
1.15. The detail in the conceptual framework of the ESA offers the opportunity
for flexible use: some concepts are not explicitly present in the ESA but
can nevertheless easily be derived from it. For example, value added at
factor cost can be derived by subtracting net other taxes on production
from value added at basic prices. Another case in point is the creation of
new sectors by rearranging the subsectors defined in the ESA.
1.16. Flexible use is also possible by introducing additional criteria which do
not conflict with the logic of the system. For example, these criteria might
be the scale of employment for producer units or the size of income for1996R2223 — EN — 07.08.2003 — 008.001 — 23
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households. For employment, subclassification by level of education, age
and sex can be introduced.
1.17. This flexible use may be incorporated in a Social Accounting Matrix
(SAM). The SAM is a matrix presentation which elaborates the linkages
between supply and use tables and the sector accounts (see paragraphs
8.133. to 8.155). A SAM commonly provides additional information on
the level and composition of (un)employment, via a subdivision of
compensation of employees by type of person employed. This subdivision
applies to both the use of labour by industry, as shown in the use tables,
and the supply of labour by socio-economic subgroup, as shown in the
allocation of primary income account for subsectors of the sector
households. In this way, the supply and use of various categories of
labour is shown systematically.
1.18. For some specific data needs the best solution is to draw up separate
satellite accounts. Cases in point are the data needs for e.g.:
(a) the analysis of the role of tourism in the national economy;
(b) the analysis of the costs and financing of health care;
(c) the analysis of the importance of research & development and human
capital for the national economy;
(d) the analysis of the income and expenditure of households on the basis
of micro-oriented concepts of income and expenditure;
(e) the analysis of the interaction between the environment and the
economy;
(f) the analysis of production within households;
(g) the analysis of changes in welfare;
(h) the analysis of the differences between national accounts and business
accounts figures and their influence on stock and exchange markets;
(i) the estimation of tax revenues.
1.19. Satellite accounts can serve such data needs by:
(a) showing more detail where necessary and leaving out superfluous
detail;
(b) enlarging the scope of the accounting framework by adding non-
monetary information, e.g. on pollution and environmental assets;
(c) changing some basic concepts, e.g. by enlarging the concept of capital
formation by amount of the expenditure on research & development
or the expenditure on education.
1.20. An important feature of the satellite accounts is that in principle all basic
concepts and classifications of the standard framework are retained. Only
when the specific purpose of the satellite account definitely requires a
modification, are changes in the basic concepts introduced. In such
instances, the satellite account should also contain a table showing the link
between the major aggregates in the satellite account and those in the
standard framework. In this way, the standard framework retains its role
as a framework of reference and at the same time justice is done to more
specific needs.
1.21. The standard framework does not pay much attention to stocks and flows
which are not readily observable in monetary terms (or without a clear
monetary counterpart). By their nature, the analysis of such stocks and
flows is usually also well served by compiling statistics in non-monetary
terms, e.g.:
(a) production within households can most easily be described in terms of
hours allocated to the alternative uses;
(b) education can be described in terms of type of education, the number
of pupils, the average number of years of education before obtaining a
diploma, etc.;
(c) the effects of pollution are best described in terms of changes in the
number of living species, the health of the trees in the forest, the
volume of refuse, the amounts of carbon-monoxide and radiation, etc.
The satellite accounts offer a possibility to link such statistics in non-
monetary units to the standard national accounts framework. The linkage
is possible by using for these non-monetary statistics, as far as possible,
the classifications employed in the standard framework, e.g. the
classification by type of household or the classification by industry. In
this way, a consistent extended framework is drawn up. This framework
can then serve as a data base for the analysis and evaluation of all kinds of1996R2223 — EN — 07.08.2003 — 008.001 — 24
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interactions between the variables in the standard framework and those in
the extended part.
1.22. The standard framework and its major aggregates do not describe changes
in welfare. Extended accounts can be drawn up which include also the
imputed monetary values of, e.g.:
(a) domestic and personal services produced and consumed within the
same household;
(b) changes in leisure time;
(c) amenities and disadvantages of urban life;
(d) inequalities in the distribution of income over persons.
They can also reclassify the final expenditure on regrettable necessities
(e.g. defence) as intermediate consumption, i.e. as not contributing to
welfare. Similarly, the damage due to floods and other natural disasters
could be classified as intermediate consumption, i.e. as a reduction in
(absolute) welfare.
In this way, one could try to construct a very rough and very imperfect
indicator of changes in welfare. However, welfare has many dimensions,
most of which are best not expressed in monetary terms. A better solution
for measuring welfare is therefore to use, for each dimension, separate
indicators and units of measurement. The indicators could be, for
example, infant mortality, life expectancy, adult literacy and national
income per capita. These indicators could be incorporated in a satellite
account.
1.23. In order to attain a consistent, internationally compatible framework,
administrative concepts are not employed in the ESA. However, for allkinds of national purposes, obtaining figures based on administrative
concepts can be very useful. For example, for estimating tax revenues
statistics of taxable income are required. These statistics can be provided
by making some modifications to the national accounts statistics.
A similar approach could be taken for some concepts used in national
economic policy, e.g. for:
(a) the concept of inflation used for increasing pensions, unemployment
benefits or compensation of employees for civil servants;
(b) the concepts of taxes, social contributions, government and the
collective sector used in discussing the optimal size of the collective
sector;
(c) the concept of ‘strategic’ sectors/industries used in national economic
policy or the economic policy of the EU;
(d) the concept of ‘business investments’ used in national economic
policy.
Satellite accounts or simple supplementary tables could meet such, usually
specifically national, data needs.
The 1995 ESA and the 1993 SNA
1.24. The ESA (the 1995 ESA) is fully consistent with the revised System of
National Accounts (the 1993 SNA), which provides guidelines on national
accounting for all countries throughout the world. Nevertheless, there areseveral differences between the 1995 ESA and the 1993 SNA:
(a) differences in presentation, e.g.:
1. in the ESA there are separate chapters on transactions in products,
distributive transactions and financial transactions. In contrast, in
the SNA these transactions are explained in seven chapters
arranged by account, e.g. chapters on the production account, the
primary distribution of income account, the capital account and the
Rest of the World account;
2. the ESA describes a concept by providing a definition and a listing
of what is included and what is excluded. The SNA describes
concepts usually in more general terms and endeavours also to
explain the rationale behind the conventions adopted;
3. the ESA also contains chapters on regional accounts and quarterly
accounts;
4. the SNA also contains a chapter on satellite accounts.1996R2223 — EN — 07.08.2003 — 008.001 — 25
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(b) The ESA concepts are in several instances more specific and precise
than those of the SNA, e.g.:
1. the SNA does not contain very precise definitions on the
distinction between market, for own final use and other non-
market for institutional units, local KAUs and their outputs. This
implies that in this respect the valuation of output and the
classification by sectors are not defined sufficiently precisely. The
ESA has therefore introduced several extra clarifications and also
added in some specific instances the criterion that the sales of a
market producer should cover at least 50 % of the production costs
(see Table 3.1);
2. the ESA specifies concrete recording thresholds, e.g. for recording
small tools and appliances devices as intermediate consumption;
3. the ESA assumes that several types of household production of
goods, such as the weaving of cloth and the making of furniture,
are not significant in European Union Member States and therefore
need not be recorded;
4. the ESA makes explicit reference to specific institutional
arrangements in the European Union, such as the Intrastat system
for recording intra-European Union flows of goods and the
contributions by the Member States to the European Union;
5. the ESA contains European Union-specific classifications, e.g.:
CPA for products and NACE rev. 1 for industries (specific but
harmonized with the corresponding UN classifications);
6. the ESA contains an additional classification for all external
transactions: they should be divided into those between residents of
the European Union and those with residents from outside the
European Union.
The ESA can be more specific than the SNA, because the ESA primarily
applies to the European Union Member States. For the data needs of the
European Union, the ESA should also be more specific.
The 1995 ESA and the 1970 ESA
1.25. The 1995 ESA differs in scope as well as in concepts from the 1970 ESA.
Most of these differences correspond to differences between the 1968
SNA and 1993 SNA. Some of these major differences in scope are:
(a) the inclusion of balance sheets;
(b) the inclusion of other changes in assets accounts, i.e. the introduction
of the concepts other changes in volume, nominal holding gains and
real holding gains;
(c) the introduction of a subsectoring of households;
(d) the introduction of a new concept of final consumption: Actual Final
Consumption;
(e) the introduction of a new price-adjusted income concept: real national
disposable income;
(f) the inclusion of the concept of purchasing power parities.
Some of the major differences in concepts are:
(a) literary-artistic work (writing books, composing music) is now
regarded as production; payments for literary-artistic work are
therefore payments for services and not property income;
(b) the valuation of the output of insurance services has changed in some
respects, e.g. the revenues from the investment of technical reserves
are now also taken into account in valuing the output of non-life
insurance;
(c) more detailed treatment of trade and transport margins;
(d) the introduction of chain linking for calculating constant prices;
(e) the concept of financial leasing has been introduced (the 1968 SNA
and 1970 ESA contained only the concept of operational leasing);
(f) expenditure on mineral exploration and on computer software is now
recorded as capital formation (instead of as intermediate consump-
tion);
(g) capital consumption should also be recorded for infrastructural works
of government (roads, dikes, etc.);
(h) identification of new financial instruments, such as repurchase
agreements, and derivative financial instruments such as options.1996R2223 — EN — 07.08.2003 — 008.001 — 26
▼B
There are also differences that do not result from changes in the SNA,
e.g.:
(a) the introduction of supply and use tables (this was already included in
the 1968 SNA);
(b) the introduction of some registration thresholds and the reference to
specific institutional arrangements in the European Union (see
paragraph 1.24.);
(c) a clear choice in favour of valuing output at basic prices (the 1970
ESA, the 1968 SNA and the 1993 SNA also accept valuation at
producer's prices);
(d) the introduction of the concepts of economically active population
and unemployment (these concepts are absent in the 1968 and 1993
SNA).
THE ESA AS A SYSTEM
1.26. The main features of the system are:
(a) statistical units and their groupings;
(b) flows and stocks;
(c) the system of accounts and the aggregates;
(d) the input-output framework.
STATISTICAL UNITS AND THEIR GROUPINGS (1)
1.27. A characteristic feature of the system is the use of two types of unit and
two ways of subdividing the economy which are quite different and serve
separate analytical purposes.
In order to describe income, expenditure and financial flows, and balance
sheets, the system groups institutional units into sectors on the basis of
their principal functions, behaviour and objectives.
In order to describe processes of production and for input-output analysis,
the system groups local kind-of-activity units (local KAUs) into industries
on the basis of their type of activity. An activity is characterized by an
input of products, a production process and an output of products.
Institutional units and sectors
1.28. Institutional units are economic entities that are capable of owning goods
and assets, of incurring liabilities of engaging in economic activities and
transactions with other units in their own right. For the purposes of the
system, the institutional units are grouped together into five mutually
exclusive institutional sectors composed of the following types of units:
(a) non-financial corporations;
(b) financial corporations;
(c) general government;
(d) households;
(e) non-profit institutions serving households.
The five sectors together make up the total economy. Each sector is also
divided into subsectors. The system makes provision for a complete set of
flow accounts and balance sheets to be compiled for each sector, and
subsector if desired, as well as for the total economy.
Local kind-of-activity units and industries
1.29. Most institutional units in their capacity as producers carry out more than
one activity; to emphasize relationships of a technico-economic kind, they
have to be partitioned with regard to the type of activity.
Local kind-of-activity units are intended to meet this requirement as an
operational approach. A local KAU groups all the parts of an institutional
unit in its capacity as producer which are located in a single or closely
located sites, and which contribute to the performance of an activity at the
class level (four digits) of the NACE rev. 1.
In principle, as many local kind-of-activity units must be registered as
there are secondary activities; however, if the accounting documents that1996R2223 — EN — 07.08.2003 — 008.001 — 27
(1) See chapter 2: ‘Units and groupings of units’.
▼B
would be necessary to describe such activities are not available, a local
kind-of-activity unit may include one or several secondary activities.
The group of all local KAUs engaged on the same, or similar, kind-of-
activity constitutes an industry.
There is a hierarchical relationship between institutional units and local
KAUs. An institutional unit contains one or more entire local KAUs; a
local KAU belongs to one and only one institutional unit.
For more refined analysis of the production process, use is made of an
analytical unit of production. This unit, which is not observable (except in
the case of a local KAU only producing one type of product), is the unit of
homogeneous production, defined as covering no secondary activities.
Groupings of these units constitute homogeneous branches.
Resident and non-resident units; total economy and rest of the world
1.30. The total economy is defined in terms of resident units. A unit is said to be
a resident unit of a country when it has a centre of economic interest on
the economic territory of that country — that is, when it engages for an
extended period (one year or more) in economic activities on this territory.
The institutional sectors referred to above are groups of resident
institutional units.
Resident units engage in transactions with non-resident units (that is, units
which are residents in other economies). These transactions are the
external transactions of the economy and are grouped in the Rest of the
World account. So, in the system's accounting structure, the rest of theworld plays a role similar to that of an institutional sector, although non-
resident units are included only in so far as they are engaged in
transactions with resident institutional units. Consequently, as far as
coding of classifications is concerned, a specific item for the rest of the
world is included at the end of the classification of sectors.
Notional resident units, treated in the system as institutional units, are
defined as:
(a) those parts of non-resident units which have a centre of economic
interest (that is in most cases which engage in economic transactions
for a year or more or which carry out a construction activity for a
period of less than a year if the output constitutes gross fixed capital
formation) on the economic territory of the country;
(b) non-resident units in their capacity as owners of land or buildings on
the economic territory of the country, but only in respect of
transactions affecting such land or buildings.
FLOWS AND STOCKS
1.31. The system records two basic kinds of information: flows and stocks.
Flows refer to actions and effects of events that take place within a given
period of time, while stocks refer to positions at a point of time.
Flows
1.32. Flows reflect the creation, transformation, exchange, transfer or extinction
of economic value. They involve changes in the value of an institutional
unit's assets or liabilities. Economic flows are of two kinds: transactions,
and other changes in assets. Transactions appear in all accounts and tables
where flows appear, except the other changes in volume of assets account
and the revaluation account. Other changes in the assets appear only in
these two accounts.
Elementary transactions and other flows are innumerable. The system
groups them into a relatively small number of types according to their
nature.1996R2223 — EN — 07.08.2003 — 008.001 — 28
▼B
Transactions
1.33. A transaction is an economic flow that is an interaction between
institutional units by mutual agreement or an action within an institutional
unit that it is useful to treat as a transaction, often because the unit is
operating in two different capacities. It is convenient to divide
transactions into four main groups:
(a) transactions in products: which describe the origin (domestic output or
imports) and use (intermediate consumption, final consumption,
capital formation or exports) of products (1);
(b) distributive transactions: which describe how value added generated
by production is distributed to labour, capital and government, and the
redistribution of income and wealth (taxes on income and wealth and
other transfers) (2);
(c) financial transactions: which describe the net acquisition of financial
assets or the net incurrence of liabilities for each type of financial
instrument. Such transactions often occur as counterparts of non-
financial transactions, but they may also occur as transactions
involving only financial instruments (3);
(d) transactions not included in the three groups above: consumption of
fixed capital and acquisitions less disposals of non-produced non
financial assets (4).
Properties of transactions
Interactions versus intra-unit transactions
1.34. Most transactions are interactions between two or more institutional units.
However, the system records some actions within institutional units as
transactions. The purpose of recording these intra-unit transactions is to
give a more analytically useful picture of output, final uses and costs.
Consumption of fixed capital, which is recorded as a cost by the system, is
an important intra-unit transaction. Most of the other intra-unittransactions are transactions in products, typically recorded when
institutional units operating as both producers and final consumers choose
to consume some of the output they have produced themselves. This is
often the case for households and general government.
1.35. All own-produced output used for final uses within the same institutional
unit is recorded. Own-produced output used for intermediate consumption
within the same institutional unit is recorded only when production and
intermediate consumption take place in different local kind-of-activity
units within the same institutional unit. Output produced and used as
intermediate consumption within the same local kind-of-activity unit is
not recorded.
Monetary versus non-monetary transactions
1.36. Most transactions recorded by the system are monetary transactions,
where the units involved make or receive payments, or incur liabilities or
receive assets denominated in units of currency.
Transactions that do not involve the exchange of cash, or assets or
liabilities denominated in units of currency, are non-monetary transac-
tions. Intra-unit transactions are normally non-monetary transactions.
Non-monetary transactions involving more than one institutional unit
occur among transactions in products (barter of products), distributive
transactions (remuneration in kind, transfers in kind, etc.) and other
transactions (barter of non-produced non-financial assets).
The system records all transactions in monetary terms. The values to be
recorded for non-monetary transactions must therefore be measured
indirectly or otherwise estimated.
Transactions with and without counterparts
1.37. Transactions involving more than one unit are either ‘something for
something’ or ‘something for nothing’ transactions. The former are
exchanges between institutional units, i.e. provision of goods, services or1996R2223 — EN — 07.08.2003 — 008.001 — 29
(1) See chapter 3: ‘Transactions in products’.
(2) See chapter 4: ‘Distributive transactions’.
(3) See chapter 5: ‘Financial transactions’.
(4) See chapter 6: ‘Other flows’.
▼B
assets in return for a counterpart, e.g. money. The latter typically are
payments in cash or in kind from one institutional unit to another without
counterpart. ‘Something for something’ transactions occur in all four
transaction groups, while ‘something for nothing’ transactions occur
mainly among distributive transactions, in the form of, for example, taxes,
social assistance benefits or gifts.
Rearranged transactions
1.38. The system's treatment of most transactions is straightforward; that is, the
transactions are recorded in the same way as they appear to the
institutional units involved. However, some transactions are rearranged in
order to bring out the underlying economic relationships more clearly.
Transactions can be rearranged in three ways: rerouting, partitioning and
recognizing the principal party to a transaction.
Rerouting
1.39. A transaction that appears to the units involved as taking place directly
between units A and C may be recorded as taking place indirectly through
a third unit B. Thus, the single transaction between A and C is recorded as
two transactions: one between A and B, and one between B and C. In this
case the transaction is rerouted.
As well-known example of a rerouting is employers' social contributions
paid directly by employers to social insurance funds. The system records
these payments as two transactions: employers pay employer's social
contributions to their employees, and employees pay the same contribu-
tions to social insurance funds. As with all reroutings, the purpose of
rerouting employers' social contributions is to bring out the economic
substance behind the transaction. In this case this means to show
employer's social contributions as contributions paid for the benefit of
employees.
Another type of rerouting is that of transactions recorded as taking place
between two or more institutional units, although according to the parties
involved no transaction takes place at all. An example is the treatment of
property income earned on certain insurance funds, which is retained by
insurance enterprises. The system records this property income as being
paid by insurance enterprises to policy holders, who then pay the same
amount back to the insurance enterprises as premium supplements.
Partitioning
1.40. When a transaction appearing to the parties involved as a single
transaction is recorded as two or more differently classified transactions,
the transaction is partitioned. Partitioning does usually not imply
involving additional units in the transactions.
The payment of non-life insurance premiums is a typical partitioned
transaction. Although policy holders and insurers regard these payments
as one transaction, the system divides them into two quite different
transactions: payments in return for non-life insurance services provided,
and net non-life insurance premiums. The recording of trade margins is
another important case of partitioning.
Recognizing the principal party to a transaction
1.41. When a unit carries out a transaction on behalf of another unit, the
transaction is recorded exclusively in the accounts of the principal. As a
rule, one should not go beyond this principle and try, for instance, to
allocate taxes or subsidies to ultimate payers or ultimate beneficiaries
under the adoption of assumptions.
Borderline cases
1.42. The definition of a transaction stipulates that an interaction between
institutional units be by mutual agreement. When a transaction is
undertaken by mutual agreement, the prior knowledge and consent of
the institutional units is implied. However, this does not mean that all
units necessarily enter a transaction voluntarily, because some transactions
are imposed by law. This applies mainly to certain distributive
transactions, such as payments of taxes, fines and penalties. However,
uncompensated seizure of assets is not regarded as a transaction, even
when imposed by law.
Illegal economic actions are transactions only when all units involved
enter the actions voluntarily. Thus, purchases, sales or barters of illegal
drugs or stolen property are transactions, while theft is not.1996R2223 — EN — 07.08.2003 — 008.001 — 30
▼B
Other changes in assets
1.43. Other changes in assets record changes that are not the result of
transactions (1). They are either:
(a) other changes in the volume of assets and liabilities; or
(b) holding gains and losses.
Other changes in the volume of assets and liabilities
1.44. These changes can be roughly divided into three main categories:
(a) normal appearance and disappearance of assets other than by
transactions;
(b) changes in assets and liabilities due to exceptional, unanticipated
events;
(c) changes in classification and structure.
1.45. Examples of changes within category (a) are discovery or depletion of
subsoil assets, and natural growth of non-cultivated biological resources.
Category (b) comprises changes (normally losses) in assets due to natural
disasters, war or severe acts of crime (2). Unilateral cancellation of debt
and uncompensated seizure of assets also belong to category (b). Category
(c) consists of changes as a consequence of reclassification and
restructuring of institutional units or of assets and liabilities.
Holding gains and losses
1.46. Holding gains and losses result from changes in the prices of assets. They
occur on all kinds of financial and non-financial assets, and on liabilities.
Holding gains and losses accrue to the owners of assets and liabilities
purely as a result of holding the assets or liabilities over time, without
transforming them in any way.
Holding gains and losses measured on the basis of current market prices
are called nominal holding gains and losses. These may be decomposed
into neutral holding gains and losses, reflecting changes in the general
price level, and real holding gains and losses, reflecting changes in the
relative prices of assets.
Stocks
1.47. Stocks are holdings of assets and liabilities at a point in time. Stocks are
recorded at the beginning and end of each accounting period. The
accounts that show stocks are called balance sheets (3).
Stocks are also recorded for population and employment. However, these
stocks are recorded as mean values over the accounting period.
Stocks are recorded for all assets within the system's boundaries; that is,
for financial assets and liabilities and for non-financial assets, both
produced and non-produced. However, the coverage is limited to those
assets that are used in economic activity and that are subject to ownership
rights. Thus, stocks are not recorded for assets such as human capital and
natural resources that are not owned.
Within its boundaries, the system is exhaustive in respect of both flows
and stocks. This implies that all changes in stocks can be fully explained
by recorded flows.
THE SYSTEM OF ACCOUNTS AND THE AGGREGATES (4)
Rules of accounting
1.48. An account is a means of recording, for a given aspect of economic life,
the uses and resources or the changes in assets and the changes in
liabilities during the accounting period, or the stock of assets and
liabilities existing at the beginning or at the end of this period.1996R2223 — EN — 07.08.2003 — 008.001 — 31
(1) See chapter 6: ‘Other flows’.
(2) The consequences of minor crimes, such as shoplifting, may be recorded as part of
change in inventories and thus as a transaction.
(3) See chapter 7: ‘Balance sheets’.
(4) See chapter 7: ‘Balance sheets’, and chapter 8: ‘Sequence of accounts and balancing
items’.
▼B
Terminology for the two sides of the accounts
1.49. The system employs the term ‘resources’ for the right side of the current
accounts where transactions appear which add to the amount of economic
value of a unit or a sector. The left side of the accounts, which relates to
transactions that reduce the amount of economic value of a unit or sector,
is termed ‘uses’.
The right side of the accumulation accounts is called ‘changes in liabilities
and net worth’ and their left side is called ‘changes in assets’.
Balance sheets are presented with ‘liabilities and net worth’ (the
difference between assets and liabilities) on the right side and ‘assets’
on the left. Comparison of two successive balance sheets shows changes
in liabilities and net worth and changes in assets.
Double entry/quadruple entry
1.50. For a unit or sector, national accounting is based on the principle of
double entry. Each transaction must be recorded twice, once as a resource
(or a change in liabilities) and once as a use (or a change in assets). The
total of transactions recorded as resources or changes in liabilities and the
total of transactions recorded as uses or changes in assets must be equal,
thus permitting a check on the consistency of the accounts.
In practice though, national accounts — with all units and all sectors —
are based on a principle of quadruple entry, since most transactions
involve two institutional units. Each transaction of this type must be
recorded twice by the two transactors involved. For example, a social
benefit in cash paid by a government unit to a household is recorded in the
accounts of government as a use under transfers and a negative acquisition
of assets under currency and deposits; in the accounts of the household
sector it is recorded as a resource under transfers and an acquisition of
assets under currency and deposits.
On the other hand, transactions within a single unit (such as the
consumption of output by the same unit that produced it) require only two
entries, whose values have to be estimated.
Valuation
1.51. With the exception of some variables concerning population and labour,
the system shows all flows and stocks in monetary terms. The system does
not attempt to determine the utility of flows and stocks. Instead, flows and
stocks are measured according to their exchange value, i.e. the value at
which flows and stocks are in fact, or could be, exchanged for cash.
Market prices are thus ESA's basic reference for valuation.
1.52. In the case of monetary transactions and cash holdings and liabilities, the
values required are directly available. In most other cases, the preferred
method of valuation is by reference to market prices for analogous goods,
services or assets. This method is used for e.g. barter and the services of
owner-occupied dwellings. When no market prices for analogous products
are available, for instance in the case of non-market services produced by
government, valuation should be made according to production costs. If
neither of these two methods are feasible, flows and stocks may be valued
at the discounted present value of expected future returns. However, due
to the great uncertainty involved, this last method is only recommended as
a last resort.
1.53. Stocks should be valued at current prices at the time to which the balance
sheet relates, not at the time of production or acquisition of the goods or
assets that form the stocks. It is sometimes necessary to value stocks at
their estimated written-down current acquisition values or production
costs.
Special valuations concerning products (1)
1.54. Because of transport costs, trade margins and taxes less subsidies on
products, the producer and the user of a given product usually perceive its
value differently. In order to keep as close as possible to the views of the
transactors, the system records all uses at purchaser's prices, which
include transport costs, trade margins and taxes less subsidies on products,
while output is recorded at basic prices, which exclude these elements.1996R2223 — EN — 07.08.2003 — 008.001 — 32
(1) See chapter 3: ‘Transactions in products’.
▼B
1.55. Imports and exports of products are recorded at border values. Total
imports and exports are valued at the exporter's customs frontier, or free
on board (fob). Foreign transport and insurance services between the
importer's and the exporter's frontiers are not included in the value of
goods but are recorded under services. As it may not be possible to obtain
fob values for detailed product breakdowns, the tables containing details
on foreign trade show imports valued at the importer's customs frontier
(cif value). All transport and insurance services to the importer's frontier
are included in the value of imported goods. As far as these services
concern domestic services a global fob/cif adjustment is made in this
presentation.
Valuation at constant prices (1)
1.56. Valuation at constant prices means valuing the flows and stocks in an
accounting period at the prices of a previous period. The purpose of
valuation at constant prices is to decompose changes over time in the
values of flows and stocks into changes in price and changes in volume.
Flows and stocks at constant prices are said to be in volume terms.
Many flows and stocks, e.g. income, do not have price and quantity
dimensions of their own. However, the purchasing power of these
variables can be obtained by deflating the current values with a suitable
price index, e.g. the price index for final national uses, excluding changes
in inventories. Deflated flows and stocks are said to be in real terms. An
example is real disposable income.
Time of recording
1.57. The system records flows on an accrual basis; that is, when economic
value is created, transformed or extinguished, or when claims and
obligations arise, are transformed or are cancelled.
Thus, output is recorded when produced, not when paid for by a
purchaser, and the sale of an asset is recorded when the asset changes
hands, not when the corresponding payment is made. Interest is recorded
in the accounting period when it accrues, regardless of whether or not it is
actually paid in that period. Recording on an accrual basis applies to all
flows, monetary as well as non-monetary and intra-unit a well as between
units.
However, in some cases it is necessary to show flexibility as regards time
of recording. This applies in particular to taxes and other flows concerning
general government, which are often recorded on a cash basis in
government accounts. It is sometimes difficult to carry out an exact
transformation of these flows from cash basis to accrual basis. In these
cases it might therefore be necessary to use approximations.
►M4 Additional to this flexibility as regards time of recording, it was
necessary for practical reasons linked to the excessive deficit procedure to
define a particular recording of taxes and social contributions payable to
the government sector, so that net lending/borrowing of general
government (and of counterpart sectors) shall not include amounts of
taxes and social contributions unlikely to be collected. By derogation to
the general principle of recording transactions, taxes and social
contributions payable to the general government can either be recorded
net of the part unlikely to be collected or, if this part is included, it should
be neutralised in the same accounting period by a capital transfer from the
general government to the relevant sectors. ◄
Any flow should be recorded at the same point of time for all institutional
units involved and in all accounts in question. This principle may seem
simple, but its implementation is not. Institutional units do not always
apply the same accounting rules. Even when they do, differences in actual
recording may occur for practical reasons such as delays in communica-
tion. Consequently, transactions may be recorded at different times by the
transactors involved. These discrepancies must be eliminated by
adjustments.
Consolidation and nettingConsolidation
1.58. Consolidation refers to the elimination, from both uses and resources, of
transactions which occur between units when the latter are grouped, and to
the elimination of reciprocal financial assets and liabilities.1996R2223 — EN — 07.08.2003 — 008.001 — 33
(1) See chapter 10: ‘Price and volume measures’.
▼B
For subsectors or sectors, flows and stocks between constituent units are
not consolidated between constituent units as a matter of principle.
However, consolidated accounts may be built up for complementary
presentations and analyses. For certain kinds of analysis, information on
the transactions of these (sub)sectors with other sectors and the
corresponding ‘external’ financial position is more significant than overall
gross figures.
Moreover, the accounts and tables showing the creditor/debitor relation-
ship provide a detailed picture of financing of the economy and are
considered very useful for understanding the channels through which thefinancing surpluses move from final lenders to final borrowers.
Netting
1.59. Individual units or sectors may have the same kind of transaction both as a
use and as a resource (e.g. they both pay and receive interest) and thesame kind of financial instrument both as an asset and as a liability.
The system recommends gross recording, apart from the degree of netting
which is inherent in the classifications themselves.
In fact, netting is implicit in various transaction categories, the most
outstanding example being ‘changes in inventories’, which underlines the
analytically significant aspect of overall capital formation rather than
tracking daily additions and withdrawals.
Similarly, with few exceptions, the financial account and other changes in
assets accounts record increases in assets and in liabilities on a net basis,
bringing out the final consequences of these types of flows at the end of
the accounting period.
Accounts, balancing items and aggregates
1.60. For units (institutional units; local kind-of-activity units) or groups of
units (institutional sectors and, by extension, the rest of the world;
industries), different sub-accounts record the transactions or other flows
which are connected to some specific aspect of economic life (for
instance, production). Such a set of transactions usually does not balance;
the total amounts recorded as receivable and payable usually differ.
Therefore, a balancing item must be introduced. Usually, a balancing item
must also be introduced between the total of assets and the total of
liabilities of an institutional unit or sector. Balancing items are meaningful
measures of economic performance in themselves. When summed for the
whole economy, they constitute significant aggregates.
The sequence of accounts
1.61. The system is built around a sequence of inter-connected accounts.
The full sequence of accounts for the institutional units and sectors is
composed of current accounts, accumulation accounts and balance sheets.
Current accounts deal with the production, generation, distribution and
redistribution of income and the use of this income in the form of final
consumption. Accumulation accounts cover changes in assets and
liabilities and changes in net worth (the difference for any institutional
unit or group of units between its assets and liabilities). Balance sheets
present stocks of assets and liabilities and net worth.
1.62. It is not possible to envisage a complete set of accounts, including balance
sheets, being compiled for a local KAU, because generally such an entity
is not capable of owning goods or assets in its own right or capable of
receiving or disbursing income. The sequence of accounts for local kind-
of-activity units and industries is shortened to the first current accounts:
production account and generation of income account, the balancing item
of which is the operating surplus.
The goods and services account
1.63. The goods and services account shows, for the economy as a whole or for
groups of products, the total resources (output and imports) and uses of
goods and services (intermediate consumption, final consumption,
changes in inventories, gross fixed capital formation, acquisitions less
disposals of valuables, and exports).1996R2223 — EN — 07.08.2003 — 008.001 — 34
▼B
The Rest of the World account
1.64. The Rest of the World account covers transactions between resident and
non-resident institutional units and the related stocks of assets and
liabilities when relevant.
As the rest of the world plays a role in the accounting structure similar to
that of an institutional sector, the Rest of the World account is established
from the point of view of the rest of the world. A resource for the rest of
the world is a use for the total economy and vice versa. If a balancing item
is positive, it means a surplus of the rest of the world and a deficit of the
total economy, and vice versa if the balancing item is negative.
Balancing items
1.65. A balancing item is an accounting construct obtained by subtracting the
total value of the entries on one side of an account from the total value on
the other side. It cannot be measured independently of the other entries; as
a derived entry, it reflects the application of the general accounting rules
to the specific entries on the two sides of the account.
Balancing items are not only devices introduced to ensure that accounts
balance. They encapsulate a great deal of information and include some of
the most important entries in the accounts, as can be seen from the
following examples of balancing items: value added, operating surplus,
disposable income, saving, net lending/net borrowing.
Aggregates
1.66. The aggregates are composite values which measure the result of the
activity of the total economy considered from a particular point of view;
for example, output, value added, disposable income, final consumption,
saving, capital formation, etc. Although the calculation of the aggregates
is neither its sole nor its main purpose, the system does recognize their
importance as summary indicators and key magnitudes for purposes of
macro-economic analysis and comparisons over time and space.
Two types of aggregates can be distinguished:
(a) aggregates which refer directly to transactions in the system, such as
the output of goods and services, actual final consumption, gross fixed
capital formation, compensation of employees, etc.;
(b) aggregates which represent balancing items in the accounts, such as
gross domestic product at market prices (GDP), operating surplus of
the total economy, national income, national disposable income,
saving, current external balance, net worth of the total economy
(national wealth).
1.67. A dimension is added to the usefulness of a number of national accounts
figures by calculating these figures per head. For broad aggregates such as
GDP or national income or household final consumption, the denominator
commonly used is the total (resident) population. When subsectoring the
accounts or part of the accounts of the household sector, data on the
number of households and the number of persons belonging to each
subsector are also necessary (1).
THE INPUT-OUTPUT FRAMEWORK (2)
1.68. The input-output framework consists of supply and use tables by industry,
tables linking the supply and use tables to the sector accounts and
symmetric input-output tables by homogeneous branch (product).
1.69. Supply and use tables are matrices (rows of products, columns of
industries), showing how the output of industries is broken down by type
of products and how the domestic and imported supply of goods and
services is allocated between various intermediate or final uses, including
exports. The use table also shows by industry the structure of production
costs and the income generated.
The supply and use tables are the coordinating framework for all tables by
industry and (or) by product, which include data on labour inputs, gross
fixed capital formation, stocks of fixed assets, detailed price indices and
thus describe in detail cost structure, income generated, employment,
labour productivity, capital intensity.1996R2223 — EN — 07.08.2003 — 008.001 — 35
(1) See chapter 11: ‘Population and labour inputs’.
(2) See chapter 9: ‘The input-output framework’.
▼B
1.70. It is possible to link the supply and use tables to the sector accounts by
cross-classifying output, intermediate consumption and the components of
value added by sector and by industry.1996R2223 — EN — 07.08.2003 — 008.001 — 36
▼B
CHAPTER 2
UNITS AND GROUPINGS OF UNITS
2.01. The economy of a country is the outcome of the activity of a very large
number of units which carry out numerous transactions of various kinds
for purposes of production, finance, insurance, redistribution and
consumption.
2.02. The units and groupings of units used in national accounts must be defined
with reference to the kind of economic analysis for which they are
intended, and not in terms of the types of unit usually employed in
statistical inquiries. These latter units (enterprises, holding companies,
kind-of-activity units, local units, government departments, non-profit
institutions, households, etc.) may not always be satisfactory for the
purposes of national accounts, since they are generally based on
traditional criteria of a legal, administrative or accounting nature.
Statisticians should take into account the definitions of units of analysis
used in the ESA, in order to ensure that in the surveys in which actual data
are collected all the elements of information needed to compile data based
on the units of analysis used in the ESA are gradually introduced.
2.03. A feature of the system is the use of three types of unit corresponding to
two very different ways of subdividing the economy. To analyse the
process of production, it is essential to select units which bring out
relationships of a technico-economic nature; to analyse flows affecting
income, capital and financial transactions and balance sheets, it is
essential to select units which make it possible to study behavioural
relationships among economic agents.
Given these two objectives, institutional units appropriate for the analysis
of economic behaviour, local kind-of-activity units and units of
homogeneous production appropriate for the analysis of technico-
economic relationships are defined later in this chapter. In practice, these
three types of unit are formed by combining or subdividing the basic units
of statistical inquiries or sometimes received directly from statistical
inquiries. Before giving precise definitions of these three types of unit
used in the ESA, it is necessary to define the limits of the national
economy.
THE LIMITS OF THE NATIONAL ECONOMY
2.04. The units, whether institutional, local kind-of-activity or of homogeneous
production, which constitute the economy of a country and whose
transactions are recorded in the ESA, are those which have a centre of
economic interest on the economic territory of that country. These units,
known as resident units, may or may not have the nationality of that
country, may or may not be legal entities, and may or may not be present
on the economic territory of the country at the time they carry out a
transaction. Having thus defined the limits of the national economy in
terms of resident units, it is necessary to define the meaning of the terms
economic territory and centre of economic interest.
2.05. The term economic territory means:
(a) the geographic territory administered by a government within which
persons, goods, services and capital move freely;
(b) any free zones, including bonded warehouses and factories under
customs control;
(c) the national air-space, territorial waters and the continental shelf lying
in international waters, over which the country enjoys exclusive
rights (1);
(d) territorial enclaves (i.e. geographic territories situated in the rest of the
world and used, under international treaties or agreements between
States, by general government agencies of the country (embassies,
consulates, military bases, scientific bases, etc.));1996R2223 — EN — 07.08.2003 — 008.001 — 37
(1) Fishing boats, other ships, floating platforms and aircraft are treated in the ESA just like
any other mobile equipment, whether owned and/or operated by units resident in the
country, or owned by non-residents and operated by resident units. Transactionsinvolving the ownership (gross fixed capital formation) and use (renting, insurance, etc.)of this type of equipment are attributed to the economy of the country of which theowner and/or operator respectively are resident. In cases of financial leasing a change of
ownership is assumed.
▼B
(e) deposits of oil, natural gas, etc. in international waters outside the
continental shelf of the country, worked by units resident in the
territory as defined in the preceding subparagraphs.
2.06. The economic territory does not include extraterritorial enclaves (i.e. the
parts of the country's own geographic territory used by general
government agencies of other countries, by the institutions of the
European Union or by international organizations under international
treaties or agreements between States (1)).
2.07. The term centre of economic interest indicates the fact there exists some
location within the economic territory on, or from, which a unit engages,
and intends to continue to engage, in economic activities and transactions
on a significant scale, either indefinitely or over a finite but long period of
time (a year or more). It follows that a unit which carries out such
transactions on the economic territory of several countries is deemed to
have a centre of economic interest in each of them. The ownership of land
and buildings within the economic territory is deemed to be sufficient in
itself for the owner to have a centre of economic interest there.
2.08. On the basis of these definitions, units deemed to be residents of a country
can be sub-divided into:
(a) units which are principally engaged in production, finance, insurance
or redistribution, in respect of all their transactions except those
relating to ownership of land and buildings;
(b) units which are principally engaged in consumption (2), in respect of
all their transactions except those relating to ownership of land and
buildings;
(c) all units in their capacity as owners of land and buildings with the
exception of owners of extraterritorial enclaves which are part of the
economic territory of other countries or are States sui generis (see
paragraph 2.06.).
2.09. In the case of units which are principally engaged in production, finance,
insurance or redistribution, in respect of all their transactions except those
relating to ownership of land and buildings, the following two cases may
be distinguished:
(a) activity conducted exclusively on the economic territory of the
country: units which carry out such activity are resident units of the
country;
(b) activity conducted for a year or more on the economic territories of
several countries: only that part of the unit which has a centre of
economic interest on the economic territory of the country is deemed
to be a resident unit. It may be:
1. either an institutional resident unit (see paragraph 2.12.), whose
activities conducted for a year or more in the rest of the world are
excluded and treated separately (3)o r
2. a notional resident unit (see paragraph 2.15.), in respect of the
activity conducted in the country for a year or more by a unit
which is resident in another country (3).
2.10. In the case of units which are principally engaged in consumption, except
in their capacity as owners of land and buildings, households which have a
centre of economic interest in the country are deemed to be resident units,
even if they go abroad for short periods (less than a year). They include, in
particular, the following:
(a) border workers, i.e. people who cross the frontier daily to work in a
neighbouring country;1996R2223 — EN — 07.08.2003 — 008.001 — 38
(1) The territories used by the institutions of the European Union and international
organizations thus constitute the territories of States sui generis. The feature of such
States is that the only residents are the institutions themselves (see paragraph 2.10. e).
(2) Consumption is not the only possible activity of households. Households may as
entrepreneurs engage in any kind of economic activity.
(3) It is only where such activity is carried on for less than a year that it should not be
separated from the activities of the producer institutional unit. This may also be donewhere the activity, though conducted for a year or more, is insignificant, and in all
circumstances for the installation of equipment abroad. But a unit which is resident in
another country and which is carrying out a construction activity in the country for aduration of less than a year is deemed to have a centre of economic interest on theeconomic territory of the country if the output of the construction activity constitutesgross fixed capital formation. Such a unit should therefore be treated as a notional
resident unit.
▼B
(b) seasonal workers, i.e. people who leave the country for several
months, but less than a year, to work in another country in sectors in
which additional manpower is needed periodically;
(c) tourists, patients, students (1), visiting officials, businessmen,
salesmen, artists and crew members who travel abroad;
(d) locally recruited staff working in the extraterritorial enclaves of
foreign governments;
(e) the staff of the institutions of the European Union and of civilian or
military international organizations which have their headquarters in
extraterritorial enclaves;
(f) the official, civilian or military representatives of the government of
the country (including their households) established in territorial
enclaves.
2.11. All units in their capacity as owners of land and/or buildings which form
part of the economic territory are deemed to be resident units or notional
resident units (see paragraph 2.15.) of the country in which the land or
buildings in question are located.
THE INSTITUTIONAL UNITS
2.12. Definition: The institutional unit is an elementary economic decision-
making centre characterized by uniformity of behaviour and
decision-making autonomy in the exercise of its principal
function. A resident unit is regarded as constituting an
institutional unit if it has decision-making autonomy in
respect of its principal function and either keeps a complete
set of accounts or it would be possible and meaningful, from
both an economic and legal viewpoint, to compile a
complete set of accounts if they were required.
In order to be said to have autonomy of decision in respect of its principal
function, a unit must:
(a) be entitled to own goods or assets in its own right; it will therefore be
able to exchange the ownership of goods or assets in transactions with
other institutional units;
(b) be able to take economic decisions and engage in economic activities
for which it is itself held to be directly responsible and accountable at
law;
(c) be able to incur liabilites on its own behalf, to take on other
obligations or further commitments and to enter into contracts.
In order to be said to keep a complete set of accounts, a unit must keep
accounting records covering all its economic and financial transactions
carried out during the accounting period, as well as a balance sheet of
assets and liabilities.
2.13. The following principles apply whenever entities do not clearly possess
both the characteristics of an institutional unit:
(a) households always enjoy autonomy of decision in respect of their
principal function and must therefore be institutional units, even
though they do not keep a complete set of accounts;
(b) entities which do not keep a complete set of accounts, and for which it
would not be possible or meaningful to compile a complete set of
accounts if required, are combined with the institutional units into
whose accounts their partial accounts are integrated;
(c) entities which, while keeping a complete set of accounts, have no
autonomy of decision in the exercise of their principal function are
combined with the units which control them;
(d) entities which satisfy the definition of an institutional unit are treated
as such even if they do not publish their accounts;
(e) entities forming part of a group of units engaged in production and
keeping a complete set of accounts are deemed to be institutional
units even if they have partially surrendered their autonomy of
decision to the central body (the holding corporation) responsible for
the general direction of the group; the holding corporation itself is
deemed to be an institutional unit distinct from the units which it
controls, unless (b) is applicable;1996R2223 — EN — 07.08.2003 — 008.001 — 39
(1) Students are always treated as residents, however long they study abroad.
▼B
(f) quasi-corporations keep a complete set of accounts and have no
independent legal status. However, they have an economic and
financial behaviour that is different from that of their owners and
similar to that of corporations. Therefore they are deemed to have
autonomy of decision and are considered as distinct institutional units.
2.14. Holding corporations are institutional units whose main function is to
control and direct a group of subsidiaries.
2.15. Notional resident units are defined as:
(a) those parts of non-resident units which have a centre of economic
interest (that is in most cases which engage in economic transactions
for a year or more or which carry out a construction activity for a
period of less than a year if the output constitutes gross fixed capital
formation) on the economic territory of the country;
(b) non-resident units in their capacity as owners of land or buildings on
the economic territory of the country, but only in respect of
transactions affecting such land or buildings.
Notional resident units, even if they keep only partial accounts and may
not always enjoy autonomy of decision, are treated as institutional units.
2.16. In conclusion, the following are deemed to be institutional units:
(a) units which have a complete set of accounts and autonomy of
decision:
1. private and public corporations;
2. cooperatives or partnerships recognized as independent legal
entities;
3. public producers which by virtue of special legislation are
recognized as independent legal entities;
4. non-profit institutions recognized as independent legal entities;
5. agencies of general government;
(b) units which have a complete set of accounts and which are deemed to
have autonomy of decision: quasi-corporations (see paragraph 2.13.
f);
(c) units which do not necessarily keep a complete set of accounts, but
which by convention are deemed to have autonomy of decision:
1. households;
2. notional resident units (see paragraph 2.15.).
THE INSTITUTIONAL SECTORS
2.17. The need for aggregation means that it is impossible to consider individual
institutional units separately; they must be combined into groups called
institutional sectors or simply sectors, some of which are divided into
subsectors.
Table 2.1 — Sectors and subsectors
Sectors and subsectors PublicNational
privateForeign
controlled
Non-financial corporations S.11 S.11001 S.11002 S.11003
Financial corporations S.12
Central Bank S.121
Other monetary financial insti-
tutions S.122 S.12201 S.12202 S.12203
Other financial intermediaries,
except insurance corporations
and pension funds S.123 S.12301 S.12302 S.12303
Financial auxiliaries S.124 S.12401 S.12402 S.12403
Insurance corporations and
pension funds S.125 S.12501 S.12502 S.12503
General government S.13
Central government S.1311State government S.1312
Local government S.13131996R2223 — EN — 07.08.2003 — 008.001 — 40
▼B
Sectors and subsectors PublicNational
privateForeign
controlled
Social security funds S.1314
Households S.14
Employers (including own-
account workers) S.141 + S.142
Employees S.143
Recipients of property incomes S.1441
Recipients of pensions S.1442Recipients of other transfer
incomes S.1443
Others S.145
Non-profit institutions serving
households S.15
Rest of the world S.2
The European Union S.21
The member countries of
the EU S.211
The institutions of the EU S.212
Third countries and interna-
tional organizations S.22
2.18. Each of the sectors and subsectors groups together the institutional units
which have a similar type of economic behaviour.
The institutional units are grouped into sectors on the basis of the type of
producer they are and depending on their principal activity and function,
which are considered to be indicative of their economic behaviour.
A sector is divided into subsectors according to the criteria relevant to that
sector; this permits a more precise description of the economic behaviour
of the units.
The accounts for sectors and subsectors record all the activities, whether
principal or secondary, of the institutional units covered.
Each institutional unit belongs to only one sector or subsector.
2.19. When the principal function of the institutional unit is to produce goods
and services, it is necessary in deciding the sector to which it should be
allocated — to distinguish first of all the type of producer it is belonging
to.
Three types of producers are distinguished in the ESA:
(a) private and public market producers (see paragraph 3.24 and table 3.1
of chapter 3);
(b) private producers for own final use (see paragraph 3.25 and table 3.1
of chapter 3);
(c) private and public other non-market producers (see paragraph 3.26
and table 3.1 of chapter 3).
Institutional units which are market producers are classified in the sectors
non-financial corporations (S.11), financial corporations (S.12) or house-
holds (S.14).
Institutional units which are private producers for own final use are
classified in the households sector (S.14) together with the unincorporated
enterprises owned by households (see paragraph 3.30).
Institutional units which are other non-market producers are classified in
the sector general government (S.13) or non-profit institutions serving
households (S.15).1996R2223 — EN — 07.08.2003 — 008.001 — 41
▼B
2.20. Table 2.2 shows the type of producer, the principal activities and functions
which are characteristic of each sector:
Table 2.2 — The type of producer, the principal activities and functions classified by sector
Sector Type of producer Principal activity and function
Non-financial corpora-
tions (S.11)
(see paragraph 2.21)Market producer Production of market goods and non-
financial services
Financial corporations
(S.12)
(see paragraph 2.32)Market producer Financial intermediation including
insurance
Auxiliary financial activities
General government
(S.13)
(see paragraph 2.68)Public other non-
market producerProduction and supply of other non-
market output for collective and indi-
vidual consumption and carrying outtransactions intended to redistribute
national income and wealth
Households (S.14)
— as consumers Consumption
— as entrepreneurs
(see paragraph 2.75)Market producer or
private producer for
own final useProduction of market output and output
for own final use
Non-profit institutions
serving households
(S.15)
(see paragraph 2.87)Private other non-
market producerProduction and supply of other non-
market output for individual consump-
tion
The rest of the world (S.2) is a grouping of institutional units (see
paragraph 2.89) which is not characterized by similar objectives and types
of behaviour; it groups together non-resident institutional units insofar as
they carry out transactions with resident institutional units.
NON-FINANCIAL CORPORATIONS (S.11)
2.21. Definition: The sector non-financial corporations (S.11) consists of
institutional units whose distributive and financial transac-
tions are distinct from those of their owners and which are
market producers (see paragraphs 3.31, 3.32 and 3.37),
whose principal activity is the production of goods and non-
financial services (
1).
2.22. The sector non-financial corporations also includes non-financial quasi-
corporations.
2.23. The term ‘non-financial corporations’ denotes all bodies recognized as
independent legal entities which are market producers and whose principal
activity is the production of goods and non-financial services.
The institutional units covered are the following:
(a) private and public corporations which are market producers
principally engaged in the production of goods and non-financial
services;
(b) cooperatives and partnerships recognized as independent legal entities
which are market producers principally engaged in the production of
goods and non-financial services;
(c) public producers which by virtue of special legislation are recognized
as independent legal entities and which are market producers
principally engaged in the production of goods and non-financial
services;1996R2223 — EN — 07.08.2003 — 008.001 — 42
(1) By convention, market regulatory agencies whose sole or principal activity is to buy,
hold and sell agricultural and other food products are classified under S.11 (see
paragraph 2.69 (a) note (11)).
▼B
(d) non-profit institutions or associations serving non-financial corpora-
tions, which are recognized as independent legal entities and which
are market producers principally engaged in the production of goods
and non-financial services (1);
(e) holding corporations controlling (see paragraph 2.26) a group of
corporations which are market producers, if the preponderant type of
activity of the group of corporations as a whole — measured on the
basis of value added — is the production of goods and non-financial
services;
(f) private and public quasi-corporations which are market producers
principally engaged in the production of goods and non-financial
services.
2.24. The term ‘non-financial quasi-corporations’ denotes all bodies without
independent legal status which are market producers principally engaged
in the production of goods and non-financial services and meet the
conditions qualifying them as quasi-corporations (see paragraph 2.13. f).
Quasi-corporations must keep a complete set of accounts and are operated
as if they were corporations. The de facto relationship to their owner is
that of a corporation to their shareholders.
Thus non-financial quasi-corporations owned by households, government
units or non-profit institutions are grouped with non-financial corporations
in the non-financial corporations sector.
The existence of a complete set of accounts, including balance sheets, is
not a sufficient condition for market producers to be treated as quasi-
corporations. Therefore, partnerships and public producers, other than
those included under 2.23. a, b, c and f and sole proprietorships — even if
they keep a complete set of accounts — are in general not distinct
institutional units because they do not enjoy autonomy of decision, their
management being under the control of the households, non-profit
institutions or governments which own them.
2.25. The sector non-financial corporations also includes all notional resident
units (see paragraph 2.15) which, by convention, are treated as if they
were quasi-corporations.
2.26. Control over a corporation is defined as the ability to determine general
corporate policy by choosing appropriate directors, if necessary.
A single institutional unit (another corporation, a household or a
government unit) secures control over a corporation by owning more
than half the voting shares or otherwise controlling more than half the
shareholders' voting power. In addition, government secures control over a
corporation as a result of special legislation decree or regulation which
empowers the government to determine corporate policy or to appoint the
directors.
In order to control more than half the shareholders' voting power, an
institutional unit need not own any of the voting shares itself. A
corporation C could be a subsidiary of another corporation B in which a
third corporation A owns a majority of the voting shares.
Corporation C is said to be subsidiary of corporation B when: either
corporation B controls more than half of the shareholders' voting power in
corporation C or corporation B is a shareholder in C with the right to
appoint or remove a majority of the directors of C.
2.27. The sector non-financial corporations is divided into three subsectors:
(a) public non-financial corporations (S.11001);
(b) national private non-financial corporations (S.11002);
(c) foreign controlled non-financial corporations (S.11003).
Subsector: Public non-financial corporations (S.11001)
2.28. Definition: The sub-sector public non-financial corporations consists of
all non-financial corporations and quasi-corporations that aresubject to control (see paragraph 2.26) by government units.
2.29. Public quasi-corporations are quasi-corporations owned directly by
government units.1996R2223 — EN — 07.08.2003 — 008.001 — 43
(1) Including institutions financed by voluntary contributions of a quasi-fiscal nature, levied
on producers by units whose principal activity is to provide services in exchange. These
contributions are considered as purchases of market services.
▼B
Subsector: National private non-financial corporations (S.11002)
2.30. Definition: The subsector national private non-financial corporations
consists of all non-financial corporations and quasi-corpora-
tions that are not controlled by government or by non-
resident institutional units. This subsector includes all the
non-profit institutions which are included in the non-
financial corporate sector (see paragraph 2.23. d).
This subsector includes corporate and quasi-corporate direct foreign
investment enterprises (see paragraph 4.65) not classified in the subsector
foreign controlled non-financial corporations (S.11003).
Subsector: Foreign controlled non-financial corporations (S.11003)
2.31. Definition: The subsector foreign controlled non-financial corporations
consists of all non-financial corporations and quasi-corpora-
tions that are controlled (see paragraph 2.26) by non-resident
institutional units.
This subsector includes:
(a) all subsidiaries of non-resident corporations;
(b) all corporations controlled by a non-resident institutional unit that is
not itself a corporation: for example, a corporation which is controlled
by a foreign government; it includes corporations controlled by a
group of non-resident units acting in concert;
(c) all branches or other unincorporated agencies of non-resident
corporations or unincorporated producers which are notional resident
units to be treated as non-financial quasi-corporations (see paragraph
2.25).
FINANCIAL CORPORATIONS (S.12)
2.32. Definition: The sector financial corporations (S.12) consists of all
corporations and quasi-corporations which are principally
engaged in financial intermediation (financial intermedi-
aries) and/or in auxiliary financial activities (financial
auxiliaries) (1).
Financial intermediation is the activity in which an
institutional unit acquires financial assets and at the same
time incurs liabilites (see paragraph 2.34) on its own account
(see paragraph 2.33) by engaging in financial transactions on
the market (see paragraphs 2.37 to 2.38). The assets and
liabilities of the financial intermediaries have different
characteristics, involving that the funds are transformed or
repackaged with respect to maturity, scale, risk and the like
in the financial intermediation process.
Auxiliary financial activities are activities closely related to
financial intermediation but which are not financial inter-
mediation themselves (see paragraph 2.39).
2.33. Through the financial intermediation process, funds are channelled
between third parties with a surplus on one side and those with a lack
of funds on the other. A financial intermediary does not simply act as an
agent for these other institutional units but places itself at risk by
acquiring financial assets and incurring liabilities on its own account.
2.34. In the financial intermediation process, all categories of liabilities may be
involved with the exception of the category other accounts payable
(AF.7).
The financial assets involved in the financial intermediation process may
be classified in any category with the exception of the category insurance
technical reserves (AF.6) but including the category other accounts
receivable (factoring). In addition, financial intermediaries may invest
their funds in non-financial assets including real estate. However, in order
to be considered as a financial intermediary, a corporation should, in
addition, incur liabilities on the market and transform funds. Therefore,
real estate corporations (NACE. rev. 1 division 70) are excluded.1996R2223 — EN — 07.08.2003 — 008.001 — 44
(1) By convention, sector S.12 includes holding corporations which only control and direct a
group of subsidiaries principally engaged in financial intermediation and/or in auxiliaryfinancial activities (see paragraph 2.43) and non-profit institutions recognized as
independent legal entities serving financial corporations (see paragraph 2.44).
▼B
2.35. The primary function of insurance corporations and pension funds consists
of the pooling of risks. The main liabilities of these institutions are
insurance technical reserves (AF.6). The counterparts of the reserves are
investments by the insurance corporations and pension funds, which,
therefore, act as financial intermediaries.
2.36. Mutual funds primarily incur liabilities through the issue of shares
(AF.52). They transform these funds by acquiring financial assets and/or
real estate. Therefore, mutual funds are classified as financial inter-
mediaries. As with other corporations, any change in the value of their
assets and liabilities other than their own shares is reflected in their own
funds (see paragraph 7.05). Because the amount of own funds normally
equals the value of the mutual fund's shares, any change in the value of the
fund's assets and liabilities will be reflected in the market value of these
shares.
Mutual funds investing solely in real estate are also regarded as financial
intermediaries.
2.37. Financial intermediation, generally, is limited to financial transactions on
the market. In other words, acquiring assets and incurring liabilities
should be with the general public or specified and relatively large sub-
groups thereof. Where the activity is limited to small groups of persons or
families, generally, no financial intermediation takes place. In particular,
financial intermediation does not include institutional units providing
treasury services to a company group. These institutional units are
allocated to a sector according to the predominant function of the
company group within the economic territory. However, in cases where
the institutional unit providing the treasury services is subject to financial
supervision, it is classified in the financial corporations sector by
convention.
2.38. Exceptions to the general limitation of financial intermediation to
financial transactions on the market may exist. Examples are municipal
credit and savings-banks, which rely heavily on the municipality involved,
or financial lease corporations depending on a parent group of companies
in acquiring funds or in investing funds. However, their lending or their
acceptance of savings should be independent of the municipality involved
or the parent group, respectively, in classifying them as financial
intermediaries.
2.39. Auxiliary financial activities comprise auxiliary activities for realizing
transactions in financial assets and liabilities or the transformation or
repackaging of funds. Financial auxiliaries do not set themselves at risk by
acquiring financial assets or incurring liabilities. They only facilitate
financial intermediation.
2.40. The institutional units included in the sector financial corporations (S.12)
are the following:
a) private or public corporations which are principally engaged in
financial intermediation and/or in auxiliary financial activities;
b) cooperatives and partnerships recognized as independent legal entities
which are principally engaged in financial intermediation and/or in
auxiliary financial activities;
c) public producers, which by virtue of special legislation are recognized
as independent legal entities, which are principally engaged in
financial intermediation and/or in auxiliary financial activities;
d) non-profit institutions recognized as independent legal entities which
are principally engaged in financial intermediation and/or in auxiliary
financial activities, or which are serving financial corporations;
e) holding corporations (see paragraph 2.14) if the group of subsidiaries
within the economic territory as a whole is principally engaged in
financial intermediation and/or in auxiliary financial activities;
f) unincorporated mutual funds comprising investment portfolios owned
by the group of participants, and whose management is undertaken, in
general, by other financial corporations. These funds are institutional
units by convention, separate from the managing financial corporation;
g) financial quasi-corporations:
1. unincorporated units principally engaged in financial intermediation
and subject to regulation and supervision (in most cases classified
in the other monetary financial institutions subsector or the
insurance corporations and pension funds subsector) are deemed
to enjoy autonomy of decision and to have autonomous manage-
ment independent of their owners. Their economic and financial
behaviour is similar to that of financial corporations. Therefore,1996R2223 — EN — 07.08.2003 — 008.001 — 45
▼B
they are treated as separate institutional units. Examples are
branches of non-resident financial corporations;
2. other unincorporated units principally engaged in financial inter-
mediation but not subject to regulation and supervision are only
considered as financial quasi-corporations if they meet the
conditions qualifying them as quasi-corporations (see paragraph
2.13. f);
3. unincorporated units principally engaged in auxiliary financial
activities are only considered as financial quasi-corporations if they
meet the conditions qualifying them as quasi-corporations (see
paragraph 2.13. f).
2.41. The financial corporations sector is subdivided into five subsectors:
(a) the central bank (S.121);
(b) other monetary financial institutions (S.122);
(c) other financial intermediaries, except insurance corporations and
pension funds (S.123);
(d) financial auxiliaries (S.124);
(e) insurance corporations and pension funds (S.125).
The other monetary financial institutions subsector is regarded as
equivalent to the other depository corporations subsector as defined in
the 1993 SNA 4.88—4.94. While the definition of the other monetary
financial institutions subsector (see paragraph 2.48) is intended to cover
those financial intermediaries through which the effects of the monetary
policy of the central bank are transmitted to the other entities of the
economy, the other depository corporations subsector is defined in the
1993 SNA with reference to measures of broad money. The combined
subsectors S.121 and S.122 coincide with the monetary financial
institutions for statistical purposes as defined by the EMI (see paragraph
2.49).
2.42. With the exception of subsector S.121, each subsector may be further
subdivided into:
(a) public financial corporations;
(b) national private financial corporations;
(c) foreign controlled financial corporations.
The criteria for this subdivision are the same as for non-financial
corporations (see paragraphs 2.26 to 2.31).
2.43. Holding corporations which only control and direct a group of subsidiaries
principally engaged in financial intermediation and/or in auxiliary
financial activities are classified in the subsector other financial
intermediaries except insurance corporations and pension funds
(S.123) (1). However, holding corporations which are financial corpora-
tions themselves are to be allocated to the subsectors according to the
main type of financial activity.
2.44. Non-profit institutions recognized as independent legal entities serving
financial corporations, but not engaged in financial intermediation or
auxiliary financial activities, are classified in the subsector financial
auxiliaries (S.124).
Subsector: The central bank (S.121)
2.45. Definition: The subsector the central bank (S.121) consists of all
financial corporations and quasi-corporations whose prin-
cipal function is to issue currency, to maintain the internal
and external value of the currency and to hold all or part of
the international reserves of the country.
2.46. The following financial intermediaries are classified in subsector S.121:
(a) the national central bank, also in the case where it is part of a
European System of Central Banks;
(b) central monetary agencies of essentially public origin (e.g. agencies
managing foreign exchange or issuing currency) which keep a1996R2223 — EN — 07.08.2003 — 008.001 — 46
(1) The classification of holding corporations within the financial corporations sector
deviates from the 1993 SNA 4.100 in order to maintain consistency with the monetaryfinancial institutions for statistical purposes as defined by the EMI and with official
statistics on insurance corporations.
▼B
complete set of accounts and enjoy autonomy of decision in relation
to central government. Mostly these activities are performed either
within central government or within the central bank. In these cases
no separate institutional units exist.
2.47. Subsector S.121 does not include agencies and bodies, other than the
central bank, which regulate or supervise financial corporations or
financial markets. They are classified in subsector S.124 (see paragraph
2.58 (g) (1).
Subsector: Other monetary financial institutions (S.122)
2.48. Definition: The subsector other monetary financial institutions (S.122)
consists of all financial corporations and quasi-corporations,
except those classified in the central bank subsector, which
are principally engaged in financial intermediation and
whose business is to receive deposits and/or close substitutes
for deposits from institutional units other than monetary
financial institutions, and, for their own account, to grant
loans and/or to make investments in securities.
2.49. The monetary financial institutions (MFIs) comprise the subsector the
central bank (S.121) and the subsector other monetary financial
institutions (S.122), and coincide with the monetary financial institutions
for statistical purposes as defined by the EMI (see paragraph 2.41).
2.50. MFIs cannot be described simply as ‘banks’, because they may possibly
include some financial corporations which may not call themselves banks,
and some which may not be permitted to do so in some countries, while
some other financial corporations describing themselves as banks may not
in fact be MFIs. In general, the following financial intermediaries are
classified in subsector S.122:
(a) commercial banks, ‘universal’ banks, ‘all-purpose’ banks;
(b) savings banks (including trustee savings banks and savings banks and
loan associations);
(c) post office giro institutions, post banks, giro banks;
(d) rural credit banks, agricultural credit banks;
(e) cooperative credit banks, credit unions;
(f) specialized banks (e.g. merchant banks, issuing houses, private
banks).
2.51. The following financial intermediaries may also be classified in subsector
S.122 where it is their business to receive repayable funds from the public
whether in the form of deposits or in other forms such as the continuing
issue of bonds and other comparable securities. Otherwise, they should be
classified in subsector S.123:
(a) corporations engaged in granting mortgages (including building
societies, mortgage banks and mortgage credit institutions);
(b) mutual funds (including investment trusts, unit trusts and other
collective investment schemes, e.g. undertakings for collective
investment in transferable securities-UCITS);
(c) municipal credit institutions.
2.52. Subsector S.122 does not include:
(a) holding corporations which only control and direct a group consisting
predominantly of other monetary financial institutions, but which are
not other monetary financial institutions themselves. They are
classified in subsector S.123 (see paragraph 2.43);
(b) non-profit institutions recognized as independent legal entities serving
other monetary financial institutions, but not engaged in financial
intermediation. They are classified in subsector S.124 (see paragraph
2.44).
Subsector: Other financial intermediaries, except insurance corporations
and pension funds (S.123)
2.53. Definition: The subsector other financial intermediaries except insur-
ance corporations and pension funds (S.123) consists of all
financial corporations and quasi-corporations which are1996R2223 — EN — 07.08.2003 — 008.001 — 47
(1) This is a deviation from the 1993 SNA 4.86 and 4.101 in order to maintain consistency
with the monetary financial institutions for statistical purposes as defined by the EMI.
▼B
principally engaged in financial intermediation by incurring
liabilities in forms other than currency, deposits and/or close
substitutes for deposits from institutional units other than
monetary financial institutions, or insurance technical
reserves.
2.54. Subsector S.123 includes various types of financial intermediaries
especially those which are predominantly engaged in long-term financing.
In most cases this predominant maturity forms the basis of a distinction
from the other monetary financial institutions subsector. Based on the
non-existence of liabilities in the form of insurance technical reserves, the
borderline with the insurance corporations and pension funds subsector
can be determined.
2.55. In particular, the following financial corporations and quasi-corporations
are classified in subsector S.123 unless they are MFIs:
(a) corporations engaged in financial leasing;
(b) corporations engaged in hire purchase and the provision of personal or
commercial finance;
(c) corporations engaged in factoring;
(d) security and derivative dealers (on own account);
(e) specialized financial corporations such as venture and development
capital companies, export/import financing companies;
(f) financial vehicle corporations, created to be holders of securitized
assets;
(g) financial intermediaries which receive deposits and/or close substi-
tutes for deposits from MFIs only;
(h) holding corporations which only control and direct a group of
subsidiaries principally engaged in financial intermediation and/or in
auxiliary financial activities, but which are not financial corporations
themselves (see paragraph 2.43).
2.56. Subsector S.123 does not include non-profit institutions recognized as
independent legal entities serving other financial intermediaries except
insurance corporations and pension funds, but not engaged in financial
intermediation. They are classified in subsector S.124 (see paragraph
2.44).
Subsector: Financial auxiliaries (S.124)
2.57. Definition: The subsector financial auxiliaries (S.124) consists of all
financial corporations and quasi-corporations which are
principally engaged in auxiliary financial activities, that is
to say activities closely related to financial intermediation
but which are not financial intermediation themselves (see
paragraph 2.39).
2.58. In particular, the following financial corporations and quasi-corporations
are classified in subsector S.124:
(a) insurance brokers, salvage and average administrators, insurance and
pension consultants, etc.;
(b) loan brokers, securities brokers, investment advisers, etc.;
(c) flotation corporations that manage the issue of securities;
(d) corporations whose principal function is to guarantee, by endorse-
ment, bills and similar instruments;
(e) corporations which arrange derivative and hedging instruments, such
as swaps, options and futures (without issuing them);
(f) corporations providing infrastructure for financial markets;
(g) central supervisory authorities of financial intermediaries and
financial markets when they are separate institutional units;
(h) managers of pension funds, mutual funds, etc.;
(i) corporations providing stock exchange and insurance exchange;
(j) non-profit institutions recognized as independent legal entities serving
financial corporations, but not engaged in financial intermediation or
auxiliary financial activities (see paragraph 2.44).
2.59. Subsector S.124 does not include holding corporations which only control
and direct a group of subsidiaries principally engaged in auxiliary
financial activities, but which are not financial auxiliaries themselves.
They are classified in subsector S.123 (see paragraph 2.43).1996R2223 — EN — 07.08.2003 — 008.001 — 48
▼B
Subsector: Insurance corporations and pension funds (S.125)
2.60. Definition: The subsector insurance corporations and pension funds
(S.125) consists of all financial corporations and quasi-
corporations which are principally engaged in financial
intermediation as the consequence of the pooling of risks
(see paragraph 2.35).
2.61. The insurance contracts administered might relate to individuals and/or
groups, whether or not participation results from a general obligation
imposed by government. Furthermore, social insurance contracts (see
paragraphs 4.83 to 4.91) are sometimes a considerable part of the
contracts administered.
2.62. Subsector S.125 includes both captive insurance corporations and
reinsurance corporations.
2.63. Subsector S.125 does not include:
(a) institutional units which fulfil each of the two criteria listed in
paragraph 2.74. They are classified in subsector S.1314;
(b) holding corporations which only control and direct a group consisting
predominantly of insurance corporations and pension funds, but which
are not insurance corporations and pension funds themselves. They
are classified in subsector S.123 (see paragraph 2.43);
(c) non-profit institutions recognized as independent legal entities serving
insurance corporations and pension funds, but not engaged in financial
intermediation. They are classified in subsector S.124 (see paragraph
2.44).
2.64. The subsector insurance corporations and pension funds may be
subdivided into:
(a) insurance corporations;
(b) (autonomous) pension funds.
Autonomous pension funds are pension funds which have autonomy of
decision and keep a complete set of accounts. They are therefore
institutional units. Non-autonomous pension funds are not institutional
units and remain part of the institutional unit that sets them up.
2.65. Risks concerning individuals or groups could both be included in the
activities of life and non-life insurance corporations. Some insurance
corporations might limit their activities to group contracts only. These
corporations are allowed to insure every group.
2.66. Pension funds can be described as institutions which insure group risks
relating to social risks and needs (see paragraph 4.84) of the insured
persons. The typical groups of participants in such policies include
employees of a single enterprise or a group of enterprises, employees of a
branch or industry, and persons having the same profession. The benefits
included in the insurance contract might encompass benefits which are
paid after death of the insured to the widow(er) and children (mainly death
in service), benefits which are paid after retirement and benefits which are
paid after the insured became disabled.
2.67. In some countries all these types of risks could be insured equally well by
life insurance corporations as by pension funds. In other countries some of
these classes of risks have to be insured through life insurance
corporations. In contrast to life insurance corporations, pension funds
are restricted (by law) to specified groups of employees and self-
employed.
GENERAL GOVERNMENT (S.13)
2.68. Definition: The sector general government (S.13) includes all institu-
tional units which are other non-market producers (see
paragraph 3.26) whose output is intended for individual and
collective consumption, and mainly financed by compulsory
payments made by units belonging to other sectors, and/or
all institutional units principally engaged in the redistribu-
tion of national income and wealth.
2.69. The institutional units included in sector S.13 are the following:
(a) general government entities (excluding public producers organized as
public corporations or, by virtue of special legislation, recognized as
independent legal entities, or quasi-corporations, when any of these
are classified in the non-financial or financial sectors) which
administer and finance a group of activities, principally providing1996R2223 — EN — 07.08.2003 — 008.001 — 49
▼B
non-market goods and services, intended for the benefit of the
community (1);
(b) non-profit institutions recognized as independent legal entities which
are other non-market producers and which are controlled and mainly
financed by general government;
(c) autonomous pension funds if the two requirements of paragraph 2.74
are met.
2.70. The general government sector is divided into four subsectors:
(a) central government (S.1311);
(b) State government (S.1312);
(c) local government (S.1313);
(d) social security funds (S.1314).
Subsector: Central government (S.1311)
2.71. Definition: The subsector central government includes all administrative
departments of the State and other central agencies whose
competence extends normally over the whole economic
territory, except for the administration of social security
funds.
Included in subsector S.1311 are those non-profit institutions which are
controlled and mainly financed by central government and whose
competence extends over the whole economic territory.
Subsector: State government (S.1312)
2.72. Definition: The State government subsector consists of state govern-
ments which are separate institutional units exercising some
of the functions of government at a level below that of
central government and above that of the governmental
institutional units existing at local level, except for the
administration of social security funds.
Included in subsector S.1312 are those non-profit institutions which are
controlled and mainly financed by state governments and whose
competence is restricted to the economic territories of the States.
Subsector: Local government (S.1313)
2.73. Definition: The subsector local government includes those types of
public administration whose competence extends to only a
local part of the economic territory, apart from local
agencies of social security funds.
Included in subsector S.1313 are those non-profit institutions which are
controlled and mainly financed by local governments and whose
competence is restricted to the economic territories of the local
governments.
Subsector: Social security funds (S.1314)
2.74. Definition: The subsector social security funds includes all central, State
and local institutional units whose principal activity is to
provide social benefits and which fulfil each of the following
two criteria:
(a) by law or by regulation certain groups of the population
are obliged to participate in the scheme or to pay
contributions;
(b) general government is responsible for the management
of the institution in respect of the settlement or approval
of the contributions and benefits independently from its
role as supervisory body or employer (see paragraph
4.89).
There is usually no direct link between the amount of the contribution
paid by an individual and the risk to which that individual is exposed.1996R2223 — EN — 07.08.2003 — 008.001 — 50
(1) By convention, market regulatory organizations which are either exclusively or
principally simple distributors of subsidies are classified in S.13, subsector centralgovernment S.1311. However, those organizations which are exclusively or principallyengaged in buying, holding and selling agricultural or food products are classified in
S.11 (see paragraph 2.21, note 6).
▼B
HOUSEHOLDS (S.14)
2.75. Definition: The households sector (S.14) covers individuals or groups of
individuals as consumers and possibly also as entrepreneurs
producing market goods and non-financial and financial
services (market producers) provided that, in the latter case,
the corresponding activities are not those of separate entities
treated as quasi-corporations. It also includes individuals or
groups of individuals as producers of goods and non-
financial services for exclusively own final use (see
paragraphs 3.20, 3.25 and 3.30).
Households as consumers may be defined as small groups of
persons who share the same living accommodation, who
pool some, or all, of their income and wealth and who
consume certain types of goods and services collectively,
mainly housing and food. The criteria of the existence of
family or emotional ties may be added.
The principal resources of these units are derived from the
compensation of employees, property income, transfers from
other sectors or the receipts from disposal of market products
or the imputed receipts from output of products for own final
consumption.
2.76. The households sector includes:
(a) individuals or groups of individuals whose principal function is
consumption;
(b) persons living permanently in institutions who have little or no
autonomy of action or decision in economic matters (e.g. members of
religious orders living in monasteries, long-term patients in hospitals,prisoners serving long sentences, old persons living permanently in
retirement homes). Such people are treated as comprising, together, a
single institutional unit, that is, a single household;
(c) individuals or groups of individuals whose principal function is
consumption and that produce goods and non-financial services for
exclusively own final use; only two categories of services produced
for own final consumption are included within the system: services of
owner-occupied dwellings and domestic services produced by paid
employees;
(d) sole proprietorships and partnerships without independent legal status
— other than those treated as quasi-corporations — which are market
producers;
(e) non-profit institutions serving households, which do not have
independent legal status or those which do but are of only minor
importance (see paragraph 2.88).
2.77. The households sector is subdivided into six subsectors:
(a) employers (including own-account workers) (S.141 + S.142);
(b) employees (S.143);
(c) recipients of property incomes (S.1441);
(d) recipients of pensions (S.1442);
(e) recipients of other transfer incomes (S.1443);
(f) others (S.145).
2.78. Households are allocated to subsectors according to the largest income
category (employers' income, compensation of employees, etc.) of the
household as a whole. When more than one income of a given category is
received within the same household, the classification must be based on
the total household income within each category.
Subsector: Employers (including own-account workers) (S.141 + S.142)
2.79. Definition: The subsector employers (including own-account workers)
consists of the group of households for which the (mixed)
incomes (B.3) accruing to the owners of household
unincorporated enterprises from their activity as producers
of market goods and services with or without paid
employees are the largest source of income for the household
as a whole, even if it does not always account for more than
a half of total household income.1996R2223 — EN — 07.08.2003 — 008.001 — 51
▼B
Subsector: Employees (S.143)
2.80. Definition: The subsector employees consists of the group of households
for which the income accruing from compensation of
employees (D.1) is the largest source of income for the
household as a whole.
Subsector: Recipients of property incomes (S.1441)
2.81. Definition: The subsector recipients of property incomes consists of the
group of households for which property income (D.4) is the
largest source of income for the household as a whole.
Subsector: Recipients of pensions (S.1442)
2.82. Definition: The subsector recipients of pensions consists of the group of
households for which the income accruing from pensions is
the largest source of income for the household as a whole.
Pension households are households whose largest income consists of
retirement or other pensions, including pensions from previous employers.
Subsector: Recipients of other transfer incomes (S.1443)
2.83. Definition: The subsector recipients of other transfer incomes consists of
the group of households for which the income accruing from
other current transfers is the largest source of income for the
household as a whole.
Other current transfers are all current transfers other than property income,
pensions and income of persons living permanently in institutions.
Subsector: Others (S.145)
2.84. Definition: The subsector others consists of persons living permanently
in institutions.
Persons living permanently in institutions are classified separately because
the criterion of the largest source of income does not allow a meaningful
classification of these persons in one of the foregoing subsectors.
2.85. If the main income source of the household as a whole is not available for
sectoring purposes, the income of the reference person constitutes the
second-best characteristic to be used for classifying purposes. The
reference person of a household is normally the person with the largest
income. If the latter information is not available, the income of the person
who states the he/she is the reference person may be used for subsectoring
households.
2.86. However, other criteria may be appropriate and needed for different kinds
of analysis or as the basis for policy-making, e.g. breakdown of
households as entrepreneurs by activity: agricultural households; non-
agricultural households (industry; services).
NON-PROFIT INSTITUTIONS SERVING HOUSEHOLDS (S.15)
2.87. Definition: The sector non-profit institutions serving households
(NPISHs) (S.15) consists of non-profit institutions which
are separate legal entities, which serve households and which
are private other non-market producers (see paragraph 3.32).
Their principal resources, apart from those derived from
occasional sales, are derived from voluntary contributions in
cash or in kind from households in their capacity as
consumers, from payments made by general governments (1)
and from property income.
2.88. Where these institutions are not very important, they are not included in
this sector, their transactions being mixed up with those of households
(S.14).
The NPISHs sector includes the following main kinds of NPISHs that
provide non-market goods and services to households:
(a) trade unions, professional or learned societies, consumers' associa-
tions, political parties, churches or religious societies (including those1996R2223 — EN — 07.08.2003 — 008.001 — 52
(1) NPIs controlled and mainly financed by general government are classified in the general
government sector (see paragraph 2.69 b).
▼B
financed but not controlled by governments), and social, cultural,
recreational and sports clubs;
(b) charities, relief and aid organizations financed by voluntary transfers
in cash or in kind from other institutional units.
Sector S.15 includes charities, relief or aid agencies serving non-resident
units and excludes entities where membership gives right to a
predetermined set of goods and services.
REST OF THE WORLD (S.2)
2.89. Definition: The rest of the world (S.2) is a grouping of units without any
characteristic functions and resources; it consists of non-
resident units (1) insofar as they are engaged in transactions
with resident institutional units, or have other economic links
with resident units. Its accounts provide an overall view of
the economic relationships linking the national economy
with the rest of the world.
2.90. The rest of the world is not a sector for which complete sets of accounts
have to be kept, although it is often convenient to describe the rest of the
world as if it were a sector. Sectors are obtained by disaggregating the
total economy to obtain more homogeneous groups of resident institu-
tional units, which are similar in respect to their economic behaviour, their
objectives and functions. This is not the case for the sector rest of the
world: there are recorded the transactions and other flows of non-financial
and financial corporations, non-profit institutions, households and general
government with non-resident institutional units and other economic
relationships between residents and non-residents, e.g. claims by residents
on non-residents.
2.91. It should be noted that the rule whereby the accounts for the rest of the
world include only transactions carried out between resident institutional
units and non-resident units is subject to the following exceptions:
(a) the services of transport (up to the border of the exporting country)
provided by resident units in respect of imported goods are shown in
the rest of the world accounts with fob imports, even though they are
produced by resident units (see paragraph 3.144);
(b) transactions in foreign assets between residents belonging to different
sectors are shown in the detailed financial accounts for the rest of the
world; although they do not affect the country's financial position vis-
à-vis the rest of the world, they affect the financial relationships of
individual sectors with the rest of the world;
(c) transactions in the country's liabilities between non-residents
belonging to different geographical zones are shown in the
geographical breakdown of the rest of the world accounts. Although
these transactions do not affect the country's overall liability to the
rest of the world, they affect its liabilities to different parts of the
world.
2.92. The sector rest of the world (S.2) is subdivided into:
(a) the European Union (S.21):
1. the member countries of the European Union (S.211);
2. the institutions of the European Union (S.212);
(b) third countries and international organizations (S.22).
SECTOR CLASSIFICATION OF PRODUCER UNITS FOR MAIN STAN-
DARD LEGAL FORMS OF OWNERSHIP
2.93. The following overview and paragraphs 2.94 to 2.101 summarize the
principles underlying the classification of producer units into sectors,
using the standard terminology for describing the main types of
institutions.
2.94. Private and public corporations which are market producers are classified
as follows:
(a) those principally engaged in the production of goods and non-
financial services: in sector S.11, non-financial corporations (see
paragraph 2.23.a);1996R2223 — EN — 07.08.2003 — 008.001 — 53
(1) Included are the institutions of the EU and international organizations (see also
paragraph 2.06).
▼B
(b) those principally engaged in financial intermediation and auxiliary
financial activities: in sector S.12, financial corporations (see
paragraphs 2.40. a and 2.40. f).
2.95. Cooperatives and partnerships recognized as independent legal entities
and which are market producers are classified as follows:
(a) those principally engaged in the production of goods and non-
financial services: in sector S.11, non-financial corporations (see
paragraph 2.23. b);
(b) those principally engaged in financial intermediation and auxiliary
financial activities: in sector S.12, financial corporations (see
paragraph 2.40. b).1996R2223 — EN — 07.08.2003 — 008.001 — 54
Table 2.3 — Sector classification of producer units for main standard legal forms of ownership
Type of producer
Standard legal descriptionMarket producers principally
engaged in the production of goods
and non-financial servicesMarket producers principally
engaged in financial intermediationOther non-market producers
Public producers
(see paragraph 3.28)Private producers
(see paragraph 3.29)
Private and public corporations S.11 non-financial corpora-
tions (see paragraph 2.23. a)S.12 financial corporations
(see paragraph 2.40. a and f)
Cooperatives and partnerships recognized as independent legal
entitiesS.11 non-financial corpora-
tions (see paragraph 2.23. b)S.12 financial corporations
(see paragraph 2.40. b)
Public producers which by virtue of special legislation are
recognized as independent legal entitiesS.11 non-financial corpora-
tions (see paragraph 2.23. c)S.12 financial corporations
(see paragraph 2.40. c)
Public producers not recognized
as independent legal entitiesthose with the characteristics
of quasi-corporationsS.11 non-financial corpora-
tions (see paragraph 2.23. f)S.12 financial corporations
(see paragraph 2.40. g)
the rest S.13 general government (see
paragraph 2.69. a)
Non-profit institutions recognized as independent legal entities S.11 non-financial corpora-
tions (see paragraph 2.23. d)S.12 financial corporations
(see paragraph 2.40. d)S.13 general government (see
paragraph 2.69. b)S.15 non-profit institutions
serving households (1) (see para-
graph 2.87)
Partnerships not recognized as
independent legal entities
Sole proprietorshipsthose with the characteristics
of quasi-corporationsS.11 non-financial corpora-
tions (see paragraph 2.23. f)S.12 financial corporations
(see paragraph 2.40. g)
the rest S.14 households (see para-
graph 2.75)S.14 households (see para-
graph 2.75)
Holding corporations whose
preponderant type of activity
of the group of corporations
controlled by them is the
production ofgoods and non-financial
servicesS.11 non-financial corpora-
tions (see 2.23. e)
financial services S.12 financial corporations
(see paragraph 2.40. e)
(1) With the exception of non-profit institutions of minor importance (see paragraph 2.88).▼B1996R2223 — EN — 07.08.2003 — 008.001 — 55
▼B
2.96. Public producers which by virtue of special legislation are recognized as
independent legal entities and which are market producers are classified as
follows:
(a) those principally engaged in the production of goods and non-
financial services: in sector S.11, non-financial corporations (see
paragraph 2.23. c);
(b) those principally engaged in financial intermediation and auxiliary
financial activities: in sector S.12, financial corporations (see
paragraph 2.40. c).
2.97. Public producers not recognized as independent legal entities and which
are market producers are classified as follows:
(a) if they are quasi-corporations (see paragraph 2.13. f):
1. those principally engaged in the production of goods and non-
financial services: in sector S.11, non-financial corporations (see
paragraph 2.23. f);
2. those principally engaged in financial intermediation and financial
auxiliary activities: in sector S.12, financial corporations (see
paragraph 2.40. g).
(b) If they are not quasi-corporations: in sector S.13, general government,
as they remain an integral part of the units which control them (see
paragraph 2.69. a).
2.98. Non-profit institutions (associations, foundations) recognized as indepen-
dent legal entities are classified as follows:
(a) those which are market producers and principally engaged in the
production of goods and non-financial services: in sector S.11, non-
financial corporations (see paragraph 2.23. d);
(b) those principally engaged in financial intermediation and auxiliary
financial activities: in sector S.12, financial corporations (see
paragraph 2.40. d);
(c) those which are non-market producers:
1. in sector S.13, general government, if they are public producers
controlled and mainly financed by general government (see
paragraph 2.69. b);
2. in sector S.15, non-profit institutions serving households, if they
are private producers (see paragraph 2.87).
2.99. Sole proprietorships and partnerships not recognized as independent legal
entities and which are market producers are classified as follows:
(a) if they are quasi-corporations (see paragraph 2.13. f):
1. those principally engaged in the production of goods and non-
financial services: in sector S.11, non-financial corporations (see
paragraph 2.23. f);
2. those principally engaged in financial intermediation and financial
auxiliary activities in sector S.12 financial corporations (see
paragraph 2.40. g).
(b) If they are not quasi-corporations, they are classified in sector S.14,
households (see paragraph 2.75).
2.100. Holding corporations (i.e. corporations which direct a group of
companies) are classified as follows:
(a) in sector S.11, non-financial corporations, if the preponderant type of
activity of the group of corporations which are market producers, as a
whole is the production of goods and non-financial services (see
paragraph 2.23. e);
(b) in sector S.12, financial corporations, if the preponderant type of
activity of the group of corporations as a whole is financial
intermediation (see paragraph 2.40. e).
2.101. Table 2.3 illustrates in schematic form the various cases which are
enumerated above.
LOCAL KIND-OF-ACTIVITY UNITS AND INDUSTRIES
2.102. In practice, most institutional units producing goods and services are
engaged in a combination of activities at the same time. They may be
engaged in a principal activity, some secondary activites and some
ancillary activities (see paragraphs 3.10 to 3.13).1996R2223 — EN — 07.08.2003 — 008.001 — 56
▼B
2.103. An activity can be said to take place when resources such as equipment,
labour, manufacturing techniques, information networks or products are
combined, leading to the creation of specific goods or services. An
activity is characterized by an input of products (goods and services), a
production process and an output of products.
Activities can be determined by reference to a specific level of NACE rev.
1(1).
2.104. If a unit carries out more than one activity, all the activites which are not
ancillary activities are ranked according to the gross value added. On the
basis of the preponderant gross value added generated, a distinction can
then be made between principal activity and secondary activities.
Ancillary activities are not isolated to form distinct entities or separated
from the principal or secondary activities of entities they serve.
2.105. In order to analyse flows occurring in the process of production and in the
use of goods and services, it is necessary to choose units which emphasize
relationships of a technico-economic kind. This requirement means that as
a rule institutional units must be partitioned into smaller and more
homogeneous units with regard to the kind of production. Local kind-of-
activity units are intended to meet this requirement as a first but practice-
oriented operational approach.
THE LOCAL KIND-OF-ACTIVITY UNIT
2.106. Definition: The local kind-of-activity unit (local KAU) is the part of a
KAU which corresponds to a local unit (2). The KAU groups
all the parts of an institutional unit in its capacity as producer
contributing to the performance of an activity at class level
(four digits) of the NACE rev. 1 and corresponds to one or
more operational subdivisions of the institutional unit. The
institutional unit's information system must be capable of
indicating or calculating for each local KAU at least the
value of production, intermediate consumption, compensa-
tion of employees, the operating surplus and employment
and gross fixed capital formation.
The local unit is an institutional unit producing goods and services or a
part thereof situated in a geographically identified place.
A local KAU may correspond to an institutional unit as producer or a part
thereof; on the other hand, it can never belong to two different
institutional units.
2.107. If an institutional unit producing goods and services contains a principal
activity and also one or several secondary activities, it should be
subdivided into the same number of KAUs, and the secondary activities
should be classified under different headings from the principal activity.
On the other hand, the ancillary activities are not separated from the
principal or secondary activities. But KAUs falling within a particular
heading of the classification system can produce products outside the
homogeneous group on account of secondary activities connected with
them which cannot be separately identified from available accounting
documents. Thus a KAU may carry out one or more secondary activities.
THE INDUSTRY
2.108. Definition: An industry consists of a group of local KAUs engaged in
the same, or similar, kind-of-activity. At the most detailed
level of classification, an industry consists of all the local
KAUs falling within a single class (four digits) of NACE
rev. 1 and which are therefore engaged in the same activity
as defined in the NACE rev. 1.
Industries comprise both local KAUs producing market goods and
services and local KAUs producing non-market goods and services. An
industry by definition consists of a group of local KAUs engaged in the
same type of productive activity, irrespective of whether or not the
institutional units to which they belong produce market or non-market
output.1996R2223 — EN — 07.08.2003 — 008.001 — 57
(1) NACE Rev. 1: Statistical Classification of Economic Activities in the European
Community in accordance with the Council Regulation (EEC) No 3037/90 of 9 October1990.
(
2) The local KAU is called establishment in the SNA and ISIC Rev. 3.
▼B
2.109. Industries may be classified in three categories:
(a) industries producing market goods and services (market industries)
and goods and services for own final use (1);
(b) industries producing non-market goods and services of general
government: non-market industries of general government;
(c) industries producing non-market goods and services of non-profit
institutions serving households: non-market industries of non-profit
institutions serving households.
CLASSIFICATION OF INDUSTRIES
2.110. The classification used for grouping local KAUs into industries is the
NACE rev. 1.
UNITS OF HOMOGENEOUS PRODUCTION AND HOMOGENEOUS
BRANCHES
2.111. The local KAU meets the requirements of production process analysis
only approximately (see paragraphs 2.105 and 2.107). The unit which is
optimal for this kind of analysis, i.e. input-output analysis, is the unit ofhomogeneous production.
THE UNIT OF HOMOGENEOUS PRODUCTION
2.112. Definition: The distinguishing feature of a unit of homogeneous
production is a unique activity which is identified by its
inputs, a particular process of production and its outputs. The
products which constitute the inputs and outputs are
themselves distinguished not only by their physical char-
acteristics and the extent to which they are processed but
also by the technique of production used: they can be
identified by reference to a classification of products (see
paragraph 2.118).
2.113. If a goods and services producing institutional unit carries out a principal
activity and also one or more secondary activities, it will be partitioned
into the same number of units of homogeneous production. Ancillary
activities are not separated from the principal or secondary activities. Just
like the local KAU, the unit of homogeneous production may correspond
to an institutional unit or a part thereof; on the other hand, it can never
belong to two different institutional units.
THE HOMOGENEOUS BRANCH
2.114. Definition: The homogeneous branch consists of a grouping of units of
homogeneous production. The set of activities covered by a
homogeneous branch is identified by reference to a product
classification. The homogeneous branch produces those
goods or services specified in the classification and only
those products.
2.115. Homogeneous branches are units designed for economic analysis. Units of
homogeneous production cannot usually be observed directly; data
collected from the units used in statistical enquiries have to be rearranged
to. form homogeneous branches.
2.116. Homogeneous branches may be classified in three categories:
(a) homogeneous branches producing market goods and services (market
branches) and goods and services for own final use (
2);
(b) homogeneous branches producing non-market goods and services of
general government: non-market branches of general government;
(c) homogeneous branches producing non-market goods and services of
non-profit institutions serving households: non-market branches of
non-profit institutions serving households.
2.117. The homogeneous branches producing market goods and services and
goods and services for own final use consist of all units of homogeneous
production of whatever institutional sector which are exclusively engaged
in the production of market goods and services or of goods and services1996R2223 — EN — 07.08.2003 — 008.001 — 58
(1) Services for own final use concern only housing services produced by owner-occupiers
and domestic services produced by employing paid staff (see paragraph 3.21).
(2) Services for own final use concern only housing services produced by owner-occupiers
and domestic services produced by employing paid staff (see paragraph 3.21).
▼B
for own final use. The production of market goods and services within the
general government or non-profit institutions sectors (including those
intended for themselves) are treated as units of homogeneous production
and classified in an appropriate market branch.
The non-market homogeneous branches of general government producing
non-market goods and services consist of all units of homogeneous
production in the general government sector which produce non-market
goods and services.
The non-market homogeneous branches of non-profit institutions serving
households consist of all units of homogeneous production in the non-
profit institutions serving households sector which produce non-market
goods and services.
THE CLASSIFICATION OF HOMOGENEOUS BRANCHES
2.118. The classification of homogeneous branches used in the input-output
tables is based on the Classification of Products by Activity (CPA) (1). The
CPA is a product classification whose elements are structured according
to the industrial origin criterion, industrial origin being defined by NACE
rev. 1.1996R2223 — EN — 07.08.2003 — 008.001 — 59
(1) CPA: Classification of Products by Activity in accordance with the Council Regulation
(EEC) No 3696/93 of 29 October 1993.
▼B
CHAPTER 3
TRANSACTIONS IN PRODUCTS
3.01. Definition: Products are all goods and services that are created within
the production boundary. The latter is defined in paragraph
3.07.
3.02. The following main categories of transactions in products are distin-
guished in the ESA:
Transaction categories Code
Output P.1
Intermediante consumption P.2
Final consumption expenditure P.3
Actual final consumption P.4
Gross capital formation P.5
Exports of goods and services P.6
Imports of goods and services P.7
3.03. Transactions in products are recorded in the following accounts:
(a) in the goods and services account, output and imports are recorded as
resources and the other transactions in products are registered as uses;
(b) in the production account, output is recorded as a resource and
intermediate consumption is recorded as a use;
(c) in the use of disposable income account, final consumption
expenditure is recorded as a use;
(d) in the use of adjusted disposable income account, actual final
consumption is recorded as a use;
(e) in the capital account, gross capital formation is registered as a use (a
change in assets);
(f) in the external account of goods and services, imports of goods and
services are recorded as a resource, while exports of goods and
services are registered as uses.
3.04. In the supply table, output and imports are recorded as supplies. In the use
table, intermediate consumption, gross capital formation, final consump-
tion expenditure and exports are registered as uses. In the symmetric
input-output table, output and imports are recorded as supplies and the
other transactions in products as uses.
3.05. Supplies of products are valued at basic prices (see paragraph 3.48). Uses
of products are valued at purchasers' prices (see paragraph 3.06). For some
types of supplies and uses, more specific valuation principles are used,
e.g. for imports and exports of goods.
3.06. Definition: At the time of purchase, the purchaser's price is the price the
purchaser actually pays for the products; including any taxes
less subsidies on the products (but excluding deductible
taxes like VAT on the products); including any transport
charges paid separately by the purchaser to take delivery at
the required time and place; after deductions for any
discounts for bulk or off-peak-purchases from standard
prices or charges; excluding interest or services charges
added under credit arrangements; excluding any extra
charges incurred as a result of failing to pay within the
period stated at the time the purchases were made.
If the time of use does not coincide with the time of purchase, adjustments
should be made in such a way to take account of the changes in price due
to the lapsing of time (in a manner symmetrical with changes in the prices
of the inventories). Such modifications are especially important if the
prices of the products involved change drastically within a year.
PRODUCTION AND OUTPUT
3.07. Definition: Production is an activity carried out under the control and
responsibility of an institutional unit that uses inputs of
labour, capital and goods and services to produce goods and
services. Production does not cover purely natural processes1996R2223 — EN — 07.08.2003 — 008.001 — 60
▼B
without any human involvement or direction, like the
unmanaged growth of fish stocks in international waters
(but fish farming is production).
3.08. Production includes:
(a) the production of all individual or collective goods or services that are
supplied to units other than their producers (or intended to be so
supplied);
(b) the own-account production of all goods that are retained by their
producers for their own final consumption or gross fixed capital
formation. Own account production for gross fixed capital formation
includes the production of fixed assets such as construction, the
development of software and mineral exploration for own gross fixed
capital formation (for the concept of gross fixed capital formation, see
paragraphs 3.100 to 3.127).
Own-account production of goods by households pertains in general
to:
1. own-account construction of dwellings;
2. the production and storage of agricultural products;
3. the processing of agricultural products, like the production of flour
by milling, the preservation of fruit by drying and bottling; the
production of dairy products like butter and cheese and the
production of beer, wine and spirits;
4. the production of other primary products, like mining salt, cutting
peat and carrying water;
5. other kinds of processing, like weaving cloth, the production of
pottery and making furniture.
Own-account production of a good by households should be recorded
if this type of production is significant, i.e. if it is believed to be
quantitatively important in relation to the total supply of that good in a
country.
By convention, in the ESA, only own-account construction of
dwellings and the production, storage and processing of agricultural
products is included; all other own-account production of goods by
households are deemed to be insignificant for European Union
countries;
(c) the own-account production of housing services by owner-occupiers;
(d) domestic and personal services produced by employing paid domestic
staff;
(e) volunteer activities that result in goods, e.g. the construction of a
dwelling, church or other building are to be recorded as production.
Volunteer activities that do not result in goods, e.g. caretaking and
cleaning without payment, are excluded.
All such activities are included even if they are illegal or not-registered
with tax, social security, statistical and other public authorities.
3.09. Production excludes the production of domestic and personal services that
are produced and consumed within the same household (with the
exception of employing paid domestic staff and the services of owner-
occupied dwellings). Cases in point are:
(a) cleaning, decoration and maintenance of the dwelling as far as these
activities are also common for tenants;
(b) cleaning, servicing and repair of household durables;
(c) preparation and serving of meals;
(d) care, training and instruction of children;
(e) care of sick, infirm or old people;
(f) transportation of members of the household or their goods.
PRINCIPAL, SECONDARY AND ANCILLARY ACTIVITIES
3.10. Definition: The principal activity of a local KAU is the activitiy whose
value added exceeds that of any other activity carried out
within the same unit. The classification of the principal
activity is determined by reference to NACE rev. 1, first at
the highest level of the classification and then at more
detailed levels.1996R2223 — EN — 07.08.2003 — 008.001 — 61
▼B
3.11. Definition: A secondary activity is an activity carried out within a single
local KAU in addition to the principal activity. The output of
the secondary activity is a secondary product.
3.12. Definition: The output of an ancillary activity is not intended for use
outside the enterprise. An ancillary activity is a supporting
activity undertaken within an enterprise in order to create the
conditions within which the principal or secondary activities
of local KAUs can be carried out. Ancillary activities
typically produce outputs that are commonly found as inputs
into almost any kind of productive activity, small as well as
large.
Ancillary activities may be, e.g. purchasing, sales, marketing, accounting,
data processing, transportation, storage, maintenance, cleaning and
security services. Enterprises may have a choice between engaging in
ancillary activities or purchasing such services on the market from
specialist service producers.
Own-account capital formation is not considered to be an ancillary
activity.
3.13. Ancillary activities are treated as integral parts of the principal or
secondary activities with which they are associated. As a result:
(a) the output of an ancillary activity is not explicitly recognized and
recorded separately. It follows that the use of this output is also not
recorded;
(b) all the inputs consumed by an ancillary activity — materials, labour,
consumption of fixed capital, etc. are treated as inputs into the
principal or secondary activity which it supports.
OUTPUT (P.1)
3.14. Definition: Output consists of the products created during the accounting
period.
Particular cases included are:
(a) the goods and services which one local KAU provides to a different
local KAU belonging to the same institutional unit;
(b) the goods which are produced by a local KAU and remain in
inventories at the end of the period in which they are produced,
whatever their subsequent use.
However, goods or services produced and consumed within the same
accounting period and within the same local KAU are not separately
identified. They are therefore not recorded as part of the output or
intermediate consumption of that local KAU.
3.15. When an institutional unit contains more than one local KAU, the output
of the institutional unit is the sum of the outputs of its component local
KAUs, including outputs delivered between the component local KAUs.
3.16. Three types of output are distinguished in the ESA:
(a) market output (P.11);
(b) output produced for own final use (P.12);
(c) other non-market output (P.13).
This distinction is also applied to local KAUs and institutional units:
(a) market producers;
(b) producers for own final use;
(c) other non-market producers.
The distinction, between market, for own final use and other non-market
is fundamental, because it determines the valuation principles to be
applied to output: market output, output produced for own final use and
total output of market producers and producers for own final use are
valued at basic prices, while the total output of other non-market
producers (local KAUs) is valued from the costs side. The total output of
an institutional unit is valued as the sum of the total outputs of its local
KAUs and depends thus also on the distinction between market, for own
final use and other non-market (see paragraphs 3.54 to 3.56). Furthermore,
the distinction is also used to classify institutional units by sector (see
paragraphs 3.27 to 3.37).
The distinctions are defined in a top-down way, i.e. the distinction is first
defined for institutional units, then for local KAUs and then for their1996R2223 — EN — 07.08.2003 — 008.001 — 62
▼B
output. As a consequence, the exact meaning of the distinction on the
product level (i.e. the definition of the concepts of market output, output
for own final use and other non-market output) can only be understood by
looking also at features of the institutional unit and the local KAU that
produce that output.
After the general definitions of the three types of output and of the three
types of producers (see paragraphs 3.17 to 3.26), the distinction between
market, for own final use and other non-market is presented in a top-down
way.
3.17. Definition: Market output consists of output that is disposed of on the
market (see paragraph 3.18) or intended to be disposed of on
the market.
3.18. Market output includes:
(a) products sold at economically significant prices;
(b) products bartered;
(c) products used for payments in kind (including compensation of
employees in kind and mixed income in kind);
(d) products supplied by one local KAU to another within the same
institutional unit to be used as intermediate inputs or for final uses;
(e) products added to the inventories of finished goods and work-in-
progress intended for one or other of the above uses (including natural
growth of animal and vegetable products and uncompleted structures
for which the buyer is unknown).
3.19. Definition: In the ESA, the economically significant price of a product is
defined partly in relation to the institutional unit and local
KAU that has produced the output (see paragraphs 3.27 to
3.40). For example, by convention all the output of
unincorporated enterprises owned by households sold to
other institutional units is sold at economically significant
prices, i.e. is to be regarded as market output. For the output
of some other institutional units, output is only sold at
economically significant prices when more than 50 % of the
production costs is covered by sales.
3.20. Definition: Output produced for own final use consists of goods or
services that are retained either for final consumption by the
same institutional unit or for gross fixed capital formation by
the same institutional unit.
3.21. Products retained for own final consumption can only be produced by the
household sector. Typical examples are:
(a) agricultural products retained by farmers;
(b) housing services produced by owner-occupiers;
(c) household services produced by employing paid staff.
3.22. Products used for own gross fixed capital formation can be produced by
any sector. Examples are:
(a) special machine tools produced by engineering enterprises;
(b) dwellings, or extensions to dwellings, produced by households;
(c) own-account construction, including communal construction under-
taken by groups of households.
3.23. Definition: Other non-market output covers output that is provided free,
or at prices that are not economically significant, to otherunits.
Other non-market output (P.13) can be subdivided into two items:
‘Payments for the other non-market output’ (P.131 ), which consist of
various fees and charges, and ‘Other non-market output, other’ (P.132),
covering output that is provided free.
3.24. Definition: Market producers are local KAUs or institutional units the
major part of whose output is market output.
It should be noted that if a local KAU or institutional unit is a market
producer its main output is by definition market output, as the concept of
market output is defined after having applied the distinction market, for
own final use and other non-market to the local KAU and institutional unit
that have produced that output.1996R2223 — EN — 07.08.2003 — 008.001 — 63
▼M2
▼B
▼B
3.25. Definition: Producers for own final use are local KAUs or institutional
units the major part of whose output is for own final use
within the same institutional unit.
3.26. Definition: Other non-market producers are local KAUs or institutional
units whose major part of output is provided free or at not
economically significant prices.
Institutional units: distinction between market, for own final use and other
non-market
3.27. For the institutional units as producers, the distinction between market, for
own final use and other non market is summarized in table 3.1. The
implications for the classification by sectors are also shown.1996R2223 — EN — 07.08.2003 — 008.001 — 64
Table 3.1 — The distinction between market producers, producers for own final use and other non-market producers for institutional units
Type of institutional unit Classification
Private or public? NPI or not?Sales cover more
than 50 % of
production costs?Type of producer Sector(s)
1. Private Producers 1.1. Unincorporated enterprises
owned by households (excluding
quasi-corporate enterprises
owned by households)1.1. = Market or for own final
useHouseholds
1.2. Other private producers
(including quasi-corporate enter-
prises owned by households)1.2.1. Private NPIs 1.2.1.1. Yes 1.2.1.1. = Market Corporations
1.2.1.2. No 1.2.1.2. = Other non-market NPISH
1.2.2. Other private producers
that are not NPI1.2.2. = Market Corporations
2. Public producers 2.1. Yes 2.1. = Market Corporations
2.2. No 2.2. = Other non-market General Government▼B1996R2223 — EN — 07.08.2003 — 008.001 — 65
▼B
The table shows that in order to determine whether an institutional unit
should be classified as a market producer, a producer for own-final use or
another non-market producer several distinctions should be applied
subsequently.
3.28. The first distinction is that between private and public producers. A public
producer is a producer that is controlled by the general government. In
case of NPIs, a public producer is an NPI that is controlled and mainly
financed by the general government. All other producers are private
producers. Control is defined as the ability to determine the general
(corporate) policy or programme of an institutional unit by appointing
appropriate directors or managers, if necessary. Owning more than half
the shares of a corporation is a sufficient, but not a necessary, condition
for control (see paragraph 2.26).
3.29. As table 3.1 shows, private producers are found in all sectors except the
sector general government. In contrast, public producers are only found in
the corporations sectors (non-financial corporations and financial
corporations) and in the general government sector.
3.30. A specific category of private producers are the unincorporated enterprises
owned by households. These are always market producers or producers for
own final use. The latter occurs in case of the production of services of
owner-occupied dwellings and the own-account production of goods. All
unincorporated enterprises owned by households are classified to the
household sector. An exception should only be made for quasi-corporate
enterprises owned by households. These are market producers and
classified to the non-financial and financial corporations sectors.
3.31. For the other private producers, a distinction should be made between
private non-profit institutions and other private producers.
Definition: A NPI is defined as a legal or social entity created for the
purpose of producing goods and services whose status does
not permit them to be a source of income, profit or other
financial gains for the units that establish, control or financethem. In practice, their productive activities are bound to
generate either surpluses or deficits but any surpluses they
happen to make cannot be appropriated by other institutional
units.
All the other private producers that are not NPIs are market producers.
They are classified to the non-financial and financial corporations sectors.
3.32. In order to determine the type of producer and the sector for the private
NPIs, a 50 % criterion should be applied:
(a) if more than 50 % of the production costs are covered by sales, the
institutional unit is a market producer and classified to the non-
financial and financial corporations sectors;
(b) if less than 50 % of the production costs are covered by sales, the
institutional unit is another non-market producer and classified to the
sector NPISH. But other non-market NPIs that are controlled and
mainly financed by general government are classified to the general
government sector.
3.33. In distinguishing market and other non-market producers by means of the
50 % criterion, sales and production costs are defined as follows:
(a) sales cover the sales excluding taxes on products but including all
payments made by general government or the institutions of the
European Union and granted to any kind of producer in this type of
activity, i.e. all payments linked to the volume or value of output are
included, but payments to cover an overall deficit are excluded.
This definition of sales corresponds to that of output at basic prices
except that:
(1) output at basic prices is only defined after it has been decided on
whether the output is market or other non-market: sales are only
used in valuing market output; other non-market output is valued
at costs;
(2) the payments made by general government to cover an overall
deficit of public corporations and quasi-corporations are part or
other subsidies on products as defined in paragraph 4.35. c. As a
consequence, market output at basic prices includes also the
payments made by general government to cover an overall deficit;
(b) production costs are the sum of intermediate consumption, compensa-
tion of employees, consumption of fixed capital and other taxes on
production. For this criterion other subsidies on production are not1996R2223 — EN — 07.08.2003 — 008.001 — 66
▼B
deducted. To ensure consistency of the concepts sales and production
costs when applying the 50 % criterion, the production costs should
exclude all costs made for own-account capital formation.
The 50 % criterion should be applied by looking over a range of years:
only if the criterion holds for several years or holds for the present year
and is expected to hold for the near future, it should be applied strictly.
Minor fluctuations in the size of sales from one year to another do not
necessitate a reclassification of institutional units (and their local KAUs
and output).
3.34. Sales may consist of various elements. For example, in case of the health
care services provided by a hospital sales may correspond to:
(a) purchases by employers to be recorded as income in kind paid to their
employees and final consumption expenditure by these employees;
(b) purchases by private insurance companies;
(c) purchases by social security funds and general government to be
classified as social benefits in kind;
(d) purchases by households without reimbursement (final consumption
expenditure).
Only other subsidies on production and gifts (e.g. from charities) received
are not treated as sales.
Similarly, the sale of transport services by an enterprise may correspond
to intermediate consumption by producers, income in kind provided by
employers, social benefits in kind provided by the government and
purchases by households without reimbursement.
3.35. Private non-profit institutions serving businesses are a special case. They
are usually financed by contributions or subscriptions from the group of
businesses concerned. The subscriptions are treated not as transfers but as
payments for services rendered, i.e. as sales. These NPIs are therefore
market producers and are classified in the non-financial and financial
corporations sectors.
3.36. In applying the 50 % criterion to the sales and production costs of private
or public NPIs, including in sales all the payments linked to volume of
output may be misleading in some specific cases. This can apply e.g. to
the financing of the output of private and public schools: the payments by
the general government can be linked to the number of pupils but be the
subject of negotiation with the general government. In such a case, these
payments need not be regarded as sales though they have an explicit link
with the volume of output, e.g. with the number of pupils. This implies
that a school mainly financed by such payments is another non-market
producer. When the school is a public producer, i.e. when it is mainly
financed and controlled by the government, it should be classified in the
sector general government. When the school is a private other non-market
producer, it should be classified in the sector NPISHs.
3.37. Public producers can be market producers or other non-market producers.
If the 50 % criterion decides that the institutional unit should be regarded
as a market producer, it is classified in the non-financial and financial
corporations sectors. The 50 % criterion decides also when a government
unit should be treated as a quasi-corporation owned by the government:
only when it meets the 50 % criterion, a quasi-corporation should be
created. If the institutional unit is another non-market producer, it is
classified in the sector general government. The distinction between NPIs
and other producers is thus irrelevant for classifying public producers.
Local KAUs and their outputs: distinction between market, for own final use
and other non-market
3.38. After having applied the distinction market, for own final use and other
non-market to institutional units as producers, the distinction can be
applied to local KAU and their outputs. This relation is shown in table 3.2.1996R2223 — EN — 07.08.2003 — 008.001 — 67
Table 3.2 — Institutional units, local KAUs and output and the distinction between market, for own final use and other non-market
Institutional unit Principal local Secondary local KAU(s)Principal output of principal
local KAUSecondary output of principal
local KAUPrincipal output of secondary
local KAUSecondary output of
secondary local KAU
Market producer Market producer Market output Market output
Output for own final use
Market producer Market output Market output
Output for own final use
Producer for own final
useOutput for own final use Market output
Producer for own final use Producer for own final use Output for own final use Market output
Other non-market producer Other non-market
producerOther non-market output Market output
Output for own final use
Other non-market output
Market producer Market output Market output
Output for own final use
Other non-market
producerOther non-market output Market output
Output for own final use
Other non-market output▼B1996R2223 — EN — 07.08.2003 — 008.001 — 68
▼B
3.39. For institutional units qualifying as market producers, the principal local
KAU is of course also a market producer. The secondary local KAU can
be a market producer, but also a producer for own final use. However, thesecondary local KAU can by convention not be another non-market
producer. This implies that the (secondary) local KAUs in the sectors non-
financial corporations and financial corporations are all market producers
or producers for own final use.
3.40. For institutional units that are other non-market producers, the principal
local KAU will also be another non-market producer. The secondary local
KAUs can be market producers or other non-market producers. This
implies that the sectors general government and NPISH can contain some
(secondary) local KAUs that are market producers (although all the
institutional units in these sectors are other non-market producers). In
order to determine whether the secondary local KAUs are market or other
non-market producers the 50 % criterion should be applied.
3.41. After having applied the distinction market, for own final use and other
non-market to institutional units and their local KAUs, the distinction can
be applied to the outputs of local KAUs. This relation is shown in table
3.3.
Table 3.3 — The distinction market, for own final use and other non-market for
local KAUs and their output
Market producersProducers for own
final useOther non-market
producersTotal
Market output X x xTotal market
output
Output for own
final usexXxTotal output for
own final use
Other non-
market output00 XTotal other non-
market output
TotalTotal output by
market produ-
cersTotal output by
producers for
own final useTotal output by
other non-
market produ-
cersTotal output
X = large output; x = small output; 0 = no output (by convention).
3.42. By convention, local KAUs as market producers and as producers for own
final use cannot supply other non-market output. Their output can thus
only be recorded as market output or output for own final use and valued
correspondingly (see paragraphs 3.46 to 3.52).
3.43. Local KAUs as other non-market producers can supply as secondary
output market outputs and output for own final use. The output for own
final use consists of own-account capital formation. The occurrence of
market output should in principle be determined by applying the 50 %
criterion to individual products: market output is output that is soldat at
least 50 % of its production costs. This might be the case for instance
when government hospitals charge economically significant prices for
some of their services. Other examples are sales of reproductions by
government museums and sales of weather forecasts by meteorological
institutes.
3.44. In statistical practice, it may be difficult to make a clear distinction
between the different products of local KAUs of government institutionsand NPISHs. Even more, this is true for the production costs in relation to
the different products. In that case, a simple solution is to treat all
revenues of other non-market producers from their secondary activity
(activities) as the revenues for one type of market output. This applies for
example to a museum's revenues from the sale of posters and cards (
1).
3.45. Other non-market producers may also have revenues from the sale of their
other non-market output at not economically significant prices, e.g. the1996R2223 — EN — 07.08.2003 — 008.001 — 69
(1) Though these revenues may not be sufficient to cover 50 % of all the costs of the
museum shop, e.g. because that also includes compensation of employees of the museum
shop personnel.
▼B
museum's revenues from tickets for entrance. These revenues pertain to
other non-market output. However, if both types of revenues (revenues
from tickets and those from the sale of posters and cards) are difficult to
distinguish, they can all be treated as either revenues for market output or
revenues from other non-market output. The choice between these two
alternative registrations should depend on the assumed relative importance
of both types of revenues (from tickets versus those from the sale of
posters and cards).
TIME OF RECORDING AND VALUATION OF OUTPUT
3.46. Output is to be recorded and valued when it is generated by the production
process.
3.47. All output is to be valued at basic prices, but specific conventions hold
for:
(a) the valuation of other non-market output;
(b) the valuation of total output of another non-market producer (local
KAU);
(c) the valuation of the total output of an institutional unit of which a
local KAU is another non-market producer. (See paragraphs 3.53 to
3.56).
3.48. Definition: ►M4 The basic price is the price receivable by the
producers from the purchaser for a unit of a good or service
produced as output, minus any tax payable (see point 4.27)
on that unit as a consequence of its production or sale (i.e.
taxes on products), plus any subsidy receivable on that unit
as a consequence of its production or sale (i.e. subsidies on
products). ◄ It excludes any transport charges invoiced
separately by the producer. It includes any transport margins
charged by the producer on the same invoice, even when
they are included as a separate item on the invoice.
3.49. Output for own final use (P.12) is to be valued at the basic prices of
similar products sold on the market; as a consequence, net operating
surplus or mixed income can occur for such output. This also applies to
services of owner-occupied dwellings (see paragraph 3.64.). However, it
will usually be necessary to value output of own-account construction by
costs of production.
3.50. Additions to work-in-progress are valued in proportion to the estimated
current basic price of the finished product.
3.51. If the value of output treated as work-in-progress is to be estimated in
advance, it should be based on the actual costs incurred, plus a mark-up
for the estimated operating surplus or an estimate of mixed income. The
provisional estimates should subsequently be replaced by those obtained
by distributing the actual value (when it becomes known) of the finished
products. The latter is the sum of the values of:
(a) finished products sold or bartered;
(b) entries of finished products into inventories, less withdrawals;
(c) finished products for own final use.
3.52. For buildings and structures acquired in an incomplete state, a value is
estimated based on costs to date, including a mark up for operating surplus
or mixed income. This mark-up results when the value can be estimated
on the basis of the prices of similar buildings and structure. The amounts
of stage payments may be used to approximate the values of gross fixed
capital formation undertaken by the purchaser at each stage (assuming no
advance payments or arrears).
If the own-account construction of a structure is not yet completed within
a single accounting period, the value of the output and the corresponding
gross fixed capital formation should be estimated by applying the fraction
of the total costs of production incurred during the relevant period to the
estimated current basic price. If it is not possible to estimate the basic
price of the finished structure, it must be valued by its total costs of
production. If some or all of the labour is provided free, as may happen
with communal construction by households, an estimate of what the cost
of paid labour would have been included in the estimated total production
costs using wage rates for similar kinds of labour in the vicinity or region.
3.53. The total output of an other non-market producer (a local KAU) is to be
valued at the total costs of production, i.e. the sum of:
(a) intermediate consumption (P.2);1996R2223 — EN — 07.08.2003 — 008.001 — 70
▼B
(b) compensation of employees (D.1);
(c) consumption of fixed capital (K.1);
(d) other taxes on production (D.29) less other subsidies on production
(D.39).
Other subsidies on production should be deducted. However, it should be
realized that other subsidies on production to other non-market producers
will often be absent in practice or only involve very small amounts (see
paragraph 4.36).
By convention, interest payments are not included as costs of other non-
market production (though they could be regarded as major costs of
production in some cases, e.g. in the case of housing corporations). The
costs of other non-market production also do not include an imputation for
the rental value of the non-residential buildings owned and used in other
non-market production.
3.54. The total output of an institutional unit is the sum of the total output of its
constituent local KAUs. This applies also to institutional units that are
other non-market producers.
3.55. In the absence of secondary market output by other non-market producers
(local KAUs), other non-market output is to be valued at the costs of
production. In the case of secondary market output by other non-market
producers, other non-market output is valued as a residual item i.e. as the
difference between the total costs of production of other non-market
producer minus their revenues from market output.
3.56. In principle, market output by other non-market producers is to be valued
at basic prices. However, even though another non-market local KAU may
have sales receipts, its total output covering both its market and its other
non-market output (and possibly also output for own final use), is still
valued by the production costs. The value of its market output is given by
its receipts from sales of market products, the value of its other non-
market output being obtained residually as the differences between on the
one hand the values of its total output and, on the other hand, its market
output and output for own final use. The value of its receipts from the sale
of other non-market goods or services at prices that are not economically
significant remain as part of the value of its other non-market output.
3.57. For some specific types of output, the times of recording and the valuation
of output are subject to the following clarifications and exceptions, given
in order of CPA sections.
3.58. A. Products of agriculture, hunting and forestry;
B.Fish
The output of agricultural products should be recorded as being produced
continuously over the entire period of production (and not simply when
the crops are harvested or animals slaughtered).
Growing crops, standing timber and stocks of fish or animals reared for
purposes of food should be treated as inventories of work-in-progress
during the process, and transformed into inventories of finished products
when the process is completed.
3.59. D. Manufactured products;
F.Construction work
When a contract of sale is agreed in advance for the construction of a
building or other structure extending over several accounting periods, the
output produced each period is treated as being sold to the purchaser at the
end of the period: i.e. in the purchaser's fixed capital formation rather than
work-in-progress in the construction industry. In effect, the output
produced is treated as being sold to the purchaser in stages as the latter
takes legal possession of the output. When the contract calls for stage
payments, the value of the output may often be approximated by the value
of stage payments made each period. In the absence of a contract of sale,
however, the incomplete output produced each period is recorded as work-
in-progress.
3.60. G. Wholesale and retail trade services; repair services of motor vehicles,
motorcycles and personal and household goods
The output of wholesale and retail services is measured by the trade
margins realized on the goods they purchase for resale.
Definition: A trade margin is the difference between the actual or
imputed price realized on a good purchased for resale and1996R2223 — EN — 07.08.2003 — 008.001 — 71
▼B
the price that would have to be paid by the distributor to
replace the good at the time it is sold or otherwise disposed
of.
By convention, holding gains and losses are not included in the trade
margin. However, in practice, data sources may not allow for separating
out all the holding gains and losses.
3.61. H. Hotel and restaurant services
The value of the output of the services of hotels, restaurants and cafes
includes the value of the food, beverages, etc. consumed.
3.62. I. Transport, storage and communication services
The output of transport services is measured by the value of the amounts
receivable for transporting goods or persons. Transportation for own use
within the local KAU is considered ancillary activity and is not separately
identified and recorded.
The output of storage services is measured as the value of an addition to
work-in-progress, either additional output in the sense of transportation
over time (e.g. storage on behalf of other local KAUs) or a physical
change (e.g. in the case of the maturing of wine).
The output of travel agency services is measured as the value of service
charges of agencies (fees or commission charges) and not by the full
expenditures made by travellers to the travel agency. The latter may e.g.
also include charges for transport by third parties.
The output of tour operator services is measured by the full expenditure
made by travellers to the tour operator.
The distinction between travel agency services and tour operator services
is that travel agency services amount only to intermediation on behalf of
the traveller, while tour operator services create a new product, i.e. a tour
is arranged of which the prices of its various components (e.g. travel,
accommodation and entertainment) are not recognizable as such for the
traveller.
3.63. J. Financial intermediation services (this includes insurance services and
pension funding services)
The output of financial intermediation for which no explicit charges are
made is measured, by convention, as the total property income received by
the units providing the services minus their total interest payments,
excluding the value of any income received from the investment of their
own funds (as such income does not arise from financial intermediation),
and, in the case of secondary insurance activities by a financial
intermediary, excluding the income from investment of insurance
technical reserves. Holding gains and losses should be ignored in
measuring this output, because throughout the system holding gains are
not recorded in the production account but in a separate account (other
changes in assets account). This applies also to holding gains on foreign
exchange and securities by professional dealers (though their holding
gains may be generally positive and be regarded by the dealers themselves
as part of their normal revenues). However, the trade margins on foreign
exchange and securities (i.e. the common differences between the
purchasers' prices for the dealer and the purchasers' price for the buyer)
are to be included in output, like for wholesale and retail traders.
Analogously, there may also be data problems in distinguishing such trade
margins from the holding gains; these should be overcome as best as
possible.
The output of services of financial intermediation provided by central
banks should be measured in the same way as those provided by other
financial intermediaries.
The activity of money lenders who lend only their own funds is not treated
as the production of services.
Financial intermediaries may also provide various financial services and
business services for which fees or commissions are explicitly charged.
Cases in point can be e.g. currency exchange and advice about
investments, the purchase of real estate or advice on taxation. The output
of such services is valued on the basis of the fees or commissions charged.1996R2223 — EN — 07.08.2003 — 008.001 — 72
▼B
Output of insurance services (service charge) is measured as:
total actual premiums earned
plus total premium supplements (equal to the income from the
investment of the insurance technical reserves)
minus the total claims due
minus the change in the actuarial reserves and reserves for with-
profits insurance.
Holding gains and losses are to be ignored in the measurement of the
output of insurance services: they are not to be regarded as income from
investment of the insurance technical reserves and they are not to be
considerd as changes in the actuarial reserves and reserves for with-profits
insurance.
Notice that insurance technical reserves may be invested in secondary
activities of the insurance company, e.g. the letting of dwellings or offices.
In that case, the net operating surplus on these secondary activities is
income from the investment of insurance technical reserves.
Similarly, the output of pension funding services is measured as:
total actual pension contributions
plus total supplementary contributions (equal to the income
from investment of the pension funds technical reserves)
minus the benefits due
minus the change in the actuarial reserves.
3.64. K. Real estate, renting and business services
The output of services of owner-occupied dwellings should be valued at
the estimated value of rental that a tenant would pay for the same
accommodation, taking into account factors such as location, neighbour-
houd amenities, etc. as well as the size and quality of the dwelling itself.
For garages located separately from dwellings, which are used by the
owner for final consumption purposes in connection with using the
dwelling, a similar imputation is to be made. No imputation is to be made
for garages used by their private owner only for the purpose of parking
near the workplace. The rental value of owner-occupied dwellings abroad,
e.g. holiday homes, should not be recorded as part of domestic production,
but imports of services and the corresponding net operating surplus asprimary income received from the rest of the world. For owner-occupied
dwellings owned by non-residents, analogous entries should be made. In
case of time-sharing apartments, a proportion of the service charge should
be recorded as such.
The output of real estate services of non-residential buildings is measured
by the value of the rentals due.
The output of operating leasing services (renting out machinery or
equipment, etc.) is measured by the value of rental which the lessee pays
to the lessor. It is clearly distinguished from financial leasing which is a
method of financing the acquisition of fixed assets, i.e. by making a loan
from the lessor to the lessee. In the case of financial leasing rentals consist
(mainly) of repayments and interest payments, and the value of services is
very small compared with the total rentals paid (see Annex II ‘Leasing
and hire purchase of durable goods’).
When possible, a separate local KAU should be distinguished for research
and development activities (R&D). When this is not possible, all R&D of
a significant size (compared to the principal activity) should be recorded
as a secondary activity of the local KAU.
The output of R&D services is measured as follows:
(a) R&D by specialised commercial research laboratories or institutes is
valued at the revenues from sales, contracts, commissions, fees, etc. in
the usual way;
(b) the output of R&D for use within the same enterprise should, in
principle, be valued on the basis of the estimated basic prices that
would be paid if the research were sub-contracted commercially.
However, in practice, it is likely to have to be valued on the basis of
the total production costs;1996R2223 — EN — 07.08.2003 — 008.001 — 73
▼B
(c) R&D by government units, universities, non-profit research institutes,
etc. is usually other non-market production and is thus valued on the
basis of the costs of production. Revenues from the sale of R&D by
other non-market producers of R&D are to be recorded as revenues
from secondary market output.
Expenditure on R&D should be distinguished from that on education and
training. Expenditure on R&D does not include the costs of developing
software as a principal or secondary activity. However, their accounting
treatment is nearly the same; the only difference is that software is
regarded as a produced intangible asset and is not patented.
3.65. L. Public administration and defence services, compulsory social security
services
Public administration, defence services and compulsory social security
services are always provided as other non-market services and should thus
be valued accordingly.
3.66. M. Education services;
N.Health and social services
For education services and health services it may often be necessary to
draw precise borderlines between market and other non-market producers
and between their market and other non-market output. For example, for
some types of education and medical treatment nominal fees can be levied
by government institutions (or by other institutions due to specific
subsidies), but for other education and special medical treatments they
may charge commercial tariffs. Another common case in point is that the
same type of service (e.g. higher education) is provided by, on the one
hand, the government (or its intermediation) and, on the other hand,
commercial institutes. Then, often large differences exist between the
prices charged and the quality of the services.
Education and health services exclude R&D activities; health services
exclude education in health care, e.g. by academic hospitals.
3.67. O. Other community, social and personal services
The production of books, recordings, films, software, tapes, disks, etc. a
two-stage process and measured accordingly:
1. the output from the production of originals (an intangible fixed asset) is
measured by the price paid if sold, or, if not sold, by the basic price
paid for similar originals, its production costs or the discounted value
of the future receipts expected from using it in production;
2. the owner of this asset may use it directly or to produce copies in
subsequent periods. If the owner has licensed other producers to make
use of the original in production, the fees, commissions, royalties, etc.
he receives from the licenses are his output of his services. However,
the sale of the intangible asset is negative fixed capital formation.
3.68. P. Private housholds with employed persons
The output of household services produced by employing paid staff is by
convention valued by the compensation of employees paid; this includes
any compensation in kind such as food or accommodation.
INTERMEDIATE CONSUMPTION (P.2)
3.69. Definition: Intermediate consumption consists of the value of the goods
and services consumed as inputs by a process of production,
excluding fixed assets whose consumption is recorded as
consumption of fixed capital. The goods and services may be
either transformed or used up by the production process.
3.70. Intermediate consumption includes the following borderline cases:
(a) the value of all the goods or services used as inputs into ancillary
activities. Common examples are purchasing, sales, marketing,
accounting, data processing, transportation, storage, maintenance,
security, etc. These goods and services are not distinguished from
those consumed by the principal (or secondary) activities of a local
KAU;
(b) the value of goods and services which are received from another local
KAU of the same institutional unit (only if they comply to the general
definition in paragraph 3.69);1996R2223 — EN — 07.08.2003 — 008.001 — 74
▼B
(c) the costs of using rented fixed assets, e.g. the operational leasing of
machines or cars;
(d) the subscriptions, contributions or dues paid to non-profit business
associations;
(e) items not treated as gross capital formation, like:
1. small tools which are inexpensive and used for relatively simple
operations, such as saws, hammers, screwdrivers and other hand
tools; small devices, such as pocket calculators. By convention, in
the ESA, all expenditure on such durables which does not exceed
500 ECU (at 1995 prices) per item (or, when bought in quantities,
for the total amount bought), should be recorded as intermediate
consumption;
2. the ordinary, regular maintenance and repair of fixed assets used in
production;
3. military weapons of destruction and the equipment needed to
deliver them (but not light weapons or armoured vehicles acquired
by police and security forces, which are treated as gross fixed
capital formation);
4. services of research and development, staff training, market
research and similar activities, purchased from an outside agency
or provided by a separate local KAU of the same institutional unit;
(f) payments for the use of intangible non-produced assets like patented
assets, trademarks, etc. (excluding payments for the purchase of such
property rights: these are treated as acquisitions of intangible non-
produced assets);
(g) expenditure by employees, reimbursed by the employer, on items
necessary for the employers' production, like contractual obligations
to purchase on own-account tools or safety-wear;
(h) expenditure by employers which is to their own benefit as well as to
that of their employees, because it is necessary for the employers'
production. Cases in point are:
1. reimbursement of employees for travelling, separation, removal
and entertainment expenses incurred in the course of their duties;
2. providing amenities at the place of work;
(a more extensive list is presented in the paragraphs on compensation
of employees (D.1));
(i) non-life insurance service charges paid by local KAUs (see also
Annex III ‘Insurance’): in order to record only the service charge as
intermediate consumption the premiums paid should be discounted
for, e.g. claims paid out and the net change in actuarial reserves. The
latter can be allocated to local KAUs as a proportion of the premiums
paid;
(j) only for the total economy: all financial intermediation services
indirectly measured (Fisim) provided by resident producers.
3.71. Intermediate consumption excludes:
(a) items treated as gross capital formation, like:
1. valuables;
2. mineral exploration;3. major improvements which go considerably beyond what is
required simply to keep the fixed assets in good working order,
e.g. renovation, reconstruction or enlargement;
4. software purchased or produced on own account;
(b) expenditure by employers treated as wages and salaries in kind (see
paragraph 4.05);
(c) use by market or own-account producer units of collective services
provided by government units (treated as collective consumption
expenditure by government);
(d) goods or services produced and consumed within the same accounting
period and within the same local KAU (they are also not recorded as
output);
(e) payments for government licences and fees that are treated as taxes on
production (see paragraphs 4.79 to 4.80).1996R2223 — EN — 07.08.2003 — 008.001 — 75
▼B
TIME OF RECORDING AND VALUATION OF INTERMEDIATE
CONSUMPTION
3.72. Products used for intermediate consumption should be recorded and
valued at the time they enter the process of production. They are to be
valued at the purchasers' prices for similar goods or services at that time.
3.73. In practice, producer units do not usually record the actual use of goods in
production directly. They record the purchases intended to be used as
inputs and the changes in the amounts of such goods held in inventory.
Intermediate consumption has therefore to be estimated by subtracting
from the purchases the changes in inventories of inputs (see paragraphs
3.120 to 3.124 for the correct valuation of the latter).
FINAL CONSUMPTION (P.3, P.4)
3.74. Two concepts of final consumption are used:
(a) final consumption expenditure (P.3);
(b) actual final consumption (P.4)
Final consumption expenditure is a concept that refers to a sector's
expenditure on consumption goods and services. In contrast, actual final
consumption refers to its acquisition of consumption goods and services.
The difference between these concepts lies in the treatment of certain
goods and services financed by the government or NPISHs but supplied to
households as social transfers in kind.
FINAL CONSUMPTION EXPENDITURE (P.3)
3.75. Definition: Final consumption expenditure consists of expenditure
incurred by resident institutional units on goods or services
that are used for the direct satisfaction of individual needs or
wants or the collective needs of members of the community.
Final consumption expenditure may take place on the
domestic territory or abroad.
3.76. Household final consumption expenditure includes the following border-
line cases:
(a) services of owner-occupied dwellings;
(b) income in kind, like:
1. goods and services received as income in kind by employees;
2. goods or services produced as outputs of unincorporated
enterprises owned by households that are retained for consumption
by members of the household. Cases in point are food and other
agricultural goods, housing services by owner-occupiers and
household services produced by employing paid staff (servants,
cooks, gardeners, chauffeurs, etc.);
(c) items not treated as intermediate consumption, like:
1. materials for small repairs to and interior decoration of dwellings
of a kind typically carried out by tenants as well as owners;
2. materials for repairs and maintenance to consumer durables,
including vehicles;
(d) items not treated as capital formation, in particular consumer
durables, that continue to perform their function in several accounting
periods; this includes the transfer of ownership of some durables from
an enterprise to a household (see transactions in existing goods,
paragraph 3.148);
(e) financial services directly charged;
(f) insurance services by the amount of the implicit service charge (see
paragraph 3.63);
(g) pension funding services by the amount of the implicit service charge
(see paragraph 3.63);
(h) payments by households for licences, permits, etc. which are regarded
as purchases of services (see paragraphs 4.79 and 4.80);
(i) the purchase of output at not economically significant prices, e.g.
entrance fees for a museum (see paragraph 3.45).
3.77. Household final consumption expenditure excludes:
(a) social transfers in kind, like expenditures initially incurred by
households but subsequently reimbursed by social security, e.g.
some medical expenses;1996R2223 — EN — 07.08.2003 — 008.001 — 76
▼B
(b) items treated as intermediate consumption or gross capital formation,
like:
1. expenditures by households owning unincorporated enterprises
when incurred for business purposes — e.g. on durable goods such
as vehicles, furniture or electrical equipment (gross fixed capital
formation), and also on non-durables such as fuel (intermediate
consumption);
2. expenditure that an owner-occupier incurs on the decoration,
maintenance and repair of the dwelling not typically carried out by
tenants (treated as intermediate consumption in producing housing
services);
3. the purchase of dwellings (treated as gross fixed capital
formation);
4. expenditure on valuables (treated as gross capital formation);
(c) items treated as acquisitions of a non-produced assets, in particular the
purchase of land;
(d) all those payments by households which are to be regarded as taxes,
such as licences to own vehicles, boats or aircraft and also licences to
hunt, shoot or fish (see paragraphs 4.79 to 4.80);
(e) subscriptions, contributions and dues paid by households to NPISHs,
like trade unions, professional societies, consumers' associations,
churches and social, cultural, recreational and sports clubs;
(f) voluntary transfers in cash or in kind by households to charities, relief
and aid organizations.
3.78. Final consumption expenditure of NPISHs includes two separate
categories:
(a) the value of the goods and services produced by NPISHs other than
own-account capital formation and other than expenditure made by
households and other units;
(b) expenditures by NPISHs on goods or services produced by market
producers that are supplied — without any transformation — to
households for their consumption as social transfers in kind.
3.79. Final consumption expenditure (P.3) by government includes two
categories of expenditures, similar to those by NPISHs:
(a) the value of the goods and services produced by general government
itself (P.1) other than own-account capital formation (corresponding
to P.12) and sales. Market output (P.11) and payments for the other
non-market output (P.131);
(b) purchases by general government of goods and services produced by
market producers that are supplied to households, without any
transformation, as social transfers in kind
(D.6311 + D.63121 + D.63131). This implies that general government
just pays for goods and services that the sellers provide to households.
3.80. Corporations do not make final consumption expenditures. Their
purchases of the same kind of goods or services as used by households
for final consumption are either used for intermediate consumption or
provided to employees as compensation of employees in kind, i.e. imputed
household final consumption expenditure. Even where, for example
through advertising, they finance individual consumption, this expenditure
is treated as intermediate.
ACTUAL FINAL CONSUMPTION (P.4)
3.81. Definition: Actual final consumption consists of the goods or services
that are acquired by resident institutional units for the direct
satisfaction of human needs, whether individual or collec-
tive.
3.82. Definition: Goods and services for individual consumption (‘individual
goods and services’) are acquired by a household and used to
satisfy the needs and wants of members of that household.
Individual goods and services have the following character-
istics:
(a) it must be possible to observe and record the acquisition
of the good or services by an individual household or
member thereof and also the time at which it took place;1996R2223 — EN — 07.08.2003 — 008.001 — 77
▼M2
▼B
▼B
(b) the household must have agreed to the provision of the
good or service and take whatever action is necessary to
make it possible, for example by attending a school or
clinic;
(c) the good or service must be such that its acquisition by
one household or person, or possibly by a small,
restricted group of persons, precludes its acquisition by
other households or persons.
3.83. Definition: Services for collective consumption (‘collective services’)
are provided simultaneously to all members of the commu-
nity or all members of a particular section of the community,
such as all households living in a particular region.
Collective services have the following characteristics:
(a) they can be delivered simultaneously to every member
of the community or to particular sections of the
community, such as those in a particular region or
locality;
(b) the use of such services is usually passive and does not
require the explicit agreement or active participation of
all the individuals concerned;
(c) the provision of a collective service to one individual
does not reduce the amount available to others in the
same community or section of the community. There is
no rivalry in acquisition.
3.84. All household final consumption expenditure is individual. By conven-
tion, all goods and services provided by NPISHs are treated as individual.
3.85. For the goods and services provided by government units, the borderline
between individual and collective goods and services is drawn on the basis
of the Classification of the Functions of Government (COFOG).
By convention, all government final consumption expenditure under each
of the following headings should be treated as expenditures on individual
consumption:
(a) 7.1 Medical products, appliances and equipment
7.2 Outpatient services7.3 Hospital services7.4 Public health services
(b) 8.1 Recreational and sporting services
8.2 Cultural services
(c) 9.1 Pre-primary and primary education
9.2 Secondary education
9.3 Post-secondary non-tertiary education
9.4 Tertiary education9.5 Education not definable by level9.6 Subsidiary services to education
(d) 10.1 Sickness and disability
10.2 Old age10.3 Survivors
10.4 Family and children
10.5 Unemployment10.6 Housing10.7 Social exclusion n.e.c.
Alternatively individual consumption expenditure of general government
corresponds to division 14 of the COICOP, which includes the following
groups:
14.1 Housing (equivalent to COFOG group 10.6)
14.2 Health (equivalent to COFOG groups 7.1 to 7.4)
14.3 Recreation and culture (equivalent to COFOG groups 8.1 and 8.2)14.4 Education (equivalent to COFOG groups 9.1 to 9.6)14.5 Social protection (equivalent to COFOG groups 10.1 to 10.5 and
group 10.7).1996R2223 — EN — 07.08.2003 — 008.001 — 78
▼M6
▼M6
The collective consumption expenditure is the remainder of the
government final consumption expenditure.
According to COFOG, it consists in particular of:
(a) General public services (division 1)
(b) Defence (division 2)
(c) Public order and safety (division 3)
(d) Economic affairs (division 4)
(e) Environmental protection (division 5)
(f) Housing and community amenities (division 6)
(g) General administration, regulation, dissemination of general informa-
tion and statistics (all divisions)
(h) Research and development (all divisions).
3.86. The relationships between the various concepts employed can be shown in
a table:
Sector making expenditure
Government NPISHs Households Total acquisitions
Individual
consumptionX
(= social trans-
fers in kind)X
(= social trans-
fers in kind)X Households'
actual individual
final consump-
tion
Collective
consumptionX 0 0 Government's
actual collective
final consump-
tion
Total Government's
final consump-
tion expendi-
tureNPISHs final
consumption
expenditureHouseholds
final consump-
tion expendi-
tureActual final
consumption=to-
tal final
consumption
expenditure
3.87. Final consumption expenditure of NPISHs is by convention all individual.
As a consequence, total actual final consumption is equal to the sum of
households actual final consumption and actual final consumption of
general government.
3.88. By convention, there are no social transfers in kind with the rest of the
world (though there are such transfers in monetary terms). As a
consequence, total actual final consumption is equal to total final
consumption expenditure.
TIME OF RECORDING AND VALUATION OF FINAL CONSUMPTION
EXPENDITURE
3.89. As explained in chapter 1, goods and services should in general be
recorded when the payables are created, that is, when the purchaser incurs
a liability to the seller. This implies that expenditure on a good is to be
recorded at the time its ownership changes; expenditure on a service is
recorded when the delivery of the service is completed.
3.90. Expenditure on a good acquired under a hire purchase or similar credit
agreement (and also under a financial lease) should be recorded at the
time the good is delivered even if there is no legal change of ownership at
this point.
3.91. Own-account consumption should be recorded when the output retained
for own final consumption is produced.
3.92. The final consumption expenditure of households is recorded at
purchasers' prices. This is the price the purchaser actually pays for the
products at the time of the purchase. A more detailed definition can be
found in paragraph 3.06.1996R2223 — EN — 07.08.2003 — 008.001 — 79
▼B
▼B
3.93. Goods and services supplied as compensation of employees in kind are
valued at basic prices when produced by the employer and at the
purchasers' prices of the employer when bought in by the employer.
3.94. Retained goods or services for own consumption are valued at basic
prices.
3.95. Final consumption expenditures by general government or NPISHs on
products produced by themselves are recorded at the time they are
produced, which is also the time of delivery of such services by
government or NPISHs. For the final consumption expenditure on goods
and services supplied via market producers, the time of delivery is the
time of recording.
3.96. Final consumption expenditure (P.3) by general government or NPISHs
are equal to the sum of their output (P.1), plus the expenditure on products
supplied to households via market producers, part of social transfers in
kind (D.6311 + D.63121 + D.63131), minus the payments by other units,
market output (P.11) and payments for the other non-market output
(P.131), minus own-account capital formation (corresponding to P.12).
TIME OF RECORDING AND VALUATION OF ACTUAL FINAL CONSUMP-
TION
3.97. Goods and services are acquired by institutional units when they become
the new owners of the goods or when the delivery of goods or services to
them is completed.
3.98. Acquisitions (actual final consumption) are valued at the purchasers'
prices for the units that incur the expenditures.
Transfers in kind other than social transfers in kind from government and
NPISHs are treated as if they were transfers in cash. Accordingly, the
values of the goods or services are actually recorded as expenditures by
the institutional units or sectors that acquire them.
3.99. The values of the two aggregates of final consumption expenditure and
actual final consumption are the same. The goods and services acquired
by resident households through social transfers in kind, thus, are valued at
the same prices at which they are valued in the expenditure aggregates.
GROSS CAPITAL FORMATION (P.5)
3.100. Gross capital formation consists of:
(a) gross fixed capital formation (P.51);
(b) changes in inventories (P.52);
(c) acquisitions less disposals of valuables (P.53).
3.101. Gross capital formation means gross of consumption of fixed capital. Net
capital formation is arrived at by deducting consumption of fixed capital
from gross capital formation.
GROSS FIXED CAPITAL FORMATION (P.51)
3.102. Definition: Gross fixed capital formation (P.51) consists of resident
producers' acquisitions, less disposals, of fixed assets during
a given period plus certain additions to the value of non-
produced assets realized by the productive activity of
producer or institutional units. Fixed assets are tangible or
intangible assets produced as outputs from processes of
production that are themselves used repeatedly, or continu-
ously, in processes of production for more than one year.
3.103. Gross fixed capital formation consists of both positive and negative
values:
(a) positive values:
1. new or existing fixed assets purchased;
2. fixed assets produced and retained for producers' own use
(including own account production of fixed assets not yet
completed or fully mature);
3. new or existing fixed assets acquired through barter;
4. new or existing fixed assets received as capital transfers in kind;
5. new or existing fixed assets acquired by the user under a financial
lease;1996R2223 — EN — 07.08.2003 — 008.001 — 80
▼M2
▼B
▼B
6. major improvements to fixed assets and existing historic monu-
ments;
7. natural growth of those natural assets that yield repeat products;
(b) negative values, i.e. disposals of fixed assets recorded as negative
acquisitions:
1. existing fixed assets sold;
2. existing fixed assets surrendered in barter;
3. existing fixed assets surrendered as capital transfers in kind.
3.104. The disposals components of fixed assets exclude:
(a) consumption of fixed capital (which includes anticipated normal
accidental damage);
(b) exceptional losses, such as those due to drought or other natural
disasters (recorded as another change in the volume of assets).
3.105. The following types of gross fixed capital formation may be distin-
guished:
(a) acquisitions, less disposals, of tangible fixed assets:
1. dwellings;
2. other buildings and structures;3. machinery and equipment;
4. and cultivated assets, e.g. trees and livestock;
(b) acquisitions, less disposals, of intangible fixed assets:
1. mineral exploration;
2. computer software;
3. entertainment, literary or artistic originals;
4. other intangible fixed assets;
(c) major improvements to tangible non-produced assets, in particular
those pertaining to land (though the acquisition of non-produced
assets is not included);
(d) costs associated with the transfers of ownership of non-produced
assets, like land and patented assets (though the acquisition of these
assets themselves is not included).
3.106. Major improvements to land include:
(a) reclamation of land from sea by the construction of dikes, sea walls or
dams for this purpose;
(b) clearance of forests, rocks, etc. to enable land to be used in production
for the first time;
(c) draining of marshes or the irrigation of deserts by the construction of
dikes, ditches and irrigation channels;
(d) prevention of flooding or erosion by the sea or rivers by the
construction of breakwaters, sea walls or flood barriers.
These activities may lead to the creation of substantial new structures such
as sea walls, flood barriers and dams but these are not themselves used
directly to produce other goods and services in the way that most
structures are. Their construction is undertaken to obtain more or better
land, and it is the land, a non-produced asset, that is needed for
production. For example, a dam built to produce electricity serves quite a
different purpose from a dam built to keep out the sea. Only building the
latter type of dam should be classified as an improvement to land.
3.107. Gross fixed capital formation includes borderline cases like:
(a) acquisitions of houseboats, barges, mobile homes and caravans used
as residences of households and any associated structures such as
garages;
(b) structures and equipment used by the military (similar to those utilised
by civilian producers) such as airfields, docks, roads and hospitals;
(c) light weapons and armoured vehicles used by non-military units;
(d) changes in livestock used in production year after year, such as
breeding stock, dairy cattle, sheep reared for wool and draught
animals;
(e) changes in trees that are cultivated year after year, such as fruit trees,
vines, rubber trees, palm trees, etc.;1996R2223 — EN — 07.08.2003 — 008.001 — 81
▼B
(f) improvements to existing fixed assets that go well beyond the
requirements of ordinary maintenance and repairs;
(g) the acquisition of fixed assets by financial leasing.
3.108. Gross fixed capital formation excludes:
(a) transactions included in intermediate consumption, like:
1. purchase of small tools for production purposes (see paragraph
3.70.e);
2. ordinary maintenance and repairs;3. purchase of military weapons and their supporting systems;
4. the purchase of fixed assets to be used under an operational leasing
contract (see also Annex II ‘Leasing and hire purchase of durable
goods’);
(b) transactions recorded as changes in inventories:
1. animals raised for slaughter, including poultry;
2. trees grown for timber (work-in-progress).
(c) machinery and equipment acquired by households for purposes of
final consumption (final consumption expenditure);
(d) holding gains and losses on fixed assets (other changes in assets);
(e) catastrophic losses on fixed assets (other changes in assets), e.g.
destruction of cultivated assets and livestock by outbreaks of disease
(and not normally covered by insurance) or damage due to abnormal
flooding, wind damage or forest fires (see chapter 6).
3.109. Gross fixed capital formation in the form of improvements to existing
fixed assets is to be classified with acquisitions of new fixed assets of the
same kind.
3.110. Intangible fixed assets typically consist of new information, specialized
knowledge, etc. and comprise:
(a) mineral exploration comprising costs of actual test drilling, aerial or
other surveys, transportation costs, etc.;
(b) computer software and large data bases to be used in production for
more than one year;
(c) literary and artistic originals of manuscripts, renderings, models,
films, sound recordings, etc.
3.111. For both fixed assets and non-produced non-financial assets, the costs of
ownership transfer incurred by their new owner consist of:
(a) charges incurred in taking delivery of the asset (new or existing asset)
at the required location and time, such as transport charges,
installation charges, erection charges, etc.;
(b) professional charges or commissions incurred, such as fees paid to
surveyors, engineers, lawyers, valuers, etc., and commissions paid to
estate agents, auctioneers, etc.;
(c) taxes payable by the new owner on the transfer of ownership of the
asset.
All these costs are to be recorded as gross fixed capital formation by the
new owner. Note that the taxes are to be treated as taxes on the services of
intermediaries and not as taxes on the asset bought.
TIME OF RECORDING AND VALUATION OF GROSS FIXED CAPITAL
FORMATION
3.112. Gross fixed capital formation is recorded when the ownership of the fixed
assets is transferred to the institutional unit that intends to use them in
production.
Modification to this general rule is needed in case of:
(a) financial leasing (a change of ownership is then imputed);
(b) own-account fixed capital formation.
Assets acquired under a financial lease are recorded as if the user becomes
the owner when he takes possession of the goods. Own account capital
formation is recorded when produced.
3.113. Gross fixed capital formation is valued at purchasers' prices including
installation charges and other costs of ownership transfer. When produced
on own-account it is valued at the basic prices of similar fixed assets1996R2223 — EN — 07.08.2003 — 008.001 — 82
▼B
(which implies a mark-up for net operating surplus or mixed income) or at
the costs of production if such prices are not available.
3.114. Acquisitions of intangible fixed assets are valued in different ways:
(a) for mineral exploration: by the costs of actual test drillings and
borings, and the costs incurred to make it possible to carry out tests,
such as aerial or other surveys;
(b) for computer software: by purchasers' prices when purchased on the
market, or at its estimated basic price (or at its costs of production if
not feasible) when developed in-house;
(c) for entertainment, literary or artistic originals: valued at the price paid
by the purchaser when it is sold, or if not sold, at the basic price paid
for similar originals, its production costs or discounted value of the
future receipts expected from using it in production.
3.115. Disposals of existing fixed assets by sale are valued at the (basic) prices
after deducting any costs of ownership transfer incurred by the seller.
3.116. Costs of ownership transfer can apply to both produced assets, including
fixed assets, and non-produced assets, such as land.
These costs are integrated in the purchasers' prices in the case of produced
assets. They must be separated from the purchases and sales themselves in
the case of land and other non-produced assets and recorded under a
separate heading in the classification of gross fixed capital formation.
CHANGES IN INVENTORIES (P.52)
3.117. Definition: Changes in inventories are measured by the value of the
entries into inventories less the value of withdrawals and the
value of any recurrent losses of goods held in inventories.
3.118. Due to physical deterioration, or accidental damage or pilfering, recurrent
losses may occur to all kinds of goods in inventories, such as:
(a) losses of materials and supplies;
(b) losses in the case of work-in-progress;
(c) losses of finished goods;
(d) losses of goods for resale (e.g. shoplifting).
3.119. Inventories consists of the following categories:
(a) materials and supplies:
materials and supplies consist of all commodities held in stock with
the intention of using them as intermediate inputs in production; this
includes commodities held in stock by the government. Items such asgold, diamonds, etc. are included when intended for industrial use or
other production;
(b) work-in-progress:
work-in-progress consists of output produced that is not yet finished.
It is recorded in the inventories of its producer. It can take a variety of
different forms, e.g.:
1. growing crops;
2. maturing trees and livestock;3. uncompleted structures (except those produced under a contract of
sale agreed in advance or on own-account which are treated as
fixed capital formation);
4. uncompleted other fixed assets, e.g. ships and oil rigs;5. partially completed research for a legal or consultant's dossier;6. partially completed film productions;7. partially completed computer programs.Work-in-progress must be recorded for any production process that is
not finished at the end of the given period. In particular, this is
significant in quarterly accounts, e.g. agricultural crops not being
completed within a quarter of a year.
Reductions in work-in-progress take place when the production
process is completed. At that point, all work-in-progress is
transformed into a finished product;
(c) finished goods:
finished goods as part of inventories consist of outputs that their
producer does not intend to process further before supplying them1996R2223 — EN — 07.08.2003 — 008.001 — 83
▼B
(also when supplied for intermediate input into other processes of
production);
(d) goods for resale:
goods for resale are goods acquired for the purpose of reselling them
in their present state.
TIME OF RECORDING AND VALUATION OF CHANGES IN INVEN-
TORIES
3.120. The time of recording and valuation of changes in inventories should be
consistent with that of other transactions in products. This applies in
particular to intermediate consumption (e.g. for materials and supplies),
output (e.g. work-in-progress and output from storage of agricultural
products) and gross fixed capital formation (e.g. work-in-progress).
Consistency is also required for processing-to-order flows. For example, if
goods are processed abroad and it involves a substantial physical change
in the goods, the goods are to be included in exports (and, later, in
imports) (see paragraph 3.135). This export is reflected by a concomitant
reduction in the inventories and the related import is later also recorded as
an increase in the inventories (when not immediately used or sold).
3.121. Changes in inventories should be valued at the time of entering the
inventories (for goods entering) or at the time of withdrawal (for goods
withdrawn).
3.122. The prices used should be consistent with those of other flows, implying
more specifically that:
(a) output of finished goods transferred into the producer's inventories are
valued as if they were sold at that time, at current basic prices;
(b) additions to work-in-progress is valued in proportion to the estimated
current basic price of the finished product;
(c) reductions in work-in-progress as withdrawn from inventories when
production is finished are valued at current basic prices of the
unfinished product;
(d) goods transferred out of inventories for sale are valued at basic prices;
(e) goods for resale entering the inventories of wholesalers and retailers,
etc. are valued at their actual or estimated purchasers' prices of the
trader;
(f) goods for resale withdrawn from inventories are valued at the
purchasers' prices at which they can be replaced at the time they are
withdrawn (not when acquired).
3.123. Losses as a result of physical deterioration, insurable accidental damage or
pilfering are recorded and valued as follows:
(a) for materials and supplies: as materials and supplies actually
withdrawn to be used up in production (intermediate consumption);
(b) for work-in-progress: as deduction from the additions accruing to
production carried out in the same period;
(c) for finished goods and goods for resale: treated as withdrawals at the
current price of undeteriorated goods.
3.124. The previous paragraphs have described the conceptually correct
valuation of each individual transaction in and out of inventories
necessary to be consistent with the valuation of output, intermediate
consumption and final uses. In practice, this will often prove too difficult
to apply and approximation methods should be used:
(a) when changes in the volume of inventories are fairly regular, a
practical method which comes close to the theoretical valuation
principle is to multiply the volume change of the inventories by the
average prices for the period (purchasers' prices for inventories held
by users or by wholesalers or retailers, basic prices for inventories
held by their producers);
(b) in case the prices of the goods involved remain fairly constant, even
large fluctuations in the volume of inventories may not invalidate a
simple approximation, i.e. the multiplication of the volume change
with the average price;
(c) if both the volume and the prices of the inventories change
substantially within the accounting period, more sophisticated
approximation methods are required. For example, quarterly valuation
of the changes in inventories or the use of a priori information about
the distribution of the fluctuation within the accounting period1996R2223 — EN — 07.08.2003 — 008.001 — 84
▼B
(fluctuations may be largest at the end of the calendar year, during
harvest time, etc.);
(d) if only information about the values at the beginning and end of the
period are available (e.g. in case of wholesale or retail trade in which
inventories often exist of many different products), the changes in
volume between the beginning and end of the period should also be
estimated. This can be done by estimating (assuming) turn-over rates
by type of product.
Note that seasonal changes in prices may partly reflect a difference in
quality, e.g. clearance prices or off-season prices for fruit and vegetables.
These changes in quality should be treated as changes in the volume.
ACQUISITIONS LESS DISPOSALS OF VALUABLES (P.53)
3.125. Definition: Valuables are non-financial goods that are not used primarily
for production or consumption, do not deteriorate (physi-
cally) over time under normal conditions and that are
acquired and held primarily as stores of value.
3.126. Valuables encompass the following types of goods:
(a) precious stones and metals, such as diamonds, non-monetary gold,
platinum, silver, etc.;
(b) antiques and other art objects, such as paintings, sculptures, etc.;
(c) other valuables, such as jewellery fashioned out of precious stones
and metals and collectors items.
These types of goods are to be recorded as acquisition or disposal of
valuables in case of:
(a) the acquisition or disposal of non-monetary gold, silver, etc. by
(central) banks and other financial intermediaries;
(b) the acquisition or disposal of these goods by enterprises whose
principal or secondary activity does not involve the production or
trade in such types of goods; as a consequence, this acquisition or
disposal is not included in the intermediate consumption or fixed
capital formation of these enterprises;
(c) the acquisition or disposal of such goods by households; as a
consequence, such acquisitions are not included in final consumption
expenditure by households.
In the ESA, by convention also the following cases are recorded as
acquisition or disposal of valuables:
(a) the acquisition or disposal of these goods by jewellers and art dealers
(following the general definition of valuables the acquisition of these
goods by jewellers and art dealers should be recorded as changes in
inventories);
(b) the acquisition or disposal of these goods by museums (following the
general definition of valuables the acquisition by a museum of these
goods should be recorded as fixed capital formation).
This convention avoids frequent reclassification between the three main
types of capital formation, i.e. between acquisition less disposal of
valuables, fixed capital formation and changes in inventories, e.g. in the
case of transactions of such goods between households and art dealers.
3.127. The production of valuables is valued at basic prices (see paragraph 3.67
on production of originals). All other acquisitions of valuables are valued
at the purchasers' prices paid for them, including any agents' fees or
commissions. They also include trade margins when bought from dealers.
Disposals of valuables are valued at the prices received by sellers, after
deducting any fees or commissions paid to agents or other intermediaries.
Disregarding the production of valuables, in aggregate, acquisitions less
disposals between resident sectors cancel out, leaving only agents or
dealers margins.
IMPORTS AND EXPORTS OF GOODS AND SERVICES (P.6 and P.7)
3.128. Definition: Exports of goods and services consist of transctions in goods
and services (sales, barter, gifts or grants) from residents to
non-residents.
3.129. Definition: Imports of goods and services consist of transactions in
goods and services (purchases, barter, gifts or grants) from
non-residents to residents.1996R2223 — EN — 07.08.2003 — 008.001 — 85
▼B
3.130. Imports and exports of goods and services do not include:
(a) establishment trade, i.e.:
1. deliveries to non-residents by non-resident affiliates of resident
enterprises, e.g. sales abroad by foreign affiliates of a multinational
owned/controlled by residents;
2. deliveries to residents by resident affiliates of non-resident
enterprises, e.g. sales by domestic affiliates of a foreign multi-
national;
(b) primary income flows to or from the rest of the world, such as
compensation of employees, interest and revenues from direct
investment. The revenues from direct investment may include an
indistinguishable part for the provision of various services, e.g.
training of employees, management services and the use of patents
and trade marks;
(c) the sale or purchase of financial assets or non-produced assets, like
land and patents.
3.131. Imports and exports of goods and services should be distinguished into:
(a) Intra-European Union deliveries;
(b) Imports and exports outside the European Union.
For convenience they will both be referred to as imports and exports here.
IMPORTS AND EXPORTS OF GOODS (P.61 and P.71)
3.132. Imports and exports of goods occur when there are changes of ownership
of goods between residents and non-residents (whether or not there are
also corresponding physical movements of goods across frontiers).
3.133. However, in four instances the change of ownership principle is modified
in recording imports and exports of goods:
(a) financial leasing: a change of ownership from lessor to lessee is to be
imputed for goods under a financial lease; it is to be recorded when
the lessee takes possession of the good (see Annex II ‘Leasing and
hire purchase of durable goods’);
(b) deliveries between affiliated enterprises (branch or subsidiary, or
foreign affiliate): a change of ownership is to be imputed whenever
goods are delivered between affiliated enterprises;
(c) goods for significant processing to order or repair are recorded both in
imports and exports although no change of ownership occurs;
(d) merchanting: no import or export is recorded when merchants or
commodity dealers buy from non-residents and then sell again to non-
residents within the same accounting period. A similar treatment is to
be employed for merchanting by non-residents.
3.134. In the following cases exports of goods occur without the goods ever
crossing the country's frontier.
(a) goods produced by resident units operating in international waters are
sold directly to non-residents in foreign countries (oil, natural gas,
fishery products, maritime salvage, etc.);
(b) transportation equipment or other movable equipment not tied to a
fixed location need not cross the frontier of the exporting country as a
result of being sold by a resident to a non-resident.
(c) goods are lost or destroyed after changing ownership before they have
crossed the frontier of the exporting country.
Analogous cases pertain to imports of goods.
3.135. Imports and exports of goods include transactions between residents and
non-residents in:
(a) non-monetary gold, i.e. gold not used for the purposes of monetary
policy;
(b) silver bullion, diamonds and other precious metals and stones;
(c) paper money and coins not in circulation and unissued securities
(valued as goods, not at face value);
(d) electricity, gas and water;
(e) livestock driven across frontiers;
(f) parcel post;
(g) government exports including goods financed by grants and loans;1996R2223 — EN — 07.08.2003 — 008.001 — 86
▼B
(h) goods transferred to or from the ownership of a buffer stock
organization;
(i) goods delivered by a resident enterprise to its non-resident affiliates;
(j) goods received by a resident enterprise from its non-resident
affiliates;
(k) smuggled goods;
(l) other unrecorded shipments, such as gifts and those of less than a
stated minimum value;
(m) goods processed to order abroad when a substantial physical change
in the goods is involved. Similar goods processed on the domestic
territory on behalf of non-residents;
(n) investment goods repaired abroad when a substantial amount of
reconstruction work or manufacturing is involved. Similar goods
repaired on the domestic territory on behalf of non-residents.
3.136. Imports and exports of goods exclude the following goods which
nevertheless may cross the national frontier:
(a) goods in transit through a country;
(b) goods shipped to or from a country's own embassies, military bases or
other enclaves inside the national frontiers of another country;
(c) transportation equipment and other movable kinds of equipment
which leave a country temporarily, without any change of ownership
(e.g. construction equipment for installation or construction purposes
abroad);
(d) equipment and other goods which are sent abroad for minor
processing, maintenance, servicing or repair;
(e) other goods which leave a country temporarily, being generally
returned within a year in their original State and without change of
ownership (e.g. goods sent abroad for exhibition and entertainment
purposes, goods under an operating lease, including leases for several
years, goods returned because expected sales did not materialize);
(f) goods on consignment lost or destroyed after crossing a frontier
before change of ownership occurs.
3.137. In principle, imports and exports of goods should be recorded when the
ownership of the goods is transferred. In practice, a change of ownership
is considered to occur at the time the parties to the transaction record it in
their books or accounts. This may not coincide with the various stages of
the contractual process, like:
(a) the time of commitment (contract date);
(b) the time of provision of goods and services and acquisition of a claim
for payment (transfer date);
(c) the time of settlement of that claim (payment date).
3.138. Imports and exports of goods are to be valued free on board at the border
of the exporting country (fob). This value consists of:
(a) the value of the goods at basic prices;
(b) plus the related transport and distributive services up to that point of
the border, including the cost of loading on to a carrier for onward
transportation (where appropriate) (see table 3.4, second column in
the second part of the table);
(c) plus any taxes less subsidies on the goods exported; for intra-
European Union deliveries this includes VAT and other taxes on the
goods paid in the exporting country.
In the supply and use and symmetric input-output tables, imports of goods
for individual product groups have to be valued differently: at the cost-
insurance-freight (cif) price at the border of the importing country.
Definition: The cif price is the price of a good delivered at the frontier of
the importing country, or the price of a service delivered to a
resident, before the payment of any import duties or other
taxes on imports or trade and transport margins within the
country (1).1996R2223 — EN — 07.08.2003 — 008.001 — 87
(1) For the trade and transport margins included, see also table 3.5, third column in second
part of the table.
▼B
3.139. Proxies or substitute measures for the fob value may be necessary under
certain circumstances, such as:
(a) barter of goods should be valued at the basic prices that would have
been received if the goods had been sold for cash;
(b) transactions between affiliated enterprises: as a rule, actual transfer
values should be used. However, if they largely differ from market
prices, they should be replaced by an estimated market priceequivalent, or at least be separately identified for analytical purposes;
(c) goods transferred under a financial lease: the goods should be valued
on the basis of the purchasers' price paid by the lessor (not by the
cumulative value of the rental payments);
(d) imports of goods to be estimated on the basis of customs data (for
extra-European Union trade) or Intrastat-information (for intra-
European Union trade). Both data sources do not apply fob valuation,
they use respectively the cif value at the European Union border and
cif values at the national border. As fob-values are only used at the
most aggregate level and cif-values are used at the product group
level, these modifications have only to be applied at the most
aggregate level, i.e. the cif/fob adjustment;
(e) imports and exports of goods to be estimated on the basis of survey
information or various types of ad hoc information. In such instances,
usually only the total value of sales split out by product can be
obtained. As a consequence, the estimate will be based on purchasers'
prices and not on fob values.
IMPORTS AND EXPORTS OF SERVICES (P.62 and P.72)
3.140. Definition: Exports of services consist of all services rendered by
residents to non-residents.
3.141. Definition: Imports of services consist of all services rendered by non-
residents to residents.
3.142. Exports of services include the following borderline cases:
(a) transportation of exported goods after they have left the frontier of
the exporting country when provided by a resident carrier (cases 2
and 3 in table 3.4);
(b) transportation of imported goods by a resident carrier:
1. up to the frontier of the exporting country when goods are valued
fob to offset the transportation value included in the fob-value
(case 3 in table 3.5);
2. up to the frontier of the importing country when goods are valued
cif to offset the transportation value included in the cif-value
(cases 3 and 2 cif in table 3.5);
(c) transportation of goods by residents on behalf of non-residents which
does not involve imports or exports of the goods (e.g. the transport of
goods that do not leave the country as exports or the transport of
goods outside the domestic territory);
(d) international or national passenger transportation on behalf of non-
residents by resident carriers;
(e) minor processing and repair activities on behalf of non-residents;
(f) construction services when a construction site office abroad is not
treated as a quasi-corporation. This applies to construction projects
lasting less than a year and whose output is not gross fixed capital
formation (see paragraph 2.09 and in particular the corresponding
note (4));
(g) installation of equipment abroad when a project is of limited duration
by its nature;
(h) financial services by the amount of the explicit commissions and
fees;
(i) insurance services by the amount of the service charge;
(j) expenditure by non-resident tourists and business travellers (by
convention classified as services; however, for the purposes of the
supply and use and symmetric input-output tables, a global break-
down by products may be necessary);
(k) expenditure by non-residents on health and education services
provided by residents; this includes the provision of these services
on the domestic territory as well as abroad;1996R2223 — EN — 07.08.2003 — 008.001 — 88
▼B
(l) services of owner-occupied holiday homes of non-residents (see
paragraph 3.64);
(m) royalties and licence fees, receipts of which are associated with the
authorized use of intangible non-produced non-financial assets and
property rights, such as patents, copyrights, trademarks, industrial
processes, franchises, etc., and with the use through licensing
agreements of produced originals or prototypes, such as manuscripts,
paintings, etc.
3.143. For imports of services most borderline cases are the mirror-image of
those for exports of services; therefore, only a limited number of specific
clarifications are necessary for imports of services.
3.144. Imports of transport services include the following borderline cases:
(a) transportation of exported goods up to the frontier of the exporting
country when provided by a non-resident carrier to offset the
transportation value included in the fob-value of the exported goods
(case 4 in table 3.4);
(b) transportation of imported goods by a non-resident carrier:
1. from the frontier of the exporting country as a separate
transportation service when imported goods are valued fob (cases
4 and 5 fob in table 3.5);
2. from the frontier of the importing country as a separate
transportation service when imported goods are valued cif (in
this case the value of the transportation service between the
frontiers of the exporting and the importing country is already
included in the cif-value of the good; case 4 in table 3.5);
(c) transportation of goods by non-residents on behalf of residents which
does not involve imports or exports of goods (e.g. transport of goods
in transit or transport outside the domestic territory);
(d) international or national passenger transportation on behalf of
residents by non-resident carriers.
Imports of transport services do not include transportation of exported
goods after they have left the frontier of the exporting country when
provided by a non-resident carrier (cases 5 and 6 in table 3.4). Exports of
goods are valued fob and all such transport services are thus to be
regarded as transactions between non-residents, i.e. between a non-
resident carrier and a non-resident importer. This applies even when these
transportation services are paid under export-cif-contracts by the exporter.
3.145. Imports in respect of direct purchases abroad by residents cover all
purchases of goods and services made by residents while travelling abroad
for business or personal purposes. Two categories must be distinguished
because they require different treatment:
(a) expenditures by business travellers are intermediate consumption;
(b) expenditures by other travellers on personal trips are household final
consumption expenditure.
3.146. Imports and exports of services are recorded at the time at which they are
rendered, which mostly coincides with the time at which services are
produced. Imports of services are to be valued at purchasers' price and
exports of services at basic prices.
Table 3.4 — The treatment of transportation of exported goods
Explanation of how to read this table: the first part of this table indicates
that there are six different possibilities of transportation of exported
goods, depending on whether the carrier is resident or not and depending
on where the transport takes place: from a place on the domestic territory
to the national border, from the national border to the border of the
importing country or from the border of the importing country to a place
within the importing country. In the second part of this table, for each of
these six possibilities, it is indicated whether they are to be recorded as
exports of goods, exports of services, imports of goods or imports of
services.
Domestic territory Territory in between Territory of importing country
1. resident carrier ⇒ 2. resident carrier ⇒ 3. resident carrier ⇒
4. non-resident carrier ⇒ 5. non-resident carrier ⇒ 6. non-resident carrier ⇒1996R2223 — EN — 07.08.2003 — 008.001 — 89
▼B
Exports of goods
(fob)Exports of servicesImports of goods
(cif/fob)Imports of services
1X — — —
2— X — —
3— X — —
4X — — X
5 ————
6 ————
Table 3.5 — The treatment of transportation of imported goods
Explanation of how to read this table: the first part of this table indicates
that there are six different possibilities of transportation of imported
goods, depending on whether the carrier is resident or not and depending
on where the transport takes place: from a place in the exporting country
to the border of this exporting country, from the border of the exporting
country to the border of the importing country and from the border of the
importing country to a place within the importing country. In the second
part of this table, for each of these six possibilities, it is indicated whether
they are to be recorded as imports of goods, imports of services, exports of
goods or exports of services. In some instances (cases 2 and 5), this
recording depends on the valuation principle applied for imported goods.
Domestic territory Territory in between Territory of exporting country
1. resident carrier ⇐ 2. resident carrier ⇐ 3. resident carrier ⇐
4. non-resident carrier ⇐ 5. non-resident carrier ⇐ 6. non-resident carrier ⇐
Valuation of
imported goodsImports of
goodsImports of
servicesExports of
goods (fob)Exports of
services
1 cif/fob — — — —
2 fob — — — —
cif X — — X
3 cif/fob X — — X
4 cif/fob — X — —
5 fob — X — —
cif X — — —
6 cif/fob X — — —
Note that the transition from valuation of imported goods at cif to fob
consists of:
(a) cif/fob adjustment, i.e. from 2 cif to 2 fob (reduces total imports and
exports);
(b) cif/fob reclassification, i.e. from 5 cif to 5 fob (leaves total imports
and exports unchanged).
TRANSACTIONS IN EXISTING GOODS
3.147. Definition: Existing goods are goods that already have had a user (other
than inventories).
3.148. Existing goods include:
(a) existing buildings and other fixed capital goods which are sold by
producer units to other units:
1. to be re-used as such;1996R2223 — EN — 07.08.2003 — 008.001 — 90
▼B
2. to be demolished or broken up; the resulting products usually
become raw materials (e.g. scrap iron) used for the production of
new goods (e.g. steel);
(b) valuables which are sold from one unit to another;
(c) existing consumer durables which are sold by households or military
authorities to other units:
1. to be re-used as such;
2. to be broken up and converted into demolition materials;
(d) existing non-durable goods (e.g. waste paper, rags, old clothes, old
bottles, etc.) which are sold by any unit, either to be used again or to
become raw material for the manufacture of new goods (recovered
goods).
3.149. The transfer of existing goods is recorded as a negative expenditure
(acquisition) for the seller and a positive expenditure (acquisition) for the
purchaser.
3.150. This has the following consequences:
(a) when the sale of an existing fixed asset or valuable takes place
between two resident producers, the positive and negative values
recorded for gross fixed capital formation cancel out for the economy
as a whole except for the costs of ownership transfer;
(b) when an existing immovable fixed asset (e.g. a building) is sold to a
non-resident, by convention the latter is treated as purchasing a
financial asset, i.e the equity of a notional resident unit. This notional
resident unit is then deemed to purchase the fixed asset. As a
consequence; the sale and purchase of the fixed asset takes place
between residents;
(c) when an existing movable fixed asset, such as a ship or aircraft, is
exported, no positive gross fixed capital formation is recorded
elsewhere in the economy to offset the seller's negative gross fixed
capital formation;
(d) some durable goods, such as vehicles, may be classified as fixed
assets or as consumer durables depending upon the owner and the
purpose for which they are used. If, therefore, the ownership of such a
good is transferred from an enterprise to a household to be used for
final consumption, negative gross fixed capital formation is recorded
for the enterprise and positive consumption expenditure for the
household. In the less common case where ownership of such a good
is transferred from a household to an enterprise, for the household
negative final consumption expenditure should be recorded and for
the enterprise positive gross fixed capital formation;
(e) transactions in existing valuables are to be recorded as the acquisition
of a valuable (positive gross capital formation) by the purchaser and
as the disposal of a valuable (negative gross capital formation) by the
seller. In case of a transaction with the rest of the world, the import or
export of a good is to be recorded (see paragraph 3.135). The sale of a
valuable by a household is not to be recorded as negative final
consumption expenditure;
(f) when existing military durables are sold abroad by the government,
this should be recorded as an export of goods and as negative
intermediate (and final) consumption by the government.
3.151. For the selling costs incurred by the former owner (costs of ownership
transfer), a holding loss has to be recorded. A similar entry is to be made
for the part of his original acquisition costs that has not been written down
as consumption of fixed capital.
3.152. Transactions in existing goods should be recorded at the time ownership
changes. The valuation principles to be applied are those appropriate to
the type(s) of transactions in products involved.1996R2223 — EN — 07.08.2003 — 008.001 — 91
▼B
CHAPTER 4
DISTRIBUTIVE TRANSACTIONS
4.01. Definition: Distributive transactions consist of transactions by means of
which the value added-generated by production is distributed
to labour, capital and government, and of transactions
involving the redistribution of income and wealth.
The system draws a distinction between current and capital transfers, with
the latter deemed to redistribute saving or wealth rather than income.
COMPENSATION OF EMPLOYEES (D.1)
4.02. Definition: Compensation of employees (D.1) is defined as the total
remuneration, in cash or in kind, payable by an employer to
an employee in return for work done by the latter during the
accounting period.
Compensation of employees is broken down into:
(a) wages and salaries (D.11):
— wages and salaries in cash;
— wages and salaries in kind;
(b) employers' social contributions (D.12):
— employers' actual social contributions (D.121);
— employers' imputed social contributions (D.122).
WAGES AND SALARIES (D.11)
Wages and salaries in cash
4.03. Wages and salaries in cash include the values of any social contributions,
income taxes, etc. payable by the employee even if they are actually
withheld by the employer and paid directly to social insurance schemes,
tax authorities, etc. on behalf of the employee:
Wages and salaries in cash include the following kinds of remuneration:
(a) basic wages and salaries payable at regular intervals;
(b) enhanced rates of pay for overtime, night work, weekend work,
disagreeable or hazardous circumstances;
(c) cost of living allowances, local allowances and expatriation
allowances;
(d) bonuses based on productivity or profits, Christmas and New Year
bonuses excluding employee social benefits (see paragraph 4.07. c),
‘13th to 14th month’ pay (annual supplementary pay);
(e) allowances for transport to and from work, excluding allowances or
reimbursement of employees for travelling, separation, removal and
entertainment expenses incurred in the course of their duties (see
paragraph 4.07. a);
(f) holiday pay for official holidays or annual holidays;
(g) commissions, tips, attendance and directors' fees paid to employees;(h)ad hoc bonuses or other exceptional payments linked to the overall
performance of the enterprise made under incentive schemes;
(i) payments made by employers to their employees under saving
schemes;
(j) exceptional payments to employees who leave the enterprise, if those
payments are not linked to a collective agreement;
(k) housing allowances paid in cash by employers to their employees.
Wages and salaries in kind
4.04. Definition: Wages and salaries in kind consist of good and services, or
other benefits, provided free or at reduced prices by
employers, that can be used by employees in their owntime and at their own discretion, for the satisfaction of their
own needs or wants or those of other members of their
households. Those goods and services, or other benefits, are
not necessary for the employers' production process. For the
employees, those wages and salaries in kind represent an
additional income: they would have paid a market price if
they had bought these goods or services by themselves.1996R2223 — EN — 07.08.2003 — 008.001 — 92
▼B
4.05. The most common are:
(a) meals and drinks, including those consumed when travelling on
business (because they would have been taken anyway) but excluding
special meals or drinks necessitated by exceptional working
conditions. Price reductions obtained in free or subsidized canteens,
or obtained by luncheon vouchers, are to be included in wages and
salaries in kind;
(b) own account and purchased housing or accommodation services of a
type that can be used by all members of the household to which the
employee belongs;
(c) uniforms or other forms of special clothing which employees choose
to wear frequently outside of the workplace as well as at work;
(d) the services of vehicles or other durables provided for the personal use
of employees;
(e) goods and services produced as outputs from the employer's own
processes of production, such as free travel for the employees of
railways or airlines, free coal for miners, or free food for employees in
agriculture;
(f) the provision of sports, recreation or holiday facilities for employees
and their families;
(g) transportation to and from work, except when organized in the
employer's time, car parking;
(h) crèches for the children of employees;
(i) payments made by employers to works councils or similar bodies;
(j) bonus shares distributed to employees;
(k) remuneration in kind may also include the value of the interest
foregone by employers when they provide loans to employees at
reduced, or even zero, rates of interest. This value may be estimated
as the amount the employee would have to pay if average mortgage
(when buying houses) or consumer loan (when buying other goods
and services) interest rates were charged, less the amount of interest
actually paid. An imputed payment from the employee is rerouted in
the primary distribution of income account back to the employer.
4.06. Goods and services, or other advantages, should be valued at basic prices
when produced by the employer, and at purchasers' prices when purchased
by the employer (that is, the price actually paid by the employer).
When provided free, the whole value of the wages and salaries in kind is
calculated according to the basic prices (or purchasers' prices of the
employer when purchased by him) of the goods and services, or other
advantages, in question.
When provided at reduced prices, the value is given by the difference
between the calculation explained above and the amount paid by the
employee.
4.07. Wages and salaries do not include:
(a) expenditure by employers which is to their own benefit as well as to
that of their employees, because it is necessary for the employers'
production process:
1. allowances or reimbursement of employees for travelling, separa-
tion, removal and entertainment expenses incurred in the course of
their duties;
2. expenditure on providing amenities at the place of work, medical
examinations required because of the nature of the work, supplying
working clothes which are worn exclusively, or mainly, at work;
3. accommodation services at the place of work of a kind which
cannot be used by the households to which the employees belong
— cabins, dormitories, huts and so on;
4. special meals or drinks necessitated by exceptional working
conditions;
5. allowances paid to employees for the purchase of tools, equipment
or special clothing needed exclusively, or primarily, for their work,
or that part of their wages or salaries which, under their contracts
of employment, employees are required to devote to such
purchases.
Such expenditure on goods and services that employers are obliged to
provide to their employees in order for them to be able to carry out
their work is treated as intermediate consumption by employers.1996R2223 — EN — 07.08.2003 — 008.001 — 93
▼B
(b) The amounts of wages and salaries which employers continue to pay
to their employees temporarily in the case of sickness, maternity,
industrial injury, disability, redundancy, etc. These payments are
treated as unfunded employee social benefits (D.623), with the same
amounts being shown under employers' imputed social contributions
(D.122);
(c) other unfunded employee social benefits, in the form of children's,
spouses', family, education or other allowances in respect of
dependants, and in the form of the provision of free medical services
(other than those necessitated by the nature of the work) to employees
or their families;
(d) any taxes payable by the employer on the wage and salary bill — for
example, a payroll tax. Such taxes are treated as other taxes on
production.
EMPLOYERS' SOCIAL CONTRIBUTIONS (D.12)
4.08. An amount equal to the value of the social contributions incurred by
employers in order to secure for their employees the entitlement to social
benefits needs to be recorded under compensation of employees.
Employers' social contributions may be either actual or imputed.
Employers' actual social contributions (D.121)
4.09. Definition: Employers' actual social contributions (D.121) consist of the
payments made by employers for the benefit of their
employees to insurers (social security funds and private
funded schemes). These payments cover statutory, conven-
tional, contractual and voluntary contributions in respect of
insurance against social risks or needs (see paragraph 4.92.a)
Although paid directly by employers to the insurers, these employers'
contributions are treated as a component of the compensation of
employees, who are then deemed to pay them over to the insurers.
Employers' imputed social contributions (D.122)
4.10. Definition: Employers' imputed social contributions (D.122) represent
the counterpart to unfunded social benefits (less eventual
employees' social contributions) paid directly by employers
to their employees or former employees and other eligible
persons (1) without involving an insurance enterprise or
autonomous pension fund, and without creating a special
fund or segregated reserve for the purpose.
The fact that certain social benefits are paid directly by employers, and
not through the medium of social security funds or other insurers, in no
way detracts from their character as social welfare benefits. However,
since the costs of these benefits form part of employers' labour costs, they
should also be included in the compensation of employees.
4.11. In the accounts of the sectors, the costs of direct social benefits appear
first among uses in the generation of income account, as a component of
the compensation of employees, and a second time among uses in the
secondary distribution of income account, as social benefits. In order to
balance the latter account, it is assumed that the households of employees
pay back to the employers' sectors the employers' imputed social
contributions which finance together with eventual employees' social
contributions the direct social welfare benefits provided to them by these
same employers. This notional circuit is similar to that for employers'
actual social contributions, which pass through the accounts of households
and are then deemed to be paid by them to the insurers.
For the valuation of employers' imputed social contributions, the amount
of which does not necessarily coincide with that of direct social benefits,
reference should be made to heading D.612.
4.12. Time of recording of compensation of employees:
(a) wages and salaries (D.11) are recorded in the period during which the
work is done. However, ad hoc bonuses or other exceptional
payments, 13th month, etc. are recorded when they are due to be paid;1996R2223 — EN — 07.08.2003 — 008.001 — 94
(1) Employers' imputed social contributions include an amount equal in value to the wages
and salaries which employers temporarily continue to pay in the event of the sickness,maternity, industrial injury, disability, redundancy, etc. of their employees, if that
amount can be separated.
▼B
(b) employers' actual social contributions (D.121) are recorded in the
period during which the work is done;
(c) employers' imputed social contributions (D.122):
1. representing the counterpart of compulsory direct social benefits
are recorded in the period during which the work is done;
2. representing the counterpart of voluntary direct social benefits are
recorded at the time these benefits are provided.
4.13. The compensation of employees may consist of:
(a) the compensation of resident employees by resident employers;
(b) the compensation of resident employees by non-resident employers;
(c) the compensation of non-resident employees by resident employers.
These different items are recorded in the ESA as follows:1. the compensation of resident and non-resident employees by resident
employers groups together items (a) and (c) and appears among uses in
the generation of income account of the sectors and industries to which
the employers belong;
2. the compensation of resident employees by resident and non-resident
employers groups together items (a) and (b) and appears among
resources in the allocation of primary income account of households;
3. item (b), compensation of resident employees by non-resident
employers, appears among uses in the external account of primary
incomes and current transfers;
4. item (c), compensation of non-resident employees by resident
employers appears, among resources in the external account of primary
incomes and current transfers.
TAXES ON PRODUCTION AND IMPORTS (D.2)
4.14. Definition: Taxes on production and imports (D.2) consist of compul-
sory, unrequited payments, in cash or in kind which are
levied by general government, or by the institutions of the
European Union, in respect of the production and importa-tion of goods and services, the employment of labour, the
ownership or use of land, buildings or other assets used in
production. These taxes are payable whether or not profits
are made.
4.15. Taxes on production and imports are divided into:
(a) taxes on products (D.21):
1. value-added type taxes (VAT) (D.211);
2. taxes and duties on imports excluding VAT (D.212):
— import duties (D.2121),
— taxes on imports excluding VAT and import duties (D.2122);
3. taxes on products, except VAT and import taxes (D.214);
(b) other taxes on production (D.29).
TAXES ON PRODUCTS (D.21)
4.16. Definition: Taxes on products (D.21) are taxes that are payable per unit
of some good or service produced or transacted. The tax may
be a specific amount of money per unit of quantity of a good
or service, or it may be calculated ad valorem as a specified
percentage of the price per unit or value of the goods and
services produced or transacted. As a general principle, taxes
in fact assessed on a product, irrespective of which
institutional unit pays the tax, are to be included in taxes
on products, unless specifically included in another heading.
Value-added type taxes (VAT) (D.211)
4.17. Definition: A value-added type tax (VAT) is a tax on goods or services
collected in stages by enterprises and which is ultimately
charged in full to the final purchasers.
This heading value-added type taxes (D.211) comprises the value-added
tax which is collected by the general government and which is applied to
national and imported products, as well as, where appropriate, other1996R2223 — EN — 07.08.2003 — 008.001 — 95
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deductible taxes applied under similar rules to those governing VAT, for
simplicity henceforth called ‘VAT’.
Producers are obliged to pay only the difference between the VAT on
their sales and the VAT on their purchases for their own intermediate
consumption or gross fixed capital formation.
VAT is recorded net in the sense that:
(a) outputs of goods and services and imports are valued excluding
invoiced VAT;
(b) purchases of goods and services are recorded inclusive of non-
deductible VAT. VAT is recorded as being borne by purchasers, not
sellers, and then only by those purchasers who are not able to deduct
it. The greater part of VAT is therefore recorded in the system as
being paid on final uses, mainly on household consumption. A part of
VAT may, however, be paid by enterprises, mainly by those which are
exempted from VAT.
For the total economy, VAT is equal to the difference between total
invoiced VAT and total deductible VAT (see point 4.27).
Taxes and duties on imports excluding VAT (D.212)
4.18. Definition: Taxes and duties on imports excluding VAT (D.212)
comprise compulsory payments levied by general govern-
ment or the institutions of the European Union on imported
goods, excluding VAT, in order to admit them to free
circulation on the economic territory, and on services
provided to resident units by non-resident units.
These payments include:
(a) import duties (D.2121): these consist of customs duties, or other
import charges, payable according to customs tariff schedules on
goods of a particular type when they enter for use in the economic
territory of the country of utilization;
(b) taxes on imports, excluding VAT and import duties (D.2122).
This heading includes:
1. levies on imported agricultural products;
2. monetary compensatory amounts levied on imports;3. excise duties and special taxes on certain imported products,
provided such duties and taxes on similar products of domestic
origin are paid by the producer branch itself;
4. general sales taxes payable on imports of goods and services;5. taxes on specific services provided by non-resident enterprises to
resident units within the economic territory;
6. profits of public enterprises exercising a monopoly over the
imports of some good or service, which are transferred to the State.
Net taxes and duties on imports excluding VAT are calculated by
deducting import subsidies (D.311) from taxes and duties on imports
excluding VAT (D.212).
Taxes on products, except VAT and import taxes (D.214)
4.19. Definition: Taxes on products, except VAT and import taxes (D.214)
consist of taxes on goods and services that become payable
as a result of the production, export, sale, transfer, leasing or
delivery of those goods or services, or as a result of their use
for own consumption or own capital formation.
4.20. This heading includes, in particular:
(a) excise duties and consumption taxes (other than those included in
taxes and duties on imports);
(b) stamp taxes on the sale of specific products, such as alcoholic
beverages or tobacco, and on legal documents or cheques;
(c) taxes on financial and capital transactions, payable on the purchase or
sale of non-financial and financial assets, including foreign exchange.
They become payable when the ownership of land or other assets
changes, except as a result of capital transfers (mainly inheritances
and gifts). They are treated as taxes on the services of intermediaries;1996R2223 — EN — 07.08.2003 — 008.001 — 96
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(d) car registration taxes;
(e) taxes on entertainment;
(f) taxes on lotteries, gambling and betting, other than those on winnings;
(g) taxes on insurance premiums;(h) other taxes on specific services: hotels or lodging, housing services,
restaurants, transportation, communication, advertising;
(i) general sales or turnover taxes (excluding VAT type taxes): these
include manufacturers' wholesale and retail sales taxes, purchase
taxes, turnover taxes;
(j) profits of fiscal monopolies which are transferred to the State, except
those exercising a monopoly over the imports of some good or
services (included in D.2122). Fiscal monopolies are public
enterprises which have been granted a legal monopoly over the
production or distribution of a particular kind of good or service in
order to raise revenue and not in order to further the interests of public
economic or social policy. When a public enterprise is granted
monopoly powers as a matter of deliberate economic or social policy
because of the special nature of the good or service or the technology
of production — for example, public utilities, post offices and
telecommunications, railways and so on — it should not be treated as
a fiscal monopoly. As a general rule, fiscal monopolies are typically
engaged in the production of goods or services which may be heavily
taxed in other countries; they tend to be confined to the production of
certain consumer goods (alcoholic beverages, tobacco, matches, etc.)
or fuels;
(k) export duties and monetary compensatory amounts collected on
exports.
4.21. Net taxes on products are obtained by deducting subsidies on products
(D.31) from taxes on products (D.21).
OTHER TAXES ON PRODUCTION (D.29)
4.22. Definition: Other taxes on production (D.29) consist of all taxes that
enterprises incur as a result of engaging in production,
independent of the quantity or value of the goods and
services produced or sold.
They may be payable on the land, fixed assets or labour employed in the
production process or on certain activities or transactions.
4.23. Other taxes on production (D.29) include in particular:
(a) taxes on the ownership or use of land, buildings, or other structures
utilized by enterprises in production (including owner-occupiers of
dwellings);
(b) taxes on the use of fixed assets (vehicles, machinery, equipment) for
purposes of production, whether such assets are owned or rented;
(c) taxes on the total wage bill and payroll taxes;
(d) taxes on international transactions (travel abroad, foreign remittances,
or similar transactions with non-residents) for purposes of production;
(e) taxes paid by enterprises in order to obtain business and professional
licences if those licences are being granted automatically on payment
of the amounts due. However, if the government carries out checks on
the suitability or safety of the business premises, on the reliability or
safety of the equipment employed, on the professional competence of
the staff employed, or on the quality or standard of goods or services
produced as a condition for granting such a licence, the payments are
treated as purchases of services rendered, unless the amounts charged
for the licences are out of all proportion to the costs of the checks
carried out by the government;
(f) taxes on pollution resulting from production activities. These consist
of taxes levied on the emission or discharge into the environment of
noxious gases, liquids or other harmful substances. They do not
include payments made for the collection and disposal of waste or
noxious substances by public authorities, which constitute inter-
mediate consumption of enterprises;
(g) under-compensation of VAT resulting from the flat rate system,
frequently found in agriculture.
4.24. This heading excludes taxes on the personal use of vehicles etc. by
households, which are recorded under current taxes on income, wealth,
etc.1996R2223 — EN — 07.08.2003 — 008.001 — 97
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TAXES ON PRODUCTION AND IMPORTS PAID TO THE INSTITUTIONS
OF THE EUROPEAN UNION
4.25. The taxes on production and imports paid to the institutions of the
European Union include, in particular:
(a) taxes paid directly by resident producer units to the institutions of the
European Union (the ECSC levy on mining and iron and steel
producing enterprises);
(b) taxes collected by national governments on behalf of the institutions
of the European Union, namely:
1. receipts from the common agricultural policy;
levies on imported agricultural products, monetary compensatory
amounts levied on exports and imports, sugar production levies
and the tax on isoglucose, co-responsibility taxes on milk and
cereals;
2. receipts from trade with third countries: customs duties levied on
the basis of the Integrated Tariff of the European Union (Taric);
3. receipts from VAT in each Member State.
4.26. Recording of taxes on production and imports: taxes on production and
imports are recorded when the activities, transactions or other events
occur which create the liabilities to pay taxes.
4.27. However, some economic activities, transactions or events, which under
tax legislation ought to impose on the units concerned the obligation to
pay taxes, permanently escape the attention of the tax authorities. It would
be unrealistic to assume that such activities, transactions or events give
rise to financial assets or liabilities in the form of payables or receivables.
For this reason, the amounts to be recorded in the system are determined
by the amounts due for payment only when evidenced by tax assessments,
declarations or other instruments which create liabilities in the form of
clear obligations to pay on the part of taxpayers. The system does not
impute missing taxes not evidenced by tax assessments.
Taxes recorded in the accounts may be derived from two sources: amounts
evidenced by assessments and declarations or cash receipts.
(a) If assessments and declarations are used, the amounts shall be
adjusted by a coefficient reflecting assessed and declared amounts
never collected. As an alternative treatment, a capital transfer, to the
relevant sectors could be recorded equal to the same adjustment. The
coefficients shall be estimated on the basis of past experience and
current expectations in respect of assessed and declared amounts
never collected. They shall be specific to different types of taxes.
(b) If cash receipts are used, they shall be time-adjusted so that the cash is
attributed when the activity took place to generate the tax liability.
This adjustment may be based on the average time difference between
the activity and cash tax receipt.
4.28. The total value of the taxes which should be recorded includes any interest
charged on arrears of taxes due and any fines imposed by taxation
authorities if it is impossible to record such interest and fines separately
from taxes; it also includes any charges which may be imposed in
connection with the collection or recovery of taxes outstanding.
Correspondingly, it is reduced by the amount of any tax rebates made
by general government as a matter of economic policy and any tax refunds
made as a result of over-payments.
4.29. In the system of accounts, taxes on production and imports (D.2) appear:
(a) among uses in the generation of income account of the total economy;
(b) among resources in the allocation of primary income account of the
general government sector and in the external account of primary
incomes and current transfers.
Taxes on products are recorded as resources in the goods and services
account of the total economy. This enables the resources of goods and
services — valued exclusive of taxes on products — to be balanced with
the uses, which are valued inclusive of these taxes.
Other taxes on production (D.29) appear among uses in the generation of
income accounts of the industries or sectors which pay them.1996R2223 — EN — 07.08.2003 — 008.001 — 98
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SUBSIDIES (D.3)
4.30. Definition: Subsidies (D.3) are current unrequited payments which
general government or the institutions of the European
Union make to resident (1) producers, with the objective of
influencing their levels of production, their prices or the
remuneration of the factors of production.
Other non-market producers can receive other subsidies on
production only if those payments depend on general
regulations applicable to market and non-market producers
as well. By convention, subsidies on products are not
recorded on other non-market output (P.13).
4.31. Subsidies granted by the institutions of the European Union cover only
current transfers made directly by them to resident producer units.
4.32. Subsidies are classified into:
(a) subsidies on products (D.31):
1. import subsidies (D.311);
2. other subsidies on products (D.319);
(b) other subsidies on production (D.39).
SUBSIDIES ON PRODUCTS (D.31)
4.33. Definition: Subsidies on products (D.31) are subsidies payable per unit
of a good or service produced or imported. The subsidy may
be a specific amount of money per unit of quantity of a good
or service, or it may be calculated ad valorem as a specified
percentage of the price per unit. A subsidy may also be
calculated as the difference between a specified target price
and the market price actually paid by a buyer. A subsidy on a
product usually becomes payable when the good is
produced, sold or imported. By convention, subsidies on
products can only pertain to market output (P.11) or to
output for own final use (P.12).
Import subsidies (D.311)
4.34. Definition: Import subsidies (D.311) consist of subsidies on goods and
services that become payable when the goods cross the
frontier for use in the economic territory or when the
services are delivered to resident institutional units. They
may include losses incurred as a matter of deliberate
government policy by government trading organizations
whose function is to purchase products from non-residents
and then sell them at lower prices to residents.
Other subsidies on products (D.319)
4.35. Other subsidies on products (D.319) include:
(a) subsidies on products used domestically: these consist of subsidies
payable to resident producers in respect of their production which is
used or consumed within the economic territory;
(b) losses of government trading organizations whose function is to buy
the products of resident producers and then sell them at lower prices
to residents or non-residents, when they are incurred as a matter of
deliberate government economic or social policy;
(c) subsidies to public corporations and quasi-corporations to compensate
for persistent losses which they incur on their productive activities as
a result of charging prices which are lower than their average costs of
production as a matter of deliberate government or European
economic and social policy;
(d) direct subsidies on exports payable directly to resident producers
when the goods leave the economic territory or the services are
provided to non-residents — except repayments at the customs
frontier of taxes on products previously paid and waiving of the taxes
that would be due if the goods were to be sold or used inside the
economic territory.1996R2223 — EN — 07.08.2003 — 008.001 — 99
(1) Subsidies are granted by the institutions of the European Union to units resident
anywhere in the Community.
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OTHER SUBSIDIES ON PRODUCTION (D.39)
4.36. Definition: Other subsidies on production (D.39) consist of subsidies
except subsidies on products which resident producer units
may receive as a consequence of engaging in production.
For their other non-market output, other non-market
producers can receive other subsidies on production only if
those payments from general government depend on general
regulations applicable to market and non-market producers
as well.
4.37. This heading includes in particular:
(a) subsidies on payroll or work force: these consist of subsidies payable
on the total wage or salary bill, or total work force, or on the
employment of particular types of persons such as physically
handicapped persons or persons who have been unemployed for
long periods, or on the costs of training schemes organized or
financed by enterprises;
(b) subsidies to reduce pollution: these consist of current subsidies
intended to cover some or all of the costs of additional processing
undertaken to reduce or eliminate the discharge of pollutants into the
environment;
(c) grants for interest relief made to resident, producer units, even when
they are intended to encourage capital formation (1). In effect, these
are current transfers designed to lighten producers' operating costs.
They are treated in the accounts as subsidies to the producers
benefiting from them, even when the difference in the interest is, in
practice, paid directly by the government to the credit institution
making the loan;
(d) over-compensation of VAT resulting from the flat rate system,
frequently found in agriculture.
4.38. The following are not treated as subsidies:
(a) current transfers from general government to households in their
capacity as consumers. These are treated either as social benefits or as
miscellaneous current transfers (D.75);
(b) current transfers between different parts of general government in
their capacity as producers of non-market goods and services, except
other subsidies on production (D.39). The current transfers are shown
under the heading current transfers within general government (D.73);
(c) investment grants (D.92);
(d) extraordinary payments into social insurance funds, in so far as these
payments are designed to increase the actuarial reserves of these
funds. Such payments are shown under the heading other capital
transfers (D.99);
(e) transfers made by general government to non-financial corporations
and quasi-corporations to cover losses accumulated over several
financial years, or exceptional losses due to factors outside the control
of the enterprise, are classified under the heading other capital
transfers (D.99);
(f) the cancellation of debts which producer units have incurred towards
the government (resulting, for example, from loans advanced by a
government agency to a non-financial enterprise which has accumu-
lated trading losses over several financial years). In general, these
transactions are treated in the accounts as other capital transfers
(D.99) (see paragraph 4.165.f);
(g) payments made by general government or by the rest of the world for
damage to, or losses of, capital goods as a result of acts of war, other
political events or national disasters are shown under the heading
other capital transfers (D.99);
(h) shares and other equities in corporate enterprises purchased by general
government, which are shown under the heading shares and other
equity (AF.5);
(i) payments made by a general government agency which has assumed
responsibility for abnormal pension charges affecting a public1996R2223 — EN — 07.08.2003 — 008.001 — 100
(1) However, when a grant serves the dual purpose of financing both the amortization of the
debt and the payment of interest on it, and when it is not possible to apportion it between
the two elements, the whole of the grant is treated as an investment grant.
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enterprise. These payments must be recorded under miscellaneous
current transfers (D.75);
(j) payments made by general government to market producers to pay
entirely, or in part, for goods and services that those market producers
provide directly and individually to households in the context of
social risks or needs (see paragraph 4.84), and to which the
households have a legally established right. These payments are
included in individual consumption expenditure of general govern-
ment (P.31) and subsequently in social benefits in kind (D.631) and
actual individual consumption of households (P.41).
4.39. Time of recording: Subsidies are recorded when the transaction or the
event (production, sale, import, etc.) which gives rise to the subsidy
occurs.
Particular cases:
(a) subsidies which take the form of the difference between the purchase
price and the selling price charged by a government trading agency
are recorded at the time the goods are bought by the agency, if the
selling price is known at that time;
(b) subsidies intended to cover a loss incurred by a producer are recorded
at the time the general government agency decides to cover the loss.
4.40. In the system of accounts, subsidies appear:
(a) among negative uses in the generation of income account of the total
economy;
(b) among negative resources in the allocation of primary income account
of the general government sector and in the external account of
primary incomes and current transfers.
Subsidies on products are recorded as negative resources in the goods and
services account of the total economy. This enables the resources of goods
and services to be balanced with the uses.
Other subsidies on production (D.39) appear among negative uses in the
generation of income accounts of the industries or sectors which receive
them.
Consequences of a system of multiple exchange rates on taxes on
production and imports and on subsidies: multiple exchange rates are not
currently applicable among the Member States of the European Union. In
such a system:
(a) implicit taxes on imports are treated as taxes on imports excluding
VAT and import duties (D.2122);
(b) implicit taxes on exports are treated as taxes on products, except VAT
and import taxes (D.214);
(c) implicit subsidies on imports are treated as import subsidies (D.311);
(d) implicit subsidies on exports are treated as other subsidies on products
(D.319).
PROPERTY INCOME (D.4)
4.41. Definition: Property income (D.4) is the income receivable by the owner
of a financial asset or a tangible non-produced asset in return
for providing funds to, or putting the tangible non-produced
asset at the disposal of, another institutional unit.
Property incomes are classified in the following way in the system:
(a) interest (D.41);
(b) distributed income of corporations (D.42):
1. dividends (D.421);
2. withdrawals from income of quasi-corporations (D.422);
(c) reinvested earnings on direct foreign investment (D.43);
(d) property income attributed to insurance policy holders (D.44);
(e) rents (D.45).
INTEREST (D.41)
4.42. Definition: Under the terms of the financial instrument agreed between
them, interest (D.41) is the amount that the debtor becomes1996R2223 — EN — 07.08.2003 — 008.001 — 101
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liable to pay to the creditor over a given period of time
without reducing the amount of principal outstanding.
4.43. Creditors lend funds to debtors that lead to creation of one or other of the
financial instruments listed below.
This form of property income is receivable by the owners of certain kinds
of financial assets:
(a) deposits (AF.2);
(b) securities other than shares (AF.3);
(c) loans (AF.4);
(d) other accounts receivable (AF.7).
Interest on deposits, loans and accounts receivable and payable
4.44. The interest receivable and payable on these financial assets and liabilities
is determined by applying the relevant rate of interest to the principal
outstanding at each point of time throughout the accounting period.
Interest on securities
Interest on bills and similar short-term instruments
4.45. The difference between the face value and the price paid at the time of
issue (i.e. the discount) measures the interest payable over the life of the
bill. The increase in the value of a bill due to the accumulation of accrued
interest does not constitute a holding gain because it is due to an increase
in the principal outstanding and not a change in the price of the asset.
Other changes in the value of the bill are treated as holding gains/losses.
Interest on bonds and debentures
4.46. Bonds and debentures are long-term securities that give the holder the
unconditional right to: a fixed or contractually determined variable money
income in the form of coupon payments, or a stated fixed sum on a
specified date or dates when the security is redeemed, or both these two
terms.
(a) zero-coupon bonds: there are no coupon payments. The interest based
on the difference between the redemption price and the issue price has
to be distributed over the years to the maturity of the bond. The
interest accruing each year is reinvested in the bond by its holder, thus
counterpart entries equal to the value of the accrued interest must be
recorded in the Financial Account as the acquisition of more bond by
the holder and as a further issue of more bond by the issuer or debtor
(i.e. as a growth in the ‘volume’ of the original bond);
(b) other bonds, including deep-discounted bonds. The interest has two
components:
1. the amount of the money income receivable from coupon
payments each period;
2. the amount of interest accruing each period attributable to the
difference between the redemption price and the issue price,
calculated in the same way as for zero-coupon bonds;
(c) index-linked securities: the amounts of the coupon payments and/or
the principal outstanding are linked to a price index. The change in
the value of the principal outstanding between the beginning and the
end of a particular accounting period due to the movement in the
relevant index is treated as interest accruing in that period, in addition
to any interest due for payment in that period. The interest accruing as
a result of the indexing is effectively reinvested in the security and
must be recorded in the financial accounts of the holder and issuer.
Interest rate swaps and forward rate agreements
4.47. No payment resulting from any kind of swap arrangement is to be
considered as interest and recorded under property income. (See
paragraphs 5.67(d) and 5.139(c) relative to financial derivatives).
Similarly, transactions under forward rate agreements are not to be
recorded as property income. (See paragraph 5.67(e)).1996R2223 — EN — 07.08.2003 — 008.001 — 102
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Interest on financial leases
4.48. A financial lease is an alternative to lending as a method of financing the
purchase of machinery and equipment. It is a contract which channels
funds from a lender to a borrower: the lessor purchases the equipment and
the lessee contracts to pay rentals which enable the lessor, over the period
of the contract, to recover all, or virtually all, of his costs including
interest.
The lessor is treated as making a loan to the lessee equal to the value of
the purchaser's price paid for the asset, this loan being gradually paid off
in full over the period of the lease. The rental paid each period by the
lessee is therefore treated as having two components: a repayment ofprincipal and a payment of interest. The rate of interest on the imputed
loan is implicitly determined by the total amount paid in rentals over the
life of the lease in relationship to the purchaser's price of the asset. The
share of the rental that represents interest gradually declines over the life
of the lease as the principal is repaid. The initial loan by the lessee,
together with the subsequent repayments of principal, are recorded in the
Financial Accounts of the lessor and lessee. The interest payments are
recorded under interest in their respective Primary Distribution of Income
Accounts.
Other interest
4.49. The following are also treated as interest:
(a) interest charged on bank overdrafts, extra interest paid on deposits left
longer than originally agreed, and payments to certain bond holders
which are determined by lottery;
(b) interest received by mutual funds (see paragraph 2.51.b), from the
investments they have made, and which is assigned to shareholders,
even if it is capitalized. It excludes holding gains or losses on
financial instruments belonging to unit trusts, which are not recorded
as property income.
Time of recording
4.50. Interest is recorded on an accrual basis: that is, interest is recorded as
accruing continuously over time to the creditor on the amount of principal
outstanding. The interest accruing in each accounting period must be
recorded whether or not it is actually paid or added to the principal
outstanding. When it is not actually paid, the increase in the principal
must also be recorded in the Financial Account as a further acquisition of
that kind of financial asset by the creditor and an equal acquisition of a
liability by the debtor.
4.51. Interest is to be recorded before the deduction of any taxes levied on it.
Interest received and paid is always recorded inclusive of grants for
interest relief, even if those grants are directly paid to financial institutions
and not to the beneficiaries (see subsidies).
The value of the services provided by financial intermediaries not being
allocated among different customers, the actual payments or receipts of
interest to or from financial intermediaries are not adjusted to eliminate
the margins that represent the implicit charges made by financial
intermediaries. An adjustment item is needed in the allocation of primary
income account of financial intermediaries and of a nominal industry to
which, by convention, the whole output of financial intermediaries is
allocated as intermediate consumption.
4.52. In the system of accounts, interest is shown:
(a) among resources and among uses in the allocation of primary income
account of the sectors (
1);
(b) among resources and among uses in the external account of primary
incomes and current transfers.1996R2223 — EN — 07.08.2003 — 008.001 — 103
(1) This practice differs from that of most business accounting, where interest paid is
normally shown as a fixed charge similar to other costs of production in the operating
account.
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DISTRIBUTED INCOME OF CORPORATIONS (D.42)
Dividends (D.421)
4.53. Definition: Dividends (D.421) are a form of property income received
by owners of shares (AF.5) to which they become entitled as
a result of placing funds at the disposal of corporations.
Raising equity capital through the issue of shares is an
alternative way of raising funds to borrowing. In contrast toloan capital, however, equity capital does not give rise to a
liability that is fixed in monetary terms and it does not entitle
the holders of shares of a corporation to a fixed or
predetermined income.
4.54. This heading also includes:
(a) shares issued to shareholders in payment of the dividend for the
financial year. However, issues of bonus shares which represent the
capitalization of own funds in the form of reserves and undistributed
profits and give rise to new shares to shareholders in proportion for
their holdings are not included;
(b) dividends received by mutual funds (see paragraph 2.51.b) from the
investments they have made, and which are assigned to shareholders,
even if they are capitalized. It excludes holding gains or losses on
financial instruments belonging to unit trusts, which are not recorded
as property income;
(c) the income paid to general government by public enterprises which
are recognized as independent legal entities though not formally
constituted as corporate enterprises.
4.55. Time of recording: dividends are recorded at the time they are due to be
paid as determined by the corporation.
In the system of accounts, dividends appear:
(a) among uses in the allocation of primary income account of the sectors
in which the corporations are classified;
(b) among resources in the allocation of primary income account of the
sectors in which shareholders are classified;
(c) among uses and resources in the external account of primary incomes
and current transfers.
Withdrawals from the income of quasi-corporations (D.422)
4.56. Definition: Withdrawals from the income of quasi-corporations (D.422)
consist of the amounts which entrepreneurs actually with-
draw for their own use from the profits earned by the quasi-
corporations which belong to them.
4.57. These amounts are to be recorded before the deduction of any current
taxes on income, wealth, etc. which are deemed always to be paid by the
owners of the businesses.
4.58. When a quasi-corporation makes a trading profit, the unit which owns it
may choose to leave part or all of the profit in the business, especially for
investment purposes. This income left in the business appears as saving by
the quasi-corporation, and only the profits actually withdrawn by the
owner units are recorded in the accounts under the heading withdrawals
from the income of quasi-corporations.
4.59. When profits are earned in the rest of the world by the branch-offices,
agencies, etc. of resident enterprises, in so far as these branch-offices etc.
are treated as non-resident units, retained earnings appear as reinvested
earnings on direct foreign investment (D.43). Only the income actually
transferred to the parent enterprise is treated in the accounts as
withdrawals from the income of quasi-corporations received from the
rest of the world. The same principles are applied to deal with the
relations between branch-offices, agencies, etc. operating on the economic
territory and the non-resident parent enterprise to which they belong.
4.60. This heading includes the net operating surplus received by residents as
owners of land and buildings in the rest of the world, or by non-residents
as owners of land or buildings on the economic territory. In effect, in
respect of all transactions in land and buildings carried out on the
economic territory of a country by non-resident units, the latter are
considered, in accordance with the conventions adopted in the ESA, to be
notional resident units in which the non-resident owners own the equity.1996R2223 — EN — 07.08.2003 — 008.001 — 104
▼B
The rental value of owner-occupied dwellings abroad is registered as
imports of services and the corresponding net operating surplus as primary
income received from the rest of the world; the rental value of owner-
occupied dwellings belonging to non-residents is registered as exports of
services and the corresponding net operating surplus as primary income
paid to the rest of the world.
4.61. The heading withdrawals from the income of quasi-corporations does not
include amounts which their owners receive:
(a) from the sale of existing fixed capital goods;
(b) from the sale of land and intangible assets;
(c) from withdrawals of capital (e.g. the total or partial liquidation of
their equity in the quasi-corporation).
These amounts are treated as withdrawals from equity in the financial
account. Conversely, any funds provided by the owner(s) of a quasi-
corporation for the purpose of acquiring assets or reducing its liabilities is
treated as additions to its equity. However, if the quasi-corporation is
owned by government, and if it runs a persistent operating deficit as a
matter of deliberate government economic and social policy, any regular
transfers of funds into the enterprise made by government to cover its
losses should be treated as subsidies.
4.62. Time of recording: withdrawals from the income of quasi-corporations are
recorded when they are made by the owners.
4.63. In the system of accounts, withdrawals from the income of quasi-
corporations appear:
(a) among uses in the allocation of primary income account of the sectors
in which the quasi-corporations are classified;
(b) among resources in the allocation of primary income account of the
owner sectors;
(c) among uses and resources in the external account of primary incomes
and current transfers.
REINVESTED EARNINGS ON DIRECT FOREIGN INVESTMENT (D.43)
4.64. Definition: Reinvested earnings on direct foreign investment (D.43) are
equal to:
the operating surplus of the direct foreign investment
enterprise
plus any property incomes or current transfers receivable
minus any property incomes or current transfers payable,
including actual remittances to foreign direct inves-
tors and any current taxes payable on the income,
wealth, etc., of the direct foreign investment
enterprise.
4.65. A direct foreign investment enterprise is an incorporated or unincorpo-
rated enterprise in which an investor resident in another economy owns
10 % or more of the ordinary shares or voting power (for an incorporated
enterprise) or the equivalent (for an unincorporated enterprise). Direct
foreign investment enterprises comprise those entities that are identified
as subsidiaries (investor owns more than 50 %), associates (investor owns
50 % or less) and branches (wholly or jointly owned unincorporated
enterprises), either directly or indirectly owned by the investor.
Consequently, ‘direct foreign investment enterprises’ is a broader concept
than ‘foreign controlled corporations’.
4.66. Actual distributions may be made out of the entrepreneurial income of
direct foreign investment enterprises in the form of dividends or
withdrawals of income from quasi-corporations.
In addition, retained earnings are treated as if they were distributed and
remitted to foreign direct investors in proportion to their ownership of the
equity of the enterprise and then reinvested by them.
Reinvested earnings on direct foreign investment can be either positive or
negative.1996R2223 — EN — 07.08.2003 — 008.001 — 105
▼B
4.67. Time of recording: reinvested earnings on direct foreign investment are
recorded when they are earned.
In the system of accounts, reinvested earnings on direct foreign
investment appear:
(a) among uses and resources in the allocation of primary income account
of the sectors;
(b) among uses and resources in the external account of primary incomes
and current transfers.
PROPERTY INCOME ATTRIBUTED TO INSURANCE POLICY HOLDERS
(D.44)
4.68. Definition: Property income attributed to insurance policy holders
corresponds to total primary incomes received from the
investment of insurance technical reserves. Insurance
technical reserves are invested by insurance enterprises and
pension funds in financial assets or land (from which net
property income, i.e. after deducting any interest paid, is
received) or in buildings (which generate net operating
surpluses). Any net income received that results from the
investment of insurance enterprises' own funds is to be
excluded in proportion to the ratio between own funds and a
sum of own funds and insurance technical reserves.
4.69. Since technical reserves are assets of insurance policy holders, the receipts
from investing them are shown in the accounts as being paid by insurance
enterprises and pension funds to the policy holders in the form of property
income attributed to insurance policy holders.
As this income is retained by insurance enterprises and pension funds in
practice, it is therefore treated as being paid back to the insurance
enterprises and pension funds in the form of premium and contribution
supplements that are additional to actual premiums and contributions
payable.
These premium and contribution supplements on non-life insurance
policies and on life insurance policies taken out under social insurance
schemes are recorded together with the actual premiums and contributions
in the secondary distribution of income accounts of the units concerned.
The premium supplements on individual life insurance not taken out under
social insurance schemes, like the actual premiums, are not current
transfers and are therefore not recorded in the secondary distribution of
income accounts. They are directly included as one of the elements
contributing to the change in the ‘net equity of households in life
insurance reserves and in pension funds reserves’ recorded in the financial
accounts of the units concerned.
4.70. Time of recording: property income attributed to insurance policy holders
is recorded when it accrues.
4.71. In the system of accounts, the property income attributed to insurance
policy holders appears:
(a) among resources in the allocation of primary income account of
policy holders;
(b) among uses in the allocation of primary income account of the
insurers;
(c) among resources and among uses in the external account of primary
incomes and current transfers.
RENTS (D.45)Rents on land
4.72. The rent received by a landowner from a tenant constitutes a form of
property income.
This heading also includes the rents payable to the owners of inland
waters and rivers for the right to exploit such waters for recreational or
other purposes, including fishing.
A landowner may be liable to pay land taxes or incur certain maintenance
expenses solely as a consequence of owning the land. By convention, such
taxes and expenses are treated as payable by the person entitled to use the
land, who is deemed to deduct them from the rent that he would otherwise
be obliged to pay to the landowner.1996R2223 — EN — 07.08.2003 — 008.001 — 106
▼B
4.73. Rents on land do not include the rentals of buildings and of dwellings
situated on it; those rentals are treated as the payment for a market service
provided by the owner to the tenant of the building or dwelling, and are
shown in the accounts as the intermediate or final consumption of the
tenant unit. If there is no objective basis on which to split the payment
between rent on land and rental on the buildings situated on it, the whole
amount is treated as rent when the value of the land is believed to exceed
the value of the buildings on it and as rental otherwise.
Rents on sub-soil assets
4.74. This heading includes the royalties that accrue to owners of deposits of
minerals or fossil fuels (coal, oil or natural gas) who grant leases to other
institutional units permitting them to explore or to extract such deposits
over a specified period of time.
4.75. Time of recording of rents: rents are recorded in the period when payable.
4.76. In the system of accounts, rents are recorded:
(a) among resources and among uses in the allocation of primary income
account of sectors;
(b) among resources and among uses in the external account of primary
incomes and current transfers.
CURRENT TAXES ON INCOME, WEALTH, ETC. (D.5)
4.77. Definition: Current taxes on income, wealth, etc. (D.5) cover all
compulsory, unrequited payments, in cash or in kind, levied
periodically by general government and by the rest of the
world on the income and wealth of institutional units, and
some periodic taxes which are assessed neither on the
income nor the wealth.
Current taxes on income, wealth, etc. are divided into:
(a) taxes on income (D.51);
(b) other current taxes (D.59).
TAXES ON INCOME (D.51)
4.78. Definition: Taxes on income (D.51) consist of taxes on incomes, profits
and capital gains. They are assessed on the actual or
presumed incomes of individuals, households, corporations
or NPIs. They include taxes assessed on holdings of
property, land or real estate when these holdings are used
as a basis for estimating the income of their owners.
Taxes on income include:
(a) taxes on individual or household income (income from employment,
property, entrepreneurship, pensions, etc.), including taxes deducted
by employers (pay-as-you-earn taxes). Taxes on the income of owners
of unincorporated enterprises are included here;
(b) taxes on the income or profits of corporations;
(c) taxes on holding gains;
(d) taxes on winnings from lottery or gambling, payable on the amounts
received by winners as distinct from taxes on the turnover of
producers that organize gambling or lotteries which are treated as
taxes on products.1996R2223 — EN — 07.08.2003 — 008.001 — 107
▼B
OTHER CURRENT TAXES (D.59)
4.79. Other current taxes (D.59) include:
(a) current taxes on capital which consist of taxes that are payable
periodically on the ownership or use of land or buildings by owners,
and current taxes on net wealth and on other assets (jewellery, other
external signs of wealth) — except taxes mentioned in D.29 (which
are paid by enterprises as a result of engaging in production) and those
mentioned in D.51 (taxes on income);
(b) poll taxes, levied per adult or per household, independently of income
or wealth;
(c) expenditure taxes, payable on the total expenditures of persons or
households;
(d) payments by households for licences to own or use vehicles, boats or
aircraft (which are not used for business purposes), or for licences to
hunt, shoot or fish, etc. (1);
(e) taxes on international transactions (travel abroad, foreign remittances,
foreign investments, etc.), except those payable by producers and
import duties paid by households.
4.80. Current taxes on income, wealth, etc. do not include:
(a) inheritance taxes, death duties or taxes on gifts inter vivos , which are
deemed to be levied on the capital of the beneficiaries and are shown
under the heading capital taxes (D.91);
(b) occasional or exceptional levies on capital or wealth, which are shown
under the heading capital taxes (D.91);
(c) taxes on land, buildings or other assets owned or rented by enterprises
and used by them for production, such taxes being treated as other
taxes on production (D.29);
(d) payments by households for licences other than licences on the use of
vehicles, boats or aircraft, or licences to hunt, shoot or fish: driving or
pilot's licences, television or radio licences, firearm licences, museum
or library admissions, garbage disposal fees, etc. which are treated in
most cases as purchases of services rendered by government (2).
4.81. The total value of the taxes which should be recorded includes any interest
charged on arrears of taxes due and any fines imposed by taxation
authorities if it is impossible to record such interest and fines separately; it
also includes any charges which may be imposed in connection with the
recovery and assessment of taxes outstanding. Correspondingly, it is
reduced by the amount of any rebates made by general government as a
matter of economic policy and any refunds made as a result of over-
payments.
4.82. Recording of current taxes on income, wealth, etc.: current taxes on
income, wealth, etc. are recorded at the time when activities, transactions
or other events occur which create the liabilities to pay.
However, some economic activities, transactions or events, which under
tax legislation ought to impose on the units concerned the obligation to
pay taxes, permanently escape the attention of the tax authorities. It would
be unrealistic to assume that such activities, transactions or events give
rise to financial assets or liabilities in the form of payables or receivables.
For this reason, the amounts to be recorded in the system are determined
by the amounts due for payment only when evidenced by tax assessments,
declarations or other instruments which create liabilities in the form of
clear obligations to pay on the part of taxpayers. The system does not
impute missing taxes not evidenced by tax assessments.1996R2223 — EN — 07.08.2003 — 008.001 — 108
(1) The borderline between taxes and purchases of services from government is defined
according to the same criteria as those used in the case of payments made by enterprises:if the licences are being granted automatically on payment of the amounts due, theirpayment is treated as taxes. But if the government uses the issue of licences to organizesome proper regulatory function (such as checking the competence, or qualifications, of
the person concerned), the payments made should be treatead as purchases of services
from government rather than payments of taxes, unless the payments are clearly out ofall proportion to the cost of providing the services.
(
2) The borderline between taxes and purchases of services from government is defined
according to the same criteria as those used in the case of payments made by enterprises:
if the licences are being granted automatically on payment of the amounts due, their
payment is treated as taxes. But if the government uses the issue of licences to organizesome proper regulatory function (such as checking the competence, or qualifications, ofthe person concerned), the payments made should be treatead as purchases of servicesfrom government rather than payments of taxes, unless the payments are clearly out of
all proportion to the cost of providing the services.
▼M4
Taxes recorded in the accounts may be derived from two sources: amounts
evidenced by assessments and declarations or cash receipts.
(a) If assessments and declarations are used, the amounts shall be
adjusted by a coefficient reflecting assessed and declared amounts
never collected. As an alternative treatment, a capital transfer to the
relevant sectors could be recorded equal to the same adjustment. The
coefficients shall be estimated on the basis of past experience and
current expectations in respect of assessed and declared amounts
never collected. They shall be specific to different types of taxes.
(b) If cash receipts are used, they shall be time-adjusted so that the cash is
attributed when the activities, transactions or other events took place
to generate the tax liability (or when the amount of tax was
determined, in the case of some income taxes). This adjustment may
be based on the average time difference between the activities,
transactions or other events (or the determination of the amount of
tax) and cash tax receipt.
When retained at source by the employer, current taxes on income,
wealth, etc. should be included in wages and salaries even if the employer
did not in fact pass them on to the general government. The households
sector is then shown as paying the full amount on to the general
government sector. The amounts actually unpaid have to be neutralised
under D.995 as a capital transfer from general government to the
employers' sectors.
In some cases, the liability to pay income taxes can only be determined in
a later accounting period than that in which the income accrues. Some
flexibility is therefore needed in the time at which such taxes are recorded.Income taxes deducted at source, such as PAYE taxes and regular
prepayments of income taxes, may be recorded in the periods in which
they are paid and any final tax liability on income can be recorded in the
period in which the liability is determined.
In the system of accounts, current taxes on income, wealth, etc. are
recorded:
(a) among uses in the secondary distribution of income account of the
sectors in which the taxpayers are classified;
(b) among resources in the secondary distribution of income account of
general government;
(c) among uses and resources in the external account of primary incomes
and current transfers.
SOCIAL CONTRIBUTIONS AND BENEFITS (D.6)
4.83. Definition: Social benefits are transfers to households, in cash or in kind,
intended to relieve them from the financial burden of a
number of risks or needs, made through collectively
organized schemes, or outside such schemes by government
units and NPISHs; they include payments from generalgovernment to producers which individually benefit house-
holds and which are made in the context of social risks or
needs.
4.84. The list of risks or needs which may give rise to social benefits is, by
convention, fixed as follows:
(a) sickness;
(b) invalidity, disability;
(c) occupational accident or disease;
(d) old age;
(e) survivors;
(f) maternity;
(g) family;(h) promotion of employment;
(i) unemployment;
(j) housing (
1);1996R2223 — EN — 07.08.2003 — 008.001 — 109
(1) In the case of housing, payments made by public authorities to tenants in order to reduce
their rents are social benefits, with the exception of special benefits paid by public
authorities in their capacity as employers.▼B
▼B
(k) education;
(l) general neediness.
4.85. Social benefits include:
(a) current and lump-sum transfers from schemes which receive
contributions, cover the entire community or large sections of the
community and are imposed and controlled by government units
(social security schemes);
(b) current and lump sum transfers from schemes organized by
enterprises on behalf of their employees, ex-employees or dependants
(private funded and unfunded enterprises' schemes). Contributions
may be made by employees or employers; they may also be made by
self-employed persons;
(c) current transfers from government units and NPISHs which are not
conditional on previous payment of contributions (assistance).
4.86. Social benefits exclude:
(a) insurance claims based on policies taken out solely on the own
initiative of the insured, independently of his employer or govern-
ment;
(b) insurance claims on policies taken out with the sole purpose of
obtaining a discount, even if those policies follow from a collective
agreement.
4.87. In order for an individual policy to be treated as part of a social insurance
scheme, the eventualities or circumstances against which the participants
are insured must correspond to the risks or needs listed in paragraph 4.84
above, and in addition, one or more of the following conditions must be
satisfied:
(a) participation in the scheme is obligatory either by law for a specified
category of worker, whether employees, self- or non-employed, or
under the terms and conditions of employment of an employee, or
group of employees;
(b) the scheme is a collective one operated for the benefit of a designated
group of workers, whether employees, self- or non-employed,
participation being restricted to members of that group;
(c) an employer makes a contribution (actual or imputed) to the scheme
on behalf of an employee, whether or not the employee also makes a
contribution.
4.88. Social insurance schemes are schemes in which workers are obliged, or
encouraged, by their employers or by general government to take out
insurance against certain eventualities or circumstances that may
adversely affect their welfare or that of their dependants.
Social insurance schemes may be classified according to the following
types:
(a) social security schemes, covering the entire community, or large
sections of the community, that are imposed, controlled and financed
by government units;
(b) private funded schemes, which consist of:
1. schemes in which the social contributions are paid to third parties
(insurance enterprises, autonomous pension funds);
2. schemes in which employers maintain special reserves which are
segregated from their other reserves, even though such schemes do
not constitute separate institutional units from the employers.
These are referred to as non-autonomous pension funds. The
reserves are treated as assets that belong to the beneficiaries and
not the employers;
(c) unfunded schemes in which employers pay social benefits to their
employees, ex-employees or their dependants out of their own
resources without creating special reserves for the purpose.
4.89. Social insurance schemes organized by government units for their own
employees are classified as private funded schemes or unfunded schemes
as appropriate and not as social security schemes.
4.90. Social contributions may be divided into actual contributions payable
under the first two categories of schemes mentioned in paragraph 4.88
above and imputed contributions payable under unfunded schemes.
4.91. Social contributions may be divided into those that are compulsory by law
and those that are not.1996R2223 — EN — 07.08.2003 — 008.001 — 110
▼B
SOCIAL CONTRIBUTIONS (D.61)
Actual social contributions (D.611)
4.92. Actual social contributions include:
(a) employers' actual social contributions (D.611). These correspond to
flow D.121.
Employers' actual social contributions are paid by employers to social
security funds, insurance enterprises or autonomous as well as non-
autonomous pension funds administering social insurance schemes to
secure social benefits for their employees.
As employers' actual social contributions are made for the benefit of
their employees, their value is recorded as one of the components of
compensation of employees together with wages and salaries in cash
and in kind. The social contributions are then recorded as being paid
by the employees as current transfers to the social security funds,
insurance enterprises or autonomous as well as non-autonomous
pension funds;
(b) employees' social contributions (D.6112).
These are social contributions payable by employees to social
security, private funded and unfunded schemes. Employees' social
contributions consist of the actual contributions payable plus, in the
case of private funded schemes, the contribution supplements payable
out of the property income attributed to insurance policy holders
received by employees participating in the schemes, minus the service
charges. All the service charges are treated as charges against the
employees' contributions and not the employers';
(c) social contributions by self-employed and non-employed persons
(D.6113).
These are social contributions payable for their own benefit by
persons who are not employees — namely, self-employed persons
(employers or own-account workers), or non-employed persons. They
also include the value of the contribution supplements payable out of
the property income attributed to insurance policy holders received by
participating individuals that they are recorded as paying back to the
insurance enterprises in addition to their other contributions.
4.93. Payments of actual social contributions may be compulsory by virtue of a
statute or regulation, or they may be paid as a result of collective
agreements in a particular industry or agreements between employer and
employees in a particular enterprise, or because they are written into the
contract of employment itself. In certain cases, the contributions may be
voluntary.
The voluntary contributions referred to here cover:
(a) social contributions which persons who are not, or who are no longer,
legally obliged to contribute pay or continue to pay to a social security
fund;
(b) social contributions paid to insurance enterprises (or friendly societies
and pension funds classified in the same sector) as part of
supplementary insurance schemes organized by enterprises for thebenefit of their employees and which the latter join voluntarily;
(c) contributions to friendly societies with membership open to
employees or self-employed workers.
4.94. To distinguish between social contributions that are compulsory and those
that are not, a supplementary level is introduced in the classification:
(a) compulsory employers' actual social contributions (D.61111);
(b) voluntary employers' actual social contributions (D.61112);
(c) compulsory employees' social contributions (D.61121);
(d) voluntary employees' social contributions (D.61122);
(e) compulsory social contributions by self and non-employed persons
(D.61131);
(f) voluntary social contributions by self and non-employed persons
(D.61132).
4.95. Actual social contributions to social security funds or other government
agencies are recorded gross as distributive transactions.
On the other hand, social contributions paid under private funded schemes
to insurance enterprises, and to friendly societies and autonomous pension1996R2223 — EN — 07.08.2003 — 008.001 — 111
▼B
funds included in the same sector, are recorded net, i.e. after deducting
that part of the contribution which represents the value of the insurance
service provided to (resident and non-resident) households. Under the
conventions adopted, this part of the contribution represents, in effect, the
payment for a market service which forms part of the final consumption of
households or, in the case of contributions paid by non-resident
households, part of exports of services.
In the case of non-autonomous private funded social insurance schemes,
where employers maintain their own segregated reserves, no service
charge is deducted from contributions paid by the employees. As such
schemes do not constitute separate institutional units from the employers,
the costs of managing and administering the funds are assimilated with the
employers' general production costs.
4.96. Time of recording: employers' actual social contributions (D.6111) and
employees' social contributions (D.6112) are recorded at the time when
the work that gives rise to the liability to pay the contributions is carried
out. Social contributions by self-employed and non-employed persons
(D.6113) are recorded when the liabilities to pay are created.
Social contributions payable to the general government sector recorded in
the accounts may be derived from two sources: amounts evidenced byassessments and declarations or cash receipts.
(a) If assessments and declarations are used, the amounts shall be
adjusted by a coefficient reflecting assessed and declared amounts
never collected. As an alternative treatment, a capital transfer to the
relevant sectors could be recorded equal to the same adjustment. The
coefficients shall be estimated on the basis of past experience and
current expectations in respect of assessed and declared amounts
never collected. They shall be specific to different types of social
contributions.
(b) If cash receipts are used, they shall be time-adjusted so that the cash is
attributed when the activity took place to generate the social
contribution liability (or when the liability is created). This adjustment
may be based on the average time difference between the activity (or
the creation of the liability) and cash receipt.
When retained at source by the employer, social contributions payable to
the general government sector should be included in wages and salaries
even if the employer did not in fact pass them on to the general
government. The households sector is then shown as paying the full
amount on to the general government sector. The amounts actually unpaid
have to be neutralised under D.995 as a capital transfer from general
government to the employers' sectors.
4.97. In the system of accounts, actual social contributions are recorded:
(a) among uses in the secondary distribution of income account of
households;
(b) among uses in the external account of primary incomes and current
transfers (in the case of non-resident households);
(c) among resources in the secondary distribution of income account of
resident insurers or employers;
(d) among resources in the external account of primary incomes and
current transfers (in the case of non-resident insurers or employers).
Imputed social contributions (D.612)
4.98. Imputed social contributions (D.612) represent the counterpart to social
benefits (less eventual employees' social contributions) paid directly by
employers (i.e. not linked to employers' actual contributions) to their
employees or former employees and other eligible persons. They
correspond to flow D.122. Their value should, in principle, be based on
actuarial considerations.
4.99. It is necessary to introduce imputed social contributions if the social
benefits distributed directly by employers are to be included in the
accounts under the heading social benefits and if the cost of these benefits
(for the part which is not covered by employees' actual contributions) is to
be included in the compensation of employees paid by the employer.
When employers provide social benefits themselves directly to their
employees, ex-employees or dependants out of their own resources
without involving a social security fund, an insurance enterprise or an
autonomous pension fund, and without creating a special fund or1996R2223 — EN — 07.08.2003 — 008.001 — 112
▼M4
▼B
▼B
segregate reserve for the purpose, beneficiaries may be considered as
being protected against various specific needs, or circumstances, even
though no payments are being made to cover them.
Remuneration should therefore be imputed for employees equal in value
to the amount of social contributions that would be needed to secure the
de facto entitlements to the social benefits they accumulate. These
amounts depend not only on the levels of the benefits currently payable
but also on the ways in which employers' liabilities under such schemes
are likely to evolve in the future as a result of factors such as expected
changes in the numbers, age distribution and life expectancies of their
present and previous employees. Thus, the values that should be imputed
for the contribution ought, in principle, to be based on the same kind of
actuarial considerations that determine the levels of premiums charged by
insurance enterprises. When as a result of political events or economic
changes, the ratio between the number currently employed and the number
receiving pensions changes appreciably and becomes abnormal, the value
of the imputed contributions for current employees should be estimated,
which will be different from the actual value of the pensions paid out. A
reasonable percentage of wages and salaries paid to current employees can
be used for this purpose.
In practice, however, it may be difficult to decide how large such imputed
contributions should be. The enterprise may make estimates itself, perhaps
on the basis of the contributions paid into similar funded schemes, in order
to calculate its likely liabilities in the future. Otherwise, the only practical
alternative may be to use the unfunded social benefits payable by the
enterprise during the same accounting period (after deducting actual
contributions made by employees themselves) as an estimate of the
imputed remuneration that would be needed to cover the imputed
contributions. While there are obviously many reasons why the value of
the imputed contributions that would be needed may diverge from the
unfunded social benefits actually paid in the same period, such as the
changing composition and age structure of the enterprise's labour force,
the benefits actually paid in the current period (less employees' social
contributions) may nevertheless provide sufficient estimates of the
contributions and associated imputed remuneration.
4.100. Employers are recorded, in the generation of income account, as paying to
their existing employees as a component of their compensation an amount
described as imputed social contributions equal in value to the estimated
social contributions that would be needed to provide for the unfunded
social benefits to which they become entitled. Employees are recorded, in
the secondary distribution of income account, as paying back to their
employers the same amount of imputed social contributions (i.e. current
transfers) as if they were paying them to a separate social insurance
scheme.
4.101. Time of recording: imputed social contributions which represent the
counterpart of compulsory direct social benefits are recorded at the time
the obligation to pay the benefits arises.
Imputed social contributions which represent the counterpart of voluntary
direct social benefits are recorded at the time the benefits are provided.
4.102. In the system of accounts, imputed social contributions are recorded:
(a) among uses in the secondary distribution of income account of
households and in the external account of primary incomes and
current transfers;
(b) among resources in the secondary distribution of income account of
the sectors to which the employers belong and in the external account
of primary incomes and current transfers.
SOCIAL BENEFITS OTHER THAN SOCIAL TRANSFERS IN KIND (D.62)
4.103. The heading D.62 is made up of four sub-headings:
Social security benefits in cash (D.621)
They are payable to households by social security funds (excluding
reimbursements, see D.6311).
Those benefits are provided under social security schemes.
Private funded social benefits (D.622)
They are (in cash or in kind), payable to households by insurance
enterprises or other institutional units administering private funded social
insurance schemes.1996R2223 — EN — 07.08.2003 — 008.001 — 113
▼B
Unfunded employee social benefits (D.623)
They are (in cash or in kind), payable to their employees, their dependants
or survivors by employers administering unfunded social insurance
schemes. They typically include:
(a) the continued payment of normal, or reduced, wages during periods of
absence from work as a result of ill health, accident, maternity, etc.;
(b) the payment of family, education or other allowances in respect of
dependants;
(c) the payment of retirement or survivors' pensions to ex-employees or
their survivors, and the payment of severance allowances to workers
or their survivors in the event of redundancy, incapacity, accidental
death, etc. (if linked to collective agreements);
(d) general medical services not related to the employee's work;
(e) convalescent and retirement homes.
Unfunded employee social benefits payable by employers to their former
employees or other eligible persons should be recorded including
employers' actual social contributions, i.e. payments made by the
employers for the benefit of the persons concerned to insurers.
Social assistance benefits in cash (D.624)
They are payable to households by government units or NPISHs to meet
the same needs as social insurance benefits but which are not made under
a social insurance scheme incorporating social contributions and social
insurance benefits. Such benefits do not include current transfers paid in
response to events or circumstances that are not normally covered by
social insurance schemes (i.e. transfers made in response to natural
disasters, recorded under other current transfers or under other capital
transfers).
SOCIAL TRANSFERS IN KIND (D.63)
4.104. Definition: Social transfers in kind (D.63) consist of individual goods
and services provided as transfers in kind to individual
households by government units and NPISHs, whether
purchased on the market or produced as non-market output
by government units or NPISHs. They may be financed out
of taxation, other government income or social security
contributions, or out of donations and property income in the
case of NPISHs.
Although some of the non-market services produced by NPISHs have
some of the characteristics of collective services, all the non-market
services produced by NPISHs are, for simplicity and by convention,
treated as individual in nature. Services provided free, or at prices that are
not economically significant, to households are described as individual
services to distinguish them from collectve services provided to the
community as a whole, or large sections of the community. Individual
services consist mainly of education and health services, although other
kinds of services such as housing services, cultural and recreational
services are also frequently provided.
The heading social transfers in kind (D.63) includes social benefits in kind
and transfers of individual non-market goods or services.
Social benefits in kind (D.631)
4.105. Social benefits in kind are social transfers in kind intended to relieve the
households from the financial burden of social risks or needs (see
paragraph 4.84). They can be subdivided into those where beneficiary
households actually purchase the goods and services themselves and are
then reimbursed, and those where the relevant services are provided
directly to the beneficiaries. In this second case, general government units
or NPISHs produce or purchase, entirely or in part, goods and services
which are directly provided by their producers to the beneficiaries.
Social security benefits, reimbursements (D.6311)
These benefits consist of reimbursement by social security funds of
approved expenditures made by households on specified goods or
services.
When a household purchases a good or service for which it is
subsequently reimbursed, in part or in whole, by a social security fund,
the household can be regarded as if it were acting on behalf of the social1996R2223 — EN — 07.08.2003 — 008.001 — 114
▼B
security fund. In effect, the household provides a short-term credit to the
social security fund that is liquidated as soon as the household is
reimbursed.
The amount of the expenditure reimbursed is recorded as being incurred
directly by the social security fund at the time the household makes the
purchase, while the only expenditure recorded for the household is the
difference, if any, between the purchaser's price paid and the amount
reimbursed. Thus, the amount of the expenditure reimbursed is not treated
as a current transfer in cash from the social security funds to households.
Other social security benefits in kind (D.6312)
These consist of social transfers in kind, except reimbursements, made by
social security funds to households. Most other social security benefits in
kind are likely to consist of medical or dental treatments, surgery, hospital
accommodation, spectacles or contact lenses, medical appliances or
equipment, and similar goods or services in the context of social risks or
needs. The service is provided directly to the beneficiaries, without
reimbursement, by market or non-market producers and should be valued
accordingly. Any payments made by the householders themselves should
be deducted. ►M2 Other social security benefits in kind can be therefore
subdivided into those for which the service is produced by market
producers and purchased by general government units or NPISHs
(D.63121), and those for which the service is produced by non-market
producers (D.63122). ◄
Social assistance benefits in kind (D.6313)
These consist of transfers in kind provided to households by government
units or NPISHs that are similar in nature to social security benefits in
kind but are not provided in the context of a social insurance scheme.
Included are, if not covered by a social insurance scheme, social housing,
dwelling allowance, day nurseries, professional training, reductions on
transport prices (provided that there is a social purpose), and similar goods
and services in the context of social risks or needs. Any payments made
by the householders themselves should be deducted. ►M2 Social
assistance benefits in kind can be therefore subdivided into those for
which the service is produced by market producers and purchased by
general government units or NPISHs (D.63131), and those for which the
service is produced by non-market producers (D.63132). ◄
Transfers of individual non-market goods or services (D.632)
4.106. Definition: Transfers of individual non-market goods or services
(D.632) consist of goods or services provided to individual
households free or at prices which are not economically
significant, by non-market producers or government units or
NPISHs. They correspond to individual consumption
expenditure of NPISHs and government (see paragraph
3.85), less social benefits in kind (D.631) granted to
households under social security or social assistance
arrangements.
4.107. Time of recording of social benefits:
(a) in cash, they are recorded when the claims on the benefits are
established;
(b) in kind, they are recorded at the time the services are provided, or at
the time the changes of ownership of goods provided directly to
households by non-market producers take place.
4.108. In the system of accounts, social benefits other than social transfers in
kind (D.62) are recorded:
(a) among uses in the secondary distribution of income account of the
sectors granting the benefits;
(b) among uses in the external account of primary incomes and current
transfers (in the case of benefits granted by the rest of the world);
(c) among resources in the secondary distribution of income account of
households;
(d) among resources in the external account of primary incomes and
current transfers (in the case of benefits granted to non-resident
households).1996R2223 — EN — 07.08.2003 — 008.001 — 115
▼B
Social transfers in kind (D.63) are recorded:
(a) among uses in the redistribution of income in kind account of the
sectors granting the benefits;
(b) among resources in the redistribution of income in kind account of
households.
The consumption of the goods and services transferred is recorded in the
use of adjusted disposable income account.
By convention there are no social transfers in kind with the rest of the
world (they are registered in D.62 social benefits other than social
transfers in kind).
OTHER CURRENT TRANSFERS (D.7)
NET NON-LIFE INSURANCE PREMIUMS (D.71)
4.109. Definition: Net non-life insurance premiums (D.71) are premiums
payable under policies taken out by institutional units. The
policies taken out by individual households are those taken
out on their own initiative and for their own benefit,
independently of their employers or government and outside
any social insurance scheme (1). Net non-life insurance
premiums comprise both the actual premiums payable by
policy holders to obtain insurance cover during the
accounting period (premiums earned) and the premium
supplements payable out of the property income attributed to
insurance policy holders, after deducting the service charges
of insurance enterprises arranging the insurance.
Net non-life insurance premiums are the amounts available to provide
cover against various events or accidents resulting in damage to goods or
property, or harm to persons as a result of natural or human causes (fires,
floods, crashes, collisions, sinkings, theft, violence, accidents, sickness,
etc.) or against financial losses resulting from events such as sickness,
unemployment, accidents, etc.
4.110. Time of recording: net non-life insurance premiums are recorded when
they are earned.
The insurance premiums from which the service charges are deducted are
those parts of the total premiums paid in the current period, or previous
periods, that cover risks outstanding in the current period.
Premiums earned in the current period must be distinguished from the
premiums due for payment during the current period, which are likely to
cover risks in future periods as well as the current period.
4.111. In the system of accounts net non-life insurance premiums are recorded:
(a) among uses in the secondary distribution of income account of
resident policy holders;
(b) among uses in the external account of primary incomes and current
transfers (in the case of non-resident policy holders);
(c) among resources in the secondary distribution of income account of
resident insurance enterprises;
(d) among resources in the external account of primary incomes and
current transfers (in the case of non-resident insurance enterprises).
NON-LIFE INSURANCE CLAIMS (D.72)
4.112. Definition: Non-life insurance claims (D.72) represent the claims due
under contracts in respect of non-life insurance (2); that is,1996R2223 — EN — 07.08.2003 — 008.001 — 116
(1) Life insurance premiums do not appear as such in the system of accounts. They are
divided into: (a) premiums constituting a form of social contribution (they are paid to
social insurance schemes); (b) individual life insurance premiums. The former are
included under the heading actual social contributions and the latter are not treated asdistributive transactions. Both categories of life insurance premiums increase theinsurance technical reserves which appear in the financial account and in the balancesheet.
(
2) Life insurance claims do not appear as such in the system of accounts. They are divided
into: (a) claims constituting a form of social benefits; (b) individual life insurance claims.The former are included under the heading social benefits other than social transfers inkind and the latter are not treated as distributive transactions. Both categories of lifeinsurance claims reduce the insurance technical reserves which appear in the financial
account, and in the balance sheet.
▼B
the amounts which insurance enterprises are obliged to pay
in settlement of injuries or damage suffered by persons or
goods (including fixed capital goods).
4.113. Non-life insurance claims do not include payments which constitute social
benefits.
4.114. As the service charges on non-life insurance are calculated by subtracting
claims due from the combined value of the premiums earned and premium
supplements, it follows that the total claims due must equal the net non-
life premiums receivable by an insurance enterprise during the same
accounting period. This underlines the fact that the essential function of
non-life insurance is to redistribute resources.
The settlement of a non-life insurance claim is treated as a transfer to the
claimant. Such payments are always treated as current transfers, even
when large sums may be involved as a result of the accidental destruction
of a fixed asset or serious personal injury to an individual. The amounts
received by claimants are usually not committed for any particular
purpose and goods or assets which have been damaged or destroyed need
not necessarily be repaired or replaced.
Some claims arise because of damage or injuries that the policy holders
cause to the property or persons of third parties. In these cases, valid
claims are recorded as being payable directly by the insurance enterprise
to the injured parties and not indirectly via the policy holder.
4.115. Time of recording: non-life insurance claims are recorded at the time the
accident or other event insured against occurs.
4.116. In the system of accounts, they are recorded:
(a) among uses in the secondary distribution of income account of
resident insurance enterprises;
(b) among uses in the external account of primary incomes and current
transfers (in the case of non-resident insurance enterprises);
(c) among resources in the secondary distribution of income account of
the beneficiary sectors;
d) among resources in the external account of primary incomes and
current transfers (in the case of non-resident beneficiaries).
CURRENT TRANSFERS WITHIN GENERAL GOVERNMENT (D.73)
4.117. Definition: Current transfers within general government (D.73) include
transfers between the different subsectors of general
government (central government, state government, local
government, social security funds) with the exception of
taxes, subsidies, investment grants and other capital
transfers.
4.118. Current transfers within general government do not include transactions
on behalf of another unit; these are recorded only once in the accounts, in
the resources of the beneficiary unit on whose behalf the transaction is
made. This situation arises particularly when a government agency (e.g. a
central government department) collects taxes which are automatically
transferred, in total or in part, to another government agency (e.g. a local
authority). In this case, the tax receipts destined for the other government
agency are shown as if they were collected directly by that agency and not
as a current transfer within general government. This solution applies a
fortiori in the case of taxes destined for another government agency which
take the form of additional rates superimposed on taxes levied by central
government. Delays in remitting the taxes from the first to the second
government unit give rise to entries under ‘other accounts receivable/
payable’ in the Financial Account.
On the other hand, transfers of tax receipts which form part of a block
transfer from central government to another government agency are
included in current transfers within general government. These transfers
do not correspond to any specific category of taxes and they are not made
automatically but mainly through certain funds (county and local authority
funds) in accordance with scales of apportionment laid down by central
government.
4.119. Time of recording: Current transfers within general government are
recorded at the time the regulations in force stipulate they are to be made.1996R2223 — EN — 07.08.2003 — 008.001 — 117
▼B
4.120. In the system of accounts, current transfers within general government are
recorded among uses and resources in the secondary distribution of
income account of the subsectors of general governmen (1).
CURRENT INTERNATIONAL COOPERATION (D.74)
4.121. Definition: Current international cooperation (D.74) includes all trans-
fers in cash or in kind between general government and
governments or international organisations (2) in the rest of
the world, except investment grants and other capital
transfers.
4.122. Heading D.74 covers:
(a) the non-tax contributions of the government to the institutions of the
European Union, except the ‘GNP’-based fourth own resource (3);
(b) the contributions of the government to international organizations
(excluding taxes payable by member governments to supranational
organizations);
(c) any current transfers which general government may receive from the
institutions or organizations referred to under (a) and (b) (4);
(d) current transfers between governments, either in cash e.g. payments
intended to finance the budget deficits of foreign countries or overseas
territories) or in kind (e.g. counterpart of gifts of food, military
equipment, emergency aid after natural disasters in the form of food,
clothing, medicines, etc.);
(e) wages and salaries paid by a government, an institution of the
European Union or an international organization, to advisers or
technical assistance experts made available to developing countries.
Current international cooperation includes transfers between general
government and international organizations located in the country, as
international organizations are not treated as resident institutional units of
the countries in which they are located.
4.123. Time of recording: the time the regulations in force stipulate the transfers
are to be made (obligatory transfers), or the time the transfers are made
(voluntary transfers).
4.124. In the system of accounts, current international cooperation is recorded:
(a) among uses and resources in the secondary distribution of income
account of the general government sector;
(b) among uses and resources in the external account of primary incomes
and current transfers.
MISCELLANEOUS CURRENT TRANSFERS (D.75)Current transfers to NPISHs
4.125. Current transfers to NPISHs include all voluntary contributions (other
than legacies), membership subscriptions and financial assistance which
NPISHs receive from households (including non-resident households)
and, to a lesser extent, from other units.
4.126. The following are included:
(a) regular subscriptions paid by households to trade unions and political,
sporting, cultural, religious and similar organizations classified in the
sector NPISHs;
(b) voluntary contributions (other than legacies) from households,
corporate enterprises and the rest of the world to NPISHs, including
transfers in kind in the form of gifts of food, clothing, blankets,
medicines, etc. to charities for distribution to resident or non-resident
households;1996R2223 — EN — 07.08.2003 — 008.001 — 118
(1) Current transfers within general government are flows internal to the general government
sector, and do not appear in a consolidated account for the sector as a whole.
(2) International organisations, in the sense used in the system, derive their authority either
directly from the national States which are their members or indirectly from themthrough other international organisations whose members are national States.
(
3) The levies paid by resident producer units to the Institutions of the European Union are
recorded in the accounts as taxes on production paid to the rest of the world; GNP basedfourth own resource created by the Council Decision of 24 June 1988 on the system ofthe Communities' own resources is classified in D.75 Miscellaneous current transfers.
(
4) The current transfers which the Institutions of the European Union make directly to
resident market producer units are shown as subsidies paid by the rest of the world.
▼B
(c) assistance and grants from general government, other than transfers
made for the specific purpose of financing capital expenditure, which
are shown under investment grants.
Excluded are payments of membership dues or subscriptions to market
NPIs serving businesses, such as chambers of commerce or trade
associations, which are treated as payments for services rendered.
4.127. Time of recording: current transfers to NPISHs are recorded at the time
they are made.
4.128. In the system of accounts, current transfers to NPISHs are recorded:
(a) among uses in the secondary distribution of income account of the
contributing sectors;
(b) among uses in the external account of primary incomes and current
transfers;
(c) among resources in the secondary distribution of income account of
the NPISHs sector.
Current transfers between households
4.129. Definition: Current transfer between households consist of all current
transfers in cash or in kind made, or received, by resident
households to, or from, other resident or non-resident
households. In particular, these comprise remittances by
emigrants or workers permanently settled abroad (or
working abroad for a period of a year or longer) to members
of their family living in their country of origin, or by parents
to children in another location.
4.130. Time of recording: the time the transfers occur.
4.131. In the system of accounts, current transfers between households are
recorded:
(a) among uses and resources in the secondary distribution of income
account of households;
(b) among uses and resources in the external account of primary incomes
and current transfers.
Fines and penalties
4.132. Definition: Fines and penalties imposed on institutional units by courts
of law or quasi-judicial bodies are treated as compulsory
current transfers.
4.133. Not included under this heading are:
(a) fines and penalties imposed by tax authorities for the evasion or late
payment of taxes, which cannot usually be distinguished from the
taxes themselves;
(b) payments of fees to obtain licences, such payments being either taxes
or payments for services rendered by government units (see D.29 and
D.59).
4.134. Time of recording: fines and penalties are recorded at the time the
liabilities arise.
Lotteries and gambling
4.135. The amounts paid for lottery tickets or placed in bets consist of two
elements: the payment of a service charge to the unit organizing the
lottery or gambling and a residual current transfer that is paid out to the
winners. The service charge may be quite substantial and may have to
cover taxes on the production of gambling services. The transfers are
regarded in the system as taking place directly between those participating
in the lottery or gambling, that is, between households. When non-resident
households take part there may be significant net transfers between the
household sector and the rest of the world. The current transfers are
recorded at the time they are made.
Payments of compensation
4.136. Definition: Payments of compensation consist of current transfers paid
by institutional units to other institutional units in compen-
sation for injury to persons or damage to property caused by
the former, excluding payments of non-life insurance claims.
Payments of compensation could be either compulsory1996R2223 — EN — 07.08.2003 — 008.001 — 119
▼B
payments awarded by a court of law, or ex gratia payments
agreed out of court. This heading covers ex gratia payments
made by government units or NPISHs in compensation for
injuries or damage caused by natural disasters other than
those classified as capital transfers.
4.137. Time of recording: payments of compensation are recorded when they are
made ( ex gratia payments) or when they are to be made (compulsory
payments).
GNP-based fourth own resource
4.138. The ‘GNP-based fourth own resource’ created by the Council Decision of
24 June 1988 on the system of Communities' own resources is a current
transfer paid by the general government of each Member State to the
institutions of the European Union.
It is a residual contribution to the budget of those institutions, which is
assessed on the levels of GNP of each of the countries.
Time of recording: GNP-based fourth own resource is recorded when it is
to be paid.
In the system of accounts, GNP-based fourth own resource appears:
(a) among uses in the secondary distribution of income account of
general government;
(b) among resources in the external account of primary incomes and
current transfers.
Other
4.139. (a) Current transfers from NPISHs to general government which are not
taxes.
(b) Payments by general government to public enterprises classified in the
sector non-financial corporate and quasi-corporate enterprises
intended to cover abnormal pension charges.
(c) Travelling fellowships and awards paid to resident or non-resident
households by general government or NPISHs.
(d) Bonus payments on savings granted at intervals by general
government to households in order to reward them for their saving
during the period.
(e) The refunds by households of expenditure incurred on their behalf by
social welfare organizations.
(f) Current transfers from NPISHs to the rest of the world.
(g) Sponsoring by corporations if those payments cannot be regarded as
purchases of advertising or other services (for instance, transfers for a
good cause, or scholarships).
(h) Current transfers from general government to households in their
capacity as consumers, if not recorded as social benefits.
4.140. Time of recording: these transfers are recorded when they are made,
except those from or to general government, which are recorded when
they are to be made.
In the system of accounts, miscellaneous current transfers appear:
(a) among resources and uses in the secondary distribution of income
account of all sectors;
(b) among resources and uses in the external account of primary incomes
and current transfers.
ADJUSTMENT FOR THE CHANGE IN THE NET EQUITY OF HOUSE-
HOLDS IN PENSION FUNDS RESERVES (D.8)
4.141. Definition: The adjustment for the change in the net equity of
households in pension funds reserves (D.8) represents the
adjustment needed to make appear in the saving of
households the change in the actuarial reserves on whichhouseholds have a definite claim (a claim which reappears at
the financial level as an asset under heading F.61) and which
are fed by premiums and contributions recorded in the
secondary distribution of income account as social contribu-
tions.1996R2223 — EN — 07.08.2003 — 008.001 — 120
▼B
4.142. Since households are treated in the financial accounts and balance sheets
of the system as owning the reserves of private funded schemes, both
autonomous and non-autonomous, an adjustment item is necessary to
ensure that any excess of pension contributions over pension receipts (i.e.
of ‘transfers’ payable over ‘transfers’ receivable) does not affect
household saving.
In order to neutralize this effect, an adjustment equal to:
the total value of the actual social contributions in respect
of pensions payable into private funded pension schemes
plus the total value of contribution supplements payable out of
the property income attributed to insurance policy holders
minus the value of the associated service charges
minus the total value of the pensions paid out as social insurance
benefits by private funded pension schemes
is added to the disposable income, or adjusted disposable income, of
households in the use of income accounts before arriving at saving.
In this way, the saving of households is the same as what it would be if
pension contributions and pension receipts had not been recorded as
current transfers in the secondary distribution of income account. This
adjustment item is necessary in order to reconcile the saving of
households with the change in their net equity in pension funds reserves
recorded in the financial account of the system. Opposite adjustments are,
of course, needed in the use of income accounts of the insurance
enterprises or autonomous pension funds or employers maintaining non-
autonomous pension funds.
4.143. Time of recording: the adjustment is recorded according to the flows
which compose it.
4.144. In the system of accounts, the adjustment for the change in the net equity
of households in pension funds reserves is recorded:
(a) among uses in the use of income accounts of the insurance enterprises
sector and other sectors administering non-autonomous pension funds;
(b) among uses in the external account of primary incomes and current
transfers (in the case of non-resident institutions);
(c) among resources in the use of income accounts of the households
sector;
(d) among resources in the external account of primary incomes and
current transfers (in the case of non-resident households).
CAPITAL TRANSFERS (D.9)
4.145. Capital transfers are different from current transfers by the fact that they
involve the acquisition or disposal of an asset, or assets, by at least one of
the parties to the transaction. Whether made in cash or in kind, they
should result in a commensurate change in the financial, or non-financial,
assets shown in the balance sheets of one or both parties to the transaction.
4.146. A capital transfer in kind consists of the transfer of ownership of an asset
(other than inventories and cash), or the cancellation of a liability by a
creditor, without any counterpart being received in return.
A capital transfer in cash consists of the transfer of cash that the first party
has raised by disposing of an asset, or assets (other than inventories), or
that the second party is expected, or required, to use for the acquisition of
an asset, or assets (other than inventories). The second party, the recipient,
is often obliged to use the cash to acquire an asset, or assets, as a condition
on which the transfer is made.
4.147. Capital transfers cover capital taxes (D.91), investment grants (D.92) and
other capital transfers (D.99).
CAPITAL TAXES (D.91)
4.148. Definition: Capital taxes (D.91) consist of taxes levied at irregular and
very infrequent intervals on the values of the assets or net
worth owned by institutional units or on the values of assets
transferred between institutional units as a result of legacies,
gifts inter vivos or other transfers.1996R2223 — EN — 07.08.2003 — 008.001 — 121
▼B
4.149. Capital taxes include:
(a) taxes on capital transfers: inheritance taxes, death duties and taxes on
gifts inter vivos , which are deemed to be levied on the capital of the
beneficiaries (except taxes on sales of assets, as these are not
transfers);
(b) capital levies: occasional and exceptional levies on assets or net worth
owned by institutional units (1). These include betterment levies, that
is taxes on the increase in the value of agricultural land due to
planning permission to develop the land for commercial or residential
purposes.
4.150.►M4 Taxes recorded in the accounts may be derived from two sources:
amounts evidenced by assessments and declarations or cash receipts.
(a) If assessments and declarations are used, the amounts shall be
adjusted by a coefficient reflecting assessed and declared amounts
never collected. As an alternative treatment, a capital transfer to the
relevant sectors could be recorded equal to the same ajdustment. The
coefficients shall be estimated on the basis of past experience and
current expectations in respect of assessed and declared amounts
never collected. They shall be specific to different types of taxes.
(b) If cash receipts are used, they shall be time-adjusted so that the cash is
attributed when the activity took place to generate the tax liability (or
when the amount of tax was determined). This adjustment may be
based on the average time difference between the activity (or the
determination of the amount of tax) and cash tax receipt. ◄
4.151. In the system of accounts, capital taxes are recorded:
(a) among changes in liabilities and net worth (−) in the capital account
of the sectors in which the taxpayers are classified;
(b) among changes in liabilities and net worth (+) in the capital account
of general government;
(c) among changes in liabilities and net worth in the capital account of
the rest of the world.
INVESTMENT GRANTS (D.92)
4.152. Definition: Investment grants (D.92) consist of capital transfers in cash
or in kind made by governments or by the rest of the
world (2) to other resident or non-resident institutional units
to finance all or part of the costs of their acquiring fixed
assets.
4.153. Investment grants can be made in cash or in kind. Investment grants in
kind consist of transfers of transport equipment, machinery and other
equipment by governments to other resident or non-resident units and also
the direct provision of buildings or other structures for resident or non-
resident units.
4.154. Investment grants do not include transfers of military equipment in the
form of weapons or equipment whose sole function is to fire such
weapons, as they are not classified as fixed assets.
4.155. The value of capital formation carried out by general government for the
benefit of other sectors of the economy is also to be shown under
investment grants whenever the beneficiary is identifiable and becomes
the owner of the capital. In such cases, the capital formation is recorded
among changes in assets in the capital account of the beneficiary and is
financed by an investment grant which appears among changes in
liabilities and net worth in the same account.
4.156. Heading D.92 includes not only single non-recurrent payments designed
to finance capital formation during the same period, but also instalment
payments in respect of capital formation carried out during an earlier
period. Thus, those parts of the annual payments by general government
which represent the amortization of debts, contracted by enterprises for
the purpose of capital formation projects for whose amortization the
government has assumed total or partial responsibility, are also treated as
investment grants.1996R2223 — EN — 07.08.2003 — 008.001 — 122
(1) However, capital gain taxes are shown in the accounts under the heading current taxes on
income, wealth, etc.
(2) Investment grants made by the rest of the world include those paid directly by the
institutions of the European Union (e.g. certain transfers made by the European
Agricultural Guidance and Guarantee Fund, EAGGF Guidance Section).
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Grants for interest relief made by general government are, however,
excluded, even when the object of the relief is to encourage capital
formation. In practice, the assumption by public authorities of part of the
interest charges constitutes, like the flow of interest itself, a current
distributive transaction. Nevertheless, when a grant serves the dual
purpose of financing the amortization of the debt contracted and the
payment of the interest on the capital borrowed, and when it is not
possible to separate these two elements, the whole of the grant is treated in
the accounts as an investment grant.
4.157. Investment grants to the sector non-financial corporate and quasi-
corporate enterprises include, in addition to grants to private enterprises,
capital grants to public enterprises recognized as independent legal
entities, provided that the government department which makes the grant
does not retain a claim against the public enterprise.
4.158. Investment grants to the households sector include equipment and
modernization grants to businesses other than corporate or quasi-corporate
enterprises and grants to households for the construction, purchase and
improvement of dwellings.
4.159. Investment grants to general government include all payments (except
grants for interest relief) made to subsectors of general government (1) for
the purpose of financing capital formation. The most important examples
are transfers from central government to local authorities for the specific
purpose of financing their gross fixed capital formation. It should be
emphasized that transfers of a general nature intended for various or
indeterminate purposes are shown under current transfers within general
government, even if they are partly used to cover expenditure on capital
formation.
4.160. Investment grants to non-profit institutions from general government and
from the rest of the world are distinguished from current transfers to non-
profit institutions by using the same criterion.
4.161. Investment grants to the rest of the world should also be restricted to
transfers with the specific objective of financing capital formation by non-
resident units. They include, for example, unrequited transfers for the
construction of bridges, roads, factories, hospitals or schools in developing
countries, or for constructing buildings for international organizations.
They may comprise instalment payments over a period of time as well as
single payments. This heading also covers the supply of fixed capital
goods free of charge.
4.162. Time of recording: investment grants in cash are recorded when the
payment is due to be made. Investment grants in kind are recorded when
the ownership of the asset is transferred.
4.163. In the system of accounts, investment grants are recorded:
(a) among changes in liabilities and net worth (−) in the capital account
of general government;
(b) among changes in liabilities and net worth (+) in the capital account
of the sectors receiving the grants;
(c) among changes in liabilities and net worth in the capital account of
the rest of the world.
OTHER CAPITAL TRANSFERS (D.99)
4.164. Definition: Other capital transfers (D.99) cover transfers other than
investment grants and capital taxes which do not themselves
redistribute income but redistribute saving or wealth among
the different sectors or subsectors of the economy or the rest
of the world.
4.165. Other capital transfers include the following transactions:
(a) payments by general government or by the rest of the world to the
owners of capital goods destroyed or damaged by acts of war, other
political events or natural disasters (floods etc.);
(b) transfers from general government to non-financial corporate and
quasi-corporate enterprises to cover losses accumulated over several
financial years or exceptional losses from causes beyond the control
of the enterprise;1996R2223 — EN — 07.08.2003 — 008.001 — 123
(1) Investment grants within general government are flows internal to the general
government sector and do not appear in a consolidated account for the sector as whole.
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(c) transfers between subsectors of general government designed to cover
unexpected expenditure or accumulated deficits (1);
(d) non-recurrent bonus payments on savings granted by general
government to households to reward them for their savings carried
out over a period of several years;
(e) legacies, large gifts inter vivos and donations between units belonging
to different sectors, including legacies or large gifts to NPIs (for
example, gifts to universities to cover the costs of building new
residential colleges, libraries, laboratories, etc.);
(f) the counterpart transaction of cancellation of debts by agreement
between institutional units belonging to different sectors or subsectors
(for example, the cancellation by the government of a debt owed to it
by a foreign country; payments in fulfilment of guarantees which free
defaulting debtors from their obligations) ►M4 — except the
particular case of taxes and social contributions payable to the
general government sector (see 4.165 (j)). ◄Such cancellations by
mutual agreement are treated as a capital transfer from the creditor to
the debtor equal to the value of the outstanding debt at the time of
cancellation. Likewise the counterpart transaction of debt assumption
is another capital transfer. However, excluded are:
1. cancellation of financial claims against and assumption of
liabilities from quasi-corporations by the owner of the quasi-
corporation. This case is treated as a transaction in shares and other
equity (see paragraph 5.16);
2. debt cancellation against and debt assumption from a public
corporation by government which disappears as an institutional
unit in the system. This case is recorded in the other changes in the
volume of assets account (see paragraphs 5.16, 6.29 and 6.30);
3. debt cancellation against and debt assumption from a public
corporation by government as a part of an ongoing process of
privatization to be achieved in a short term perspective. This case
is treated as a transaction in shares and other equity (see paragraph
5.16).
The writing-off of debt is not a transaction between institutional units
and therefore does not appear in either the capital account or the
financial account of the system. If the creditor decides such a write-
off, it should
be recorded in the other changes in the volume of assets accounts of
the creditor and the debtor (see paragraph 6.27. d)). Provisions for bad
debt are treated as book-keeping entries that are internal to the
institutional producer unit and do not appear anywhere in the system.
The unilateral repudiation of debt by a debtor is also not a transaction
and is not recognized in the system;
(g) that part of realized capital gains (or losses) which is redistributed to
another sector, as, for example, capital gains redistributed by
insurance companies to households. However, the counterpart
transactions of transfers to general government of the proceeds of
privatization made indirectly (through a holding company for
example) have to be recorded as financial transactions in shares and
other equity (F.5) and have therefore no direct impact on the level of
net lending/net borrowing of the general government;
(h) major payments in compensation for extensive damage or serious
injuries not covered by insurance policies (except payments by
general government or by the rest of the world described in (a)). The
payments may be awarded by courts of law or settled out of court.
They include payments of compensation for damage caused by major
explosions, oil spillages, the side-effects of drugs, etc.;
(i) extraordinary payments into social insurance funds made by
employers (including government) or by government (as part of its
social function), in so far as these payments are designed to increase
the actuarial reserves of these funds. The accompanying adjustment
from social insurance funds to households is also recorded as other
capital transfers (D.99) (see Annex III ‘Insurance’, paragraph 20);
(j) when taxes and social contributions payable to the general govern-
ment sector are recorded on the basis of assessments and declarations,
the part unlikely to be collected has to be neutralised in the same1996R2223 — EN — 07.08.2003 — 008.001 — 124
(1) These transfers between subsectors of general government are flows within the general
government sector and do not appear in a consolidated account for the sector as a whole.▼M4
▼M4
accounting period. This can be done by an ‘Other capital transfer’
(D.99), inside the specific line D.995, between general government
and the relevant sectors. This D.995 flow has to be subdivided
according to the coding of the different taxes and social contributions
concerned.
4.166. Time of recording:
(a) other capital transfers in cash are recorded when the payment is due to
be made;
(b) other capital transfers in kind are recorded when the ownership of the
asset is transferred or the liability cancelled by the creditor.
4.167. In the system of accounts, other capital transfers are shown among
changes in liabilities and net worth in the capital account of sectors and of
the rest of the world.1996R2223 — EN — 07.08.2003 — 008.001 — 125
▼B
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CHAPTER 5
FINANCIAL TRANSACTIONS
5.01. Definition: Financial transactions are transactions in financial assets and
liabilities between institutional units, and between them and
the rest of the world.
5.02. Considering the definition of a transaction (see paragraph 1.33), a
financial transaction is an interaction between institutional units, or
between an institutional unit and the rest of the world, by mutual
agreement, involving a simultaneous creation or liquidation of a financial
asset and the conterpart liability, or a change in ownership of a financial
asset, or an assumption of a liability.
5.03. Financial assets are economic assets, comprising means of payment,
financial claims and economic assets which are close to financial claims
in nature.
5.04. Means of payment consist of monetary gold, special drawing rights,
currency and transferable deposits.
Financial claims entitle their owners, the creditors, to receive a payment
or series of payments without any counter-performance from other
institutional units, the debtors, who have incurred the counterpart
liabilities.
Examples of economic assets which are close to financial claims in nature
are shares and other equity and partly contingent assets. The institutional
unit issuing such a financial asset is considered to have incurred a
counterpart liability.
5.05. Contingent assets are contractual arrangements between institutional units,
and between them and the rest of the world, which specify one or more
conditions which must be fulfilled before a financial transaction takes
place. Examples are guarantees of payment by third parties, letters of
credit, lines of credit, underwritten note issuance facilities (NIFs) and
many of the derivative instruments. In the system, a contingent asset is a
financial asset in cases where the contractual arrangement itself has a
market value because it is tradable or can be offset on the market.
Otherwise, a contingent asset is not recorded in the system (1).
5.06. Seven categories of financial assets are distinguished: monetary gold and
special drawing rights (AF.1), currency and deposits (AF.2), securities
other than shares (AF.3), loans (AF.4), shares and other equity (AF.5),
insurance technical reserves (AF.6) and other accounts receivable/payable
(AF.7).
5.07. In the system, each financial asset has a counterpart liability, with the
exception of those financial assets classified in the category monetary
gold and special drawing rights (AF.1). Six categories of liabilities are
distinguished corresponding to the categories of the counterpart financial
assets.
5.08. The classification of financial transactions corresponds to the classifica-
tion of financial assets and liabilities. Seven categories of financial
transactions are distinguished: transactions in monetary gold and special
drawing rights (F.1), transactions in currency and deposits (F.2),
transactions in securities other than shares (F.3), transactions in loans
(F.4), transactions in shares and other equity (F.5), transactions in
insurance technical reserves (F.6) and transactions in other accounts
receivable/payable (F.7).
5.09. The financial assets held and the liabilities outstanding at a particular
point in time (of a sector or the rest of the world) are recorded in the
balance sheet (see chapter 7). Financial transactions result in changes in
balance sheets. However, the changes between the opening balance sheet
and the closing balance sheet may also include other flows (see chapter 6).
They are not due to interactions between institutional units, or between
them and the rest of the world, by mutual agreement. The other flows are
broken down into revaluations in financial assets and liabilities, and
changes in the volume of financial assets and liabilities not due to
financial transactions. The former are recorded in the revaluation account
and the latter in the other changes in the volume of assets account under
the categories catastrophic losses, uncompensated seizures, other volume1996R2223 — EN — 07.08.2003 — 008.001 — 126
(1) Insurance technical reserves (AF.6) are unconditional liabilities of insurance corpora-
tions and pension funds. However, the counterpart financial assets of individual policy
holders and beneficiaries are contingent assets in most cases.
▼B
changes in financial assets and liabilities n.e.c., and changes in
classifications and structure.
5.10. Financial transactions between institutional units are recorded in the
financial accounts of the sectors involved. Financial transactions between
institutional units and the rest of the world are recorded in the financial
accounts of the sectors involved and the external financial account, that is
the financial account of the rest of the world (see chapter 8).
The financial account (of a sector or the rest of the world) shows on its left
side acquisitions less disposals of financial assets, while its right side
shows the incurrence of liabilities less their repayment. The balancing
item of the financial account, that is net acquisition of financial assets less
net incurrence of liabilities, is net lending (+)/net borrowing (−) (B.9).
5.11. The financial account of a sector may be consolidated or non-
consolidated. The non-consolidated financial account of a sector shows
the changes in financial assets and liabilities due to all financial
transactions in which institutional units classified in the sector are
involved. The consolidated financial account of a sector shows the
changes in financial assets and liabilities due to financial transactions
between institutional units classified in the sector under consideration and
other institutional units or the rest of the world. Compared to the non-consolidated financial account, the financial transactions between
institutional units classified in the sector under consideration are
eliminated from the consolidated financial account. The external financial
account is consolidated by definition.
5.12. A financial transaction between two institutional units increases net
lending/net borrowing of one institutional unit and, by the same amount,
decreases net lending/net borrowing of the other institutional unit.
Financial transactions between institutional units classified in the same
sector do not change net lending/net borrowing of the sector. The
consolidated and the non-consolidated financial account of a sector show
the same amount of net lending/net borrowing. By the same token,
financial transactions between institutional units do not change net
lending/net borrowing of the total economy. It is of equal amount but
opposite sign to net lending/net borrowing in the external financial
account. Therefore, total net lending/net borrowing of all institutional
units and the rest of the world is zero.
5.13. The financial account by debtor/creditor (
1) (of a sector or the rest of the
world) is an extension of the financial account, showing in addition a
breakdown of the net acquisition of financial assets by debtor sector and a
breakdown of the net incurrence of liabilities by creditor sector.
Therefore, it provides information on debtor/creditor relationships and it
is consistent with the financial balance sheet by debtor/creditor (see
paragraph 7.69). In the case of financial transactions on secondary
markets, however, it does not provide information on the institutional
units to whom financial assets were sold or from whom financial assets
were bought, that is to say the financial account by debtor/creditor
provides not a complete answer on the question who is financing whom in
an accounting period.
5.14. The financial account is the final account, in the full sequence of accounts
that records transactions (see chapter 8). Therefore, the financial account
does not have a balancing item that is carried forward to another account.
In the system, the balancing item of the financial account is identical with
the balancing item of the capital account. In practice, a discrepancy will
usually be found between them because they are calculated on the basis of
different statistical data.
5.15. Financial transactions always have counterpart transactions in the system.
Those counterparts may be other financial transactions or non-financial
transactions.
The simultaneous rise or reduction of both financial assets and liabilities,
or the exchange of one financial asset for another are recorded wholly
within the financial account (of a sector or the rest of the world). In cases
where a transaction and its counterpart are both financial transactions,
they change the portfolio of financial assets and liabilities and they may
change the totals of both financial assets and liabilities of the institutional
units involved or the rest of the world, but they do not change net lending/
net borrowing or net worth.
The counterparts of financial transactions may also be transactions in
products (see chapter 3), distributive transactions (see chapter 4) or1996R2223 — EN — 07.08.2003 — 008.001 — 127
(1) The 1993 SNA (11.103 to 11.111) uses the term detailed flow of funds account.
▼B
transactions in non-financial non-produced assets (see paragraph 6.06). In
cases where the counterpart transaction of a financial transaction is not a
financial transaction, net lending/net borrowing of the institutional units
involved or the rest of the world will change.
5.16. The counterpart transaction of a financial transaction may be a (current or
a capital) transfer (see chapter 4). In this case, the financial transaction
involves a change in ownership of a financial asset, or an assumption of a
liability as debtor (debt assumption), or the simultaneous liquidation of afinancial asset and the counterpart liability (debt cancellation or debt
forgiveness). The counterpart transaction of debt assumption and debt
cancellation is classified in the category capital transfers (D.9) and is
recorded in the capital account.
If the owner of a quasi-corporation assumes liabilities from or cancels
financial claims against the quasi-corporation, the counterpart transaction
of debt assumption or debt cancellation is a transaction in shares and other
equity (F.5).
If government cancels or assumes debt from a public corporation which
disappears as an institutional unit in the system, no transaction is recorded
in the capital account or the financial account. In this case a flow is
recorded in the other changes in the volume of assets account (chapter 6,
‘Other flows’).
If government cancels or assumes debt from a public corporation as part
of an ongoing process of privatization to be achieved in a short term
perspective, the counterpart transaction is a transaction in shares and other
equity. Privatization means the giving up of control over that public
corporation (see paragraph 2.26) by the disposal of shares and other
equity. Such a cancellation or assumption leads to an increase of the own
funds (see paragraph 7.05), regardless as to whether or not this increase of
the own funds is due to an issue of shares and other equity.
The writing-off or writing-down of bad debts by creditors and the
unilateral cancellation of a liability by a debtor (debt repudiation) are not
classified as financial transactions because they do not involve
interactions between institutional units, or between institutional units
and the rest of the world, by mutual agreement. The writing-off or
writing-down of bad debts by creditors is recorded in the other changes in
the volume of assets account (see paragraph 6.27. d). Debt repudiation is
not recognized in the system.
5.17. The counterpart transaction of a financial transaction may be interest
(D.41). Interest is receivable by the creditors and payable by the debtors
of certain kinds of financial claims classified in the categories currency
and deposits (AF.2), securities other than shares (AF.3), loans (AF.4) and
other accounts receivable/payable (AF.7). In the system, interest is
recorded on an accrual basis, that is to say interest is recorded as accruing
continuously over time to the creditor on the amount of principal
outstanding (see paragraph 4.50). The counterpart transaction of an entry
in interest (D.41) is always a financial transaction creating an additional
financial claim of the creditor against the debtor. The effect of this
financial transaction is that interest is reinvested. The actual payment of
interest is not recorded in interest (D.41), but it involves a transaction
relating to the change in ownership of the means of payment. The
counterpart transaction is a financial transaction reducing the net financial
claim of the creditor against the debtor. When accrued interest is not paid
when due, this gives rise to interest arrears. As accrued interest is already
recorded in the system, interest arrears do not change the total of financial
assets or liabilities but possibly their classification (see paragraph 5.131).
5.18. The counterpart transaction of a financial transaction may be property
income allocated but not distributed. Examples are interest (D.41) and
dividends (D.421) received by mutual funds from the investments they
have made and which are allocated but not distributed to shareholders (see
paragraphs 4.49. b and 4.54. b), reinvested earnings on direct foreign
investment (D.43) and property income attributed to insurance policy
holders (D.44) in case of individual life insurance policies not taken out
under social insurance schemes. The effect of the counterpart financial
transaction is that the (positive or negative) property income is reinvested.
CLASSIFICATION OF FINANCIAL TRANSACTIONS
5.19. The financial transactions are classified in categories subdivided into sub-
categories and some of which are further subdivided into sub-positions.
The classification of the transactions in financial assets and liabilities
corresponds to the classification of financial assets and liabilities (see
paragraphs 5.06 to 5.08). Therefore, the definitions of the categories, sub-
categories and sub-positions and the supplementary explanations are1996R2223 — EN — 07.08.2003 — 008.001 — 128
▼B
provided only once in the ESA — in this section of the financial
transactions chapter. The balance sheets chapter does not repeat the
definitions and their explanations in its main text but it provides in its
Annex 7.1 a summary of all assets and liabilities defined in the system.
5.20. The classification of financial transactions and of financial assets and
liabilities is based primarily on the liquidity and the legal characteristics
of the financial assets. The classification does not contain functional
categories with the exception of a memorandum item related to direct
foreign investment. The definitions of the categories, sub-categories and
sub-positions are in general independent of the classification of
institutional units. As the need arises, however, the classification of
financial assets and liabilities can be further detailed by a cross-
classification with the classification of institutional units. The class
deposits between monetary financial institutions would be an example.
The detail in which the classification of financial assets and liabilities may
be employed depends on the institutional sector to be analysed.
Table 5.1 — Classification of financial transactions
Classification of financial transactions Code
Monetary gold and special drawing rights (SDRs) F.1
Monetary gold F.11
Special drawing rights (SDRs) F.12
Currency and deposits F.2
Currency F.21
Transferable deposits F.22
Other deposits F.29
Securities other than shares F.3
Securities other than shares, excluding financial deriva-
tives F.33
Short-term F.331Long-term F.332
Financial derivatives F.34
Loans F.4
Short-term F.41
Long-term F.42
Shares and other equity F.5
Shares and other equity, excluding mutual funds shares F.51
Quoted shares F.511
Unquoted shares F.512
Other equity F.513
Mutual funds shares F.52
Insurance technical reserves F.6
Net equity of households in life insurance reserves and in
pension funds reserves F.61
Net equity of households in life insurance reserves F.611
Net equity of households in pension funds reserves F.612
Prepayments of insurance premiums and reserves for
outstanding claims F.62
Other accounts receivable/payable F.7
Trade credits and advances F.71
Other F.79
Memorandum item: Direct investment F.m
5.21. Analyses of the monetary policy transmission channels may require to
identify measures of money in the balance sheets and also in the financial
accounts of the sectors and the rest of the world. However, the definitions1996R2223 — EN — 07.08.2003 — 008.001 — 129
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of the measures of money applied vary among countries and in time. In
addition, they are composed of components which in most of the cases do
not correspond with the categories, sub-categories or sub-positions of
financial assets and liabilities as defined in the system. Moreover, the
money-creating, money-holding and money-neutral sectors depend on the
definition of the monetary aggregate under consideration. Therefore,
measures of money are not defined in the system. Nevertheless, a method
is provided in the Annex 5.1 to this chapter which allows any measure of
money in the balance sheets and the financial accounts to be shown.
5.22. Innovations in financial markets have diminished the usefulness of a
short-term/long-term distinction for financial assets and liabilities.
However, when maturity analysis is important, such as for analysis of
interest rates and asset yields, a breakdown of a range of maturities may
be required. Therefore, maturity distinction is recognized as a secondary
classification criterion when relevant.
Definition: Short-term financial assets (liabilities) are financial assets
(liabilities) whose original maturity is normally one year or
less, and in exceptional cases two years at the maximum (1).
Long-term financial assets (liabilities) are financial assets
(liabilities) whose original maturity is normally more than
one year, and in exceptional cases more than two years at the
minimum.
5.23. Many of the categories, sub-categories and sub-positions of the financial
assets and liabilities may be broken down by the units in which they are
denominated.
Definition: Financial assets (liabilities) in national currency are financial
assets (liabilities) which are denominated in the currency
unit(s) of the country's legal tender.
Financial assets (liabilities) in foreign currency are financial
assets (liabilities) which are not denominated in the currency
unit(s) of the country's legal tender.
Financial assets in foreign currency include financial assets denominated
in a currency basket, for example ecus or SDRs, and financial assets
denominated in gold. A distinction between national and foreign currency
is particularly useful for the category currency and deposits (AF.2).
MONETARY GOLD AND SPECIAL DRAWING RIGHTS (SDRs) (F.1)
5.24. Category F.1 consists of two sub-categories of financial transactions:
(a) monetary gold (F.11);
(b) special drawing rights (SDRs) (F.12).
5.25. The financial assets classified in the category monetary gold and SDRs
(AF.1) are the only financial assets for which there are no counterpart
liabilities in the system. Therefore, transactions in monetary gold and
SDRs (F.1) always involve changes in ownership of financial assets (see
paragraph 5.02).
Monetary gold (F.11)
5.26. Definition: The sub-category monetary gold (F.11) consists of all
transactions in monetary gold (AF.11) that is gold held as
a component of foreign reserves by monetary authorities or
by others who are subject to the effective control of the
authorities.
5.27. The monetary authorities sector, which is based on a functional concept,
consists of the subsector the central bank (S.121) and central government
institutions which carry out operations usually attributed to the central
bank. Such operations include the issue of currency, maintenance and
management of international reserves and the operation of exchange
stabilization funds.
Therefore, gold can normally be a financial asset only for the central bank
or central government. However, in some circumstances, other financial
corporations may hold title to gold that can only be sold with the specific
consent of the monetary authorities. In such restricted circumstances, the
concept of effective control can be applied to the gold holdings of
financial corporations other than the central bank.1996R2223 — EN — 07.08.2003 — 008.001 — 130
(1) In certain cases, securities other than shares issued by the general government sector with
a maturity up to five years may be classified as short-term.
▼B
5.28. Monetary gold normally takes the form of bars with a purity of at least
995/1000.
5.29. Transactions in monetary gold consist predominantly of sales and
purchases of monetary gold among monetary authorities. Purchases of
monetary gold are recorded in the financial accounts of the domestic
monetary authorities as increases in financial assets. The counterpart
entries are decreases in financial assets of the rest of the world.
5.30. Transactions in non-monetary gold, that is in gold other than monetary
gold, are treated as acquisitions less disposals of valuables (if the sole
purpose is to provide a store of wealth) and otherwise as final or
intermediate consumption and/or change in inventories. Transactions in
non-monetary gold include transactions by the monetary authorities in
gold that is not a component of their foreign reserves.
5.31. If monetary authorities add non-monetary gold to their holdings of
monetary gold or release monetary gold from their holdings for non-
monetary purposes, they are deemed to have monetized or demonetized
gold, respectively. Monetization or demonetization of gold does not give
rise to entries in the financial accounts; instead, the change in balance
sheet positions is accounted for by entries in the other changes in the
volume of assets account as a reclassification, i.e. the reclassification of
gold as valuables (AN.13) to monetary gold (AF.11) (see paragraph 6.32).
Demonetization of gold is recorded symmetrically.
5.32. Deposits, securities and loans denominated in gold are treated as financial
assets other than monetary gold and are classified along with similar
financial assets in foreign currency in the appropriate category.
Non-monetary gold swaps, that is arrangements involving the temporary
exchange of non-monetary gold for deposits, are treated as collateralized
loans (see paragraph 5.81. e).
Special drawing rights (SDRs) (F.12)
5.33. Definition: The sub-category special drawing rights (SDRs) (F.12)
consists of all transactions in SDRs (AF.12) that is
international reserve assets created by the International
Monetary Fund (IMF) and allocated to its members to
supplement existing reserve assets.
5.34. SDRs are not considered liabilities of the IMF, and IMF members to
whom SDRs are allocated do not have an actual (unconditional) liability
to repay their SDRs allocations. SDRs are held exclusively by official
holders, which are normally central banks, and are transferable among
participants in the IMF's Special Drawing Rights Department and other
holders designated by the IMF (other central banks and certain
international agencies). SDRs represent each holder's assured and
unconditional right to obtain other reserve assets, especially foreign
exchange.
5.35. Changes in SDRs held by a monetary authority can arise through
transactions in SDRs involving SDR payments to or receipts from the
IMF, other participants in the IMF's Special Drawing Rights Department,
or other holders. They are recorded in the financial accounts of the
monetary authorities and the rest of the world, respectively. Changes in
SDRs can also arise from changes in the value of SDRs to be recorded in
the revaluation account, or from allocations and cancellations of SDRs to
be recorded in the other changes in the volume of assets account (see
paragraph 6.27. a).
CURRENCY AND DEPOSITS (F.2)
5.36. Definition: The category currency and deposits (F.2) consists of all
transactions in currency and deposits (AF.2) that is currency
in circulation and all types of deposits in national and in
foreign currency.
5.37. Category F.2 is divided into three sub-categories of financial transactions:
(a) currency (F.21);
(b) transferable deposits (F.22);
(c) other deposits (F.29).
The distinction between transferable and non-transferable deposits may be
difficult and not very useful analytically in some countries (for the
distinction between deposits and loans see paragraphs 5.74 to 5.76).1996R2223 — EN — 07.08.2003 — 008.001 — 131
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Currency (F.21)
5.38. Definition: The sub-category currency (F.21) consists of all transactions
in currency (AF.21) that is notes and coins in circulation that
are commonly used to make payments.
5.39. Sub-category AF.21 includes:
(a) notes and coins in circulation issued by resident monetary authorities;
(b) notes and coins in circulation issued by non-resident monetary
authorities and held by residents.
5.40. Sub-category AF.21 does not include:
(a) notes and coins that are not in circulation, for example, a central
bank's stock of own notes or emergency stockpiles of notes;
(b) commemorative coins that are not commonly used to make payment.
5.41. All sectors and the rest of the world may hold currency. It is issued by the
central bank, central government, the rest of the world, and in exceptional
cases other monetary financial institutions. Currency is deemed to be a
liability of the issuing institutional unit.
Transferable deposits (F.22)
5.42. Definition: The sub-category transferable deposits (F.22) consists of all
transactions in transferable deposits (AF.22) that is deposits
(in national or in foreign currency) which are immediately
convertible into currency or which are transferable by
cheque, banker's order, debit entry or the like, both without
any kind of significant restriction or penalty.
5.43. Sub-category AF.22 includes transferable deposits with resident and non-
resident monetary financial institutions. They cover transferable deposits
between monetary financial institutions, such as deposits which other
monetary financial institutions hold with the central bank to satisfy
compulsory reserve requirements, insofar as such deposits remain
transferable, or working balances and foreign exchange deposits under
swap arrangements or between other monetary financial institutions.
5.44. All sectors and the rest of the world may hold transferable deposits. They
are liabilities predominantly of monetary financial institutions and the rest
of the world, and sometimes of general government.
Other deposits (F.29)
5.45. Definition: The sub-category other deposits (F.29) consists of all
transactions in other deposits (AF.29) that is deposits (in
national or in foreign currency) other than transferable
deposits. Other deposits cannot be used to make payments at
any time and they are not convertible into currency or
transferable deposits without any kind of significant
restriction or penalty.
5.46. Sub-category AF.29 includes:
(a) time deposits. These deposits are not immediately disposable because
they are subject to a fixed term or a period of prior notice before
withdrawal. They include, for example, deposits with the central bank
as a form of compulsory reserves to the extent that the depositors
cannot realize them without notice or restriction;
(b) savings deposits, savings books, savings certificates or certificates of
deposit all of which are not negotiable, or whose negotiability, while
theoretically possible, is very restricted;
(c) deposits resulting from a savings scheme or contract. These deposits
often involve an obligation on the part of the depositor to make
regular payments over a given period, and the capital paid and interest
accrued do not become available until a fixed term has elapsed. These
deposits are sometimes combined with the issue, at the end of the
savings period, of loans which are proportionate to the accumulated
savings, for the purpose of buying or building a dwelling;
(d) evidence of deposit issued by savings and loan associations, building
societies, credit unions, and the like, sometimes called shares, which
are legally, or in practice, redeemable on demand or at relatively short
notice;
(e) repayable margin payments related to financial derivatives which are
liabilities of monetary financial institutions (see paragraph 5.81. c);1996R2223 — EN — 07.08.2003 — 008.001 — 132
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(f) short-term repurchase agreements (repos) which are liabilities of
monetary financial institutions (see paragraph 5.81. d) (1).
5.47. Sub-category AF.29 does not include negotiable certificates of deposit and
negotiable savings certificates. They are classified in category securities
other than shares, excluding financial derivatives (AF.33).
5.48. Sub-category AF.29 includes further:
(a) official ecus held by the central bank. These financial assets consist of
the ecus issued by the EMI against monetary reserves from the central
banks of the Member States for the purpose of implementing the EMS
Agreement. These ecus may be used by the EMI and the central banks
of the Member States as a means of settlement and for transactions
between them and the EMI. The EMI may grant to the monetary
authorities of third countries and to international monetary institutions
the status of Other Holders of ecus (2);
(b) financial claims or liabilities of the central bank arising from the very
short-term financing mechanism and the short-term monetary support
mechanism. They are administered by the EMI (3);
(c) financial claims on the IMF that are components of international
reserves and that are not evidenced by loans. They consist of an IMF
member's reserve tranche position which arises from the payment of
part of a member's subscription in reserve assets and the Fund's net
use of the member's currency;
(d) liabilities to the IMF that are not evidenced by loans. They consist of
use of Fund credit within the IMF's General Resources Account; it
measures the amount of a member's currency with the IMF that the
member is obligated to repurchase.
5.49. All sectors and the rest of the world may hold other deposits. They are
liabilities predominantly of monetary financial institutions and the rest of
the world, but also of other sectors, for example, general government (see
paragraphs 5.74 to 5.76).
SECURITIES OTHER THAN SHARES (F.3)
5.50. Definition: The category securities other than shares (F.3) consists of all
transactions in securities other than shares (AF.3) that is
financial assets which are bearer instruments, are usually
negotiable and traded on secondary markets or can be offset
on the market, and do not grant the holder any ownership
rights in the institutional unit issuing them.
5.51. Category AF.3 covers financial assets which are typically represented by
documents intended to circulate, and whose nominal value is determined
on issue. It includes bills, bonds, certificates of deposit, commercial paper,
debentures, financial derivatives, and similar instruments normally traded
in the financial markets (for the distinction between securities other than
shares and loans see paragraphs 5.77 to 5.80).
5.52. All sectors and the rest of the world may hold securities other than shares
as financial assets. They are liabilities predominantly of financial and non-
financial corporations, central, state and local government, and the rest of
the world.
5.53. Category F.3 is divided into two sub-categories of financial transaction (4):
(a) securities other than shares, excluding financial derivatives (F.33);
(b) financial derivatives (F.34).1996R2223 — EN — 07.08.2003 — 008.001 — 133
(1) The 1993 SNA (11.32, 11.72 and 11.83) classifies repurchase agreements under loans
unless they involve bank liabilities and are classified in national measures of broad
money; in the latter case, repurchase agreements are classified under other deposits.
(2) Articles 6.2 and 6.3 of the Protocol on the Statute of the European Monetary Institute
annexed to the Treaty establishing the European Community.
(3) Article 6.1 second indent of the Protocol on the Statute of the European Monetary
Institute annexed to the Treaty establishing the European Community.
(4) The 1993 SNA (11.79, 11.80 and 11.81) recommends an optional subclassification of
transactions in securities other than shares by maturity into short-term (F.31) and long-term (F.32). However, the 1993 SNA (11.82) provides for an additional optionalsubclassification of transactions in securities other than shares showing transactions in
financial derivatives separately where they are important from the point of view of
analysis and policy. This second option is adopted in the ESA. It also facilitates thelinkage to the sub-category debt securities as defined in the 1993 Balance of PaymentsManual, which divides debt securities into bonds, notes, money market instruments andfinancial derivatives. The codes F.31 and F.32 are not used in the ESA to avoid
confusion with the 1993 SNA codes.
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Securities other than shares, excluding financial derivatives (F.33)
5.54. Definition: The sub-category securities other than shares excluding
financial derivatives (F.33) consists of all transactions in
securities other than shares excluding financial derivatives
(AF.33), that is securities other than shares which give the
holder the unconditional right to a fixed or contractually
determined variable money income in the form of coupon
payments (interest) and/or a stated fixed sum on a specified
date or dates or startiung from a date fixed at the time of
issue.
5.55. Sub-category F.33 may be divided, when relevant, into two sub-positions
of financial transactions:
(a) short-term securities other than shares, excluding financial derivatives
(F.331);
(b) long-term securities other thanshares, excluding financial derivatives
(F.332).
Short-term securities other than shares, excluding financial derivatives (F.331)
5.56. Definition: The sub-position short-term securities other than shares
excluding financial derivatives (F.331) consists of all
transactions in short-term securities other than shares
excluding financial derivatives (AF.331) that is securities
other than shares with a short-term original maturity (see
paragraph 5.22) except financial derivatives.
5.57. Short-term securities other than financial derivatives are generally issued
at a discount.
5.58. Sub-position AF.331 includes:
(a) treasury bills and other short-term paper issued by general govern-
ment, including those which are taken up by other monetary financial
institutions to satisfy their compulsory reserve requirements;
(b) negotiable short-term paper issued by financial and by non-financial
corporations. A variety of terms are used for such paper including:
commercial paper, commercial bills, promissory notes, bills of trade,
bills of exchange and certificates of deposit;
(c) short-term securities issued under long-term underwritten note
issuance facilities (NIFs);
(d) bankers' acceptances (BAs). A BA involves the acceptance by
financial corporations of drafts, commercial bills or bills of exchange
issued by non-financial corporations and the unconditional promise to
pay a specific amount at a specified date. The BA represents an
unconditional financial claim on the part of the holder and an
unconditional liability on the part of the accepting financial
corporation. The financial corporation's counterpart transaction is a
transaction in a short-term loan made by the financial corporation to
its customer. For this reason it is recommended that BAs be treated as
an actual liability of the accepting financial corporation and as a
financial asset of the holder, even though no funds may have been
exchanged. Flexibility in the application of this recommendation will
be required to take national practices and variations in the nature of
these instruments into account.
5.59. Sub-position AF.331 does not include securities whose negotiability,
while theoretically possible, is very restricted in practice and which are
therefore classified in the sub-categories other deposits (AF.29) or short-
term loans (AF.41) as appropriate (see paragraphs 5.74 to 5.76).
Long-term securities other than shares, excluding financial derivatives (F.332)
5.60. Definition: The sub-position long-term securities other than shares
excluding financial derivatives (F.332) consists of all
transactions in long-term securities other than shares
excluding financial derivatives (AF.332) that is securities
other than shares with a long-term original maturity (see
paragraph 5.22) except financial derivatives.
5.61. Long-term securities are generally issued with coupons.
5.62. Sub-position AF.332 includes:
(a) bearer bonds;
(b) subordinated bonds, often referred to as subordinated debt;1996R2223 — EN — 07.08.2003 — 008.001 — 134
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(c) bonds with optional maturity dates, the latest of which is more than
one year away;
(d) undated or perpetual bonds;
(e) floating rate notes (FRNs);
(f) index-linked securities, where the value of the principal is linked to a
price index, the price of a commodity, or to an exchange rate index;
(g) deep-discount bonds and zero-coupon bonds;(h) eurobonds. A bond issue that is placed simultaneously on the market
of at least two countries and is denominated in currency which need
not be that of either, usually through international syndicates of
financial corporations of several countries;
(i) privately issued bonds, that is bonds restricted by bilateral agreement
to certain investors, if they are at least potentially transferable; if not,
they are treated as long-term loans;
(j) loans that have become negotiable de facto. This should be
interpreted to mean only if they are traded on an organized secondary
market (see paragraph 5.79.);
(k) securities resulting from the conversion of loans. A conversion
involves two financial transactions: the liquidation of the loan and the
creation of the new securities;
(l) debentures and loan stock convertible into shares, whether shares of
the issuing corporation or shares of another corporation, so long as
they have not yet been converted. A conversion involves two
financial transactions: the liquidation of the debenture or loan stock
and the share issue. Where separable from the underlying bond, the
conversion option should be regarded as a separate financial asset
classified in the sub-category financial derivatives (AF.34) (see
paragraphs 5.67. a and 5.67. b);
(m) shares or stocks that pay a fixed income but do not provide for
participation in the distribution of the residual value of a corporation
on dissolution, including non participating preference shares.
5.63. Sub-position AF.332 includes further financial assets issued as part of the
securitization of loans, mortgages, credit card debt, accounts receivable
and other assets. Sometimes the new security is issued as replacement for
the original asset, which is effectively liquidated. Alternatively, the
original asset is transferred to another institutional unit and the new
securities replace the original asset on the original institutional unit's
balance sheet. In this case the original asset should be recorded on the
balance sheet of the new institutional unit that holds it.
5.64. Sub-position F.332 does not include:
(a) transactions in securities as part of repurchase agreements.
Repurchase agreements are classified in the sub-category other
deposits (see paragraph 5.46. f) or in the category loans (see
paragraph 5.81. d) depending on the institutional units involved. The
stock lent or subject to repurchase does not change balance sheet and
remains classified in AF.332;
(b) transactions in non-negotiable securities. They are classified in sub-
category long-term loans;
(c) transactions in non-negotiable loans, including those which have been
sold to a third party, but for which no organized secondary market
exists (see paragraph 5.79).
Financial derivatives (F.34)
5.65. Definition: The sub-category financial derivatives (F.34) consists of all
transactions in financial derivatives (AF.34) that is financial
assets based on or derived from a different underlying
instrument. The underlying instrument is usually another
financial asset, but may also be a commodity or an index.
5.66. Financial derivatives are also referred to as secondary instruments and
since risk avoidance is frequently a motivation for their creation, they are
also referred to as hedging instruments. Only those secondary instruments
which have a market value because they are tradable or can be offset on
the market are financial assets in the system and are classified in the sub-
category AF.34 (see paragraph 5.05).
5.67. Sub-category AF.34 includes:
(a) options, tradable and over-the-counter (OTC). Options are contingent
assets which give their holders the right, but not the obligation, to1996R2223 — EN — 07.08.2003 — 008.001 — 135
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purchase from (in the case of a call option) or to sell to (in the case of
a put option) the issuer of the option (the option writer) financial or
non-financial assets (the underlying instrument) at a predetermined
price (the strike price) within a given time span (American option) or
on a given date (European option). The purchaser of the option pays a
premium (the option price) for the commitment of the option writer to
sell or to purchase the specified amount of the underlying asset or to
provide, on demand of the purchaser, appropriate remuneration. By
convention, that commitment is treated as a liability of the option
writer because the option price represents the current cost to the
option writer of buying out his contingent liability;
(b) warrants. They are a form of tradable options, which give their
holders the right to purchase from the issuer of the warrant (usually a
corporation) a certain number of shares or bonds under specified
conditions for a designated period of time. There are also currency
warrants, the value of which is based on the amount of one currency
required to purchase another currency at or before the expiration date
of the warrant and cross-currency warrants tied to third currencies. By
convention, the issuer of the warrant is considered to have incurred a
liability representing the current cost of buying out the issuer's
contingent liability;
(c) futures, but only if they have a market value because they are tradable
or can be offset. Futures are commitments to deliver, or to take
delivery of, a specified quantity of a standard grade of a commodity,
foreign exchange, or a security at a fixed price and for a specified
delivery date or period. Futures may also be based on an index rather
than a specific financial or non-financial asset;
(d) swaps, but only if they have a market value because they are tradable
or can be offset. Swaps are contractual arrangements between two
parties who agree to exchange, over time and according to
predetermined rules, streams of payment of the same amount of
indebtedness. The most prevalent varieties are interest rate swaps,
foreign exchange swaps and currency swaps (also named cross-
currency interest swaps). Interest rate swaps involve an exchange of
interest payments of different character, such as fixed rate for floating
rate, two different floating rates, fixed rate in one currency and
floating rate in another, etc. Foreign exchange swaps (including all
forward contracts) are transactions in foreign currencies at a rate of
exchange stated in advance. Currency swaps involve an exchange of
specified amounts of two different currencies with subsequent
repayments, which include both interest and repayment flows, over
time according to predetermined rules. None of the resulting
payments is considered as property income in the system and all
settlements are to be recorded in the financial account;
(e) forward rate agreements (FRAs), but only if they have a market value
because they are tradable or can be offset. FRAs are contractual
arrangements in which two parties, in order to protect themselves
against interest rate changes, agree on an interest to be paid, at a
settlement date, based on a notional amount of principal that is never
exchanged. The payments are related to the difference between the
agreement rate and the prevailing market rate at the time of
settlement. These payments are not considered as property income
in the system but are to be recorded under the item financial
derivatives.
5.68. Sub-category AF.34 does not include:
(a) the underlying instrument upon which the financial derivative is
based;
(b) repayable margin payments related to financial derivatives. They are
classified in other deposits (AF.29) (see paragraph 5.46. e) or loans
(AF.4) (see paragraph 5.81. c) depending on the institutional units
involved;
(c) secondary instruments, which are not tradable and cannot be offset on
the market.
LOANS (F.4)
5.69. Definition: The category loans (F.4) consists of all transactions in loans
(AF.4) that is financial assets created when creditors lend
funds to debtors, either directly or through brokers, which
are either evidenced by non-negotiable documents or not
evidenced by documents.1996R2223 — EN — 07.08.2003 — 008.001 — 136
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5.70. Generally loans are characterized by the following features:
(a) the conditions governing a loan are either fixed by the financial
corporation granting the loan or negotiated by the lender and the
borrower directly or through a broker;
(b) the initiative concerning a loan normally lies with the borrower;
(c) a loan is an unconditional debt to the creditor which has to be repaid
at maturity and which is interest-bearing.
5.71. Category F.4 may be divided, when relevant, into two sub-categories of
financial transactions;
(a) short-term loans (F.41);
(b) long-term loans (F.42).
Short-term loans (F.41)
5.72. Definition: The sub-category short-term loans (F.41) consists of all
transactions in short-term loans (AF.41) that is loans with a
short-term original maturity (see paragraph 5.22) and loans
repayable on demand.
Long-term loans (F.42)
5.73. Definition: The sub-category long-term loans (F.42) consists of all
transactions in long-term loans (AF.42) that is loans with a
long-term original maturity (see paragraph 5.22).
5.74. The distinction between transactions in loans (F.4) and transactions in
deposits (F.22, F.29) may often be based on the criterion who is taking the
initiative for the transaction. In cases where the initiative is taken by a
borrower, the transaction is to be classified in the category loans. In cases
where the initiative is taken by a lender, the transaction is to be classified
in one of the deposit sub-categories. However, the criterion of who is
taking the initiative is often a matter of judgement.
5.75. By convention, short-term loans granted to monetary financial institutions,
resident or non-resident, are normally classified in one of the deposit sub-
categories (AF.22, AF.29), and short-term deposits accepted by institu-
tional units other than monetary financial institutions, resident or non-
resident, are normally classified in sub-category short-term loans (AF.41).
Therefore, deposits are liabilities predominantly of resident and non-
resident monetary financial institutions (see paragraphs 5.44 and 5.49),
while monetary financial institutions normally have no short-term loan
liabilities in the system.
5.76. It might be useful analytically to allow for exceptions to the above
conventions. Examples are savings deposits with general government and
non-monetary gold swaps between monetary financial institutions (see
paragraph 5.81. e) (1).
5.77. The distinction between transactions in loans (F.4) and transactions in
securities other than shares (F.3) can be based on the degree of
marketability of the financial assets and its implications.
5.78. Security issues consist of a large number of identical documents, each
evidencing a round sum, which together form the total amount borrowed.
Compared with this, loans are evidenced in most cases by a single
document and transactions in loans are carried out between one creditor
and one debtor. In the case of syndicated loans, however, the loan is
granted by several creditors.
5.79. Secondary trade in loans exists. However, individual loans are only traded
incidentally. In cases where a loan becomes negotiable on an organized
market, it is to be classified in the category securities other than shares.
An explicit conversion of the original loan is normally involved (see
paragraphs 5.62. j and 5.62. k).
5.80. Standard loans are offered in most cases by financial corporations and
they are often granted to households. The financial corporations determine
the conditions and the households may only choose either to accept or not
to accept. Compared with this, the conditions of non-standard loans are1996R2223 — EN — 07.08.2003 — 008.001 — 137
(1) Foreign exchange swaps between the central bank and other monetary financial
institutions, that is a central bank acquires foreign exchange from another monetaryfinancial institution in return for a deposit at the central bank and there is a commitmentto reverse the transaction at a later date, are not classified in the category loans. This is a
deviation from the 1993 SNA (11.33).
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usually the result of negotiations between the creditor and the debtor. This
is an important criterion which facilitates a distinction between non-
standard loans and securities other than shares. In the case of public
security issues, the issue conditions are determined by the borrower,
possibly after consulting the bank/lead-manager. In the case of private
security issues, however, the creditor and the debtor negotiate the issue
conditions (see paragraph 5.62. i).
5.81. Category AF.4 includes:
(a) balances on current accounts, for example, intra-group balances
between non-financial corporations and their non-resident subsidi-
aries, but excluding balances which are liabilities of monetary
financial institutions classified in the deposit sub-categories;
(b) balances of employees because of participation in the corporation's
profits;
(c) repayable margin payments related to financial derivatives which are
liabilities of institutional units other than monetary financial
institutions (see paragraph 5.46. e);
(d) short-term repurchase agreements (repos) which are liabilities of
institutional units other than monetary financial institutions (see
paragraph 5.46. f) and long-term repurchase agreements;
(e) loans arising from non-monetary gold swaps. These are arrangements
involving the temporary exchange of non-monetary gold for deposits.
Their economic nature is similar to that of a collateralized loan in
that the purchaser of the gold is providing to the seller advances
backed by the gold for the period of the arrangement and is receiving
a return from the fixed price when the gold is repurchased;
(f) loans which are counterparts of bankers' acceptances (see paragraph
5.58. d);
(g) financial leasing and hire-purchase agreements (1);
(h) loans to finance trade credits;
(i) mortgage loans;
(j) consumer credit;
(k) revolving credits;
(l) instalment loans;
(m) loans paid as a guarantee for fulfilling certain obligations.
5.82. Category AF.4 includes further:
(a) financial claims or liabilities arising from the medium-term financial
assistance for Member States' balances of payments. The loans are
administered by the EMI (2);
(b) financial claims on the IMF evidenced by loans under the General
Arrangements to Borrow or under special borrowing arrangements
with members;
Liabilities to the IMF evidenced by loans under the Structural Adjustment
Facility, the Enhanced Structural Adjustment Facility, and the Trust Fund.
5.83. Category AF.4 does not include:
(a) other accounts receivable/payable (AF.7), including trade credits and
advances (AF.71);
(b) financial assets or liabilities arising from the ownership of immovable
assets, such as land and structures, by non-residents. They are
classified in sub-position other equity (AF.513) (see paragraph 5.95.
f).
5.84. Loans may be financial assets or liabilities of all sectors and the rest of the
world. However, monetary financial institutions have normally no short-
term loan liabilities in the system.1996R2223 — EN — 07.08.2003 — 008.001 — 138
(1) See Annex II ‘Leasing and hire purchase of durable goods’.
(2) Article 6.1 third indent of the Protocol on the Statute of the European Monetary Institute
annexed to the Treaty establishing the European Community.
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5.85. The sub-categories short-term loans and long-term loans are not divided
into sub-positions in the system. Nevertheless, it may be useful
analytically to divide, in particular, long-term loans into consumer
credit (1), mortgage loans (2) and other loans.
SHARES AND OTHER EQUITY (F.5)
5.86. Definition: The category shares and other equity (F.5) consists of all
transactions in shares and other equity (AF.5) that is
financial assets which represent property rights on corpora-
tions or quasi-corporations. These financial assets generally
entitle the holders to a share in the profits of the corporations
or quasi-corporations and to a share in their net assets in the
event of liquidation (3).
Shares offered for sale but not taken up on issue are not
recorded in the system. Shares and other equity are
redeemed when purchased by the issuing corporation or
when exchanged for the net assets of a corporation in the
event of its liquidation.
5.87. Category F.5 is divided into two sub-categories of financial transactions:
(a) shares and other equity, excluding mutual funds shares (F.51);
(b) mutual funds shares (F.52).
Shares and other equity, excluding mutual funds shares (F.51)
5.88. Definition: The sub-category shares and other equity excluding mutual
funds shares (F.51) consists of all transactions in shares and
other equity excluding mutual funds shares (AF.51) that is
financial assets except mutual fund shares which represent
property rights on corporations or quasi-corporations. These
financial assets generally entitle the holders to a share in the
profits of the corporations or quasi-corporations and to a
share in their net assets in the event of liquidation.
5.89. Sub-category F.51 may be divided, when relevant, into three sub-positions
of financial transactions:
(a) quoted shares, excluding mutual funds shares (F.511);
(b) unquoted shares, excluding mutual funds shares (F.512);
(c) other equity (F.513).
Quoted shares, excluding mutual funds shares (F.511), and unquoted shares,
excluding mutual funds shares (F.512)
5.90. Definition: The sub-position quoted shares excluding mutual funds
shares (F.511) consists of all transactions in quoted shares
excluding mutual funds shares (AF.511) and the sub-position
unquoted shares excluding mutual funds shares (F.512)
consists of all transactions in unquoted shares excluding
mutual funds shares (AF.512). Shares cover beneficial
interest in the capital of corporations in the form of
securities which in principle are negotiable. Sub-position
AF.511 covers those shares with prices quoted on a
recognized stock exchange or other form of secondary
market, and sub-position AF.512 covers those shares that are
not quoted.
5.91. Sub-positions AF.511 and AF.512 include:
(a) capital shares issued by limited liability companies: these are
securities which give the holders the status of joint owners and1996R2223 — EN — 07.08.2003 — 008.001 — 139
(1) Consumer credit are loans granted to households, which in the case of these transactions
are acting for purposes outside their business and profession. Mortgage loans for
financing house building or buying (amongst others bridging loans) are excluded. It isthe intention that consumer credit relates exclusively to credits used for buying goodsand/or services which are consumed by the households individually. National practicesmight necessitate a somewhat different definition.
(
2) Mortgage loans are long-term loans secured by a mortgage on a dwelling used by the
borrower for its own accommodation. National practices might necessitate a somewhatdifferent definition.
(
3) Net assets in the event of liquidation are defined as the amount of assets of an enterprise
less all liabilities other than liabilities to the owners themselves in respect of their
invested capital.
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entitle them both to a share in the total distributed profits and to a
share in the net assets in the event of liquidation;
(b) redeemed shares in limited liability companies: these are shares whose
capital has been repaid but which are retained by the holders who
continue to be joint owners and to be entitled to a share in the profits
left after dividends have been paid on the remaining registered capital
and also to a share in any surplus which may be left on liquidation, i.e.
the net assets less the remaining registered capital;
(c) dividend shares issued by limited liability companies: these are
securities:
1. which, according to country and the circumstances in which they
are created, have a variety of names such as founders' shares,
profits shares, dividend shares, etc. and which are not part of the
registered capital;
2. which do not give the holders the status of joint owners strictly
speaking (the right to a share in the repayment of the registered
capital, the right to a return on this capital, the right to vote at
shareholders' meetings, etc.);
3. which entitle the holders to a proportion of any profits remaining
after dividends have been paid on the registered capital and to a
fraction of any surplus remaining on liquidation;
(d) preferred (preference) stocks or shares which provide for participation
in the distribution of the residual value on dissolution of a
corporation. These may be quoted or unquoted on a recognized
exchange.
5.92. Sub-positions AF.511 and AF.512 do not include:
(a) shares offered for sale but not taken up on issue. They are not
recorded in the system;
(b) debentures and loan stock convertible into shares. They are shown in
the accounts under sub-category AF.33 up to the time when they are
converted (see paragraph 5.62. l);
(c) the equity of partners with unlimited liability (unlimited partners) in
incorporated partnerships. They are classified in sub-position AF.513;
(d) government investments in the capital of international organizations
which are legally constituted as corporations with share capital. They
are classified in sub-position AF.513 (see paragraph 5.95. c).
5.93. Sub-positions F.511 and F.512 do not include issues of bonus shares that
is the remittance of new shares to shareholders in proportion to their
holdings. Such an issue, which changes neither the liability of the
corporation vis-à-vis the shareholders nor the proportion of the assets that
each shareholder holds in the corporation, does not constitute a financial
transaction and is not recorded in the system (see paragraph 6.56). The
same applies for share split issues.
Other equity (F.513)
5.94. Definition: The sub-position other equity (F.513) consists of all
transactions in other equity (AF.513) that is all forms of
equity other than those classified in sub-positions AF.511
and AF.512, and in sub-category AF.52.
5.95. Sub-position AF.513 includes:
(a) all forms of equity in corporations which are not shares:
1. the equity in incorporated partnerships subscribed by unlimited
partners;
2. the equity in limited liability companies whose owners are partners
and not shareholders;
3. the capital invested in ordinary or limited partnerships recognised
as independent legal entities;
4. the capital invested in cooperative societies recognized as
independent legal entities;
(b) investments by general government in the capital of public
enterprises, whose capital is not divided into shares, which by virtue
of special legislation are recognized as independent legal entities (see
paragraph 2.16. c);
(c) government investments in the capital of international and suprana-
tional organizations, with the sole exception of the IMF, even if these1996R2223 — EN — 07.08.2003 — 008.001 — 140
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are legally constituted as companies with share capital (e.g. the
European Investment Bank);
(d) the financial resources of the EMI provided out of contributions by
the national central banks (1);
(e) capital invested in financial and non-financial quasi-corporations (see
paragraph 2.13. f). The amount of such investments corresponds to
new investments (in cash or kind) less any capital withdrawals (see
paragraph 4.61);
(f) the financial assets that non-resident units have against notional
resident units (see paragraph 2.15) and vice versa.
Mutual funds shares (F.52)
5.96. Definition: The sub-category mutual funds shares (F.52) consists of all
transactions in mutual funds shares (AF.52) that is shares
issued by a specific type of financial corporation, whose
exclusive purpose is to invest the funds collected on the
money market, the capital market and/or in real estate.
5.97. Sub-category AF.52 includes the shares issued by financial corporations
called, according to country, mutual funds, unit trusts, investment trusts
and other collective investment schemes, e.g. UCITS, whether they are
open-ended, semi-open or closed-end funds. These shares may be quoted
or unquoted. When they are unquoted, they are usually repayable on
request, at a value corresponding to their share in the own funds of the
financial corporation. These own funds are revalued regularly on the basis
of the market prices of their various components.
INSURANCE TECHNICAL RESERVES (F.6) (2)
5.98. Definition: The category insurance technical reserves (F.6) consists of
all transactions in insurance technical reserves (AF.6) that is
the technical provisions of insurance corporations and
(autonomous and non-autonomous) pension funds against
policy holders or beneficiaries as laid down in Council
Directive 91/674/EEC of 19 December 1991 on the annual
accounts and consolidated accounts of insurance under-
takings (3).
5.99. Category AF.6 covers:
(a) net equity of households in life insurance reserves;
(b) net equity of households in pension funds reserves;
(c) prepayments of insurance premiums;
(d) reserves for outstanding claims.
5.100. Insurance technical reserves are financial assets:
(a) for policy holders — in respect of net equity of households in life
insurance reserves and in pension funds reserves, and prepayments of
insurance premiums;
(b) for beneficiaries — in respect of reserves for outstanding claims.
5.101. Insurance technical reserves are liabilities:
(a) of life or non-life insurance corporations and autonomous pension
funds included in the subsector insurance corporations and pension
funds (S.125);
(b) of non-autonomous pension funds included in the sectors of the
institutional units that set them up.
Provisions or similar funds constituted by employers to provide
employees with pensions (non-autonomous pension funds) are only
included in category AF.6 if they are calculated according to actuarial
criteria similar to those used by insurance corporations and autonomous
pension funds. Otherwise, these provisions are covered by the shares or
other equity issued by the institutional unit that sets up the provisions.
5.102. Category AF.6 does not include provisions established by institutional
units classified in the sub-sector social security funds (S.1314). In the1996R2223 — EN — 07.08.2003 — 008.001 — 141
(1) Article 16.2 of the Protocol on the Statute of the European Monetary Institute annexed to
the Treaty establishing the European Community.
(2) See Annex III on insurance for a description of the treatment of social insurance and
other insurance in the system.
(3) OJ No L 374, 31. 12. 1991, pp. 7—31.
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system, these provisions are not liabilities of the social security funds sub-
sector.
5.103. Category F.6 is divided into two sub-categories of financial transactions:
(a) net equity of households in life insurance reserves and in pension
funds reserves (F.611);
(b) prepayments of insurance premiums and reserves for outstanding
claims (F.62).
Net equity of households in life insurance reserves and in pension funds
reserves (F.61)
5.104. Definition: The sub-category net equity of households in life insurance
reserves and in pension funds reserves (F.61) consists of all
transactions in net equity of households in life insurance
reserves and in pension funds reserves (AF.61) that is
technical provisions set aside in the corporations and quasi-
corporations concerned for the purpose of satisfying, once
the established conditions are met, the claims and benefits
foreseen.
5.105. Sub-category F.61 is divided into two sub-positions of financial
transactions:
(a) net equity of households in life insurance reserves (F.61);
(b) net equity of households in pension funds reserves (F.612).
Net equity of households in life insurance reserves (F.611)
5.106. Definition: The sub-position net equity of households in life insurance
reserves (F.611) consists of all transactions in net equity of
households in life insurance reserves (AF.611) that is
technical provisions against outstanding risks and technical
provisions for with-profit insurance that add to the value on
maturity of with-profit endowments or similar policies.
5.107. Sub-position AF.611 includes life insurance provisions, provisions for
bonuses and rebates and technical provisions for life insurance policies
where the investment risk is borne by the policyholders as defined in
Articles 27, 29 and 31 of Council Directive 91/674/EEC of 19 December
1991 on the annual accounts and consolidated accounts of insurance
undertakings.
5.108. Transactions in net equity of households in life insurance reserves consist
of additions less reductions, which are to be distinguished from nominal
holding gains or losses on the funds invested by insurance corporations
(see paragraph 6.57).
Additions consist of:
(a) actual premiums earned during the current accounting period;
(b) plus premium supplements corresponding to the income from the
investment of the provisions, which is attributed to policy holding
households;
(c) less service charges for life insurance.
Reductions consist of:
(a) amounts due to holders of endowment and similar insurance policies
when they mature and amounts due to beneficiaries from deaths of
insured persons;
(b) plus payments due on policies that are surrendered before maturity.
5.109. Life insurance reserves are financial assets of resident or non-resident
households and liabilities of resident or non-resident insurance corpora-
tions.
In the case of a group insurance taken out, for example, by a corporation
on behalf of its employees, the employees, but not the employer, are
deemed to be the creditors, since they are considered as the real policy
holders.
Net equity of households in pension funds reserves (F.612)
5.110. Definition: The sub-position net equity of households in pension funds
reserves (F.612) consists of all transactions in net equity of
households in pension funds reserves (AF.612) that is
technical provisions held by autonomous and non-autono-1996R2223 — EN — 07.08.2003 — 008.001 — 142
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mous pension funds established by employers and/or
employees or groups of self-employed to provide pensions
for employees or self-employed.
5.111. Transaction in net equity of households in pension funds reserves consist
of additions less reductions, which are to be distinguished from nominal
holding gains or losses on the funds invested by pension funds (see
paragraph 6.57).
Additions consist of:
(a) actual contributions into pension funds payable by employees,
employers, self-employed or other institutional units on behalf of
individuals or households with claims on the funds and earned during
the current accounting period;
(b) plus contribution supplements corresponding to the income earned
from the investment of the provisions of the pension funds, which are
attributed to participating households;
(c) less service charges during the period for managing the funds.
Reductions consist of:
(a) social benefits equal to the amounts payable to retired persons or their
dependants in the form of regular payments or other benefits;
(b) plus social benefits which consist of any lump sums payable to
persons when they retire.
5.112. Transactions in net equity of households in pension funds reserves do not
include funds transferred from non-autonomous pension funds to
autonomous pension funds, classified in the subsector insurance corpora-
tions and pension funds (S.125), as a result of the conversion of one fund
into another. This event is to be recorded in the category changes in sector
classification and structure (K.12.1) of the other changes in the volume of
assets account (see paragraph 6.30).
5.113. Pension funds reserves are financial assets of resident or non-resident
households but not financial assets of the institutional units that manage
them.
Prepayments of insurance premiums and reserves for outstanding claims
(F.62)
5.114. Definition: The sub-category prepayments of insurance premiums and
reserves for outstanding claims (F.62) consists of all
transactions in prepayments of insurance premiums and
reserves for outstanding claims (AF.62) that is technical
provisions established by insurance corporations and (auton-
omous and non-autonomous) pension funds for:
(a) the amount representing that part of gross premiums
written which is to be allocated to the following
accounting period (prepayments of insurance
premiums);
(b) the total estimated ultimate cost of settling all claims
arising from events which have occurred up to the end of
the accounting period, whether reported or not, less
amounts already paid in respect of such claims
(provisions for outstanding claims).
5.115. Prepayments of insurance premiums result from the fact that insurance
premiums are, in general, due to be paid at the start of the period covered
by the insurance, and this period does not normally coincide with the
accounting period itself. Therefore, at the end of the accounting period
when the balance sheet is drawn up, parts of the insurance premiums
payable during the accounting period are intended to cover risks in the
subsequent period. The prepayments of insurance premiums are
determined on the basis of the proportion of the risks involved in relation
to time for the period remaining to run until the contract expires.
In the financial account, the prepayments of insurance premiums recorded
between policy holders and insurance corporations consist of those parts
of the premiums that are payable in the current accounting period and that
are intended to cover risks outstanding during the following period.
5.116. The prepayments of insurance premiums are financial assets of the policy
holders. If these prepayments relate to life insurance, the policy holders
are resident or non-resident households. If they relate to non-life
insurance, the policy holders may belong to any sector of the economy
or to the rest of the world. The insurance premiums or social contributions1996R2223 — EN — 07.08.2003 — 008.001 — 143
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paid by the policy holders may be taken as the criterion to distribute the
prepayments of insurance premiums among the sectors of the economy
and the rest of the world.
5.117. Reserves for outstanding claims are held by insurance corporations in
order to cover the amounts they expect to pay out in respect of claims that
are not yet settled, for example, because they are disputed. Valid claims
accepted by insurance corporations are considered due for payment when
the event that gives rise to the claim occurs, however long it takes to settle
disputed claims.
5.118. Reserves for outstanding claims are financial assets of the beneficiaries
that may belong to any sector of the economy or to the rest of the world.
5.119. Sub-category AF.62 includes provisions for unearned premiums, other
technical provisions, claims outstanding and equalization provisions as
defined in Articles 25, 26, 28 and 30 of Council Directive 91/674/EEC of
19 December 1991 on the annual accounts and consolidated accounts of
insurance undertakings.
OTHER ACCOUNTS RECEIVABLE/PAYABLE (F.7)
5.120. Definition: The category other accounts receivable/payable (F.7)
consists of all transactions in other accounts receivable/
payable (AF.7) that is financial claims which are created as a
counterpart of a financial or a non-financial transaction in
cases where there is a timing difference between this
transaction and the corresponding payment.
5.121. Category F.7 includes transactions in financial claims which stem from
the early or late payment for transactions in goods or services, distributive
transactions or secondary trade in financial assets. They consist of the
counterpart transactions in case payment is due and not yet paid. Debts
arising from income accruing over time and arrears are also classified
under this category.
5.122. Category F.7 does not include:
(a) statistical discrepancies other than timing differences between
transactions in goods and services, distributive transactions or
financial transactions and the corresponding payments;
(b) items about which there is not enough information for them to be
classified. The classification should be based on whatever information
is available;
(c) items about whose nature nothing whatsoever is known;
(d) the miscellaneous item of the balance of payments described as net
errors and omissions;
(e) early or late payment (inclusive of arrears) in case of the creation of
financial assets or the redemption of liabilities other than classified in
category F.7. They remain classified in their category.
5.123. Category F.7 is divided into two sub-categories of financial transactions:
(a) trade credits and advances (F.71);
(b) other accounts receivable/payable, excluding trade credits and
advances (F.79).
Trade credits and advances (F.71)
5.124. Definition: The sub-category trade credits and advances (F.71) consists
of all transactions in trade credits and advances (AF.71) that
is financial claims arising from the direct extension of credit
by suppliers and buyers for goods and services transactions
and advance payments for work that is in progress or to be
undertaken and associated with such transactions.
5.125. Sub-category AF.71 includes:
(a) financial claims relating to the delivery of goods or services where
payment has not taken place;
(b) trade credit accepted by factoring corporations except when regarded
as a loan;
(c) rent of buildings accruing over time;
(d) arrears concerning the payment of goods and services, when not
evidenced by a loan.1996R2223 — EN — 07.08.2003 — 008.001 — 144
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5.126. Sub-category AF.71 does not include loans to finance trade credits. They
are classified in category AF.4 (see paragraph 5.81. h).
5.127. Trade credits and advances may be financial assets or liabilities of all
sectors and the rest of the world.
Other accounts receivable/payable, excluding trade credits and advances
(F.79)
5.128. Definition: The sub-category other accounts receivable/payable
excluding trade credits and advances (F.79) consists of all
transactions in other accounts receivable/payable excluding
trade credits and advances (AF.79) that is financial claims
which arise from timing differences between distributive
transactions or financial transactions on the secondary
market and the corresponding payment. It includes also
financial claims due to income accruing over time.
5.129. Sub-category AF.79 includes financial claims created as a result of the
timing difference between accrued transactions and payments made in
respect of, for example:
(a) taxes;
(b) social contributions;
(c) wages and salaries;
(d) rents on land and subsoil assets;
(e) dividends;
(f) interest;
(g) transactions in financial assets on the secondary market.
The amounts of taxes and social contributions payable to the general
government to be included under AF.79 should not include the part of
these taxes and social contributions which is unlikely to be collected, and
which therefore represents a general government claim that has no real
value.
5.130. Preferably, the counterpart financial transaction of interest accruing on
financial assets (see paragraph 5.17) should be recorded as being
reinvested in that financial asset. The recording of interest will, however,
have to follow national practices. If the interest accrual is not recorded as
being reinvested in the financial asset, it should be classified in sub-
category F.79.
5.131. At the date due for payment of interest, two financial transactions are
recorded (see paragraph 5.17): firstly, in the event of payment, a
transaction in the financial asset used for payment, or, in the event of non-
payment, an increase of interest arrears to be recorded in sub-category
F.79; secondly, the counterpart financial transaction reducing the net
financial claim of the creditor against the debtor.
MEMORANDUM ITEM: DIRECT FOREIGN INVESTMENT (F.m)
5.132. Definition: Direct foreign investment (F.m) consists of all transactions
in direct foreign investment (AF.m) that is investment
involving a long-term relationship reflecting a lasting
interest of a resident institutional unit in one economy
(‘direct investor’) in an institutional unit resident in an
economy other than that of the investor (‘direct investment
enterprise’). The direct investor's purpose is to exert a
significant degree of influence on the management of the
enterprise resident in the other economy. Direct investment
involves both the initial transaction between the direct
investor and the direct investment enterprise and all
subsequent capital transactions between them and among
affiliated enterprises, both incorporated and unincorpo-
rated (1).
5.133. Transactions in financial assets and liabilities that constitute direct foreign
investment are to be recorded under the appropriate categories of financial
transactions, i.e. loans (F.4), shares and other equity (F.5) and other
accounts receivable/payable (F.7). However, the amounts of direct foreign1996R2223 — EN — 07.08.2003 — 008.001 — 145
(1) OECD benchmark definition of foreign direct investment, third edition.▼M4
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investment included within each of those categories should also be
recorded separately as a memorandum item.
ACCOUNTING RULES FOR FINANCIAL TRANSACTIONS
VALUATION
5.134. Financial transactions are recorded at the transaction values, that is, the
values in national currency at which the financial assets and/or liabilities
involved are created, liquidated, exchanged or assumed between
institutional units, or between them and the rest of the world, on the
basis of commercial considerations only.
5.135. Financial transactions and their financial or non-financial counterpart
transactions are recorded at the same transaction value. Three possibilities
can be envisaged:
(a) the financial transaction is a transaction in means of payment in
national currency (see paragraphs 5.04 and 5.23): the transaction
value is equal to the amount of the means of payment exchanged;
(b) the financial transaction is a transaction in means of payment in
foreign currency (see paragraphs 5.04 and 5.23) and the counterpart
transaction is not a transaction in means of payment in national
currency: the transaction value is equal to the amount of the means of
payment exchanged converted into national currency applying the
market rate prevailing when the payment takes place;
(c) neither the financial transaction nor its counterpart transaction is a
transaction in means of payment (see paragraph 5.04): the transaction
value is identified with the current market value of the financial assets
and/or liabilities involved.
5.136. The transaction value refers to a specific financial transaction and its
counterpart transaction. In concept, the transaction value is to be clearly
distinguished from a value based on a price quoted in the market, a fair
market price, or any price that is intended to express the generality of
prices for a class of similar or even identical financial assets and/or
liabilities. However, in cases where the counterpart transaction of a
financial transaction is, for example, a transfer and therefore the financial
transaction is undertaken other than for purely commercial considerations,
the transaction value is identified with the current market value of the
financial assets and/or liabilities involved.
5.137. The transaction value does not include service charges, fees, commissions,
and similar payments for services provided in carrying out the
transactions; these are to be recorded as payments for services. Taxes
on financial transactions are also excluded and treated as taxes on services
within taxes on products. When a financial transaction involves a new
issue of liabilities, the transaction value is equal to the amount of the
liability incurred exclusive of any prepaid interest. Similarly, when a
liability is extinguished, the transaction value for both creditor and debtor
must correspond to the reduction of the liability.
Special valuation criteria for some sub-categories of financial transactions
5.138. Securities other than shares, excluding financial derivatives (F.33)
(a) When securities are marketed by issuers through underwriters or other
intermediaries and then sold at higher prices to final investors, the
financial assets and liabilities are to be recorded at the values paid by
the investors. The differences between the amounts paid by the
investors and those received by the issuers should be treated as service
payments paid by the issuers to the underwriters.
(b) Security issues are recorded at the issue value. When securities are
issued at a discount or at a premium, the proceeds to the issuer at the
time of sale, and not the face value, are recorded in the accounts as the
actual issue value. The difference between the issue value and the
redemption value is treated as interest that is accrued over the life of
the security.
(c) Deep-discount or zero-coupon bonds should be treated as securities
issued at a discount. The interest is accrued over the life of the bondsand treated as being reinvested in such bonds (see paragraph 4.46).
(d) When long-term securities are issued at a discount, which is not
significant, the difference between the issue value and the redemption
value can be imputed at the date of issue.1996R2223 — EN — 07.08.2003 — 008.001 — 146
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(e) In case of securities where the value of the principal is linked to a
price index, the price of a commodity or an exchange rate index, the
issue price of the security is recorded as the principal and the index
payment paid periodically and/or at maturity is treated as interest that
is accrued over the life of the security, and the counterpart is recorded
as reinvestment in securities other than shares in the financial account.
(f) Investment in securities in circulation on the secondary market is
recorded at the stock exchange quotation or market price.
(g) Securities which have reached maturity are recorded at redemption
value, which includes redemption premiums but excludes payments
by lottery and savings premiums, which are recorded as interest.
(h) The conversion of bonds into shares should be treated as a sale of
bonds and a purchase of shares (see paragraph 5.62. l). The
transaction value is to be derived from the market value of the bonds
disposed of, possibly implying a holding gain or loss on shares to be
recorded in the revaluation account (see paragraph 6.54).
5.139. Financial derivatives (F.34)
(a) Secondary trade in options and closing out options prior to delivery
involve financial transactions. If an option proceeds to delivery, it
may be exercised or not exercised. In cases where the option is
exercised, there may be a payment from the option writer to the option
holder equal to the difference between the prevailing market price of
the underlying asset and the strike price, or, alternatively, there may
be the acquisition or sale of the underlying financial or non-financial
asset recorded at the prevailing market price and a counterpart
payment between the option holder and the option writer equal to the
strike price. The difference between the prevailing market price of the
underlying asset and the strike price is in both cases equal to the
liquidation value of the option, that is the option price at delivery. In
cases where the option is not exercised, no transaction takes place.
However, the option writer makes a holding gain and the option
holder makes a holding loss to be recorded in the revaluation account.
(b) Financial derivatives other than options typically involve contracts
where two parties agree to exchange specified assets, either real or
financial, at some future point or points in time. The transactions
which are to be recorded against such financial derivatives include
any trading in the contracts as well as the net value of settlements
made. There may also be the need to record transactions associated
with the establishment of derivative contracts. However, in many
cases, the two parties will enter into a derivative contract without any
payment by one party to the other; in these cases the value of the
transaction establishing the contract is nil and no entry is actually
required in the financial account.
(c) Any explicit commissions paid or received from brokers or
intermediaries for arranging options, futures, swaps, and other
derivatives contracts are treated as payments for services in the
appropriate accounts. The parties to a swap are not considered to be
providing a service to each other, but any payment to a third party for
arranging the swap should be treated as payment for a service. Under
a swap arrangement, where principal amounts are exchanged the
corresponding flows are to be recorded as transactions in the
underlying instrument; streams of other payments (excluding
commissions) are to be recorded under the item financial derivatives
(F.34). While the premium paid to the seller of an option can
conceptually be considered to include a service charge, in practice it is
usually not possible to distinguish the service element. Therefore, the
full price is to be recorded as acquisition of a financial asset by the
buyer and as incidence of a liability by the seller.
(d) Where swap contracts involve an exchange of principal amounts, for
example as occurs with currency swaps, the initial exchange is to be
recorded as a transaction in the underlying instrument exchanged and
not a transaction in financial derivatives (F.34). Where contracts do
not involve an exchange of principal, no transaction is recorded at
inception. In both cases, implicitly, a financial derivative with zero
initial value is created at that point. Subsequently, the value of a swap
will be equal to:
1. for principal amounts, the current market value of the difference
between the expected future market values of the amounts to be re-
exchanged and the amounts specified in the contract;
2. for other payments, the current market value of the future streams
specified in the contract.1996R2223 — EN — 07.08.2003 — 008.001 — 147
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Changes in the value of the derivative over time should be recorded in
the revaluation account.
Subsequent re-exchanges of principal will be governed by the terms
and conditions of the swap contract and may imply financial assets
being exchanged at a price different from the prevailing market price
of such assets. The counterpart payment between the parties to the
swap contract will be that specified within the contract. The
difference between the market price and the contract price is then
equal to the liquidation value of the asset/liability as it applies on the
due date and should be recorded as a transaction in financial
derivatives (F.34). On the contrary, other flows under a swap
arrangement are recorded as a transaction in financial derivatives for
the amounts effectively exchanged. All transactions in financial
derivatives must match the total revaluation gain or loss throughout
the duration of the swap contract. This treatment is analogous to that
set out with respect to options, which proceed to delivery (see point
(a)).
For an institutional unit, a swap or a forward rate agreement is
recorded under the item financial derivatives on the assets side where
it has a net asset value, positive net payments increasing the net value
(and conversely). Where the swap has a net liability value, it is
recorded on the liabilities side, negative net payments increasing the
net value (and conversely).
Changes in the value of the derivative over time should be recorded in the
revaluation account.
Subsequent re-exchanges of principal will be governed by the terms and
conditions of the swap contract and may imply financial assets being
exchanged at a price different from the prevailing market price of such
assets. The counterpart payment between the parties to the swap contract
will be that specified within the contract. The difference between the
market price and the contract price is then equal to the liquidation value of
the asset/liability as it applies on the due date and should be recorded as a
transaction in financial derivatives (F.34). This final derivative transaction
and any final net interest flow must match the total revaluation gain or
loss throughout the duration of the swap contract. This treatment is
analogous to that set out with respect to options which proceed to delivery
(see (a) above).
5.140. Shares and other equity, excluding mutual funds shares (F.51)
(a) New shares are recorded at issue value, which normally corresponds
to nominal value plus the issue premium.
(b) Transactions in shares in circulation are to be recorded at their
transaction value. When it is not known, it may be approximated by
the stock exchange quotation or market price for quoted shares and by
the book value for unquoted shares.
(c) Scrip dividend shares are valued at the price implied by the issuer's
dividend proposal.
(d) Issues of bonus shares are not recorded in the system (see paragraph
5.93). However, in cases where the issue of bonus shares involves
changes in the total market value of the shares of a corporation, the
changes are to be recorded in the revaluation account (see paragraph
6.56).
(e) The transaction value of other equity (F.513) is the amount of funds
transferred by the owners to their corporations or quasi-corporations.
In some cases, funds can be transferred by assuming liabilities of the
corporation or quasi-corporation.
5.141. Mutual funds shares (F.52)
(a) Transactions in mutual funds shares include the value of net
contributions to a fund.
(b) Property income received by mutual funds, net of a part of
management costs, and assigned to shareholders, even though it is
not distributed, has a counterpart entry in the financial account under
mutual funds shares. The effect is that property income is reinvested.
TIME OF RECORDING
5.142. Financial transactions and their counterpart transactions are to be recorded
at the same point in time.1996R2223 — EN — 07.08.2003 — 008.001 — 148
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5.143. When the counterpart of a financial transaction is a non-financial
transaction, both are recorded at the time the non-financial transaction
takes place. For example, when sales of goods or services give rise to a
trade credit, this financial transaction is to be recorded when the entries
are made in the relevant non-financial account.
5.144. When the counterpart of a financial transaction is also a financial
transaction, three possibilities can be envisaged:
(a) both financial transactions are transactions in means of payment (see
paragraph 5.04): they are recorded at the time the first payment is
made;
(b) only one of the two financial transactions is a transaction in means of
payment (see paragraph 5.04): they are recorded at the time payment
is made;
(c) neither of the two financial transactions is a transaction in means of
payment (see paragraph 5.04): they are recorded at the time the first
financial transaction takes place.
COMPILING FINANCIAL TRANSACTIONS FROM CHANGES IN
BALANCE SHEETS
5.145. In cases where basic statistics on financial transactions are not available,
financial transactions may be compiled based on changes in financial
balance sheets, that is changes in the amount of financial assets held and
liabilities outstanding between the closing balance sheet and the opening
balance sheet. The difference between the amount of financial transactions
and the changes in financial balance sheets consists of entries in the
revaluation account and the other changes in the volume of assets account.
Annex 5.1
Link with measures of money
5.146. This Annex explains a method which allows measures of money to be
shown in the balance sheets and the financial accounts.
5.147. The definitions of the measures of money applied vary among countries
and over time. In addition, these definitions are not necessarily based on
the classification of financial assets and the classification of sectors as
defined in the system. Therefore, measures of money are not defined in
the system.
5.148. The following problems appear in integrating measures of money in the
balance sheets and the financial accounts. Firstly, the measures of money
may be composed of components which do not correspond with the
classes, that is to say the categories, sub-categories and sub-positions, of
financial assets and liabilities as defined in the system. For example, a
measure of money may include only a sub-class of the category currency
and deposits (AF.2). The sub-class may be defined by a reference to
maturity and/or by a reference to the institutional units holding or issuing
currency and deposits. Secondly, the measures of money may imply
money-creating, money-holding and money-neutral sectors which cannot
be composed of the sectors and subsectors as defined in the system.
Thirdly, the data sources used for compiling monetary aggregates may in
practice differ from the data sources used for compiling the balance sheets
and the financial accounts of the sectors and the rest of the world.
5.149. In order to identify a measure of money MX in the balance sheets or the
financial accounts, it may be necessary to subdivide any class i of
financial assets and liabilities defined in the system into two sub-classes:
(a) MXi: sub-class of financial assets (liabilities) classified in class i
and included in the measure of money MX;
(b) MX−i: sub-class of financial assets (liabilities) classified in class i but
not included in the measure of money MX.
In practice, some classes of financial assets (liabilities) do not contribute
even to broad measures of money, for example, monetary gold and SDRs
(AF.1) or insurance technical reserves (AF.6). Therefore, MX1and MX6would be zero, that is to say a breakdown of AF.1 in MX and MX−1or of
AF.6 in MX6and MX−6is not necessary.
5.150. The measure of money MX is equal to the sum of all sub-classes of
financial assets MXiof the money-holding sectors and MX is equal to the
sum of all sub-classes of liabilities MXiof the money-creating sectors.
5.151. A main advantage of this method is its flexibility. In cases where the
definition of a measure of money is changed, only the breakdowns of1996R2223 — EN — 07.08.2003 — 008.001 — 149
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some classes of financial assets and liabilities into MXiand MX−ihave to
be adapted.
Measures of money in the balance sheets or the financial
accounts
Financial assets of
money-holding sectorsLiabilities of money-
creating sectors
TotalBreakdown by
sectorsBreakdown by
sectorsTotal
AF.1
AF.2
of
whichMX2
MX−2
AF.3
AF.33
of
whichMX33
MX−33
AF.34
of
whichMX34
MX−34
AF.4
AF.41
of
whichMX41
MX−41
AF.42
of
whichMX42
MX−42
AF.5
AF.51
of
whichMX51
MX−51
AF.52
of
whichMX52
MX−52
AF.6
AF.7AF.71
of
whichMX
71
MX−71
AF.79
Total of financial
assets and liabil-
ities of which MX1996R2223 — EN — 07.08.2003 — 008.001 — 150
▼B
CHAPTER 6
OTHER FLOWS
6.01. Other flows cover consumption of fixed capital (K.1), acquisitions and
disposals of non-financial non-produced assets (K.2) and other changes in
assets (K.3 to K.12).
The other changes in assets consist of different kinds of changes in assets,
liabilities and net worth which are not the result of transactions being
recorded in the capital and financial accounts. They cover other changes
in volume (K.3 to K.10 and K.12) and also holding gains and losses
(K.11).
CONSUMPTION OF FIXED CAPITAL (K.1)
6.02. Definition: Consumption of fixed capital (K.1) represents the amount of
fixed assets used up, during the period under consideration,
as a result of normal wear and tear and foreseeable
obsolescence, including a provision for losses of fixed assets
as a result of accidental damage which can be insured
against.
6.03. Consumption of fixed capital must be calculated for all fixed assets
(except animals), including both tangible fixed assets and intangible fixed
assets such as mineral exploration costs and software, major improve-
ments to non-produced assets and costs of ownership transfers associated
with non-produced assets.
6.04. Consumption of fixed capital (which should be distinguished from the
depreciation allowed for tax purposes or the depreciation shown in
business accounts) should be estimated on the basis of the stock of fixed
assets and the probable average economic life of the different categories
of those goods. For the calculation of the stock of fixed assets, the
perpetual inventory method (PIM) is recommended whenever direct
information on the stock of fixed assets is missing. The stock of fixed
assets should be valued at the purchasers' prices of the current period.
Losses of fixed assets occurring as a result of accidental damage which
can be insured against are taken into account in calculating the average
service life of the goods in question. For the economy as a whole the
actual normal accidental damage within a given accounting period may be
expected to be equal, or close, to the average. However, for individual
units and groupings of units actual normal and average accidental damage
may differ. In this case, for sectors, any difference is recorded as other
changes in volume of fixed assets.
Consumption of fixed capital is calculated according to the ‘straight line’
method, by which the value of a fixed asset is written off at a constant rate
over the whole lifetime of the good.
However, depending on the pattern of decline in the efficiency of a fixed
asset the calculation of consumption of fixed capital according to the
geometric depreciation method may be required.
6.05. In the system of accounts consumption of fixed capital is recorded below
each balancing item, which is shown gross and net. Recording ‘gross’
means without deducting consumption of fixed capital, while recording
‘net’ means after deducting consumption of fixed capital.
ACQUISITIONS LESS DISPOSALS OF NON-FINANCIAL NON-
PRODUCED ASSETS (K.2)
6.06. Definition: Non-financial non-produced assets (1) consist of land and
other tangible non-produced assets that may be used in the
production of goods and services, and intangible non-
produced assets.
6.07. Land is defined as the ground itself, including soil covering and associated
surface water (1). The associated surface water includes any inland waters
(reservoirs, lakes, rivers, etc.) over which ownership rights can be
exercised.
6.08. The following items are not included in land:
(a) buildings or other structures on the land or through it (roads, tunnels,
etc.);1996R2223 — EN — 07.08.2003 — 008.001 — 151
(1) For the definition of assets, see Annex 7.1 to chapter 7.
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(b) vineyards, orchards, or other plantations of trees and any growing
crops, etc.;
(c) subsoil assets;
(d) non-cultivated biological resources;
(e) water resources below the ground.
Items (a) and (b) are produced fixed assets, items (c), (d) and (e) belong to
tangible non-produced assets.
6.09. Acquisitions and disposals of land are valued at current market prices
prevailing at the time the acquisitions/disposals occur. Transactions in
land are recorded at the same value both in the accounts of the purchaser
and in those of the seller. This value excludes the costs involved in the
transfer of ownership of land, which are treated as gross fixed capital
formation.
6.10. Acquisitions and disposals of other tangible non-produced assets cover
subsoil assets, non-cultivated biological resources and water resources.
Subsoil assets include coal, oil and natural gas reserves, metallic mineral
reserves and non-metallic mineral reserves (1).
6.11. Acquisitions and disposals of other tangible non-produced assets are
valued at current market prices prevailing at the time the acquisitions/
diposals occur. Acquisitions and disposals exclude the associated costs of
ownership transfer. The latter are recorded as gross fixed capital
formation.
6.12. Intangible non-financial non-produced assets consist of patented entities,
leases or other transferable contracts, purchased goodwill and other
intangible non-produced assets. Such leases are on land, subsoil assets andresidential and non-residential buildings (
1). Further examples include
transferable contracts with athletes and authors. The value of the
acquisitions or disposals of leases or other transferable contracts consists
of payments made to the original or subsequent tenants or lessees when
the leases or concessions are sold or transferred to other institutional units.
The value of acquisitions and disposals of intangible non-produced assets
excludes the associated costs of ownership transfer. The costs of
ownership transfer are a component of gross fixed capital formation.
6.13. Acquisitions less disposals of non-financial non-produced assets are
recorded in the capital account of the sectors, the total economy and the
rest of the world.
OTHER CHANGES IN ASSETS (K.3 to K.12)
6.14. Definition: Other changes in assets are flows which are not the result of
transactions recorded in the capital and financial accounts.
Two kinds of other changes are distinguished. The first kind
consists of changes in the volume of assets. The second
consists of changes in the value of assets, liabilities and net
worth due to changes in the level and structure of prices
leading to holding gains or losses.
OTHER CHANGES IN VOLUME (K.3 to K.10 AND K.12)
6.15. Other changes in volume are flows with different functions. One
important function is to allow certain assets to enter and leave the system
in the normal course of events — e.g. entrances and exits of naturally
occurring assets. This is important for recording the discovery, depletion
and degradation of natural assets. A second function is to record the effect
of exceptional, unanticipated events that affect the economic benefits
derivable from assets.
6.16. The other changes in volume cover nine categories:
(a) economic appearance of non-produced assets (K.3);
(b) economic appearance of produced assets (K.4);
(c) natural growth of non-cultivated biological resources (K.5);
(d) economic disappearance of non-produced assets (K.6);
(e) catastrophic losses (K.7);
(f) uncompensated seizures (K.8);
(h) other volume changes in non-financial assets n.e.c. (K.9);1996R2223 — EN — 07.08.2003 — 008.001 — 152
(1) For the definition of assets, see Annex 7.1 to chapter 7.
▼B
(i) other volume changes in financial assets and liabilities n.e.c. (K.10);
(j) changes in classifications and structure (K.12).
ECONOMIC APPEARANCE OF NON-PRODUCED ASSETS (K.3)
6.17. Economic appearance of non-financial non-produced assets (K.3)
represents the increase in the volume of this kind of assets that is not
the result of production.
Included are:
(a) gross increases in the level of exploitable subsoil resources: proven
reserves of coal, oil, natural gas, metallic minerals or non-metallic
minerals that are economically exploitable. This also covers the
increase in reserves for which exploitation becomes economic as a
result of technological progress or relative price changes;
(b) transfers of other natural assets to economic activity: naturally
occuring entities that change status to qualify as economic assets,
economic assets being entities over which ownership rights are
enforced by institutional units and from which economic benefits may
be derived by their owners (e.g. exploitation of virgin forests, transfer
of land from a wild or waste state to land that can be put to economic
use, land reclamation);
(c) quality changes in non-produced assets due to changes in economic
uses. Changes in quality are treated as changes in volume. The quality
changes recorded here occur as the counterpart of the changes in
economic use that are shown as changes in classification (see
paragraph 6.32.) — e.g. from cultivated land to land underlying
buildings;
(d) appearance of intangible non-produced assets. Intangible non-
financial non-produced assets arise when entities are patented or
transferable contracts are written. Also when enterprises are sold at
prices that exceed their own funds (see paragraph 7.05), the excess of
purchase price over own funds is the asset ‘purchased goodwill’.
Goodwill not evidenced by a sale/purchase is not considered as an
economic asset.
ECONOMIC APPEARANCE OF PRODUCED ASSETS (K.4)
6.18. Economic appearance of produced assets (K.4) occurs in the case of goods
that are not already recorded in the Balance Sheets. It is the recognition of
a significant or special value that is considered an economic appearance to
be recorded under other changes in volume.
Economic appearance of produced assets includes:
(a) valuables, such as precious stones and art objects, when the high value
or artistic significance of an object not already recorded in the
Balance Sheets is first recognized;
(b) historic monuments, when the special archaeological, historical or
cultural significance of a structure or site not already recorded in the
Balance Sheets is first recognized.
NATURAL GROWTH OF NON-CULTIVATED BIOLOGICAL
RESOURCES (K.5)
6.19. Natural growth of non-cultivated biological resources (K.5) is not under
the direct control, responsibility and management of an institutional unit
and thus is not production. The increment in these economic assets such as
standing natural timber, or fish in the estuaries, must then be regarded as
an economic appearance.
6.20. Natural growth should be recorded as an addition (K.5); the depletion of
these resources should be recorded as an economic disappearance (K.61).
In practice, however, natural growth can only be recorded net because the
physical measurements that are likely to be the only basis available for the
recording are, in effect, net measurements.
ECONOMIC DISAPPEARANCE OF NON-PRODUCED ASSETS (K.6)
6.21. Economic disappearance on non-financial non-produced assets (K.6)
includes:
(a) depletion of natural economic assets (K.61), which covers the
reduction of deposits of subsoil assets and the depletion of non-
cultivated biological resources included in the asset boundary (see
paragraph 6.19);1996R2223 — EN — 07.08.2003 — 008.001 — 153
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(b) other economic disappearance of non-produced assets (K.62):
1. other reductions in the level of exploitable subsoil resources
(reassessments of exploitability due to changes in technology or
relative prices);
2. quality change in non-produced assets due to changes in economic
uses;
3. degradation of non-produced assets due to economic activity.
Covered is degradation of land, water resources and in principle of
other natural assets;
4. write-off of purchased goodwill, cancellation of transferable
contracts and exhaustion of patent protection.
CATASTROPHIC LOSSES (K.7)
6.22. Catastrophic losses (K.7) recorded as other changes in the volume of
assets are the result of large-scale, discrete and recognizable events that
may destroy items within any of the categories of economic (non-financial
or financial) assets.
6.23. Such events include major earthquakes, volcanic eruptions, tidal waves,
exceptionally severe hurricanes, drought and other natural disasters; acts
of war, riots and other political events; and technological accidents such
as major toxic spills or release of radioactive particles into the air.
Included here are in particular:
(a) deterioration in the quality of land caused by abnormal flooding or
wind damage;
(b) destruction of cultivated assets by drought or outbreak of disease;
(c) destruction of buildings, equipment or valuables in forest fires or
earthquakes;
(d) accidental destruction of currency or bearer securities as a result of
natural catastrophes or political events.
UNCOMPENSATED SEIZURES (K.8)
6.24. Uncompensated seizures (K.8) occur when governments or other
institutional units take possession of the assets of other institutional units,
including non-resident units, without full compensation, for reasons other
than the payment of taxes, fines or similar levies. The uncompensated part
of such unilateral seizures is not a capital transfer recorded in the capital
account.
OTHER VOLUME CHANGES IN NON-FINANCIAL ASSETS N.E.C. (K.9)
6.25. Under other volume changes in non-financial assets (K.9) are recorded the
effects of unexpected events on the economic benefits derivable from
assets.
Included are:
(a) unforeseen obsolescence. Consumption of fixed capital does not cover
unforeseen obsolescence in fixed assets, and the amount included for
their normally expected obsolescence may fall short of the actual
obsolescence. Entries must, therefore, be made for the decline in the
value of the fixed assets resulting from the introduction of improved
technology;
(b) differences between allowances included in consumption of fixed
capital for normal damage and actual losses. Consumption of fixed
capital does not cover unforeseen damage, and the amount included
for their normally expected damage may fall short (or exceed) the
actual damage. Adjustments must therefore be made for the unfore-
seen decline (or increase) in the value of the fixed assets due to these
events;
(c) degradation of fixed assets not accounted for in consumption of fixed
capital: decline in the value of fixed assets from, for example, the
unforeseen effects of acidity in air and rain on building surfaces or
vehicle bodies;
(d) abandonment of production facilities before completion or being
brought into economic use;
(e) exceptional losses in inventories (e.g. from fire damage, from
robberies, from insect infestation of grain stores);1996R2223 — EN — 07.08.2003 — 008.001 — 154
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(f) statistical discrepancies concerning non-financial assets between the
closing balance sheet and the corresponding opening balance sheet.
OTHER VOLUME CHANGES IN FINANCIAL ASSETS AND LIABIL-
ITIES N.E.C. (K.10)
6.26. Any changes in financial assets and liabilities that are not due to financial
transactions recorded in the financial account, that are not attributed to
holding gains and losses recorded in the revaluation account, that are not
changes in classifications and structure and that are not due to catastrophic
losses and uncompensated seizures are to be recorded here.
6.27. Category K.10 includes:
(a) allocations and cancellations of SDRs (AF.12) (see paragraphs 5.33 to
5.35):
For SDRs not even a notional liability exists. Therefore, the
mechanism by which SDRs are created (referred to as allocations of
SDRs) and extinguished (cancellations of SDRs) is not treated as one
that gives rise to transactions but rather to entries in the other changes
in the volume of assets account. Allocations of SDRs increase the
financial assets of the monetary authorities, cancellations of SDRs
decrease their financial assets;
(b) other volume changes related to defined benefit pension funds.
Defined benefit pension schemes are those in which the level of
pension benefits promised to participating employees is guaranteed.
Benefits are related by some formula to participants' length of service
and salary and are not totally dependent on the assets in the fund. For
defined benefit schemes, an entry in the other changes in the volume
of assets account captures changes in the actuarially determined
liability that result from changes in benefits structure, which are to be
distinguished from changes in the age and service composition of the
beneficiary pool. Examples of changes in benefit structure include
changes in the formula, reductions in the pensionable age, or funding
for an annual increase (usually defined as constant × per cent per
year) in future pensions or in all pensions in the course of payment;
(c) exceptional losses of currency or bearer securities because of, e.g.,
fire damage or theft;
(d) writing-off or writing-down of bad debts by creditors.
Unilateral recognition by a creditor that a financial asset can no longer
be collected, due to bankruptcy or other factors, and the consequent
removal by the creditor of that financial asset from his balance sheet
should be accounted for here, along with the removal of the
counterpart liability of the debtor. However, in cases where the
debtor institutional unit is controlled by the creditor, the writing-off or
writing-down of debt by the creditor, not due to bankruptcy, is
recorded in the accumulation accounts. ►M4 By derogation from the
general principle, this heading does not include taxes and social
contributions payable to the general government that the general
government unilaterally recognises as unlikely to be collected. Taxes
and social contributions payable to the general government and
unlikely to be collected are, in the same accounting period which has
generated the liability, neutralised in the calculation of the net
lending/net borrowing of the general government sector and of the
counterpart sectors (see point 1.57); ◄
(e) statistical discrepancies concerning financial assets and liabilities
between the closing balance sheet and the corresponding opening
balance sheet.
6.28. Category K.10 does not include:
(a) cancellation of debt by mutual agreement between debtor and creditor
(debt cancellation or debt forgiveness): it is treated as a transaction
between the creditor and the debtor (see paragraph 4.165. f and 5.16)
and not as another change of volume;
(b) debt repudiation: the unilateral cancellation of a liability by a debtor is
not recognized in the system.
CHANGES IN CLASSIFICATIONS AND STRUCTURE (K.12)
6.29. Changes in classifications and structure (K.12) comprise changes in sector
classification and structure of institutional units (K.12.1) and changes in
classification of assets and liabilities (K.12.2).1996R2223 — EN — 07.08.2003 — 008.001 — 155
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CHANGES IN SECTOR CLASSIFICATION AND STRUCTURE (K.12.1)
6.30. Reclassifying an institutional unit from one sector to another transfers its
entire balance sheet, e.g. an institutional unit classified in the household
sector becomes a quasi-corporation to be reclassified in the corporations
sector.
Changes in structure of institutional units cover appearance and
disappearance of certain financial assets and liabilities arising fromcorporate restructuring. When a corporation disappears as an independent
legal entity because it is absorbed by one or more corporations, all
financial assets/liabilities including shares and other equity that existed
between that corporation and those that absorbed it, disappear from the
system. However, the purchase of shares and other equity of a corporation
as part of a merger is to be recorded as a financial transaction between the
purchasing corporation and the previous owner. Replacement of existing
shares by shares in the take-over or new corporation are to be recorded as
redemptions of shares accompanied by the issue of new shares. Financial
assets/liabilities that existed between the absorbed corporation and third
parties remain unchanged and pass to the absorbing corporation(s).
Symmetrically, when a corporation is legally split up into two or more
institutional units, new financial assets and liabilities (appearance of
financial assets) are recorded in this category (K.12.1).
CHANGES IN CLASSIFICATION OF ASSETS AND LIABILITIES (K.12.2)
6.31. Category K.12.2 distinguishes monetization/demonetization of gold
(K.12.21) and changes in classification of assets or liabilities other than
monetization/demonetization of gold (K.12.22).
6.32. Monetization/demonetization of gold (K.12.21) is recorded in the other
changes in the volume of assets account of the monetary authorities, that
is to say in the subsector the central bank (S.121) or central government
(S.1311).
Monetization of gold occurs when the monetary authorities reclassify gold
from stocks of valuables to reserve assets held by the monetary
authorities. The other changes in the volume of assets account records
then a decrease in their holding of valuables and an increase in their
holding of monetary gold.
Purchases of monetary gold directly from other monetary authorities are
classified as transactions in monetary gold (F.11). All other purchases,
including those from financial intermediaries or via an organized gold
market must be recorded as purchase of valuables followed by a
classification change.
Demonetization of gold occurs when the monetary authorities transfer
gold from reserve assets to valuables. Holdings of monetary gold by
monetary authorities then decrease and valuables show an increase. Sales
of monetary gold directly to other monetary authorities are classified as
transactions in monetary gold (F.11). All other sales, including those to
financial intermediaries or via an organized gold market must be recorded
as sales of valuables preceded by a classification change.
6.33. Changes in classification of assets or liabilities other than monetization/
demonetization of gold (K.12.22): examples are changes in land use or
conversions of dwellings to commercial use or vice versa. In the case of
land both entries (a negative entry for the old category, a positive one for
the new category) have to be made with the same value in the category
K.12.22. The change in land value resulting from this change in use is
recorded in economic appearance (see paragraph 6.17 c) or disappearance
of non-produced assets (see paragraph 6.21 c) considered as volume
changes.
K.12.22 does not include the conversion of bonds into shares. This
conversion is recorded as two financial transactions (see paragraph 562. l).
6.34. Entries for other changes in volume (K.3 to K.10 and K.12) are recorded
in the other changes in the volume of assets accounts of the sectors, the
total economy and the rest of the world.1996R2223 — EN — 07.08.2003 — 008.001 — 156
▼B
NOMINAL HOLDING GAINS/LOSSES (K.11)
6.35. Nominal holding gains (1) are that category of other changes in the value
of assets, liabilities and therefore net worth which reflects the changes in
the level and structure of their prices. Nominal holding gains are broken
down into neutral holding gains and real holding gains.
6.36. Definition: The nominal holding gain (K.11) on a given quantity of an
asset is defined as the change in value for the owner of that
asset as a result of a change in its price. The nominal holding
gain on a liability is defined as the change in value of that
liability as a result of a change in its price, but with the sign
reversed.
6.37. A positive holding gain is due to an increase in the value of a given asset
or to a reduction in the value of a given liability. A negative holding gain,
i.e. a holding loss, is due to a reduction in the value of a given asset or an
increase in the value of a given liability.
6.38. The nominal holding gains recorded in the revaluation account are those
accruing on assets or liabilities, whether realized or not. A holding gain is
said to be realized when the asset in question is sold, redeemed, used or
otherwise disposed of, or the liability repaid. An unrealised gain is
therefore one accruing on an asset that is still owned or a liability that is
still outstanding at the end of the accounting period. A realized gain is
usually understood as the gain realized over the entire period over which
the asset is owned or liability outstanding whether this period coincides
with the accounting period or not. However, as holding gains are recorded
on an accruals basis in the system, the distinction between realized and
unrealized gains, although useful for some purposes, does not appear in
the classifications and accounts.
6.39. Holding gains include gains on all kinds of assets: non-financial produced
and non-produced assets, and financial assets. Thus, holding gains on
inventories of all kinds of goods held by producers, including work in
progress, are also covered.
6.40. Nominal holding gains may accrue on assets held for any length of time
during the accounting period and not merely on assets that appear in the
opening and/or closing balance sheets. The nominal holding gain accruing
to the owner of a particular asset, or given quantity of a specific type of
asset, between two points of time is defined as:
the current value of that asset at the later point of time,
minus
the current value of that asset at the earlier point of time,
assuming that the asset itself does not change, qualitatively or
quantitatively, in the meanwhile. The nominal holding gain (G) accruing
on a given quantity q of some asset between times o and t can be
expressed as follows:
G¼pt/C0po ðÞ /C2 q
where poand ptare the prices of the asset at times o and t respectively. For
financial assets and liabilities with fixed current values for which both poand ptare unity by definition, nominal holding gains are always zero.
6.41. For purposes of calculating nominal holding gains, acquisitions and
disposals of assets must be valued in the same way as in the capital and
financial accounts and stocks of assets must be valued in the same way as
in the balance sheets. In the case of fixed assets the value of an acquisition
is the amount paid by the purchaser to the producer, or seller, plus the
associated costs of ownership transfer incurred by the purchaser. The
value of a disposal of an existing fixed asset is the amount received by the
seller from the purchaser minus the costs of ownership transfer incurred
by the seller.
Four different situations giving rise to nominal holding gains may be
distinguished:
1. an asset held throughout the accounting period: the nominal holding
gain accruing during the accounting period is equal to the closing
balance sheet value minus the opening balance sheet value. These
values are the estimated values of the assets if they were to be acquired1996R2223 — EN — 07.08.2003 — 008.001 — 157
(1) The term ‘holding gain’ is used to cover both holding gains and losses on the clear
understanding that holding gains may be negative as well as positive. Similarly, the term
‘asset’ may be used collectively to cover both assets and liabilities.
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at the times the balance sheets are drawn up. The nominal gain is
unrealized;
2. an asset held at the beginning of the period that is sold during the
period: the nominal holding gain accruing is equal to the actual or
estimated disposal value minus the opening balance sheet value. The
nominal gain is realized;
3. an asset acquired during the period and still held at the end of the
period: the nominal holding gain accruing is equal to the closing
balance sheet value minus the actual, or estimated, acquisition value of
the asset. The nominal gain is unrealized;
4. an asset acquired and disposed of during the accounting period: the
nominal holding gain accruing is equal to the actual, or estimated,
disposal value minus the actual, or estimated, acquisition value. The
nominal gain is realized.
6.42. The nominal holding gains included are those accruing on assets and
liabilities, whether realized or not. They are recorded in the revaluation
account of the sectors, the total economy and the rest of the world.
NEUTRAL HOLDING GAINS/LOSSES (K.11.1)
6.43. Definition: The neutral holding gain (K.11.1) on an asset is defined as
the value of the holding gain that would accrue if the price of
the asset changed over time in the same proportion as the
general price level.
Neutral holding gains are identified to facilitate the derivation of real
holding gains which redistribute real purchasing power between sectors.
6.44. Let the general price index be denoted by r. The neutral holding gain (NG)
on a given quantity q of an asset between times o and t is then given by
the following expression:
NG¼po/C2qr t=ro/C01 ðÞ
where po× q is the current value of the asset at time o and rt/rothe factor of
the change in the general price index between times o and t. The same
term rt/rois applied to all assets and liabilities.
6.45. There is no ideal general price index appropriate to calculate neutral
holding gains. By convention, the general price index to be applied for the
calculation of neutral holding gains is the price index for final national
uses excluding changes in inventories.
6.46. Neutral holding gains are recorded in the neutral holding gains/losses
account, which is a sub-account of the revaluation account of the sectors,
the total economy and the rest of the world.
REAL HOLDING GAINS/LOSSES (K.11.2)
6.47. Definition: The real holding gain (K.11.2) on an asset is defined as the
difference between the nominal and the neutral holding gain
on that asset.
The real holding gain (RG) on a given quantity q of an asset between
times o and t is given by:
RG¼G/C0NG
or
RG¼pt=po/C0rt=ro ðÞ /C2 po/C2q
The values of the real holding gains on assets thus depend on the
movements of their prices over the period in question, relative to
movements of other prices, on average, as measured by the general price
index.
6.48. Real holding gains are recorded in the real holding gains/losses account,
which is a sub-account of the revaluation account of the sectors, the total
economy and the rest of the world.1996R2223 — EN — 07.08.2003 — 008.001 — 158
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HOLDING GAINS BY TYPE OF FINANCIAL ASSET
Currency and deposits (AF.2)
6.49. The current values of currency and deposits denominated in national
currency remain constant over time. The ‘price’ of such an asset is always
unity while the quantity is given by the number of units of the currency in
which they are denominated. The nominal holding gains on such assets
are always zero. For this reason, the difference between the values of the
opening and closing stocks of such assets is, with the exception of the
other changes in the volume of assets, entirely accounted for by the values
of the transactions in the assets. This being one case in which it is
normally possible to deduce the latter from the balance sheet figures.
6.50. In order to calculate the neutral and real holding gains on assets of fixed
current value, however, data on the times and values of transactions are
needed as well as the opening and closing balance sheet values. Suppose,
for example, a loan is made and repaid within the accounting period while
the general price level is rising. The neutral gain on the loan is positive
and the real gain negative from the creditor's point of view, the amount
depending upon the length of time the loan is outstanding and the rate of
inflation. It is impossible to record such real losses without data on the
value of the loans made and repaid during the accounting period and the
times at which they are made and repaid. In general, it may be inferred
that if the total absolute value of the positive and negative transactions is
large in relation to the opening and closing balance sheet levels,
approximate estimates of the neutral and real holding gains on financial
assets and liabilities with fixed current values derived from balance sheet
data alone may not be very satisfactory. Even recording the values of
financial transactions on a gross basis, i.e. recording loans made and
repaid separately as distinct from the total value of loans minus
repayments, may not be sufficient without information on the timing of
the loans.
Loans (AF.4) and other accounts receivable/payable (AF.7)
6.51. The same as for currency and deposits applies for loans and other accounts
receivable/payable, which are not traded. However, when an existing loan
or trade credit is sold to another institutional unit the difference between
the redemption price and the transaction price should be recorded under
the revaluation account of the seller and the purchaser at the time of
transaction.
Securities other than shares (AF.3)
6.52. When a bond is issued at premium or discount, including deep discounted
and zero coupon bonds, the difference between its issue price and its face
or redemption value when it matures measures interest that the issuer is
obliged to pay over the life of the bond. Such interest is recorded as
property income payable by the issuer of the bond and receivable by the
holder of the bond in addition to any coupon interest actually paid by the
issuer at specified intervals over the life of the bond. The interest accruing
is recorded in the financial account as being simultaneously reinvested in
the bond by the holder of the bond (see paragraph 5.17). It is, therefore,
recorded in the financial account as the acquisition of an asset which is
added to the existing asset (1). Thus the gradual increase in the market
value of a bond that is attributable to the accumulation of accrued,
reinvested interest reflects a growth in the principal outstanding — that is,
in the size of the asset. It is essentially a quantum or volume increase and
not a price increase. It does not generate any holding gain for the holder of
the bond or holding loss for the issuer of the bond. The situation is
analogous to that of a good, such as wine, that matures while it is being
stored. Any increase in the price of the wine that is attributable to an
improvement in its quality reflects an increase in volume and not price.
Bonds change qualitatively over time as they approach maturity and it is
essential to recognize that increases in their values due to the
accumulation of accrued interest are not price changes and do not
generate holding gains.
6.53. The prices of fixed-interest bonds also change, however, when the market
rates of interest change, the prices varying inversely with the interest rate
movements. The impact of a given interest rate change on the price of an
individual bond is less, the closer the bond is to maturity. Changes in bond1996R2223 — EN — 07.08.2003 — 008.001 — 159
(1) The system recommends this treatment, but allows for recording of such interest under
other accounts receivable/payable (AF.7) where required to conform to national practices
(see paragraph 5.130).
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prices that are attributable to changes in market rates of interest constitute
price and not quantum changes. They therefore generate nominal holding
gains or losses for both the issuers and the holders of the bonds. An
increase in interest rates generates a nominal holding gain for the issuer of
the bond and an equal nominal holding loss for the holder of the bond, and
vice versa in the case of a fall in interest rates.
Nominal holding gains or losses may accrue on bills in the same way as
for bonds. However, as bills are short-term securities with much shorter
times to maturity, the holding gains generated by interest rate changes are
generally much smaller than on bonds with the same face values.
6.54. The conversion of bonds into shares is recorded as two financial
transactions (see paragraph 5.62.1). It will usually take place at a price
below the market price of the shares and the resulting holding gains are to
be recorded as a price change under the revaluation account.
6.55. The value of financial derivatives (AF.34) may change as a result of
changes in the value of the underlying instrument, changes in the volatility
of the price of the underlying instrument, or approaching the date of
execution or maturity. All such changes in value should be regarded as
price changes and recorded under K.11.
Shares and other equity (AF.5)
6.56. Bonus shares (see paragraph 5.93) increase the number of shares and the
nominal value of the shares issued but do not in theory alter the market
value of the totality of shares. By convention, they do not enter the
accounts at all. However, these issues are designed to improve the
liquidity of the shares on the market and hence the total market value of
shares issued may rise as a result: any such change should be recorded as a
revaluation effect.
Insurance technical reserves (AF.6)
6.57. Changes in the net equity of households in life insurance reserves and in
pension funds reserves (AF.61) that occur between the beginning and the
end of the accounting period and that result from nominal holding gains or
losses on the reserves invested by insurance corporations and pension
funds are recorded in the revaluation account, as well as changes in
prepayments of insurance premiums and reserves for outstanding claims
(AF.62) resulting from holding gains or losses.
FINANCIAL ASSETS IN FOREIGN CURRENCY
6.58. The value of financial assets in foreign currency is measured by their
current market value in foreign currency converted into national currency
at the current exchange rate. Nominal holding gains may therefore occur
not only because the price of the asset in local currency changes but also
because the exchange rate changes. The total value of the nominal holding
gains accruing over the accounting period may be calculated in the usual
way by subtracting the value of transactions from the difference between
the opening and closing balance sheet values. For this purpose,
transactions in the financial assets in foreign currency must be converted
into the national currency using the exchange rates at the time the
transactions occur, while the opening and closing balance sheet values
must be converted using the exchange rates prevailing at the dates to
which the balance sheets relate. This implies that the total value of the
transactions — acquisitions less disposals — expressed in foreign
currency is, in effect, converted by a weighted average exchange rate in
which the weights are given the values of transactions conducted on
different dates.1996R2223 — EN — 07.08.2003 — 008.001 — 160
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CHAPTER 7
BALANCE SHEETS
7.01. Definition: A balance sheet is a statement, drawn up at a particular point
in time, of the values of assets owned and of liabilities
outstanding. The balancing item is called net worth (B.90).
The stock of the assets and liabilities recorded in the balance
sheet is valued at the market prices prevailing on the date to
which the balance sheet relates.
7.02. A balance sheet is drawn up for sectors, the total economy and the rest of
the world.
For a sector the balance sheet provides as a balancing item what is often
referred to as national wealth — the sum of non-financial assets and net
financial assets with respect to the rest of the world.
The balance sheet for the rest of the world, called the external assets and
liabilities account, consists entirely of financial assets and liabilities.
7.03. Corporations are seen to have a net worth in addition to the value of the
shares and other equity issued. In the case of quasi-corporations, net worth
is zero, because the value of the owners' equity is assumed to be equal to
its assets less its liabilities. Therefore, the net worth of resident direct
investment enterprises, which are branches of non-resident enterprises and
are therefore treated as quasi-corporations, is zero.
7.04. The difference between total financial assets and total liabilities is called
net financial assets (see paragraph 7.67).
7.05. For the non-financial and the financial corporations sectors the calculation
of own funds provides an analytically meaningful indicator.
Own funds are the sum of net worth (B.90) and shares and other equity
(AF.5) issued.
7.06. The balance sheet completes the sequence of accounts, showing the
ultimate result of the entries in the production, distribution and use of
income, and accumulation accounts (see chapter 8: Sequence of accounts
and balancing items).
7.07. A balance sheet relates to the value of assets and liabilities at a particular
moment of time. Balance sheets are to be compiled at the beginning of the
accounting period (the same as the end of the preceding period) and at its
end.
7.08. A basic accounting identity links the opening balance sheet and the
closing balance sheet:
the value of the stock of a specific type of asset in the opening balance
sheet;
plus transactions: the total value of the assets acquired, less the
total value of those disposed of, in transactions that take
place within the accounting period: transactions in non-
financial assets are recorded in the capital account and
transactions in financial assets in the financial account;
minus consumption of fixed capital;
plus other volume changes: the value of other positive or
negative changes in the volume of the assets held (for
example, as a result of the discovery of a subsoil asset or
the destruction of an asset as a result of war or a natural
disaster): these changes are recorded in the other changes
in volume of assets account;
plus revaluations: the value of the positive or negative nominal
holding gains accruing during the period resulting from a
change in the price of the asset: these changes are recorded
in the revaluation account;
is identical with the value of the stock of the asset in the closing balance
sheet.
The accounting links between the opening and closing balance sheets via
transactions and other changes in assets (other changes in volume and
holding gains) are shown schematically in Annex 7.2.1996R2223 — EN — 07.08.2003 — 008.001 — 161
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TYPES OF ASSETS
7.09. The assets recorded in the balance sheets are economic assets.
7.10. Definition: Economic assets are entities functioning as a store of value
over which ownership rights are enforced by institutional
units, individually or collectively, and from which economic
benefits may be derived by their owners by holding them or
using them over a period of time.
7.11. The economic benefits consist of primary incomes (operating surplus by
using, property income by letting others use) derived from the use of the
asset and the value, including possible holding gains/losses, that could be
realized by disposing of the asset or terminating it.
7.12. An overview of the classification and coverage of economic assets is
given in the table 7.1. The detailed definition of each asset category is set
out in the Annex 7.1 to this chapter.
Excluded from the asset boundary are:
(a) human capital;
(b) natural assets that are not economic assets (e.g. air, river water);
(c) contingent assets, which are not financial assets (see paragraph 7.22).
7.13. Three categories of assets are distinguished:
(a) non-financial produced assets;
(b) non-financial non-produced assets;
(c) financial assets.
NON-FINANCIAL PRODUCED ASSETS (AN.1)
7.14. Definition: Produced assets (AN.1) are non-financial assets that have
come into existence as outputs from production processes.
7.15. The classification of produced assets is designed to distinguish among
assets on the basis of their role in production. It consists of: fixed assets (1)
which are used repeatedly or continuously in production for more than one
year; inventories which are used up in production as intermediate
consumption, sold or otherwise disposed of; and valuables. The latter are
not used primarily for production or consumption, but are instead acquired
and held primarily as stores of value.
NON-FINANCIAL NON-PRODUCED ASSETS (AN.2)
7.16. Definition: Non-produced assets (AN.2) are economic assets that come
into existence other than through processes of production.
They consist of tangible assets and intangible assets as
defined below.
7.17. The classification is designed to distinguish assets on the basis of the way
they come into existence. Some of these assets occur in nature, others,
which may be referred to as constructs devised by society, come into
existence by legal or accounting actions.
7.18. All tangible non-produced assets are natural assets. Which natural assets
are included is determined, in compliance with the general definition of an
economic asset, by whether the assets are subject to effective ownership
and are capable of bringing economic benefits to their owners, given the
existing technology, knowledge, economic opportunities, available
resources, and set of relative prices. Moreover, natural assets over which
ownership rights have not, or cannot, be established, such as open seas orair, are excluded.
7.19. Intangible non-produced assets include patented entities, transferable
contracts, purchased goodwill, etc. Entities not evidenced by legal or
accounting actions — that is, such actions as the granting of a patent or
the conveyance of some economic benefit to a third party — are excluded.1996R2223 — EN — 07.08.2003 — 008.001 — 162
(1) Two kinds of durable goods used by producers are excluded from gross fixed capital
formation: small tools and certain kinds of military equipment. Therefore there are nocorresponding assets.In addition, transport equipment and other machinery and equipment acquired byhouseholds for final consumption are not considered fixed assets. They are included in
the memorandum item ‘consumer durables’ in the balance sheet (see paragraph 7.63).
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FINANCIAL ASSETS AND LIABILITIES (AF.)
7.20. Definition: Financial assets (AF.) are economic assets, comprising
means of payment, financial claims and economic assets
which are close to financial claims in nature.
7.21. Means of payment consist of monetary gold, special drawing rights,
currency and transferable deposits. Financial claims entitle their owners,
the creditors, to receive a payment or series of payments without any
counter-performance from other institutional units, the debtors, who have
incurred the counterpart liabilities.
Examples of economic assets which are close to financial claims in nature
are shares and other equity and partly contingent assets. The institutional
unit issuing such a financial asset is considered to have incurred a
counterpart liability.
7.22. Contingent assets are contractual arrangements between institutional units,
and between them and the rest of the world, which specify one or more
conditions which must be fulfilled before a financial transaction takes
place. Excamples are guarantees of payment by third parties, letters of
credit, lines of credit, underwritten note issuance facilities (NIFs) and
many of the derivative instruments. In the system, a contingent asset is a
financial asset in cases where the contractual arrangement itself has a
market value because it is tradable or can be offset on the market.
Otherwise, a contingent asset is not recorded in the system (1).
7.23. In the system, each financial asset has a counterpart liability, with the
exception of those financial assets classified in the category monetary
gold and special drawing rights (AF.1).
7.24. The classification of financial assets and liabilities corresponds to the
classification of financial transactions. Therefore, the definitions of the
categories, sub-categories and sub-positions of financial assets and
liabilities and the supplementary explanations are provided only once in
the ESA — in the financial transactions chapter. The balance sheets
chapter does not repeat the definitions and their explanations in its main
text but it provides in its Annex 1 a summary of all assets and liabilities
defined in the system.
Table 7.1 — Classification of assets
AN. NON-FINANCIAL ASSETS (AN.1 + AN.2)
AN.1 Produced assets
AN.11 Fixed assets (1)
AN.111 Tangible fixed assets
AN.1111 DwellingsAN.1112 Other buildings and structures
AN.11121 Non-residential buildings
AN.11122 Other structuresAN.1113 Machinery and equipment
AN.11131 Transport equipment
AN.11132 Other machinery and equipmentAN.1114 Cultivated assets
AN.11141 Livestock for breeding, dairy, draught, etc.
AN.11142 Vineyards, orchards and other plantations of trees yielding
repeat products
AN.112 Intangible fixed assetsAN.1121 Mineral exploration
AN.1122 Computer software
AN.1123 Entertainment, literary or artistic originalsAN.1129 Other intangible fixed assets1996R2223 — EN — 07.08.2003 — 008.001 — 163
(1) Insurance technical reserves (AF.6) are unconditional liabilities of insurance corpora-
tions and pension funds. However, the counterpart financial assets of individual policy
holders and beneficiaries are contingent assets in most cases.
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AN.12 Inventories
AN.121 Materials and suppliesAN.122 Work in progressAN.1221 Work in progress on cultivated assets
AN.1222 Other work in progress
AN.123 Finished goodsAN.124 Goods for resaleAN.13 ValuablesAN.131 Precious metals and stonesAN.132 Antiques and other art objects
AN.139 Other valuables
AN.2 Non-produced assets
AN.21 Tangible non-produced assetsAN.211 LandAN.2111 Land underlying buildings and structuresAN.2112 Land under cultivation
AN.2113 Recreational land and associated surface water
AN.2119 Other land and associated surface waterAN.212 Subsoil assetsAN.2121 Coal, oil and natural gas reservesAN.2122 Metallic mineral reserves
AN.2123 Non-metallic mineral reserves
AN.213 Non-cultivated biological resourcesAN.214 Water resourcesAN.22 Intangible non-produced assetsAN.221 Patented entitiesAN.222 Leases and other transferable contracts
AN.223 Purchased goodwill
AN.229 Other intangible non-produced assetsAF. FINANCIAL ASSETS (
2)
(AF.1 + AF.2 + AF.3 + AF.4 + AF.5 + AF.6 + AF.7)
AF.1 Monetary gold and special drawing rights (SDRs)
AF.11 Monetary goldAF.12 Special drawing rights (SDRs)AF.2 Currency and deposits
AF.21 CurrencyAF.22 Transferable deposits
AF.29 Other deposits
AF.3 Securities other than shares
AF.33 Securities other than shares, excluding financial derivativesAF.331 Short-termAF.332 Long-term
AF.34 Financial derivatives
AF.4 Loans
AF.41 Short-termAF.42 Long-term1996R2223 — EN — 07.08.2003 — 008.001 — 164
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AF.5 Shares and other equity
AF.51 Shares and other equity, excluding mutual funds shares
AF.511 Quoted shares
AF.512 Unquoted sharesAF.513 Other equity
AF.52 Mutual funds shares
AF.6 Insurance technical reserves
AF.61 Net equity of households in life insurance reserves and in
pension funds reserves
AF.611 Net equity of households in life insurance reservesAF.612 Net equity of households in pension funds reserves
AF.62 Prepayments of insurance premiums and reserves for
outstanding claims
AF.7 Other accounts receivable/payable
AF.71 Trade credits and advancesAF.79 Other
(1) Memorandum item AN.m: consumer durables.
(2) Memorandum item AF.m: direct foreign investment.
VALUATION OF ENTRIES IN THE BALANCE SHEETS
GENERAL VALUATION PRINCIPLES
7.25. A particular item in the balance sheet should be valued as if it were being
acquired on the date to which the balance sheet relates, including any
associated costs of ownership transfer in the case of non-financial assets.
This implies that assets and liabilities are to be valued using current
market prices on the date to which the balance sheet relates.
This means that assets should be valued on the basis of
(a) purchasers' prices if they are bought;
(b) basic prices if they are own-account produced and on the basis of
basic prices of similar goods or of the sum of its cost if no basic prices
are available.
7.26. Ideally, these prices should be prices observable on the market. When
there are no observable prices — as may be the case if no purchases/sales
of the items in question have been observed in the recent past — an
attempt has to be made to estimate what the prices would be if the assets
were acquired on the market on the date to which the balance sheetrelates.
7.27. In addition to prices observed on markets or estimated from observed
prices or costs incurred, current prices may be approximated for balance
sheet valuation by:
(a) revaluing and accumulating acquisitions less disposals or
(b) the present, or discounted, value of future returns.
7.28. Market prices are usually available for many of the financial assets,
existing real estate (buildings and other structures plus the underlying
land), existing transport equipment, crops and livestock as well as for
newly produced fixed assets and inventories.
7.29. For some assets revalued initial acquisition prices are written off over the
asset's expected life. The value of such an asset at a given point in its life
is given by its current acquisition price less the accumulated value of these
write-offs. Most fixed assets can be recorded in balance sheets at current
purchasers' prices written down for the accumulated consumption of fixed
capital (written-down replacement cost) (
1).1996R2223 — EN — 07.08.2003 — 008.001 — 165
(1) The sum of written-down values of all fixed assets still in use is described as net capital
stock. Gross capital stock includes the values of the accumulated consumption of fixed
capital.
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7.30. In the case of assets for which the returns either are delayed (as with
timber) or are spread over a lengthy period (as with subsoil assets), a rate
of discount must be used to compute the present value of the expected
future returns.
The rate of discount should be derived from information based on
transactions in the particular type of assets under consideration — forests,
mines and quarries — rather than using a general rate of interest.
7.31. The value of assets and liabilities denominated in foreign currencies
should be converted into the national currency at the market exchange rate
prevailing on the date to which the balance sheet relates. This rate should
be the midpoint between the buying and the selling spot rates for currency
transactions.
7.32. Alternatives to current market values might be useful for some analytical
purposes and may be shown as memorandum items in the balance sheets.
Examples of alternative valuation include nominal value for long-term
bonds and revalued paid-in and equivalent value for corporate equity.
NON-FINANCIAL ASSETS (AN.)
PRODUCED ASSETS (AN.1)Fixed assets (AN.11)Tangible fixed assets (AN.111)
7.33. Tangible fixed assets have to be recorded at market prices if possible (or
basic prices in the case of own-account production of new assets), if not
then at current purchasers' prices written down by the accumulated
consumption of fixed capital. Purchasers' costs of ownership transfer
associated with these assets, appropriately written down, are included in
the balance sheet value.
Intangible fixed assets (AN.112)
7.34. Mineral exploration should be valued either on the basis of the
accumulated amounts paid under contracts awarded to other institutional
units for the purpose, or on the basis of the costs incurred for exploration
undertaken on own account. That part of exploration undertaken in the
past that has not yet been fully written off should be revalued at the prices
and costs of the current period.
7.35. Computer software should be valued on the basis of the purchasers' price
paid on the market, on the basis of estimated basic prices when produced
in house, or on the basis of costs of production when such prices are not
available. Software acquired in previous years and not yet fully written
down should be revalued at current prices or costs (which may be less
then the original price or cost).
7.36. Entertainment, literary or artistic originals and other intangible fixed
assets should be valued at the acquisition price when these intangible
assets are actually traded on markets. In the case of intangible assets that
have been produced on own account, it may be necessary to value them on
the basis of their costs of production, appropriately revalued at prices of
the current period and written down. Otherwise, it may be necessary to use
estimates of the present value of the expected future receipts to be
received by owners of such assets.
Inventories (AN.12)
7.37. Inventories should be valued at prices prevailing on the date to which the
balance sheet relates, and not at the prices at which the products were
valued when they entered inventory.
7.38. Inventories of materials and supplies are valued at purchasers' prices, and
inventories of finished goods and work in progress are valued at basic
prices. Inventories of goods intended for resale without further processing
by wholesalers and retailers are valued at the prices prevailing on the date
to which the balance sheet relates, excluding any transportation costs
incurred by the wholesalers or retailers. For work-in-progress inventories,
the value of the closing balance sheet can be calculated by applying the
fraction of the total production cost incurred by the end of the period to
the basic price of a similar finished product on the date to which the
balance sheet relates. If the basic price of the finished products is not
available, it can be estimated by the value of the production cost with a1996R2223 — EN — 07.08.2003 — 008.001 — 166
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mark-up for expected net operating surplus or (estimated net) mixed
income.
Growing single-use crops (except timber) and livestock being raised for
slaughter can be valued by reference to the prices of such products on the
markets. Standing timber is valued by discounting the future proceeds of
selling the timber at current prices after deducting the expenses of
bringing the timber to maturity, felling, etc.
Valuables (AN.13)
7.39. Valuables (works of art, antiques, jewellery, precious stones, non-
monetary gold (see paragraph 5.30) and other metals) are to be valued
at current prices. To the extent that organized markets exist for these
assets, they should be valued at the actual or estimated prices that would
be paid for them were they purchased on the market, including any agents'
fees or commissions, on the date to which the balance sheet relates.
Otherwise, they should be valued at acquisition prices revalued to the
current price level.
NON-PRODUCED ASSETS (AN.2)
Tangible non-produced assets (AN.21)
Land (AN.211)
7.40. In the capital account, expenditures on land improvements and the costs of
ownership transfer on land are recorded as gross fixed capital formation,
separately from land itself.
If the value of the land cannot be separated from that of the buildings or
other structures situated on it, the assets have to be classified together on
the basis of which is likely the larger value.
In the balance sheet land is valued at its current market price.This price does not necessarily equal the sum of all components
constituting the costs of acquiring the land at the time of acquisition.
Particularly the current market price may not cover the costs of ownership
transfer or expenditures on land improvements not already written off to
zero. So it may be necessary to enter these amounts, either completely or
in part, as holding losses in the revaluation account.
Subsoil assets (AN.212)
7.41. Proven reserves of mineral deposits located on or below the earth's surface
that are economically exploitable given current technology and relative
prices are valued by the present value of expected net returns resulting
from the commercial exploitation of those assets.
Other natural assets (AN.213 and AN.214)
7.42. As observed prices for these assets are not likely to be available, they have
to be valued by the present value of future returns expected from them.
Intangible non-produced assets (AN.22)
7.43. Intangible non-produced assets (patented entities, leases or other
transferable contracts, and purchased goodwill) should be valued at
current prices when they are actually traded on markets. Otherwise,
estimates of the present value of the expected future returns to be received
by the owners of such assets will have to be made.
FINANCIAL ASSETS AND LIABILITIES (AF.)
7.44. Financial assets and liabilites should in principle be valued at current
prices. They should be assigned the same value whether they appear as
financial assets or liabilities. The prices should exclude service charges,
fees, commissions and similar payments which are recorded as services
provided in carrying out the transactions.
Monetary gold and SDRs (AF.1)
7.45. Monetary gold (AF.11) is to be valued at the price established in
organized gold markets.1996R2223 — EN — 07.08.2003 — 008.001 — 167
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The value of SDRs (AF.12) is determined daily by the IMF and the rates
against domestic currencies are obtainable from foreign exchange
markets.
Currency and deposits (AF.2)
7.46. For currency (AF.21), the valuation is the nominal or face value of the
currency.
For deposits (AF.22, AF.29), the values to be recorded in the balance
sheets are the amounts of principal that the debtors are contractually
obliged to repay the creditors under the terms of the deposits when the
deposits would be liquidated on the date the balance is set up. The values
may include accrued interest (see paragraph 5.130).
Securities other than shares (AF.3)
7.47. The valuation adopted must be consistent with the treatment of accrued
interest and its classification to specific asset headings (see paragraph
5.128, 5.130, 5.138). If accrued interest has been treated in the financial
account as being reinvested in the corresponding securities, then, in the
balance sheet, securities other than shares, excluding financial derivatives,
(AF.33) should be valued at current market prices in such a way that they
include the value of the accrued interest. The global current market value
of these securities has two distinct volume components, one representingthe principal and the other the accrued interest. The global total volume
thus includes the accrued interest (i.e., it is the number of units of
securities in issue plus the supplementary volume resulting from accrued
interest, see paragraph 6.52) and the price to be applied to each of those
units of volume excludes accrued interest.
If, in the financial account, the value of accrued interest has been included
under F.79 (Other accounts receivable/payable) rather than F.33
(Securities other than shares, excluding financial derivatives), then the
value of accrued interest should also be included under AF.79 in the
balance sheet.
7.48. Short-term securities other than shares excluding financial derivatives
(AF.331) are to be valued at their current market values.
If current market values are not available:
(a) short-term securities issued at par should be valued at face value plus
accrued interest not due for payment or not paid;
(b) discounted securities should be valued at the issue price plus accrued
interest.
These approximations should be restricted to securities whose original
maturity does not exceed three months.
7.49. Long-term securities other than shares excluding financial derivatives
(AF.332) are always to be valued at their current market values, whether
they are bonds on which interest is paid regularly or deep-discounted or
zero-coupon bonds on which little or no interest is paid.
7.50. Financial derivatives (AF.34) should be included in the balance sheets at
their current market prices. In the case that no quoted market price exists
(e.g. OTC options), a financial derivative should be valued at either the
amount required to buy out or to offset the contract or the amount of
premium paid.
By convention, the issuer of a financial derivative is considered to have
incurred a counterpart liability.
Loans (AF.4)
7.51. The values to be recorded in the balance sheets of both creditors and
debtors are the amounts of principal that the debtors are contractually
obliged to repay the creditors, even in cases where the loan was traded at a
discount or premium.
Shares and other equity (AF.5)
7.52. Shares and other equity are to be valued at their current prices. The same
current price is adopted for both the asset side and the liability side,
although shares and other equity are not, legally, a liability of the issuer,
but an ownership right on the liquidation value of the corporation, whose
amount is not known in advance.1996R2223 — EN — 07.08.2003 — 008.001 — 168
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7.53. Quoted shares (AF.511) are to be valued at a representative mid-market
price observed on the stock exchange or other organized financial
markets.
7.54. The values of unquoted shares (AF.512), which are not regularly traded on
organized markets, should be estimated with reference to the values of
quoted shares. However, these estimates should take into account
differences between the two types of shares, notably their liquidity, and
they should consider the reserves accumulated over the life of the
corporation and its branch of business.
7.55. The estimation method applied depends very much on the basic statistics
available. It may take into account, for example, data on merger activities
involving unquoted shares. Furthermore, in cases where the reserves of
corporations, which issue unquoted shares, differ on average, and in
proportion to their nominal capital, from that of corporations, which issue
unquoted shares, it would be appropriate to calculate the current price of
unquoted shares in proportion to figures including reserves, such as networth given by the corporation balance sheet, or as own funds compiled
according to ESA principles:
current price of
unquoted shares¼current price of
quoted shares/C2own funds
unquoted corporationsðÞ
own funds
quoted corporationsðÞ
The ratio of current price to own funds may vary with the branch of
business. Therefore, it is preferable to calculate the current price of
unquoted shares branch by branch. There may be other differences
between quoted and unquoted corporations, which may have an effect on
the estimation method.
7.56. Other equity (AF.513) is very often a liability of specific institutional
units (quasi-corporations, corporations owned by the state, internationalorganizations, notional units, etc.). In general, they have to be valued
according to specific methods, such as own funds or nominal value. The
own funds method is notably to be used systematically for quasi-
corporations, since their net worth is by convention equal to zero.
7.57. Mutual funds shares (AF.52) are to be valued at their current stock
exchange price, if they are quoted, or at their current redemption value, if
they are redeemable by the fund itself.
Insurance technical reserves (AF.6)
7.58. In the case of net equity of households in life insurance reserves (AF.611),
the present value of the individuals' actuarially determined claims to the
payment of capital or income can be ascertained. This value includes the
liability of life insurance corporations for reserves against outstanding
risks and reserves for with-profit insurance that add to the value on
maturity of with-profit endowments or similar policies. In the case of
with-profit insurance, the reserves include holding gains.
7.59. In the case of net equity of households on pension funds reserves
(AF.612), the nature of the liability of the funds — and financial asset of
the households — depends on the kind of pension scheme.
Defined benefit pension schemes are those in which the level of pension
benefits promised to participating employees is guaranteed. The liability
of a defined benefit pension scheme is equal to the present value of the
promised benefits. As the scheme may be temporarily over or under-
funded, a defined benefit pension scheme may have a positive or negative
net worth.
Money purchase pension schemes are those for which benefits are directly
dependent on the assets of the fund. The liability of a money purchase
pension scheme is the current market value of the funds' assets. The funds'
net worth is always zero.
7.60. The value of the prepayments of insurance premiums, which are part of
AF.62, is determined on the basis of the proportion of the risks involved in
relation to time for the time remaining on the contract. The value of the
reserves for outstanding claims, which are also part of AF.62, is the
present value of the amounts expected to be paid out in settlement of
claims, including disputed claims.
Other accounts receivable/payable (AF.7)
7.61. Trade credits and advances (AF.71) or other items receivable/payable
(AF.79) are to be valued for both creditors and debtors at the amount the1996R2223 — EN — 07.08.2003 — 008.001 — 169
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debtors are contractually obliged to pay the creditors when the obligation
is extinguished.
The amounts of taxes and social contributions payable to the general
government to be included under AF.79 should not include the part of
these taxes and social contributions which is unlikely to be collected, and
which therefore represents a general government claim that has no real
value.
MEMORANDUM ITEMS
7.62. In order to show items of more specialized analytic interest for particular
sectors, two memorandum items are to be included in the balance sheets:
(a) consumer durables (AN.m);
(b) direct foreign investment (AF.m).
Consumer durables (AN.m)
7.63. Consumer durables are durable goods used by households repeatedly over
periods of time of more than one year for final consumption. They are
included in the balance sheets only as memorandum items. Their inclusion
as a component of the balance sheet would be appropriate if the system
postulated that the durables were gradually used up in production
processes whose outputs consist of services. But consumer durables are
not treated in this way.
7.64. The stocks of consumer durables held by households — transport
equipment and other machinery and equipment — are to be valued at
current prices, both gross and net of accumulated charges equivalent to
consumption of fixed capital. The figures shown as memorandum items in
the balance sheet should be net of these accumulated charges.
7.65. Durable goods owned by owners of unincorporated enterprises may be
used partly by the enterprise for production and partly by members of the
household for final consumption. The values shown in the balance sheet
for the enterprise should reflect the proportion of the use that is
attributable to the enterprise.
Direct foreign investment (AF.m).
7.66. Direct investment consists of financial assets, not physical capital, because
the direct investment enterprise is a corporation or quasi-corporation
resident in another country. Financial assets and liabilities that constitute
direct investment are to be recorded according to the nature of the
financial assets in the categories shares and other equity, loans, and other
accounts receivable/payable. The amounts of direct investment included
within each of those categories should be recorded separately as a
memorandum item.
FINANCIAL BALANCE SHEETS
7.67. The financial balance sheet (of a sector or the rest of the world) shows on
its left side financial assets and on its right side liabilities. The balancing
item of the financial balance sheet is net financial assets (BF.90).
7.68. The financial balance sheet of a sector may be consolidated or non-
consolidated. The non-consolidated financial balance sheet shows the
financial assets and liabilities of the institutional units classified in the
sector. Compared to the non-consolidated financial balance sheet, those
financial assets and liabilities are eliminated from the consolidated
financial balance sheet, the counterparts of which are respectively
liabilities or financial assets of institutional units classified in the same
sector. The external assets and liabilities account, that is the financial
balance sheet of the rest of the world (see paragraph 8.77), is consolidated
by definition.
7.69. The financial balance sheet by debtor/creditor (of a sector or the rest of
the world) is an extension of the financial balance sheet, showing in
addition a breakdown of financial assets by debtor sector and a breakdown
of liabilities by creditor sector. Therefore, it provides information on
debtor/creditor relationships and it is consistent with the financial account
by debtor/creditor (see paragraph 5.13).1996R2223 — EN — 07.08.2003 — 008.001 — 170
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Annex 7.1
Definition of each asset category
Classification of assets Definitions
NON-FINANCIAL ASSETS
(AN.)Entities, over which ownership rights are enforced by institutional
units, individually or collectively, and from which economic
benefits may be derived by their owners by holding them, or using
them over a period of time, that consist of tangible assets, both
produced and non-produced, and most intangible assets for which
no corresponding liabilities are recorded.
Produced assets (AN.1) Non-financial assets that have come into existence as outputs from
production processes. Produced assets consist of fixed assets,
inventories and valuables, as defined below.
Fixed assets (AN.11) Produced assets that are used repeatedly or continuously in
production processes for more than one year. Fixed assets consist
of tangible and intangible fixed assets, as defined below.
Tangible fixed assets (AN.111) Fixed assets that consist of dwellings; other buildings and
structures; machinery and equipment and cultivated assets, as
defined below.
Dwellings (AN.1111) Buildings that are used entirely or primarily as residences,
including any associated structures, such as garages, and all
permanent fixtures customarily installed in residences. Houseboats,
barges, mobile homes and caravans used as principal residences of
households are also included, as are historic monuments identified
primarily as dwellings. Costs of site clearance and preparation are
also included.
Examples include residential buildings, such as one- and two-
dwelling buildings and other residential buildings intended for non-
transient occupancy.
Uncompleted dwellings are included to the extent that the ultimate
user is deemed to have taken ownership, either because the
construction is on own account or as evidenced by the existence of
a contract of sale/purchase. Dwellings acquired for military
personnel are included because they are used, as are dwellings
acquired by civilian units, for the production of housing services.
Other buildings and structures
(AN.1112)Non-residential buildings and other structures, as defined below.
Uncompleted buildings and structures are included to the extent
that the ultimate user is deemed to have taken ownership, either
because the construction is for own use or as evidenced by the
existence of a contract of sale/purchase. Buildings and structures
acquired for military purposes are included to the extent that they
resemble civilian buildings acquired for purposes of production and
are used in the same way.
Non-residential buildings
(AN.11121)Buildings other than dwellings, including fixtures, facilities and
equipment that are integral parts of the structures and costs of site
clearance and preparation. Historic monuments identified primarily
as non-residential buildings are also included.
Examples include warehouse and industrial buildings, commercial
buildings, buildings for public entertainment, hotels, restaurants,
educational buildings, health buildings, etc.
Other structures (AN.11122) Structures other than buildings, including the cost of the streets,
sewers and site clearance and preparation other than for residential
or non-residential buildings. Also included are historic monuments
for which identification as dwellings or non-residential buildings is
not possible and shafts, tunnels and other structures associated with
mining subsoil assets. (Major improvements to land, such as dams
and dikes for flood control, are included in the value of land.)
Examples include highways, streets, roads, railways and airfield
runways, bridges, elevated highways, tunnels and subways, water-
ways, harbours, dams and other waterworks, long distance
pipelines, communication and power lines, local pipelines and
cables, ancillary works, constructions for mining and manufacture,
and constructions for sport and recreation.1996R2223 — EN — 07.08.2003 — 008.001 — 171
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Classification of assets Definitions
Machinery and equipment
(AN.1113)Transport equipment and other machinery and equipment, as
defined below, other than that acquired by households for final
consumption. Tools that are relatively inexpensive and purchased
at a relatively steady rate, such as hand tools, may be excluded.
Also excluded is machinery and equipment integral to buildings
that is included in dwellings and non-residential buildings.
Uncompleted machinery and equipment is excluded, unless
produced for own use, because the ultimate user is deemed to
take ownership only on delivery of the asset. Machinery and
equipment acquired for military purposes is included to the extent
that it resembles goods acquired by civilian units for purposes of
production and that the military uses in the same way.
Machinery and equipment acquired by households for final
consumption is not treated as an asset. It is instead included in
the memorandum item consumer durables in the balance sheet for
households. Houseboats, barges, mobile homes and caravans used
by households as principal residences are included in dwellings.
Transport equipment
(AN.11131)Equipment for moving people and objects. Examples include
products other than parts included in CPA (1) subsection DM,
transport equipment, such as motor vehicles, trailers and semi-
trailers, ships, railway and tramway locomotives and rolling stock,
aircraft and spacecraft, and motorcycles, bicycles, etc.
Other machinery and equipment
(AN.11132)Machinery and equipment not elsewhere classified. Examples
include products other than parts, installation, repair and main-
tenance services included in CPA groups 29.1, machinery for the
production and use of mechanical power, except aircraft, vehicle
and cycle engines; 29.2, other general purpose machinery; 29.3,
agricultural and forestry machinery; 29.4, machine-tools; 29.5 other
special purpose machinery; in CPA divisions 30, office machinery
and computers; 31, electrical machinery and apparatus n.e.c; 32,
radio, television and communication equipment and apparatus; and
33, medical, precision and optical instruments, watches and clocks.
Other examples are products other than parts, installation, repair
and maintenance services included in CPA category 23.30.2, fuel
elements (cartridges), non-irradiated, for nuclear reactors; in CPA
groups 36.1, furniture; 36.3, musical instruments; 36.4, sporing
goods; and 28.3, steam generators, except central heating hot water
boilers.
Cultivated assets (AN.1114) Livestock for breeding, dairy, draught, etc. and vineyards, orchards
and other plantations of trees yielding repeat products that are
under the direct control, responsibility and management of
institutional units, as defined below.
Immature cultivated assets are excluded unless produced for own
use.
Livestock for breeding, dairy,
draught, etc. (AN.11141)Livestock that are kept for the products they provide year after
year. They include breeding stocks (including fish and poultry),
dairy cattle, draught animals, sheep or other animals used for wool
production and animals used for transportation, racing or
entertainment.
Vineyards, orchards and other
plantations of trees yielding
repeat products (AN.11142)Trees (including vines and shrubs) cultivated for products they
yield year after year, including those cultivated for fruits and nuts,
for sap and resin and for bark and leaf products.
Intangible fixed assets (AN.112) Fixed assets that consist of mineral exploration, computer software,
entertainment, literary or artistic originals and' other intangible
fixed assets, as defined below, intended to be used for more than
one year.
Mineral exploration (AN.1121) The value of expenditures on exploration for petroleum and natural
gas and for non-petroleum deposits. These expenditures include
prelicence costs, licence and acquisition costs, appraisal costs and
the costs of actual test drilling and boring, as well as the costs of
aerial and other surveys, transportation costs, etc., incurred to make
it possible to carry out the tests.
Computer software (AN.1122) Computer programs, program descriptions and supporting materials
for both systems and applications software. Included are purchased
software and software developed on own account, if the
expenditure is large. Large expenditures on the purchase, devel-
opment or extension of computer databases that are expected to be
used for more than one year, whether marketed or not, are also
included.1996R2223 — EN — 07.08.2003 — 008.001 — 172
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Classification of assets Definitions
Entertainment, literary or artistic
originals (AN.1123)Original films, sound recordings, manuscripts, tapes, models, etc.,
on which drama performances, radio and television programmes,
musical performances, sporting events, literary and artistic output,
etc. are recorded or embodied. Included are works produced on
own account. In some cases, such as films, there may be multiple
originals.
Other intangible fixed assets
(AN.1129)New information, specialized knowledge, etc., not elsewhere
classified, whose use in production is restricted to the units that
have established ownership rights over them or to other units
licensed by the latter.
Inventories (AN.12) Produced assets that consist of goods and services that came into
existence in the current period or in an earlier period held for sale,
use in production or other use at a later date. They consist of
materials and supplies, work in progress, finished goods and goodsfor resale, as defined below.
Included are all inventories held by government, including, but not
limited to, inventories of strategic materials, grains and other
commodities of special importance to the nation.
Materials and supplies (AN.121) Goods that their owners intend to use as intermediate inputs in their
own production processes, not to resell.
Work in progress (AN.122) Goods and services that are partially completed but that are not
usually turned over to other units without further processing or that
are not mature and whose production process will be continued in a
subsequent period by the same producer. Excluded are partially
completed structures for which the ultimate owner is deemed to
have taken ownership, either because the production is for own use
or as evidenced by the existence of a contract of sale/purchase.
They consist of work in progress on cultivated assets and other
work in progress, as defined below.
Work in progress on cultivated
assets (AN.1221)Livestock raised for products yielded only on slaughter, such as
fowl and fish raised commercially, trees and other vegetation
yielding once-only products on destruction and immature cultivated
assets yielding repeat products.
Other work in progress
(AN.1222)Goods other than cultivated assets and services that have been
partially processed, fabricated or assembled by the producer but
that are not usually sold, shipped or turned over to others without
further processing.
Finished goods (AN.123) Goods that are ready for sale or shipment by the producer.Goods for resale (AN.124) Goods acquired by enterprises, such as wholesalers and retailers,
for the purpose of reselling them without further processing (that is,
not transformed other than by presenting them in ways that are
attractive to the customer).
Valuables (AN.13) Produced assets that are not used primarily for production or
consumption, that are expected to appreciate or at least not to
decline in real value, that do not deteriorate over time under normal
conditions and that are acquired and held primarily as stores of
value. Valuables consist of precious metals and stones, antiques
and other art objects and other valuables, as defined below.
Precious metals and stones
(AN.131)Precious metals and stones that are not held by enterprises for use
as inputs into processes of production.
Antiques and other art objects
(AN.132)Paintings, sculptures, etc., recognised as works of art and antiques.
Other valuables (AN.139) Valuables not elsewhere classified, such as collections and
jewellery of significant value fashioned out of precious stones
and matals.
Non-produced assets (AN.2) Non-financial assets that come into existence other than through
processes of production. Non-produced assets consist of tangible
assets and intangible assets, as defined below. Also included are
costs of ownership transfer on and major improvements to these
assets.
Tangible non-produced assets
(AN.21)Non-produced assets that occur in nature and over which ownership
may be enforced and transferred. Environmental assets over which
ownership rights have not, or cannot, be enforced, such as open
seas or air, are excluded. Tangible non-produced assets consist of
land, subsoil assets, non-cultivated biological resources and water
resources, as defined below.1996R2223 — EN — 07.08.2003 — 008.001 — 173
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Classification of assets Definitions
Land (AN.211) The ground, including the soil covering and any associated surface
waters, over which ownership rights are enforced. Also included
are major improvements that cannot be physically separated from
the land itself. Excluded are any buildings or other structures
situated on it or running through it; cultivated crops, trees and
animals; subsoil assets; non-cultivated biological resources and
water resources below the ground. Land consists of land underlying
buildings and structures, land under cultivation, recreational land
and associated surface water and other land and associated surface
water, as defined below.
Land underlying buildings and
structures (AN.2111)Land on which dwellings, non-residential buildings and structures
are constructed or into which their foundations are dug, including
yards and gardens deemed an integral part of farm and non-farm
dwellings and access roads to farms.
Land under cultivation
(AN.2112)Land on which agricultural or horticultural production is carried on
for commercial or subsistance purposes, including, in principle,
land under plantations, orchards and vineyards.
Recreational land and associated
surface water (AN.2113)Land that is used as privately owned amenity land, parklands and
pleasure grounds and publicly owned parks and recreational areas,
together with associated surface water.
Other land and associated
surface water (AN.2119)Land not elsewhere classified, including private gardens and plots
not cultivated for subsistence or commercial purposes, communal
grazing land, land surrounding dwellings in excess of those yards
and gardens deemed an integral part of farm and non-farm
dwellings and associated surface water.
Subsoil assets (AN.212) Proven reserves of mineral deposits located on or below the earth's
surface that are economically exploitable, given current technology
and relative prices. Ownership rights to the subsoil assets are
usually separable from those to the land itself. Subsoil assets
consist of coal, oil and natural gas reserves, metallic mineral
reserves and non-metallic mineral reserves, as defined below.
Coal, oil and natural gas
reserves (AN.2121)Anthracite, bituminous and brown coal deposits; petroleum and
natural gas reserves and fields.
Metallic mineral reserves
(AN.2122)Ferrous, non-ferrous and precious metal ore deposits
Non-metallic mineral reserves
(AN.2123)Stone quarries and clay and sand pits; chemical and fertilizer
mineral deposits; salt deposits; deposits of quartz, gypsum, natural
gem stones, asphalt and bitumen, peat and other non-metallic
minerals other than coal and petroleum.
Non-cultivated biological
resources (AN.213)Animals and plants that yield both once-only and repeat products
over which ownership rights are enforced but for which natural
growth and/or regeneration is not under the direct control,
responsibility and management of institutional units. Examples
are virgin forests and fisheries within the territory of the country.
Only those resources that are currently, or are likely soon to be,
exploitable for economic purposes should be included.
Water resources (AN.214) Aquifers and other groundwater resources to the extent that their
scarcity leads to the enforcement of ownership and/or use rights,
market valuation and some measure of economic control.
Intangible non-produced assets
(AN.22)Non-produced assets that are constructs of society. They are
evidenced by legal or accounting actions, such as the granting of a
patent or the conveyance of some economic benefit to a third party.
Some entitle their owners to engage in certain specific activities
and to exclude other institutional units from doing so except with
the permission of the owner. Intangible non-produced assets consist
of patented entities, leases and other transferable contracts,
purchased goodwill and other intangible non-produced assets.
Patented entities (AN.221) Inventions in categories of technical novelty that, by law or by
judicial decision, can be afforded patent protection. Examples
include constitutions of matter, processes, mechanisms, electrical
and electronic circuits and devices, pharmaceutical formulations
and new varieties of living things produced by artifice.1996R2223 — EN — 07.08.2003 — 008.001 — 174
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Classification of assets Definitions
Leases and other transferable
contracts (AN.222)Leases or contracts where the lessee has the right to convey the
lease to a third party independently of the lessor. Examples include
leases of land and buildings and other structures, concessions or
exclusive rights to exploit mineral deposits or fishing grounds,
transferable contracts with athletes and authors and options to buy
tangible assets not yet produced. Leases on the rental of machinery
are excluded from non-financial intangible assets.
Purchased goodwill (AN.223) The difference between the value paid for an enterprise as a going
concern and the sum of its assets less the sum of its liabilities, each
item of which has been separately identified and valued. The value
of goodwill, therefore, includes anything of long-term benefit to the
business that has not been separately identified as an asset, as well
as the value of the fact that the group of assets is used jointly and is
not simply a collection of separable assets.
Other intangible non-produced
assets (AN.229)Intangible non-produced assets not elsewhere classified.
FINANCIAL ASSETS AND
LIABILITIES (AF.)Financial assets are economic assets comprising means of payment,
financial claims and economic assets which are close to financial
claims in nature.
Means of payment consist of monetary gold, special drawing rights,
currency and transferable deposits.
Financial claims entitle their owners, the creditors, to receive a
payment or series of payments without any counter-performance
from other institutional units, the debtors, who have incurred the
counterpart liabilities.
Examples of economic assets which are close to financial claims in
nature are financial derivatives and shares and other equity.
Monetary gold and SDRs
(AF.1)The financial assets classified in this category are the only financial
assets for which there are no counterpart liabilities in the system.
Monetary gold (AF.11) Gold held as a component of foreign reserves by monetary
authorities or by others who are subject to the effective control of
the authorities.
Special drawing rights (SDRs)
(AF.12)International reserve assets created by the International Monetary
Fund (IMF) and allocated to its members to supplement existing
reserve assets.
Currency and deposits (AF.2) Currency in circulation and all types of deposits in national and in
foreign currency.
Currency (AF.21) Notes and coins in circulation that are commonly used to make
payments.
Transferable deposits (AF.22 Deposits (in national or in foreign currency) which are immediately
convertible into currency or which are transferable by cheque,
banker's order, debit entry or the like, both without any kind of
significant restriction or penalty.
Other deposits (AF.29) Deposits (in national or in foreign currency) other than transferable
deposits. Other deposits cannot be used to make payments at any
moment and they are not convertible into currency or transferable
deposits without any kind of significant restriction or penalty.
Securities other than shares
(AF.3)Financial assets which are negotiable and bearer instruments, are
usually traded on secondary markets, and do not grant the holder
any ownership rights in the institutional unit issuing them.
Securities other than shares,
excluding financial derivatives
(AF.33)Securities other than shares which give the holder the unconditional
right to a fixed or contractually determined variable money income
in the form of coupon payments (interest) and/or a stated fixed sum
on a specified date or dates or starting from a date fixed at the time
of issue.
Short-term securities other than
shares, excluding financial deri-
vatives AF.331)Securities other than shares, whose original maturity is normally
one year or less and in exceptional cases two years at the
maximum, except financial derivatives.
Long-term securities other than
shares, excluding financial deri-
vatives (AF.332)Securities other than shares, whose original maturity is normally
more than one year, and in exceptional cases more than two years
at the minimum, except financial derivatives.
Financial derivatives (AF.34) Financial assets based on or derived from a different underlying
instrument. The underlying instrument is usually another financial
asset, but may also be a commodity or an index.1996R2223 — EN — 07.08.2003 — 008.001 — 175
▼B
Classification of assets Definitions
Loans (AF.4) Financial assets created when creditors lend funds to debtors, either
directly or through brokers, which are either evidenced by non-
negotiable documents or not evidenced by documents.
Short-term loans (AF.41) Loans whose original maturity is normally one year or less, and in
exceptional cases two years at the maximum, and loans repayable
on demand.
Long-term loans (AF.42) Loans whose original maturity is normally more than one year, and
in exceptional cases more than two years at the minimum.
Shares and other equity (AF.5) Financial assets which represent property rights on corporations or
quasi-corporations. These financial assets generally entitle the
holders to a share in the profits of the corporations or quasi-
corporations and to a share in their net assets in the event of
liquidation.
Shares and other equity,
excluding mutual funds shares
(AF.51)Financial assets except mutual fund shares which represent
property rights on corporations or quasi-corporations. These
financial assets generally entitle the holders to a share in the
profits of the corporations or quasi-corporations and to a share in
their net assets in the event of liquidation.
Quoted shares, excluding
mutual funds shares (AF.511)Shares cover beneficial interest in the capital of corporations in the
form of securities which in principle are negotiable. Quoted shares
cover those shares with prices quoted on a recognized stock
exchange or other form of secondary market.
Unquoted shares, excluding
mutual funds shares (AF.512)Unquoted shares cover those shares that are not quoted.
Other equity (AF.513) All forms of equities other than those classified in sub-positions
AF.511 and 512, and in sub-category AF.52.
Mutual funds shares (AF.52) Shares issued by a specific type of financial corporations, whose
exclusive purpose is to invest the funds collected on the money
market, the capital market and/or in real estate.
Insurance technical reserves
(AF.6)Technical provisions of insurance corporations and (autonomous
and non-autonomous) pension funds against policy holders or
beneficiaries as laid down in the Council Directive 91/674/EEC of
19 December 1991 on the annual accounts and consolidated
accounts of insurance undertakings.
Net equity of households in life
insurance reserves and in
pension funds reserves (AF.61)Provisions set aside in the corporations concerned for the purpose
of obtaining, once the established conditions are met, the claims
and benefits foreseen.
Net equity of households in life
insurance reserves (AF.611)Provisions against outstanding risks and provisions for with-profit
insurance that add to the value on maturity of with-profit
endowments or similar policies.
Net equity of households in
pensions funds reserves
(AF.612)Provisions held by autonomous and non-autonomous pension funds
established by employers and/or employees or groups of self-
employed to provide pensions for employees or self-employed.
Prepayments of insurance
premiums and reserves for
outstanding claims (AF.62)Provisions established by insurance corporations and (autonomous
and non-autonomous) pension funds for
— the amount representing that part of gross premiums written
which is to be allocated to the following accounting period
(prepayments of insurance premiums),
— the total estimated ultimate cost of settling all claims arising
from events which have occurred up to the end of the
accounting period, whether reported or not, less amounts
already paid in respect of such claims (provisions for
outstanding claims).
Other accounts receivable/
payable (AF.7)Financial assets which are created as a counterpart of a financial or
a non-financial transaction in cases where there is a timing
difference between this transaction and the corresponding payment.
Trade credits and advances
(AF.71)Financial assets arising from the direct extension of credit by
suppliers and buyers for goods and services transactions and
advance payments for work that is in progress or to be undertaken
and associated with such transactions.
Other accounts receivable/
payable, excluding trade credits
and advances (AF.79)Financial assets which arise from timing differences between
distributive transactions or financial transactions on the secondary
market and the corresponding payment. It includes also financial
claims due to income accruing over time.1996R2223 — EN — 07.08.2003 — 008.001 — 176
▼B
Classification of assets Definitions
Memorandum items The system calls for several memorandum items to show assets not
separately identified in the central framework that are of more
specialized analytic interest.
Consumer durables (AN.m) Durable goods acquired by households for final consumption (i.e.
those that are not used by households as stores of value or by
unincorporated enterprises owned by households for purposes of
production).
Direct foreign investment
(AF.m)Direct foreign investment involves a long-term relationship
reflecting a lasting interest of a resident institutional unit in one
economy (direct investor) in an institutional unit resident in an
economy other than that of the investor (direct investment
enterprise). The direct investor's purpose is to exert a significant
degree of influence on the management of the enterprise resident in
the other economy.
(1) Statistical Classification of Products by Activity (CPA), 1993.1996R2223 — EN — 07.08.2003 — 008.001 — 177
▼B
Annex 7.2
A map of entries from opening balance sheet to closing balance sheet
Classification
of assets,
liabilities and
net worthIV.1
Opening
balance sheetIII.1 and III.2
TransactionsIII.3.1
Other
changes in
volumeIII.3.2
Holding gains
IV.3
Closing
balance sheetIII.3.2.1
Neutral
holding gains
and lossesIII.3.2.2
Real holding
gains and
losses
Non-finan-
cial assetsAN. P.5, K.1,
K.2K.3, K.4,
K.5, K.6,
K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.
Produced
assetsAN.1 P.5, K.1 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.1
Fixed
assets (1)AN.11 P.51, K.1 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.11
Tangible
fixed assetsAN.111 P.511, K.1 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.111
Dwellings AN.1111 P.511, K.1 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.1111
Other build-
ings and
structuresAN.1112 P.511, K.1 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.1112
Machinery
and equip-
mentAN.1113 P.511, K.1 K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.1113
Cultivated
assetsAN.1114 P.511, K.1 K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.1114
Intangible
fixed assetsAN.112 P.512, K.1 K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.112
Inventories AN.12 P.52 K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.12
Valuables AN.13 P.53 K.4, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.131996R2223 — EN — 07.08.2003 — 008.001 — 178
▼B
Classification
of assets,
liabilities and
net worthIV.1
Opening
balance sheetIII.1 and III.2
TransactionsIII.3.1
Other
changes in
volumeIII.3.2
Holding gains
IV.3
Closing
balance sheetIII.3.2.1
Neutral
holding gains
and lossesIII.3.2.2
Real holding
gains and
losses
Non-
produced
assetsAN.2 K.2,
P.513, K.1K.3, K.5,
K.61,
K.62, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.2
Tangible
non-
produced
assetsAN.21 K.21,
P.513, K.1K.3, K.5,
K.61,
K.62, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.21
Land AN.211 K.21,
P.513, K.1K.3, K.62,
K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.211
Subsoil
assetsAN.212 K.21,
P.513K.3, K.61,
K.62, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.212
Non-culti-
vated biolo-
gical
resourcesAN.213 K.21,
P.513K.3, K.5,
K.61,
K.62, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.213
Water
resourcesAN.214 K.21,
P.513K.3, K.61,
K.62, K.7,
K.8, K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.214
Intangible
non-
produced
assetsAN.22 K.22,
P.513K.3, K.62,
K.7, K.8,
K.9,
K.12.1,
K.12.22K.11.1 K.11.2 AN.22
Financial
assets/liabil-
ities (2)AF. F. K.7, K.8,
K.10,
K.12.1,
K.12.21,
K.12.22K.11.1 K.11.2 AF.
Monetary
gold and
SDRs
(assets only)AF.1 F.1 K.7, K.8,
K.10,
K.12.1,
K.12.21,
K.12.22K.11.1 K.11.2 AF.1
Currency
and depositsAF.2 F.2 K.7, K.8,
K.10,
K.12.1,
K.12.22K.11.1 K.11.2 AF.2
Securities
other than
sharesAF.3 F.3 K.7, K.8,
K.10,
K.12.1,
K.12.22K.11.1 K.11.2 AF.31996R2223 — EN — 07.08.2003 — 008.001 — 179
▼B
Classification
of assets,
liabilities and
net worthIV.1
Opening
balance sheetIII.1 and III.2
TransactionsIII.3.1
Other
changes in
volumeIII.3.2
Holding gains
IV.3
Closing
balance sheetIII.3.2.1
Neutral
holding gains
and lossesIII.3.2.2
Real holding
gains and
losses
Loans AF.4 F.4 K.7, K.8,
K.10,
K.12.1,
K.12.22K.11.1 K.11.2 AF.4
Shares and
other equityAF.5 F.5 K.7, K.8,
K.10,
K.12.1,K.12.22K.11.1 K.11.2 AF.5
Insurance
technical
reservesAF.6 F.6 K.7, K.8,
K.10,
K.12.1,
K.12.22K.11.1 K.11.2 AF.6
Other
accountsreceivable/
payableAF.7 F.7 K.7, K.8,
K.10,K.12.1,
K.12.22K.11.1 K.11.2 AF.7
Net worth B.90 B.10.1 B.10.2 B.10.31 B.10.32 B.90
(1) Memorandum item: AN.m: Consumer durables.
(2) Memorandum item: AF.m: Direct foreign investment.
AN. …, AF. … are from classification of assets.
Balancing items
B.10.1 Changes in net worth due to saving and capital transfers
B.10.2 Changes in net worth due to other changes in volume of assetsB.10.31 Changes in net worth due to neutral holding gains/losses
B.10.32 Changes in net worth due to real holding gains/losses
B.90 Net worthTransactions in financial assets and liabilitiesF. Transactions in financial assets and liabilities
F.1 Monetary gold and SDRs
F.2 Currency and depositsF.3 Securities other than shares
F.4 Loans
F.5 Shares and other equityF.6 Insurance technical reserves
F.7 Other accounts receivable/payable
Transactions in goods and servicesP.5 Gross capital formation
P.51 Gross fixed capital formation
P.511 Acquisitions less disposals of tangible fixed assetsP.512 Acquisitions less disposals of intangible fixed assets
P.513 Additions to the value of non-produced non-financial assets
P.52 Changes in inventoriesP.53 Acquisitions less disposals of valuables
Other accumulation entries
K.1 Consumption of fixed capital1996R2223 — EN — 07.08.2003 — 008.001 — 180
▼B
K.2 Acquisitions less disposals of non-financial non-produced assets
K.21 Acquisitions less disposals of land and other tangible non-produced assets
K.22 Acquisitions less disposals of intangible non-produced assets
K.3 Economic appearance of non-produced assetsK.4 Economic appearance of produced assets
K.5 Natural growth of non-cultivated biological resources
K.61 Depletion of natural assetsK.62 Other economic disappearance of non-produced assets
K.7 Catastrophic losses
K.8 Uncompensated seizuresK.9 Other volume changes in non-financial assets n.e.c.
K.10 Other volume changes in financial assets and liabilities n.e.c.
K.11 Nominal holding gains/lossesK.11.1 Neutral holding gains/losses
K.11.2 Real holding gains/losses
K.12 Changes in classifications and structureK.12.1 Changes in sector classification and structure
K.12.21 Monetization/demonetization of gold
K.12.22 Changes other than monetization/demonetization of gold in classifications of assets or
liabilities1996R2223 — EN — 07.08.2003 — 008.001 — 181
▼B
CHAPTER 8
SEQUENCE OF ACCOUNTS AND BALANCING ITEMS
8.01. The ESA records flows and stocks in an ordered set of accounts describing
the economic cycle from the generation of income, through its distribution
and redistribution and finally to its accumulation in the form of assets.
8.02. Each of the accounts shows transactions which balance out, either because
of the definitions used or because a significant balance is carried forward
to the next account.
8.03. The structured recording of transactions according to a logical analysis of
economic life provides the aggregates required for the study of an
industry, an institutional sector or subsector, or the total economy. The
breakdown of the accounts was designed to reveal the most significant
economic information.
8.04. The accounts are grouped in three categories:
(a) current accounts;
(b) accumulation accounts;
(c) balance sheets.
Current accounts concern the generation, distribution and redistribution of
income and its use in the form of final consumption. Finally, they permit
the calculation of saving, which is an essential factor in accumulation.
Accumulation accounts analyse the various components of changes in the
assets and liabilities of the various units and enable changes in net worth
(the difference between assets and liabilities) to be recorded.
Balance sheets show the total assets and liabilities of the various units at
the beginning and the end of the accounting period, together with their net
worth. The flows for each asset and liability item recorded in the
accumulation accounts are seen again in the changes in balance sheets
account.
8.05. The sequence of accounts applies, wholly or partly, to institutional units,
institutional sectors and subsectors, industries and the total economy.
8.06. The balancing items are established both gross and net. They are gross if
calculated before deduction of consumption of fixed capital and net if
calculated after this deduction. It is more significant to express income
balancing items in net terms.
8.07. The accounts are presented in various ways:
(a) in the form of integrated economic accounts, showing the accounts for
all the institutional sectors, the total economy and the rest of the world
in a single table;
(b) in the form of a sequence of accounts, giving more detailed
information. The tables showing the presentation of each account
are given in the section of this chapter entitled ‘Sequence of
accounts’;
(c) in the form of matrices, in which each account is represented by a
row/column pair.
8.08. Synoptic presentation of the accounts, balancing items and main
aggregates:1996R2223 — EN — 07.08.2003 — 008.001 — 182
Table 8.1 — Synoptic presentation of the accounts, balancing items and main aggregates
Accounts Balancing items Main aggregates
Full sequence of acounts for institutional sectors
Current
accountsI. Production account I. Production account B.1 Value added
B.2 Operating surplus
B.3 Mixed income
B.4 Entrepreneurial income
B.5 Balance of primary
incomes
B.6 Disposable income
B.7 Adjusted disposable
income
B.8 SavingDomestic product (GDP/NDP)
National income (GNI, NNI)
National disposable income
National savingII. Distribution and use of
income accountsII.1. Primary distribution of
income accountsII.1.1. Generation of
income account
II.1.2. Allocation of
primary income
accountII.1.2.1. Entrepreneurial
income account
II.1.2.2. Allocation of other
primary income
account
II.2. Secondary distribu-
tion of income
account
II.3. Redistribution of
income in kind
account
II.4. Use of income
account
II.4.1. Use of disposable
income account
II.4.2. Use of adjusted
disposable income
account▼B1996R2223 — EN — 07.08.2003 — 008.001 — 183
Accounts Balancing items Main aggregates
Full sequence of acounts for institutional sectors
Accumula-
tion
accountsIII. Accumulation accounts III.1. Capital account III.1.1. Change in net worth
due to saving and
capital transfers
account
III.1.2. Acquisition of non
financial assets
accountB.10.1 Changes in net
worth, due to
saving and capital
transfers
B.9 Net lending/Net
borrowing
B.9 Net lending/Net
borrowing
B.10.2 Changes in net
worth, due to
other changes in
volume of assets
B.10.3 Changes in net
worth, due to
nominal holding
gains/losses
B.10.31 Changes in net
worth, due to
neutral holding
gains/losses
B.10.32 Changes in net
worth, due to real
holding gains/
lossesIII.2. Financial account
III.3. Other changes in
assets accountsIII.3.1. Other changes in
volume of assets
account
III.3.2. Revaluation
accountsIII.3.2.1. Neutral holding
gains/losses
III.3.2.2. Real holding
gains/losses
Balance
sheetsIV. Balance sheets IV.1. Opening balance
sheet
IV.2. Changes in balance
sheet
IV.3. Closing balance sheetB.90 Net worth
B.10 Changes in net worth,
total
B.90 Net worthNational worth
Changes in national worthNational worth
0. Goods
and
services
accountTransaction accounts
0. Goods and services account
Rest of World account (external transactions account)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 184
Accounts Balancing items Main aggregates
Full sequence of acounts for institutional sectors
Currents
accountsV. Rest of the World
accountV.I. External account of
goods and services
V.II. External account of
primary income and
current transfersB.11 External balance of
goods and services
B.12 Current external
balance
B.10.1 Changes in net
worth due to
current external
balance and capital
transfers
B.9 Net lending/Net
borrowing
B.9 Net lending/Net
borrowing
B.10.2 Changes in net
worth, due to other
changes in volume
of assets
B.10.3 Changes in net
worth, due to
nominal holding
gains/losses
neutral holding
gains/losses real
holding
gains/losses
B.90 Net worth
B.10 Changes in net
worth
B.90 Net worthExternal balance of goods and
services
Current external balance
Net lending/Net borrowing
Net external financial position
Net external financial positionAccumula-
tion
accountsV.III. External accumulation
accountsV.III.1. Capital account V.III.1.1. Changes in net
worth due to
saving and
capital transfers
account
V.III.1.2. Acquisition of
non fin cial
assets account
V.III.2. Financial account
V.III.3. Other changes in
assets accountV.III.3.1. Other changes in
volume of assets
V.III.3.2. Revaluation
accounts
Balance
sheetsV.IV. External assets and
liabilities accountV.IV.1. Opening balance
sheet
V.IV.2. Changes in balance
sheet
V.IV.3. Closing balance
sheet▼B1996R2223 — EN — 07.08.2003 — 008.001 — 185
▼B
SEQUENCE OF ACCOUNTS
8.09. The sequence of accounts is composed of three main categories of
accounts:
(a) Current accounts:
1. production account (I);
2. distribution and use of income accounts (II);
(b) accumulation accounts (III);
(c) balance sheets (IV).
CURRENT ACCOUNTSProduction account (I) (
1)
8.10. The production account (I) shows the transactions relating to the
production process proper. It is drawn up for institutional sectors and
for industries. Its resources include output and its uses include
intermediate consumption.
8.11. The production account can be used to obtain one of the most important
balancing items in the system — value added, or the value generated by
any unit engaged in a production activity — and a vital aggregate: gross
domestic product. Value added is economically significant for both the
institutional sectors and the industries.
8.12. As with the balancing items of the following accounts, value added (the
balancing item of the account) may be calculated before or after
consumption of fixed capital, i. e. gross or net. Given that output is valued
at basic prices and intermediate consumption at purchaser's prices, value
added does not include taxes less subsidies on products.
8.13. The production account at the level of the total economy includes in
resources, in addition to the output of goods and services, taxes less
subsidies on products. It thus enables gross domestic product (at market
prices) to be obtained as a balancing item.
8.14. As financial intermediation services indirectly measured (Fisim) are not
allocated to user sectors, the whole of the value of the output of Fisim is
treated as the intermediate consumption of a nominal sector with zero
output and negative value added equal in size but opposite in sign to
intermediate consumption. In this way, the value added of all sectors and
industries together is reduced in total by this amount. To lighten the
presentation of accounts, it is possible not to insert a supplementary
column for the nominal sector, but instead to take into account the
corresponding figure in the column total economy.
Distribution and use of income accounts (II)
8.15. Distribution and use of income are analysed in four stages: primary
distribution, secondary distribution, redistribution in kind and use of
income.
The first stage concerns the generation of income resulting directly from
the production process and its distribution between the production factors
(labour, capital) and general government (via taxes on production and
imports, and subsidies). It enables the operating surplus (or mixed income
in the case of households) and primary income to be determined.
The second stage traces redistribution of income via transfers other than
social transfers in kind. This yields the disposable income.
The third stage describes redistribution via social transfers in kind,
yielding the adjusted disposable income.
The fouth stage describes how the income is consumed and saved,
yielding the saving.1996R2223 — EN — 07.08.2003 — 008.001 — 186
(1) See chapter 3: ‘Transactions in products’.
Table 8.2. — Account I: Production account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
3 595 3 595 P.1 Output 1 753 102 434 1 269 37 3 595 3 595
3 048 3 048 P.11 Market output/
Fisim 1 722 102 74 1 129 21 3 048 3 048
171 171 P.12 Output for own
final use 31 0 0 140 0 171 171
376 376 P.13 Other non-
market output 360 16 376 376
1 904 1 904 6 694 246 29 881 P.2 Intermediate
consumption/
Fisim 1 904 1 904
133 133 D.21-D.31 Taxes less subsi-
dies on products 133 133
1 824 1 824 31 575 188 73 872 B.1g/B.1 * g Value added,
gross/gross
domestic product
222 222 3 42 30 10 137 K.1 Consumption of
fixed capital
1 602 1 602 28 533 158 63 735 B.1n/B.1 * n Value added, net/
net domestic
product
P.11 Financial corporations: 102 including 48 for Fisim (P.119).
P.2 Total economy: 1904 corresponding to the sum of institutional sectors (1856) and to Fisim (48).
B.1g Total economy: 1824 corresponding to the sum of institutional sectors /1739), plus taxes less subsidies on products (133) less Fisim (48).▼B1996R2223 — EN — 07.08.2003 — 008.001 — 187
▼B
Primary distribution of income accounts (II.1)
Generation of income account (II.1.1)
The layout of the generation of income account by institutional sector is as shown
in the table 8.3.
8.16. The generation of income account is also presented by industries, in the
columns of the supply and uses tables.
8.17. The generation of income account presents the sectors, subsectors and
industries which are the source, rather than the destination, of primary
income.
8.18. It analyses the extent to which value added can cover compensation of
employees and other taxes less subsidies on production. It measures the
operating surplus, which is the surplus (or deficit) on production activities
before account has been taken of the interest, rents or charges which the
production unit:
(a) must pay on financial assets or on tangible non-produced assets which
it has borrowed or rented;
(b) must receive on financial assets or on tangible non-produced assets of
which it is the owner.
The operating surplus corresponds to the income which the units obtain
from their own use of their production facilities. It is the last balancing
item which can be calculated for both the industries and the institutional
sectors and subsectors.
8.19. In the case of unincorporated enterprises in the households sector, the
balancing item of the generation of income account implicitly contains an
element corresponding to remuneration for work carried out by the owner
or members of his family which cannot be distinguished from his profits
as entrepreneur. This is referred to as ‘mixed income’.
8.20. In the case of own account production of accommodation services by
owner-occupier households, the balancing item of the generation of
income account is an operating surplus.
Allocation of primary income account (II.1.2)
8.21. Unlike the generation account, the allocation of primary income account
concerns the resident units and institutional sectors as recipients rather
than producers of primary income.
8.22. ‘Primary income’ is the income which resident units receive by virtue of
their direct participation in the production process, and the income
receivable by the owner of a financial asset or a tangible non-produced
asset in return for providing funds to, or putting the tangible non-produced
asset at the disposal of, another institutional unit.
8.23. The allocation of primary income account (II.1.2) can be calculated only
for the institutional sectors and subsectors because, in the case of
industries, it is impossible to break down certain flows connected with
financing (capital loans and borrowings) and assets.
8.24. As financial intermediation services indirectly measured (Fisim) are not
allocated to user sectors, the entries shown for interest are those for actual
interest payable and receivable. An adjustment is made to resources in the
column financial corporations (with a negative sign) and in the column
nominal sector (with a positive sign). To lighten the presentation of
accounts, it is possible not to insert a supplementary column for the
nominal sector, but instead to present the corresponding figure in the
column total economy.
8.25. The allocation of primary income account is broken down into an
entrepreneurial income account (II.1.2.1) and an allocation of other
primary income account (II.1.2.2).
Entrepreneurial income account (II.1.2.1)
8.26. The purpose of the entrepreneurial income account is to determine a
balancing item corresponding to the concept of current profit beforedistribution and income tax, as normally used in business accounting.1996R2223 — EN — 07.08.2003 — 008.001 — 188
Table 8.3. — Account II.1.1: Generation of income account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing
itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.1g/B.1 * g Value added,
gross/gross
domestic product 872 73 188 575 31 1 824 1 824
B.1n/B.1 * n Value added, net/
net domestic
product 735 63 158 533 28 1 602 1 602
762 762 23 39 140 15 545 D.1 Compensation of
employees
569 569 12 39 87 10 421 D.11 Wages and
salaries
193 193 11 0 53 5 124 D.12 Employers'
social contribu-
tions
174 174 10 0 48 4 112 D.121 Employers'
actual social
contributions
19 19 1 0 5 1 12 D.122 Employers'
imputed social
contributions
235 0 235 0 3 2 3 86 D.2 Taxes on
production and
imports 0
141 0 141 D.21 Taxes on
products 0▼B1996R2223 — EN — 07.08.2003 — 008.001 — 189
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing
itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
121 0 121 D.211 Value added type
taxes (VAT) 0
17 0 17 D.212 Taxes and duties
on imports
excluding VAT 0
17 0 17 D.2121 Import duties 0
0 0 0 D.2122 Taxes on imports
excluding VAT
and duties 0
3 0 3 D.214 Taxes on
products except
VAT and import
taxes 0
94 0 94 0 3 2 3 86 D.29 Other taxes on
production 0
− 44 0 − 44 0 − 1 0 0 − 35 D.3 Subsidies 0
− 8 0 − 8 D.31 Subsidies on
products 0
0 0 0 D.311 Import subsidies 0
− 8 0 − 8 D.319 Other subsidies
on products 0
− 36 0 − 36 0 − 1 0 0 − 35 D.39 Other subsidies
on production 0▼B1996R2223 — EN — 07.08.2003 — 008.001 — 190
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing
itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
429 429 8 92 46 55 276 B.2g Operating
surplus, gross
442 442 442 B.3g Mixed income,
gross
217 217 5 60 16 45 139 B.2n Operating
surplus, net
432 432 432 B.3n Mixed income,
net▼B1996R2223 — EN — 07.08.2003 — 008.001 — 191
Table 8.4 — Account II.1.2: Allocation of primary income account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.2g Operating
surplus, gross 276 55 46 92 8 429 429
B.3g Mixed income,
gross 442 442 442
B.2n Operating
surplus, net 139 45 16 60 5 217 217
B.3n Mixed income,
net 432 432 432
6 6 D.1 Compensation of
employees 766 766 2 768
6 6 D.11 Wages and
salaries 573 573 2 575
D.12 Employers'
social contribu-
tions 193 193 0 193
D.121 Employers'
actual social
contributions 174 174 0 174
D.122 Employers'
imputed social
contributions 19 19 0 19
0 D.2 Taxes on
production and
imports 235 235 0 235▼B1996R2223 — EN — 07.08.2003 — 008.001 — 192
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
0 D.21 Taxes on
products 141 141 0 141
0 D.211 Value added type
taxes (VAT) 121 121 0 121
0 D.212 Taxes and duties
on imports
excluding VAT 17 17 0 17
0 D.2121 Import duties 17 17 0 170 D.2122 Taxes on imports
excluding VAT
and duties 0 0 0 0
D.214 Taxes on
products except
VAT and import
taxes 3 3 0 3
0 D.29 Other taxes on
production 94 94 0 94
0 D.3 Subsidies − 44 − 44 0 − 44
0 D.31 Subsidies on
products − 8 − 8 0 − 8
0 D.311 Import subsidies 0 0 0 00 D.319 Other subsidies
on products − 8 − 8 0 − 8▼B1996R2223 — EN — 07.08.2003 — 008.001 — 193
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
0 D.39 Other subsidies
on production − 36 − 36 0 − 36
446 66 380 7 44 46 138 145 D.4 Property income 78 160 30 134 5 407 39 446
222 16 206 7 17 39 77 66 D.41 Interest 25 125 12 33 5 200 22 222
0 0 P.119 Adjustment
Fisim − 48 0 0
120 36 84 0 0 36 48 D.42 Distributed
income of
corporations 3 25 18 57 0 103 17 120
60 0 60 36 24 D.421 Dividends 3 25 5 13 0 46 14 6060 36 24 0 24 D.422 Withdrawals
from income of
quasi-corpora-
tions 13 44 0 57 3 60
14 14 0 0 0 0 0 D.43 Reinvested earn-
ings on direct
foreign invest-
ment 4 7 0 3 0 14 0 14
25 25 25 D.44 Property income
attributed to
insurance policy
holders 5 0 0 20 0 25 0 25
65 65 0 27 7 0 31 D.45 Rent 41 3 0 21 0 65 65▼B1996R2223 — EN — 07.08.2003 — 008.001 — 194
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
1 855 1 855 6 1 390 221 29 209 B.5g/B.5 * g Balance or
primary incomes,
gross/national
income, gross
1 633 1 633 3 1 348 191 19 72 B.5n/B.5 * n Balance of
primary incomes,
net/national
income, net
The adjustment Fisim for Total economy (0) is the sum of Financial corporations sector (+ 48) and of the nominal sector (+ 48).▼B1996R2223 — EN — 07.08.2003 — 008.001 — 195
▼B
8.27. In the case of general government and non-profit institutions serving
households, this account concerns only their market activities.
8.28. Entrepreneurial income corresponds to the operating surplus or mixed
income (on the resources side):
plus property income receivable in connection with financial
and other assets belonging to the enterprise (on the
resources side);
minus interest on debts payable by the enterprise and rents
payable on land and other non-produced tangible assets
rented by the enterprise (on the uses side).
Property income payable in the form of dividends or reinvested earnings
on direct foreign investment is not deducted from entrepreneurial income.
Allocation of other primary income account (II.1.2.2)
8.29. The purpose of the allocation of other primary income account is to return
from the concept of entrepreneurial income to the concept of primary
income. It therefore contains the elements of primary income not included
in the entrepreneurial income account:
(a) in the case of corporations, distributed dividends and reinvested
earnings on direct foreign investment (on the uses side);
(b) in the case of households:
1. property income payable, excluding rents and interest payable in
connection with the entrepreneurial activity (on the uses side);
2. compensation of employees (on the resources side);
3. property income receivable, excluding that receivable in connec-
tion with the activity of the enterprise (on the resources side);
(c) in the case of general government:
1. property income payable, excluding that payable in connection
with market activities (on the uses side);
2. taxes on production and imports less subsidies (on the resources
side);
3. property income receivable, excluding that receivable in connec-
tion with market activities (on the resources side).
Secondary distribution of income account (II.2)
8.30. The secondary distribution of income account shows how the balance of
the primary income of an institutional sector is allocated by redistribution:
current taxes on income, wealth etc., social contributions and benefits
(excluding social transfers in kind) and other current transfers.
8.31. The balancing item of the account is disposable income, which reflects
current transactions and explicitly excludes capital transfers, real holding
gains and losses and the consequences of events such as natural disasters.
8.32. Social contributions are recorded (1) on the uses side of the secondary
distribution of income account of households and on the resources side of
the secondary distribution of income account of the institutional sectors
responsible for management of social insurance. When payable by
employers for their employees, they are first included under compensation
of employees, on the uses side of the employers' generation of incomeaccount, since they form part of wage costs; they are also recorded, as
compensation of employees, on the resources side of the households'
allocation of primary income account, since they correspond to benefits to
households.1996R2223 — EN — 07.08.2003 — 008.001 — 196
(1) The social contributions shown on the uses side of the secondary distribution of income
account of households are net of the service charges of the pension funds and otherinsurance companies, all or part of whose resources are made up of actual social
contributions.
Table 8.5 — Accounts II.1.2.1: Entrepreneurial income and II.1.2.2: Allocation of other primary income
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
II.1.2.1.
Entrepre-
neurial
incomeB.2g Operating
surplus, gross 276 55 46 92 8 429 429II.1.2.1.
Entrepre-
neurial
incomeB.3g Mixed
income, gross 442 442 442
B.2n Operating
surplus, net 139 45 16 60 5 217 217
B.3n Mixed
income, net 432 432 432
244 27 217 2 7 9 102 97 D.4 Property
income 78 160 4 5 0 247 21 268
160 13 147 2 0 2 77 66 D.41 Interest 25 125 0 0 0 150 16 166
0 0 P.119 Adjustment
Fisim − 48 0 0
D.42 Distributed
income of
corporations 3 25 4 5 0 37 5 42
D.421 Dividends 3 25 4 5 0 37 5 42D.422 Withdrawals
from income
of quasi-
corporations 0 0 0 0 0 0 0 0▼B1996R2223 — EN — 07.08.2003 — 008.001 — 197
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
14 14 D.43 Reinvested
earnings on
direct foreign
investment 4 7 0 11 11
25 25 25 D.44 Property
income attrib-
uted to
insurance
policyholders 5 0 0 0 5 5
45 45 0 7 7 0 31 D.45 Rent 41 3 0 44 44
901 901 6 532 41 65 257 B.4g Entrepre-
neurial
income, gross
679 679 3 490 11 55 120 B.4n Entrepre-
neurial
income, net
II.1.2.2.
Allocation of
other primary
incomeB.4g Entrepre-
neurial
income, gross 257 65 41 532 6 901 901II.1.2.2.
Allocation of
other primary
income
B.4n Entrepre-
neurial
income, net 120 55 11 490 3 679 679
6 6 D.1 Compensation
of employees 766 766 2 768
6 6 D.11 Wages and
salaries 573 573 2 575▼B1996R2223 — EN — 07.08.2003 — 008.001 — 198
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
D.12 Employers'
social contri-
butions 193 193 0 193
D.121 Employers'
actual social
contributions 174 174 0 174
D.122 Employers'
imputed
social contri-
butions 19 19 0 19
0 0 D.2 Taxes on
production
and imports 235 235 0 235
0 0 D.21 Taxes on
products 141 141 0 141
0 0 D.211 Value added
type taxes
(VAT) 121 121 0 121
0 0 D.212 Taxes and
duties on
imports
excluding
VAT 17 17 0 17
0 0 D.2121 Import duties 17 17 0 17▼B1996R2223 — EN — 07.08.2003 — 008.001 — 199
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
0 0 D.2122 Taxes on
imports
excluding
VAT and
duties 0 0 0 0
0 0 D.214 Taxes on
products
except VAT
and import
taxes 3 3 0 3
0 0 D.29 Other taxes on
production 94 94 0 94
0 0 D.3 Subsidies − 44 − 44 0 − 440 0 D.31 Subsidies on
products − 8 − 8 0 − 8
0 0 D.311 Import subsi-
dies 0 0 0 0
0 0 D.319 Other subsi-
dies on
products − 8 − 8 0 − 8
0 0 D.39 Other subsi-
dies on
production − 36 − 36 0 − 36
202 39 163 5 37 37 36 48 D.4 Property
income 26 129 5 160 18 178
62 3 59 5 17 37 D.41 Interest 12 33 5 50 6 56▼B1996R2223 — EN — 07.08.2003 — 008.001 — 200
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
120 36 84 36 48 D.42 Distributed
income of
corporations 14 52 0 66 12 78
60 0 60 36 24 D.421 Dividends 1 8 0 9 9 1860 36 24 0 24 D.422 Withdrawals
from income
of quasi-
corporations 13 44 0 57 3 60
0 0 0 0 D.43 Reinvested
earnings on
direct foreign
investment 3 0 3 3
D.44 Property
income attrib-
uted to
insurance
policyholders
Rent 20 0 20 20
20 20 0 20 D.45 Rent 21 0 21 21
1 855 1 855 6 1 390 221 29 209 B.5g/B.5 * g Balance of
primary
incomes,
gross/national
income, gross▼B1996R2223 — EN — 07.08.2003 — 008.001 — 201
Uses Resources
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
1 633 1 633 3 1 348 191 19 72 B.5n/B.5 * n Balance of
primary
incomes, net/
national
income, net▼B1996R2223 — EN — 07.08.2003 — 008.001 — 202
Table 8.6 — Account II.2: Secondary distribution of income account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.5g/B.5 * g Balance of
primary incomes,
gross/national
income, gross 209 29 221 1 390 6 1 855 1 855
B.5n/B.5 * n Balance of
primary incomes,
net/national
income, net 72 19 191 1 348 3 1 633 1 633
213 1 212 178 10 24 D.5 Current taxes on
income, wealth,
etc. 213 213 213
204 1 203 176 7 20 D.51 Taxes on income 204 204 204
9 9 2 3 4 D.59 Other current
taxes 9 9 9
322 322 322 D.61 Social contribu-
tions 14 39 268 1 322 322
303 303 303 D.611 Actual social
contributions 2 38 263 303 303
174 174 174 D.6111 Employers,
actual social
contributions 1 18 155 174 174
160 160 160 D.61111 Compulsory
employers, actual
social contribu-
tions 1 15 144 160 160▼B1996R2223 — EN — 07.08.2003 — 008.001 — 203
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
14 14 14 D.61112 Voluntary
employers, actual
social contribu-
tions 3 11 14 14
97 97 97 D.6112 Employees,
social contribu-
tions 1 20 76 97 97
85 85 85 D.61121 Compulsory
employees,
social contribu-
tions 1 15 69 85 85
12 12 12 D.61122 Voluntary
employees,
social contribu-
tions 5 7 12 12
32 32 32 D.6113 Social contribu-
tions by self- and
non-employed
persons 32 32 32
22 22 22 D.61131 Compulsary
social contribu-
tions by self- and
non-employed
persons 22 22 22
10 10 10 D.61132 Voluntary social
contributions by
self- and non-
employed
persons 10 10 10▼B1996R2223 — EN — 07.08.2003 — 008.001 — 204
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
19 19 19 D.612 Imputed social
contributions 12 1 5 1 19 19
332 332 1 289 29 13 D.62 Social benefits
other than social
transfers in kind 332 332 332
232 232 232 D.621 Social security
benefits in cash 232 232 232
29 29 28 1 D.622 Private funded
social benefits 29 29 29
19 19 1 5 1 12 D.623 Unfunded
employee social
benefits 19 19 19
52 52 52 D.624 Social assistance
benefits in cash 52 52 52
278 9 269 2 71 139 46 11 D.7 Other current
transfers 10 49 108 36 36 239 39 278
45 2 43 31 4 8 D.71 Net non-life
insurance
premiums 45 45 45
45 45 45 D.72 Non-life insur-
ance claims 6 1 35 42 3 45
96 96 96 D.73 Current transfers
within general
government 96 96 96▼B1996R2223 — EN — 07.08.2003 — 008.001 — 205
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
32 1 31 31 D.74 Current interna-
tional coopera-
tion 1 1 31 32
56 2 54 2 40 8 1 3 D.75 Miscellaneous
current transfers 4 4 10 1 36 55 1 56
1 826 1 826 40 1 187 382 32 185 B.6g Disposable
income, gross
1 604 1 604 37 1 145 352 22 48 B.6n Disposable
income, net▼B1996R2223 — EN — 07.08.2003 — 008.001 — 206
Table 8.7. — Account II.3: Redistribution of income in kind account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.6g Disposable
income, gross 185 32 382 1 187 40 1 826 1 826
B.6n Disposable
income, net 48 22 352 1 145 37 1 604 1 604
219 219 13 206 D.63 Social transfers
in kind 219 219 219
162 162 0 162 D.631 Social benefits in
kind 162 162 162
78 78 78 D.6311 Social security
benefits, reim-
bursements 78 78 78
65 65 65 D.6312 Other social
security benefits
in kind 65 65 65
19 19 0 19 D.6313 Social assistance
benefits in kind 19 19 19
57 57 13 44 D.632 Transfers of
individual non-
market goods
and services 57 57 57
1 826 1 826 27 1 406 176 32 185 B.7g Adjusted dispo-
sable income,
gross▼B1996R2223 — EN — 07.08.2003 — 008.001 — 207
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
1 604 1 604 24 1 364 146 22 48 B.7n Adjusted dispo-
sable income, net▼B1996R2223 — EN — 07.08.2003 — 008.001 — 208
▼B
Redistribution of income in kind account (II.3)
8.33. The redistribution of income in kind account gives a broader picture of
households' income by including the flows corresponding to the use of
individual goods and services which these households receive free of
charge, i. e. social benefits in kind and transfers of individual non-market
goods and services, these two categories of flows being grouped together
under the concept of social transfers in kind. This facilitates comparisons
over time when there are differences or changes in economic and social
conditions, and supplements the analysis of the role of general
government in the redistribution of income.
8.34. Social transfers in kind are recorded on the resources side of the
redistribution of income in kind account in the case of households, and on
the uses side in the case of general government and non-profit institutions
serving households.
8.35. The balancing item in the redistribution of income in kind account is
adjusted disposable income.
Use of income account (II.4)
8.36. For the institutional sectors with final consumption, the use of income
account shows how disposable income (or adjusted disposable income) is
divided between final consumption expenditure (or actual final consump-
tion) and saving.
8.37. In the system, only government, NPISHs and households have final
consumption. In addition, the use of income account includes, for
households and for pension funds, an adjustment item (D.8 Adjustment for
the change in the net equity of households in pension funds reserves)
which relates to the way that transactions between households and pension
funds are recorded (1).
Use of disposable income account (II.4.1)
8.38. The use of disposable income account includes the concept of final
consumption expenditure financed by the various sectors concerned:
households, general government and non-profit institutions serving
households.
8.39. The balancing item in the use of disposable income account is saving.
Use of adjusted disposable income account (II.4.2)
8.40. The use of adjusted disposable income account includes the concept of
actual final consumption, which corresponds to the value of the goods and
services actually at the disposal of households for final consumption, even
if their acquisition is financed by general government or non-profit
institutions serving households.
Consequently, the actual final consumption of general government
corresponds only to collective final consumption. Since final consumption
expenditure by non-profit institutions serving households is regarded as
entirely individual, their actual final consumption is zero.
8.41. At the level of the total economy, final consumption expenditure and
actual final consumption are equal; it is only the distribution over the
institutional sectors which differs. The same is true of disposable income
and adjusted disposable income.
8.42. Saving is the balancing item in both versions of the use of income
account. Its value is identical for all sectors, regardless of whether it is
obtained by subtracting final consumption expenditure from disposable
income or by subtracting actual final consumption from adjusted
disposable income.1996R2223 — EN — 07.08.2003 — 008.001 — 209
(1) See chapter 4: ‘Distributive transactions’.
Table 8.8 — Account II.4.1: Use of disposable income account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.6g Disposable
income, gross 185 32 382 1 187 40 1 826 1 826
B.6n Disposable
income, net 48 22 352 1 145 37 1 604 1 604
1 371 1 371 13 996 362 P.3 Final consump-
tion expenditure 1 371 1 371
1 215 1 215 13 996 206 P.31 Individual
consumption
expenditure 1 215 1 215
156 156 156 P.32 Collective
consumption
expenditure 156 156
11 0 11 0 0 11 0 D.8 Adjustment for
the change in net
equity of house-
holds in pension
funds reserves 11 11 0 11
455 455 27 202 20 21 185 B.8g Saving, gross
233 233 24 160 − 10 11 48 B.8n Saving, net
− 41 − 41 B.12 Current external
balance▼B1996R2223 — EN — 07.08.2003 — 008.001 — 210
▼B
8.43. Saving is the (positive or negative) amount resulting from current
transactions which establishes the link with accumulation. If saving is
positive, non-spent income is used for the acquisition of assets or for
paying off liabilities. If saving is negative, certain assets are liquidated or
certain liabilities increase.
ACCUMULATION ACCOUNTS (III) (1)
8.44. The accumulation accounts are flow accounts. They record the various
causes of changes in the assets and liabilities of units and the change in
their net worth.
8.45. Changes in assets are recorded on the left-hand side of the accounts (plus
or minus), changes in liabilities and net worth on the right-hand side (plus
or minus).
Capital account (III.1)
8.46. The capital account records acquisitions less disposals of non-financial
assets by resident units and measures the change in net worth due to
saving (final balancing item in the current accounts) and capital transfers.
8.47. The capital account makes it possible to determine the extent to which
acquisitions less disposals of non-financial assets have been financed out
of saving and by capital transfers. It shows a net lending corresponding to
the amount available to a unit or sector for financing, directly or
indirectly, other units or sectors, or a net borrowing corresponding to the
amount which a unit or sector is obliged to borrow from other units or
sectors.
Change in net worth due to saving and capital transfers account (III.1.1)
8.48. This account makes it possible to determine the change in net worth due to
saving and capital transfers, which corresponds to net saving plus capital
transfers receivable, minus capital transfers payable.
Acquisitions of non-financial assets account (III.1.2)
8.49. This account records acquisitions less disposals of non-financial assets in
order to return from the concept of change in net worth due to saving and
capital transfers to net lending or borrowing.
Financial account (III.2)
8.50. The financial account records, by type of financial instrument, the changes
in the financial assets and liabilities that compose net lending or
borrowing.
8.51. The classification of assets and liabilities used in the financial account is
identical to that used in the balance sheets.
Other changes in assets account (III.3)
8.52. The other changes in assets account records changes in assets and
liabilities of units, other than in connection with saving and voluntary
transfers of wealth, these being recorded in the capital and financial
accounts. It is divided into two: the other changes in volume of assets
account (III.3.1) and the revaluation account (III.3.2).1996R2223 — EN — 07.08.2003 — 008.001 — 211
(1) See chapter 5: ‘Financial transactions’ and chapter 6: ‘Other flows’.
Table 8.9 — Account II.4.2: Use of adjusted disposable income account
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.7g Adjusted dispo-
sable income,
gross 185 32 176 1 406 27 1 826 1 826
B.7n Adjusted dispo-
sable income, net 48 22 146 1 364 24 1 604 1 604
1 371 1 371 1 215 156 P.4 Actual final
consumption 1 371 1 371
1 215 1 215 1 215 P.41 Actual individual
consumption 1 215 1 215
156 156 156 P.42 Actual collective
consumption 156 156
11 0 11 0 0 11 0 D.8 Adjustment for
the change in net
equity of house-
holds in pension
funds reserves 11 11 0 11
455 455 27 202 20 21 185 B.8g Saving, gross233 233 24 160 − 10 11 48 B.8n Saving, net
− 41 − 41 B.12 Current external
balance▼B1996R2223 — EN — 07.08.2003 — 008.001 — 212
Table 8.10 — Account III.1.1: Change in net worth due to saving and capital transfers account
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.8n Saving, net 48 11 − 10 160 24 233 233
B.12 Current external
balance −4 1 −4 1
D.9 Capital transfers,
receivable 33 6 23 62 4 66
D.91 Capital taxes,
receivable 2 2 2
D.92 Investment
grants, receivable 23 23 4 27
D.99 Other capital
transfers, recei-
vable 10 4 23 37 37
D.9 Capital transfers,
payable − 16 − 7 − 34 − 5 − 3 − 65 − 1 − 66
D.91 Capital taxes,
payable − 2 − 2 − 2
D.92 Investment
grants, payable − 27 − 27 − 27
D.99 Other capital
transfers, payable − 16 − 7 − 7 − 3 − 3 − 36 − 1 − 37▼B1996R2223 — EN — 07.08.2003 — 008.001 — 213
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
192 − 38 230 21 178 − 38 4 65 B.10.1 Changes in net
worth due to
saving and
capital transfers▼B1996R2223 — EN — 07.08.2003 — 008.001 — 214
Table 8.11 — Account III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.10.1 Changes in net
worth due to
saving and
capital transfers 65 4 − 38 178 21 230 − 38 192
376 376 19 61 37 9 250 P.51 Gross fixed
capital formation 376 376
303 303 14 49 23 8 209 P.511 Acquisitions less
disposals of
tangible fixed
assets 303 303
305 305 13 50 24 7 211 P.5111 Acquisitions of
new tangible
fixed assets 305 305
11 11 1 4 1 1 4 P.5112 Acquisitions of
existing tangible
fixed assets 11 11
− 13 − 13 − 5 − 2 − 6 P.5113 Disposals of
existing tangible
fixed assets − 13 − 13
51 51 5 12 12 1 21 P.512 Acquisitions less
disposals of
intangible fixed
assets 51 51
53 53 10 9 12 1 21 P.5121 Acquisitions of
new intangible
fixed assets 53 53▼B1996R2223 — EN — 07.08.2003 — 008.001 — 215
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
6 6 3 2 1 P.5122 Acquisitions of
existing intan-
gible fixed assets 6 6
− 8 − 8 − 5 − 2 − 1 P.5123 Disposals of
existing intan-gible fixed assets − 8 − 8
22 22 2 20 P.513 Additions to the
value of non-
produced non-
financial assets 22 22
5 5 2 3 P.5131 Major improve-
ments to non-
produced non-
financial assets 5 5
17 17 17 P.5132 Costs of owner-
ship transfer on
non-produced
non-financial
assets 17 17
− 222 − 222 − 3 − 42 − 30 − 10 − 137 K.1 Consumption of
fixed capital
28 28 2 26 P.52 Changes in
inventories 28 28
10 10 5 3 2 P.53 Acquisitions less
disposals of
valuables 10 10▼B1996R2223 — EN — 07.08.2003 — 008.001 — 216
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
1 4 2 − 7 K.2 Acquisitions less
disposals of non-
produced non-
financial assets
1 3 2 − 6 K.21 Acquisitions less
disposals of land
and other
tangible non-
produced assets
1 − 1 K.22 Acquisitions less
disposals of
intangible non-
produced assets
−3 8 3 8 4 1 4 8 −5 0 5 −6 9 B . 9 Net lending (+)
net borrowing (−)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 217
Table 8.12 — Account III.2: Financial account
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
B.9 Net lending (+)/
net borrowing
(−) − 69 5 − 50 148 4 38 − 38 0
691 50 641 32 181 120 237 71 F Net acquisition
of financial
assets
F Net incurrence of
liabilities 140 232 170 33 28 603 88 691
1 − 1 − 1 F.1 Monetary gold
and SDRs
130 11 119 12 68 7 15 17 F.2 Currency and
deposits 130 2 132 − 2 130
37 3 34 2 10 2 15 5 F.21 Currency 35 35 2 3764 2 62 7 41 4 10 F.22 Transferable
deposits 63 2 65 − 1 64
29 6 23 3 17 1 2 F.29 Other deposits 32 32 − 3 29
143 5 138 12 29 26 53 18 F.3 Securities other
than shares 6 53 64 123 20 143
254 10 244 5 45 167 27 F.4 Loans 71 94 28 24 217 37 254
86 3 83 3 1 63 16 F.41 Short-term 16 32 11 17 76 10 86
168 7 161 2 44 104 11 F.42 Long-term 55 62 17 7 141 27 168▼B1996R2223 — EN — 07.08.2003 — 008.001 — 218
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
46 2 44 3 36 3 2 F.5 Shares and other
equity 26 13 4 43 3 46
36 36 36 F.6 Insurance tech-
nical reserves 36 36 36
33 33 33 F.61 Net equity of
households in
life insurance
reserves and in
pension funds
reserves 33 33 33
22 22 22 F.611 Net equity of
households in
life insurance
reserves 22 22 22
11 11 11 F.612 Net equity of
households in
pension funds
reserves 11 11 11
3 3 3 F.62 Prepayments of
insurance
premiums and
reserves for
outstanding
claims 3 3 3
82 21 61 8 40 6 7 F.7 Other accounts
receivable/
payable 37 10 5 52 30 82
36 18 18 11 1 6 F.71 Trade credits and
advances 8 6 4 18 18 36▼B1996R2223 — EN — 07.08.2003 — 008.001 — 219
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
46 3 43 8 29 5 1 F.79 Other accounts
receivable/
payable except
trade credits and
advances 29 4 1 34 12 46▼B1996R2223 — EN — 07.08.2003 — 008.001 — 220
▼B
Other changes in volume of assets account (III.3.1)
8.53. The movements recorded in the other changes in volume of assets account
affect the net worth of the balance sheets of the units, sectors and
subsectors concerned. This change, called change in net worth due to
other volume changes of assets, is the balancing item in the account.
Revaluation account (III.3.2)
8.54. The revaluation account records changes in the value of assets and
liabilities due to changes in their prices.
For a given asset or liability, this change is measured as:
(a) either the difference between its value at the end of the accounting
period and its value at the start of the accounting period or the date on
which it was first entered in the balance sheet;
(b) or the difference between its value at the date on which it was written
out of the balance sheet and its value at the start of the accounting
period or the date on which it was first entered in the balance sheet.
This difference is called ‘nominal holding gain (or loss)’.A nominal holding gain corresponds to the positive revaluation of an asset
or the negative revaluation of a (financial) liability.
A nominal holding loss corresponds to the negative revaluation of an asset
or the positive revaluation of a (financial) liability.
8.55. The flows recorded in the revaluation account change the net worth of the
balance sheets of the units concerned. This change, called ‘change in net
worth due to nominal holding gains and losses’, is the balancing item in
the account. It is recorded on the changes in liabilities and net worth side.
8.56. The revaluation account is broken down into two sub-accounts: the neutral
holding gains and losses account (III.3.2.1) and the real holding gains and
losses account (III.3.2.2).
Neutral holding gains and losses account (III.3.2.1)
8.57. The neutral holding gains and losses account records changes in the value
of assets and liabilities in proportion to changes in the general price level.
Such changes correspond to the revaluation necessary to maintain the
general purchasing power of assets and liabilities. The general index price
to be applied for this calculation is the price index for final national uses,
excluding changes in inventories.
Real holding gains and losses account (III.3.2.2)
8.58. Real holding gains and losses measure the difference between nominal
holding gains and losses and neutral holding gains and losses.
8.59. If the nominal holding gains net of the nominal holding losses on a given
asset exceed the neutral holding gains net of the neutral holding losses,
there is a real holding gain on the asset for the unit holding it. This gain
reflects the fact that the actual price of the asset has, on average, risen
faster than the general price level. Conversely, a drop in the relative price
of the asset produces a real holding loss for the unit holding it.
By the same token, a rise in the relative price of a liability produces a real
holding loss on liabilities, while a drop in the relative price of a liability
generates a real holding gain on liabilities.1996R2223 — EN — 07.08.2003 — 008.001 — 221
Table 8.13 — Account III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
10 10 − 2 12 AN Non-financial
assets
− 7 − 7 − 3 − 2 − 2 AN.1 Produced assets
3 3 3 K.4 Economic
appearance of
produced assets
− 9 − 9 − 4 − 5 K.7 Catastrophic
losses
1 − 1 K.8 Uncompensated
seizures
1 1 1 K.9 Other volume
changes in non-
financial assets
n.e.c.
− 2 − 2 − 3 − 2 3 K.12 Changes in clas-
sifications and
structure
− 3 3 K.12.1 Changes in
sector classifica-
tion and structure
− 2 − 2 − 2 K.12.2 Changes in clas-
sification of
assets and liabil-
ities▼B1996R2223 — EN — 07.08.2003 — 008.001 — 222
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
− 2 − 2 − 2 K.12.21 Monetization/
demonetization
of gold
K.12.22 Changes in clas-
sification of
assets or liabil-
ities other than
monetization/
demonetization
of gold
of which:
− 4 − 4 − 3 − 1 AN.11 Fixed assets
− 1 − 1 − 1 AN.12 Inventories
− 2 − 2 − 2 AN.13 Valuables
17 17 3 14 AN.2 Non-produced
assets
24 24 24 K.3 Economic
appearance of
non-produced
assets
4 4 4 K.5 Natural growth
of non-cultivatedbiological
resources
− 9 − 9 − 2 − 7 K.6 Economic disap-
perance of non-
produced assets▼B1996R2223 — EN — 07.08.2003 — 008.001 — 223
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
− 8 − 8 − 2 − 6 K.61 Depletion of
natural assets
− 1 − 1 − 1 K.62 Other economic
disapperance of
non-produced
assets
− 2 − 2 − 2 K.7 Catastrophic
losses
4 − 4 K.8 Uncompensated
seizures
K.9 Other volume
changes in non-
financial assets
n.e.c.
− 1 1 K.12 Changes in clas-
sifications and
structure
− 1 1 K.12.1 Changes in
sector classifica-
tion and structure
K.12.2 Changes in clas-
sification of
assets and liabil-
ities▼B1996R2223 — EN — 07.08.2003 — 008.001 — 224
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
K.12.22 Changes in clas-
sification of
assets or liabil-
ities other than
monetization/
demonetization
of gold
of which:
17 17 3 14 AN.21 Tangible non-
produced assets
AN.22 Intangible non-
produced assets
5 5 2 1 2 AF Financial assets/
liabilities − 3 2 − 1 − 2
K.7 Catastrophic
losses
3 − 3 K.8 Uncompensated
seizures
3 3 2 1 K.10 Other volume
changes in finan-
cial assets and
liabilities n.e.c. − 4 2 − 2
2 2 − 2 2 2 K.12 Changes in clas-
sifications and
structure 1 − 1▼B1996R2223 — EN — 07.08.2003 — 008.001 — 225
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
− 2 2 K.12.1 Changes in
sector classifica-
tions and
structure 1 − 1
2 2 2 K.12.2 Changes in clas-
sification of
assets and liabil-
ities
2 2 2 K.12.21 Monetization/
demonetization
of gold
K.12.22 Changes in clas-
sification of
assets or liabil-
ities other than
monetization/
demonetization
of gold
of which:
7 7 7 AF.1 Monetary gold
and SDRs
AF.2 Currency and
deposits
3 − 3 AF.3 Securities other
than shares
− 4 − 4 − 4 AF.4 Loans − 3 − 1 − 4▼B1996R2223 — EN — 07.08.2003 — 008.001 — 226
Changes in assets Changes in liabilities and net worth
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions, other flows and balan-
cing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
World
accountRest of
the
World
accountGoods
and
services
account
− 2 2 AF.5 Shares and other
equity
2 2 2 AF.6 Insurance tech-
nical reserves 2 2
AF.7 Other accounts
receivable/
payable
B.10.2 Changes in net
worth due to
other changes in
volume of assets 17 − 4 2 2 17▼B1996R2223 — EN — 07.08.2003 — 008.001 — 227
Table 8.14 — Account III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
III.3.2
Revaluation
accountK.11 Nominal
holding gains/
lossesIII.3.2.
Revaluation
account
280 280 8 80 44 4 144 AN Non-financial
assets
126 126 5 35 20 2 63 AN.1 Produced
assets
111 111 5 28 18 2 58 AN.11 Fixed assets
7 7 2 1 4 AN.12 Inventories8 8 5 1 1 AN.13 Valuables
154 154 3 45 23 2 81 AN.2 Non-produced
assets
152 152 3 45 23 1 80 AN.21 Tangible non-
produced
assets
2 2 1 AN.22 Intangible
non-produced
assets
91 7 84 1 16 2 57 8 AF Financial
assets/liabil-
ities 18 51 7 76 3 78▼B1996R2223 — EN — 07.08.2003 — 008.001 — 228
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
12 12 1 11 AF.1 Monetary
gold and
SDRs
AF.2 Currency and
deposits
44 4 40 1 6 30 3 AF.3 Securities
other than
shares 1 34 7 42 2 44
AF.4 Loans
34 3 31 1 10 16 5 AF.5 Shares and
other equity 16 17 34 34
AF.6 Insurance
technical
reserves
AF.7 Other
accounts
receivable/
payable
B.10.3 Changes in
net worth due
to nominal
holding gains/
losses 134 10 38 96 10 288 4 292▼B1996R2223 — EN — 07.08.2003 — 008.001 — 229
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
III.3.2.1.
Neutral
holding gains
accountK.11.1 Neutral
holding gains/
lossesIII.3.2.1.
Neutral
holding gains
account
198 198 6 56 32 3 101 AN Non-financial
assets
121 121 5 34 20 2 60 AN.1 Produced
assets
111 111 5 28 18 2 58 AN.11 Fixed assets
5 5 2 1 2 AN.12 Inventories5 5 4 1 1 AN.13 Valuables
78 78 2 22 12 1 41 AN.2 Non-produced
assets
76 76 2 22 12 1 40 AN.21 Tangible non-
produced
assets
1 1 1 AN.22 Intangible
non-produced
assets
147 11 136 3 36 8 70 18 AF Financial
assets/liabil-
ities 36 68 14 6 2 126 6 132
15 15 2 14 AF.1 Monetary
gold and
SDRs▼B1996R2223 — EN — 07.08.2003 — 008.001 — 230
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
32 2 30 2 17 3 8 AF.2 Currency and
deposits 1 26 2 1 29 2 32
28 3 25 1 4 19 2 AF.3 Securities
other than
shares 1 21 4 26 2 28
29 1 28 2 24 1 AF.4 Loans 18 7 3 1 29 29
28 2 26 8 13 4 AF.5 Shares and
other equity 14 14 28 28
8 1 7 6 1 1 AF.6 Insurance
technical
reserves 7 7 1 8
7 3 5 1 3 AF.7 Other
accounts
receivable/
payable 3 2 1 6 1 7
B.10.31 Changes in
net worth due
to neutralholding gains/
losses 82 5 26 87 8 208 6 214
III.3.2.2.
Real holding
gains accountK.11.2 Real holding
gains/lossesIII.3.2.2.
Real holding
gains account
81 81 2 24 12 1 43 AN Non-financial
assets
5 5 1 3 AN.1 Produced
assets▼B1996R2223 — EN — 07.08.2003 — 008.001 — 231
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
AN.11 Fixed assets
3 3 3 AN.12 Inventories
2 2 1 AN.13 Valuables
77 77 2 22 12 1 40 AN.2 Non-produced
assets
76 76 2 22 12 1 40 AN.21 Tangible non-
produced
assets
1 1 AN.22 Intangible
non-produced
assets
− 57 − 5 − 52 − 2 − 20 − 6 − 13 − 10 AF Financial
assets/liabil-
ities − 18 − 17 − 7 − 6 − 2 − 50 − 3 − 54
− 3 − 3 − 3 AF.1 Monetary
gold and
SDRs
− 32 − 2 − 30 − 2 − 17 − 3 − 8 AF.2 Currency and
deposits − 1 − 26 − 2 − 1 − 29 − 2 − 32
17 1 15 2 11 1 AF.3 Securities
other than
shares 1 13 3 16 1 17
− 29 − 1 − 28 − 2 − 24 − 1 AF.4 Loans − 18 − 7 − 3 − 1 − 29 − 29▼B1996R2223 — EN — 07.08.2003 — 008.001 — 232
Changes in assets Changes in liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsOther flows and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
6 5 2 3 1 AF.5 Shares and
other equity33 6 6
− 8 − 1 − 7 − 6 − 1 − 1 AF.6 Insurance
technical
reserves − 7 − 7 − 1 − 8
− 7 − 3 − 5 − 1 − 3 AF.7 Other
accounts
receivable/
payable − 3 − 2 − 1 − 6 − 1 − 7
B.10.32 Changes in
net worth due
to real
holding gains/
losses 51 5 12 9 2 80 − 1 78▼B1996R2223 — EN — 07.08.2003 — 008.001 — 233
▼B
BALANCE SHEETS (IV) (1)
8.60. The aim of the balance sheets is to give a picture of the assets, liabilities
and net worth of units at the start and end of the accounting period and of
changes between balance sheets. The sequence is as follows:
(a) opening balance sheet (IV.1);
(b) changes in balance sheet (IV.2);
(c) closing balance sheet (IV.3).
Opening balance sheet (IV.1)
8.61. The opening balance sheet records the value of assets and liabilities held
by units at the start of the accounting period.
These items are categorized on the basis of the classification of assets and
liabilities.
They are valued at prices current at the start of the accounting period.
The difference between assets and liabilities — the balancing item in the
account — is the net worth at the start of the accounting period.
Changes in balance sheet (IV.2)
8.62. The changes in balance sheet account records changes in the value of
assets and liabilities in the course of the accounting period and aggregates
the amounts recorded in the various accumulation accounts, i. e. change in
net worth due to saving and capital transfers, change in net worth due to
other volume changes in assets and change in net worth due to nominal
holding gains and losses.
Closing balance sheet (IV.3)
8.63. The closing balance sheet records the value of assets and liabilities held
by units at the end of the accounting period. These items are categorised
on the basis of the same classification used in the opening balance sheet
and are valued at prices current at the end of the period.
The difference between assets and liabilities is the net worth at the end of
the accounting period.
8.64. The value of an asset or liability in the closing balance sheets is equal to
the sum of its value in the opening balance sheets and the amount
recorded for the said item in the changes in balance sheet account.
REST OF THE WORLD ACCOUNTS (V)
8.65. The Rest of the World accounts record transactions between resident and
non-resident units. The rest of the world does not constitute an
institutional sector as such, but in the structure of the system it plays a
similar role.
8.66. The sequence of Rest of the World accounts follows the same general
pattern as the institutional sector accounts, i. e.:
(a) current accounts,
(b) accumulation accounts,
(c) balance sheets.
8.67. These accounts are drawn up from the point of view of the rest of the
world. Thus, what is a resource for the rest of the world is a use for the
total economy and vice versa. By the same token, a financial asset held by
the rest of the world is a liability for the total economy and vice versa
(except monetary gold and special drawing rights).1996R2223 — EN — 07.08.2003 — 008.001 — 234
(1) See chapter 7: ‘Balance sheets’.
Table 8.15 — Account IV: Balance sheets
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
IV.1.
Opening
balance sheet9 922 9 922 324 2 822 1 591 144 5 041 AN Non-financial
assets
6 047 6 047 243 1 698 1 001 104 3 001 AN.1 Produced
assets
5 544 5 544 231 1 423 913 99 2 878 AN.11 Fixed assets
231 231 2 97 47 85 AN.12 Inventories272 272 10 178 41 5 38 AN.13 Valuables
3 875 3 875 81 1 124 590 40 2 040 AN.2 Non-produced
assets
3 809 3 809 81 1 124 578 37 1 989 AN.21 Tangible non-
produced
assets
66 66 12 3 51 AN.22 Intangible
non-produced
assets
7 365 573 6 792 172 1 819 396 3 508 897 AF Financial
assets/liabil-
ities 1 817 3 384 687 289 121 6 298 297 6 595IV.1.
Opening
balance sheet
770 770 80 690 AF.1 Monetary
gold andSDRs
1 587 105 1 482 110 840 150 382 AF.2 Currency and
deposits 40 1 281 102 10 38 1 471 116 1 587▼B1996R2223 — EN — 07.08.2003 — 008.001 — 235
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
1 388 125 1 263 25 198 950 90 AF.3 Securities
other thanshares 44 1 053 212 2 1 311 77 1 388
1 454 70 1 384 8 24 115 1 187 50 AF.4 Loans 897 328 169 43 1 437 17 1 4541 409 113 1 296 22 411 12 651 200 AF.5 Shares and
other equity 687 715 4 1 406 3 1 409
396 26 370 4 291 20 30 25 AF.6 Insurance
technical
reserves 12 335 19 5 371 25 396
361 134 227 3 55 19 150 AF.7 Other
accounts
receivable/payable 137 22 108 35 302 59 361
B.90 Net worth 4 121 268 1 300 4 352 375 10 416 276 10 692
IV.2.
Changes in
balance sheetTotal changes
in assets/
liabilities
482 482 25 110 56 1 290 AN Non-financial
assets
289 289 21 61 25 − 1 182 AN.1 Produced
assets
239 239 21 47 20 1 150 AN.11 Fixed assets
34 34 4 1 29 AN.12 Inventories
16 16 10 4 − 2 3 AN.13 Valuables▼B1996R2223 — EN — 07.08.2003 — 008.001 — 236
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
193 193 4 49 30 2 108 AN.2 Non-produced
assets
191 191 4 48 30 1 108 AN.21 Tangible non-
produced
assets
2 2 1 AN.22 Intangible
non-produced
assets
787 57 730 33 199 123 294 81 AF Financial
assets/liabil-
ities 155 285 176 33 28 677 91 767IV.2.
Changes in
balance sheet
19 1 18 1 17 AF.1 Monetary
gold and
SDRs
130 11 119 12 68 7 15 17 AF.2 Currency and
deposits 130 2 132 − 2 130
187 9 178 13 35 29 80 21 AF.3 Securities
other than
shares 7 87 71 165 22 187
250 10 240 5 45 163 27 AF.4 Loans 68 93 28 24 213 37 250
80 5 75 1 13 34 19 9 AF.5 Shares and
other equity 42 30 4 77 3 80
38 38 38 AF.6 Insurance
technical
reserves 38 38 38▼B1996R2223 — EN — 07.08.2003 — 008.001 — 237
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
82 21 61 8 40 6 7 AF.7 Other
accounts
receivable/
payable 37 10 5 52 30 82
B.10 Changes in
net worth,
total due to: 216 10 2 276 31 535 − 34 501
B.10.1 Saving and
capital trans-
fers 65 4 − 38 178 21 230 − 38 192
B.10.2 Other
changes in
volume of
assets 17 − 4 2 2 17 17
B.10.3 Nominal
holding gains/losses 134 10 38 96 10 288 4 292
B.10.31 Neutral
holding gains/
losses 82 5 26 87 8 208 6 214
B.10.32 Real holding
gains/losses 51 5 12 9 2 80 − 1 78
IV.3.
Closing
balance sheet10 404 10 404 349 2 932 1 647 145 5 331 AN Non-financial
assets
6 336 6 336 264 1 759 1 026 103 3 183 AN.1 Produced
assets
5 783 5 783 252 1 470 933 100 3 028 AN.11 Fixed assets
265 265 2 101 48 114 AN.12 Inventories▼B1996R2223 — EN — 07.08.2003 — 008.001 — 238
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
288 288 10 188 45 3 41 AN.13 Valuables
4 068 4 068 85 1 173 620 42 2 148 AN.2 Non-produced
assets
4 000 4 000 85 1 172 608 38 2 097 AN.21 Tangible non-
produced
assets
68 68 1 12 3 51 AN.22 Intangible
non-produced
assets
8 152 630 7 522 205 2 018 519 3 802 978 AF Financial
assets/liabil-
ities 1 972 3 669 863 322 149 6 975 388 7 362IV.3.
Closing
balance sheet
788 788 81 707 AF.1 Monetary
gold and
SDRs
1 717 116 1 601 122 908 157 15 399 AF.2 Currency and
deposits 40 1 411 104 10 38 1 603 114 1 717
1 575 134 1 441 38 233 29 1 030 111 AF.3 Securities
other than
shares 51 1 140 283 2 1 476 99 1 575
1 704 80 1 624 8 29 160 1 350 77 AF.4 Loans 965 421 197 67 1 650 54 1 704
1 489 118 1 371 23 424 46 670 209 AF.5 Shares and
other equity 729 745 4 4 1 483 6 1 489
434 26 408 4 329 20 30 25 AF.6 Insurance
technical
reserves 12 373 19 5 409 25 434▼B1996R2223 — EN — 07.08.2003 — 008.001 — 239
Assets Liabilities and net worth
Accounts TotalCorresponding
entries of theS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gene-
ral go-
vern-
mentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions, other flows, stocks
and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gene-
ral go-
vern-
mentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myCorresponding
entries of the
Total AccountsGoods
and
servi-
ces ac-
countRest of
the
World
ac-
countRest of
the
World
ac-
countGoods
and
servi-
ces ac-
count
443 155 288 11 95 25 157 AF.7 Other
accounts
receivable/
payable 174 32 113 35 354 89 443
B.90 Net worth 4 337 278 1 302 4 628 406 10 951 242 11 193▼B1996R2223 — EN — 07.08.2003 — 008.001 — 240
▼B
CURRENT ACCOUNTS
External account of goods and services (V.I)
8.68. Imports of goods and services are recorded on the resources side of the
account and exports of goods and services on the uses side. The difference
between resources and uses is the balancing item in the account, called
‘external balance of goods and services’. If it is positive, there is a surplus
for the rest of the world and a deficit for the total economy and vice versa
if it is negative.
8.69. In order to be consistent with measures of the output of resident units,
imports are valued at an equivalent of the basic price, i. e. net of import
taxes but including import subsidies.
Imports of goods recorded in the external account of goods and services
are valued fob, i. e. at the border of the country of export. Exports of
goods are also valued fob.
When transport and insurance services included in the fob value of
imports of goods (i. e. between the factory and the border of the country of
export) are provided by resident units, they must be included in the value
of exports of services by the economy importing the goods. Conversely,
when transport and insurance services included in the fob value of exportsof goods are provided by non-resident units they must be included in the
value of imports of services by the economy exporting the goods.
External account of primary incomes and current transfers (V.II)
8.70. The purpose of the external account of primary incomes and current
transfers is to determine the current external balance, which, in the
structure of the system, corresponds to saving by the institutional sectors.
This account is a condensed version of the sequence, for an institutional
sector, extending from the allocation of primary income account to the use
of income account.
8.71. On the resources side, the external account of primary incomes and
current transfers shows the external balance of goods and services. It also
records, on the resources or uses side, all distributive transactions which
may involve the rest of the world, apart from capital transfers.
EXTERNAL ACCUMULATION ACCOUNTS (V.III)Capital account (V.III.1)
8.72. The Rest of the World capital account records acquisitions less disposals
of non-produced non-financial assets by non-resident units and measures
the changes in net worth due to saving and capital transfers.
8.73. The balancing item of the capital account is the net lending or borrowing
of the rest of the world. It is equal, but has the opposite sign, to the sum of
the net lending or borrowing of the resident institutional sectors.
Financial account (V.III.2)
8.74. The layout of the Rest of the World financial account is identical to that of
the institutional sectors' financial account.
Other changes in assets account (V.III.3)
8.75. As for the institutional sectors, the changes in net worth due to other
changes in volume of assets and due to nominal holding gains and losses
are determined successively, holding gains and losses themselves being
broken down into neutral and real holding gains and losses.
8.76. The absence of produced assets in the accumulation accounts and balance
sheets of the rest of the world is due to the convention whereby a notional
institutional unit is created, the rest of the world being deemed to have
acquired a financial asset — and vice versa for assets held in other
economies by resident units.
BALANCE SHEETS (V.IV)
8.77. The balance sheets of the rest of the world contain financial assets and
liabilities. On the assets side, they record the total acquisitions less
disposals between non-resident and resident units of monetary gold and
SDRs.1996R2223 — EN — 07.08.2003 — 008.001 — 241
▼B
Table 8.16 — Full sequence of accounts for the rest of the world (external transactions
account)
V.I: external account of goods and services
Uses Resources
P.6 Exports of goods and
services 536P.7 Imports of goods and
services 497
P.61 Exports of goods 462 P.71 Imports of goods 392P.62 Exports of services 74 P.72 Imports of services 105
B.11 External balance of goods
and services −3 9
V.II: External account of primary incomes and current transfers
Uses Resources
D.1 Compensation of employees 6 B.11 External balance of goods
and services −3 9
D.11 Wages and salaries 6
D.1 Compensation of employees 2
D.2 Taxes on production and
imports 0D.11 Wages and salaries 2
D.21 Taxes on products 0 D.12 Employers, social contribu-
tions 0
D.211 Value added type taxes
(VAT) 0D.121 Employers, actual social
contributions 0
D.212 Taxes and duties on imports
excluding VAT 0D.122 Employers, imputed social
contributions 0
D.2121 Import duties 0
D.2122 Taxes on imports excluding
VAT and duties 0D.2 Taxes on production and
imports 0
D.21 Taxes on products 0
D.214 Taxes on products except
VAT and import taxesD.211 Value added type taxes
(VAT) 0
D.29 Other taxes on production 0 D.212 Taxes and duties on imports
excluding VAT 0
D.2121 Import duties 0
D.3 Subsidies 0 D.2122 Taxes on imports excluding
VAT and duties 0
D.31 Subsidies on products 0D.311 Import subsidies 0 D.214 Taxes on products except
VAT and import taxes 0
D.29 Other taxes on production 0
D.319 Other subsidies on products 01996R2223 — EN — 07.08.2003 — 008.001 — 242
▼B
Uses Resources
D.39 Other subsidies on produc-
tion 0D.3 Subsidies 0
D.31 Subsidies on products 0
D.4 Property income 66 D.311 Import subsidies 0D.41 Interest 16D.42 Distributed income of
corporations 36D.319 Other subsidies on products 0
D.421 Dividends 0 D.39 Other subsidies on produc-
tion 0
D.422 Withdrawals from income of
quasi-corporations 36
D.43 Reinvested earnings on
direct foreign investment 14D.4 Property income 39
D.41 Interest 22
D.5 Current taxes on income,
wealth, etc. 1D.42 Distributed income of
corporations 17
D.51 Taxes on income 1 D.421 Dividends 14D.59 Other current taxes 0 D.422 Withdrawals from income of
quasi-corporations 3
D.43 Reinvested earnings on
direct foreign investment 0
D.61 Social contributions 0 D.44 Property income attributed to
insurance policy-holders 0
D.611 Actual social contributions 0
D.6111 Employers, actual social
contributions 0D.5 Current taxes on income,
wealth, etc. 0
D.61111 Compulsory employers,
actual social contributions 0D.51 Taxes on income 0
D.61112 Voluntary employers, actual
social contributions 0D.59 Other current taxes 0
D.6112 Employees, social contribu-
tions 0
D.61121 Compulsory employees,
social contributions 0D.61 Social contributions 0
D.61122 Voluntary employees, social
contributions 0D.611 Actual social contributions 0
D.612 Imputed social contributions 0 D.6111 Employers, actual social
contributions 0
D.61111 Compulsory employers,
actual social contribution 0
D.62 Social benefits other than
social transfers in kind 0D.61112 Voluntary employers, actual
social contributions 0
D.622 Private funded social bene-
fits 0D.6112 Employees, social contribu-
tions 01996R2223 — EN — 07.08.2003 — 008.001 — 243
▼B
Uses Resources
D.623 Unfunded employee social
benefits 0D.61121 Compulsory employees,
social contributions 0
D.7 Other current transfers 9 D.61122 Voluntary employees, social
contributions 0
D.71 Net non-life insurance
premiums 2D.612 Imputed social contributions 0
D.74 Current international coop-
eration 1D.62 Social benefits other than
social transfers in kind 0
D.75 Miscellaneous current trans-
fers 2D.621 Social security benefits in
cash 0
D.622 Private funded social bene-
fits 0
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0D.624 Social assistance benefits in
cash 0
D.7 Other current transfers 39
D.72 Non-life insurance claims 3D.74 Current international coop-
eration 31
D.75 Miscellaneous current trans-
fers 1
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0
B.12 Current external balance −4 1
V.III: Accumulation accounts
V.III.1: Capital accounts
V.III.1.1: Change in net worth due to saving and capital transfers
account
Uses Resources
B.10.1 Changes in net worth due to
saving and capital transfers −3 8B.12 Current external balance −4 1
D.9 Capital transfers, receivable 4
D.91 Capital taxes 0
D.92 Investment grants 4
D.99 Other capital transfers 01996R2223 — EN — 07.08.2003 — 008.001 — 244
▼B
Uses Resources
D.9 Capital transfers, payable − 1
D.91 Capital taxes 0D.92 Investment grants 0
D.99 Other capital transfers − 1
V.III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
K.2 Acquisitions less disposals of
non-produced non-financial
assets 0B.10.1 Changes in net worth due to
saving and capital transfers −3 8
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 0
K.22 Acquisitions less disposals of
intangible non-produced
assets 0
B.9 Net lending (+)/net
borrowing (−) −3 8
V.III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets 50F Net incurrence of liabilities 88
F.1 Monetary gold and SDRs 1
F.2 Currency and deposits 11 F.2 Currency and deposits − 2
F.21 Currency 3 F.21 Currency 2F.22 Transferable deposits 2 F.22 Transferable deposits − 1
F.29 Other deposits 6 F.29 Other deposits − 3
F.3 Securities other than shares 5 F.3 Securities other than shares 20
F.4 Loans 10 F.4 Loans 37
F.41 Short-term 3 F.41 Short-term 10F.42 Long-term 7 F.42 Long-term 27
F.5 Shares and other equity 2 F.5 Shares and other equity 31996R2223 — EN — 07.08.2003 — 008.001 — 245
▼B
Changes in assets Changes in liabilities and net worth
F.6 Insurance technical reserves 0 F.6 Insurance technical reserves 0
F.61 Net equity of households in
life insurance reserves and in
pension funds reserves 0F.61 Net equity of households in
life insurance reserves and in
pension funds reserves 0
F.611 Net equity of households in
life insurance reserves 0F.612 Net equity of households in
pension finds reserves 0
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 0
F.7 Other accounts payable 30
F.7 Other accounts receivable 21 F.71 Trade credits and advances 18
F.71 Trade credits and advances 18 F.79 Other accounts payable
except trade credits and
advances 12
F.79 Other accounts receivable,
except trade credits and
advances 3
B.9 Net lending (+)/net
borrowing (−)−3 8
V.III.3: Other changes in assets accounts
V.III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 0 AF Liabilities 0
AN.2 Non-produced assets 0 K.7 Catastrophic losses 0
K.8 Uncompensated seizures 0 K.8 Uncompensated seizures 0
K.12 Changes in classifications
and structure 0K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.12.2 Changes in classification of
assets and liabilities 0K.12 Changes in classifications
and structure 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0K.12.1 Changes in sector classifica-
tion and structure 0
of
which:
AN.21 Tangible non-produced assets 0K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
AN.22 Intangible non-produced
assets 0of
which:
AF.2 Currency and deposits 0
AF Financial assets 0 AF.3 Securities other than shares 0
K.7 Catastrophic losses 0 AF.4 Loans 01996R2223 — EN — 07.08.2003 — 008.001 — 246
▼B
Changes in assets Changes in liabilities and net worth
K.8 Uncompensated seizures 0 AF.5 Shares and other equity 0
K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0AF.6 Insurance technical reserves 0
K.12 Changes in classifications
and structure 0AF.7 Other accounts payable 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.1 Monetary gold and SDRs 0
AF.2 Currency and deposits 0AF.3 Securities other than shares 0AF.4 Loans 0
AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 0
V.III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains (+)/
losses (−):K.11 Nominal holding gains (+)/
losses (−):
AN.2 Non-produced assets 0 AF Liabilities 3
AN.21 Tangible non-produced assets 0 AF.2 Currency and deposits 0AN.22 Intangible non-produced
assets 0AF.3 Securities other than shares 2
AF.4 Loans 0
AF Financial assets 7 AF.5 Shares and other equity 0
AF.1 Monetary gold and SDRs 0 AF.6 Insurance technical reserves 0
AF.2 Currency and deposits 0 AF.7 Other accounts payable 0AF.3 Securities other than shares 4AF.4 Loans 0
AF.5 Shares and other equity 31996R2223 — EN — 07.08.2003 — 008.001 — 247
▼B
Changes in assets Changes in liabilities and net worth
AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable
B.10.3. Changes in net worth due to
nominal holding gains/losses 4
V.III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains (+)/
losses (−):K.11.1 Neutral holding gains (+)/
losses (−):
AN.2 Non-produced assets 0 AF Liabilities 6
AN.21 Tangible non-produced assets 0 AF.2 Currency and deposits 2AN.22 Intangible non-produced
assets 0AF.3 Security other than shares 2
AF.4 Loans 0
AF Financial assets 11 AF.5 Shares and other equity 0AF.1 Monetary gold and SDRs 0 AF.6 Insurance technical reserves 1
AF.2 Currency and deposits 2 AF.7 Other accounts payable 1
AF.3 Securities other than shares 3AF.4 Loans 1AF.5 Shares and other equity 2AF.6 Insurance technical reserves 1
AF.7 Other accounts receivable 3
B.10.31 Changes in net worth due to
neutral holding gains/losses 6
V.III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real gains (+)/losses (−): K.11.2 Real gains (+)/losses (−):
AN.2 Non-produced assets 0 AF Liabilities − 3
AN.21 Tangible non-produced assets 0 AF.2 Currency and deposits − 2AN.22 Intangible non-produced
assets 0AF.3 Securities other than shares 1
AF.4 Loans 0
AF Financial assets − 5 AF.5 Shares and other equity 0AF.1 Monetary gold and SDRs 0 AF.6 Insurance technical reserves − 11996R2223 — EN — 07.08.2003 — 008.001 — 248
▼B
Changes in assets Changes in liabilities and net worth
AF.2 Currency and deposits − 2 AF.7 Other accounts payable − 1
AF.3 Securities other than shares 1AF.4 Loans − 1
AF.5 Shares and other equity 0
AF.6 Insurance technical reserves − 1AF.7 Other accounts receivable − 3
B.10.32 Changes in net worth due to
real holding gains/losses 4
V.IV: External assets and liabilities account
V.IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 0 AF Liabilities 297
AN.2 Non-produced assets 0 AF.2 Currency and deposits 116AN.21 Tangible non-produced assets 0 AF.3 Securities other than shares 77AN.22 Intangible non-produced
assets 0AF.4 Loans 17
AF.5 Shares and other equity 3
AF Financial assets 573 AF.6 Insurance technical reserves 25
AF.1 Monetary gold and SDRs 0 AF.7 Other accounts payable 59
AF.2 Currency and deposits 105AF.3 Securities other than shares 125AF.4 Loans 70
AF.5 Shares and other equity 113
AF.6 Insurance technical reserves 26AF.7 Other accounts receivable 134
B.90 Net worth 276
V.IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 0 AF Liabilities 91
AN.2 Non-produced assets 0 AF.2 Currency and deposits − 2AN.21 Tangible non-produced assets 0 AF.3 Securities other than shares 221996R2223 — EN — 07.08.2003 — 008.001 — 249
▼B
Assets Liabilities and net worth
AN.22 Intangible non-produced
assets 0AF.4 Loans 37
AF.5 Shares and other equity 3
AF Financial assets 57 AF.6 Insurance technical reserves 0AF.1 Monetary gold and SDRs 1 AF.7 Other accounts payable 30AF.2 Currency and deposits 11
AF.3 Securities other than shares 9
AF.4 Loans 10AF.5 Shares and other equity 5AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 21
B.10 Changes in net worth total
due to: −3 4
B.10.1 Saving and social transfers −3 8
B.10.2 Other changes in volume of
assets 0
B.10.3 Nominal holding gains/losses 4
B.10.31 Neutral holding gains/losses 6
B.10.32 Real holding gains/losses − 1
V.IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 0 AF Liabilities 388
AN.2 Non-produced assets 0 AF.2 Currency and deposits 114AN.21 Tangible non-produced assets 0 AF.3 Securities other than shares 99AN.22 Intangible non-produced
assets 0AF.4 Loans 54
AF.5 Shares and other equity 6
AF Financial assets 630 AF.6 Insurance technical reserves 25
AF.1 Monetary gold and SDRs 0 AF.7 Other accounts payable 89
AF.2 Currency and deposits 116AF.3 Securities other than shares 134AF.4 Loans 80
AF.5 Shares and other equity 118
AF.6 Insurance technical reserves 26AF.7 Other accounts receivable 1551996R2223 — EN — 07.08.2003 — 008.001 — 250
▼B
Assets Liabilities and net worth
B.90 Net worth 242
GOODS AND SERVICES ACCOUNT (0)
8.78. The purpose of the goods and services account is to show, by product
group and for the total economy, how the products available are used.
8.79. It therefore shows, by product group and for the total economy, the
resources (output and imports) and the uses of goods and services
(intermediate consumption, final consumption, gross fixed capital
formation, changes in inventories, acquisitions less disposals of valuables,
exports).
8.80. Given the way in which output is valued at basic prices and uses at
purchaser's prices, taxes less subsidies on products must be included in the
resources section.
8.81. Uses are recorded on the right-hand side of the goods and services account
and resources on the left, i.e. on the opposite side from that used in the
current accounts for the institutional sectors, since the product flows are
the counterparts of the monetary flows.
8.82. The goods and services account is by definition in balance and therefore
has no balancing item.
Table 8.17 — Account 0: Goods and services account
Resources Uses
P.1 Output 3 595 P.2 Intermediate consumption 1 904
P.11 Market output 3 048
P.12 Output for own use 171 P.3/P.4 Final consumption expendi-
ture/actual final consumption 1 371
P.13 Other non-market output 376 P.31/
P.41Individual consumption
expenditure/actual individual
consumption 1 215
D.21 Taxes on products 141 P.32/
P.42Collective consumption
expenditure/actual collective
consumption 156
D.31 Subsidies on products − 8
P.51 Gross fixed capital formation 376
P.7 Imports of goods and
services 497P.511 Acquisitions less disposals of
tangible fixed assets 303
P.71 Imports of goods 392 P.5111 Acquisitions of new tangible
fixed assets 305
P.72 Imports of services 105 P.5112 Acquisitions of existing
tangible fixed assets 11
P.5113 Disposals of existing tangible
fixed assets − 13
P.512 Acquisitions less disposals of
intangible fixed assets 51
P.5121 Acquisitions of new intan-
gible fixed assets 53
P.5122 Acquisitions of existing
intangible fixed assets 6
P.5123 Disposals of existing intan-
gible fixed assets − 81996R2223 — EN — 07.08.2003 — 008.001 — 251
▼B
Resources Uses
P.513 Additions to the value of
non-produced non-financial
assets 22
P.5131 Major improvements to non-
produced non-financial assets 5
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 17
P.52 Changes in inventories 28P.53 Acquisitions less disposals of
valuables 10
P.6 Exports of goods and
services 536
P.61 Exports of goods 462P.62 Exports of services 74
INTEGRATED ECONOMIC ACCOUNTS
8.83. The integrated economic accounts give a concise overview of the accounts
of an economy: current accounts, accumulation accounts and balance
sheets.
They bring together in the same table the accounts of all the institutional
sectors, the total economy and the rest of the world, and balance all theflows and all the assets and liabilities. They also enable the aggregates to
be read off directly.
8.84. In the table of integrated economic accounts, uses, assets and changes in
assets are recorded on the left-hand side, while resources, liabilities,
changes in liabilities and net worth are recorded on the right-hand side.
8.85. To make the table readable while giving a picture of the whole economic
process, the levels of aggregation used are the highest compatible with an
understanding of the structure of the system.
8.86. The columns in the table represent the institutional sectors, namely: non-
financial corporations, financial corporations, general government, non-
profit institutions serving households, and households. There are also a
column for the total economy, a column for the rest of the world, and a
column which balances uses and resources of goods and services.
8.87. The rows in the table represent the various categories of transactions,
assets and liabilities, balancing items and certain aggregates.1996R2223 — EN — 07.08.2003 — 008.001 — 252
Table 8.18 — Integrated economic accounts
CURRENT ACCOUNTS
Uses Resources
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
I.
Production/
external
account of
goods and
services497 497 P.7 Imports of
goods and
services497 497 I.
Production/
external
account of
goods and
services536 536 P.6 Exports of
goods and
services536 536
3 595 3 595 P.1 Output 1 753 102 434 1 269 37 3 595 3 595
1 904 1 904 6 694 246 29 881 P.2 Intermediate
consumption1 904 1 904
133 133 D.21-D.31 Taxes less
subsidies on
products133 133
1 824 1 824 31 575 188 73 872 B.1g/B.1 * g Value added,
gross/gross
domestic
product872 73 188 575 31 1 824 1 824 II.1.1.
Generation of
income
account
222 222 3 42 30 10 137 K.1 Consumption
of fixed
capital
1 602 1 602 28 533 158 63 735 B.1n/B.1 * n Value added,
net/net
domestic
product735 63 158 533 28 1 602 1 602▼B1996R2223 — EN — 07.08.2003 — 008.001 — 253
Uses Resources
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
− 39 − 39 B.11 External
balance of
goods and
services−3 9 −3 9
II.1.1.
Generation of
income
account768 6 762 23 39 140 15 545 D.1 Compensation
of employees766 766 2 768 II.1.2.
Allocation of
primary
income
account 191 0 191 0 2 2 3 51 D.2-D.3 Taxes less
subsidies on
production
and imports191 191 0 191
133 0 133 D.21-D.31 Taxes less
subsidies on
products133 133 0 133
58 0 58 0 2 2 3 51 D.29-D.39 Other taxes
less subsidies
on production58 58 0 58
429 429 8 92 46 55 279 B.2g Operating
surplus, gross276 55 46 92 8 429 429
442 442 442 B.3g Mixed
income, gross442 442 442
217 217 5 60 16 45 139 B.2n Operating
surplus, net139 45 16 60 5 217 217
432 432 432 B.3n Mixed
income, net432 432 432▼B1996R2223 — EN — 07.08.2003 — 008.001 — 254
Uses Resources
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
II.1.2.
Allocation of
primary
income
account446 66 380 7 44 46 138 145 D.4 Property
income78 160 30 134 5 407 39 446
1 855 1 855 6 1 390 221 29 209 B.5g Balance of
primary
incomes,
gross/national
income, gross209 29 221 1 390 6 1 855 1 855 II.2.
Secondary
distribution of
income
account
1 633 1 633 3 1 348 191 19 72 B.5n/B.5 * n Balance of
primary
incomes, net/
national
income, net72 19 191 1 348 3 1 633 1 633
II.2.
Secondary
distribution of
incomeaccount213 1 212 0 178 0 10 24 D.5 Current taxes
on income,
wealth etc.213 213 0 213
322 0 322 322 D.61 Social contri-
butions14 39 268 0 1 322 0 322
332 0 332 1 0 289 29 13 D.62 Social bene-
fits other than
social trans-
fers in kind332 332 0 332
278 9 269 2 71 139 46 11 D.7 Other current
transfers10 49 108 36 36 239 39 278
1 826 1 826 40 1 187 382 32 185 B.6g Disposable
income, gross185 32 382 1 187 40 1 826 1 826 II.3.
Redistribution
of income in
kind account1 604 1 604 37 1 145 352 22 48 B.6n Disposable
income, net48 22 352 1 145 37 1 604 1 604▼B1996R2223 — EN — 07.08.2003 — 008.001 — 255
Uses Resources
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
II.3.
Redistribution
of income in
kind account219 219 13 206 D.63 Social trans-
fers in kind219 219 219
1 826 1 826 27 1 406 176 32 185 B.7g Adjusted
disposable
income, gross185 32 176 1 406 27 1 826 1 826 II.4.
Use of income
account
1 604 1 604 24 1 364 146 22 48 B.7n Adjusted
disposable
income, net48 22 146 1 364 24 1 604 1 604
II.4.
Use of income
accountB.6g Disposable
income, gross185 32 382 1 187 40 1 826 1 826
B.6n Disposable
income, net48 22 352 1 145 37 1 604 1 604
1 371 1 371 1 215 156 P.4 Actual final
consumption1 371 1 371
1 371 1 371 13 996 362 P.3 Final
consumption
expenditure1 371 1 371
11 0 11 0 0 11 0 D.8 Adjustment
for the change
in net equity
of households
in pension
funds reserves11 11 0 11
455 455 27 202 20 21 185 B.8g Saving, gross
233 233 24 160 − 10 11 48 B.8n Saving, net▼B1996R2223 — EN — 07.08.2003 — 008.001 — 256
Uses Resources
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
− 41 − 41 B.12 Current
external
balance▼B1996R2223 — EN — 07.08.2003 — 008.001 — 257
ACCUMULATION ACCOUNTS
Changes in assets Changes in liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
III.1.1.
Change in net
worth due to
saving and
capital
transfer
accountB.8n Saving, net 48 11 − 10 160 24 233 233 III.1.1.
Change in net
worth due to
saving and
capital
transfer
accountB.12 Current
external
balance−4 1 −4 1
D.9 Capital trans-
fers, recei-
vable33 0 6 23 0 62 4 66
D.9 Capital trans-
fers, payable
(−)−1 6 −7 −3 4 −5 −3 −6 5 −1 −6 6
192 − 38 230 21 178 − 38 4 65 B.10.1 Changes in
net worth due
to saving and
capital trans-
fers65 4 − 38 178 21 230 − 38 192 III.1.2.
Acquisition of
non-financial
assets account
III.1.2.
Acquisition of
non-financial
assets account376 376 19 61 37 9 250 P.51 Gross fixed
capital forma-
tion376 376
− 222 − 222 − 3 − 42 − 30 − 10 − 137 K.1 Consumption
of fixed
capital (−)
28 28 0 2 0 0 26 P.52 Changes in
inventories28 28
10 10 0 5 3 0 2 P.53 Acquisitions
less disposals
of valuables10 10▼B1996R2223 — EN — 07.08.2003 — 008.001 — 258
Changes in assets Changes in liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
0 0 0 1 4 2 0 − 7 K.2 Acquisitions
less disposals
of non-
produced non-
financial
assets
0 − 38 38 4 148 − 50 5 − 69 B.9 Net lending
(+−/net
borrowing (−)− 69 5 − 50 148 4 38 − 38 III.2.
Financial
account
III.2.
Financial
account691 50 641 32 181 120 237 71 F Net acquisi-
tion of
financial
assets
F Net incur-
rence of
liabilities140 232 170 33 28 603 88 691
0 1 − 1 0 − 1 F.1 Monetary
gold and
SDRs
130 11 119 12 68 7 15 17 F.2 Currency and
deposits0 130 2 0 0 132 − 2 130
143 5 138 12 29 26 53 18 F.3 Securities
other than
shares6 53 64 0 0 123 20 143
254 10 244 0 5 45 167 27 F.4 Loans 71 0 94 28 24 217 37 254
46 2 44 0 3 36 3 2 F.5 Shares and
other equity26 13 0 4 43 3 46▼B1996R2223 — EN — 07.08.2003 — 008.001 — 259
Changes in assets Changes in liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
36 0 36 0 36 0 0 0 F.6 Insurance
technical
reserves03 6 0 0 3 6 0 3 6
82 21 61 8 40 6 0 7 F.7 Other
accounts
receivable/
payable37 0 10 5 0 52 30 82
III.3.1.
Other changes
in volume of
assets account15 15 0 2 1 − 2 14 K.3-10 and
K.12Other volume
changes, total− 3 2 − 1 0 0 − 2 0 − 2 III.3.1.
Other changes
in volume of
assets account24 24 0 0 0 0 24 K.3 Economic
appearance of
non-produced
assets
3 3 0 0 3 0 0 K.4 Economic
appearance of
produced
assets
4 4 0 0 4 0 0 K.5 Natural
growth of
non-cultivated
biological
resources
− 9 − 9 0 0 − 2 0 − 7 K.6 Economic
disappearance
of non-
produced
assets
− 11 0 − 11 0 0 − 6 0 − 5 K.7 Catastrophic
losses00 00 0 0 0 0▼B1996R2223 — EN — 07.08.2003 — 008.001 — 260
Changes in assets Changes in liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
0 0 0 0 0 8 − 3 − 5 K.8 Uncompen-
sated seizures00 00 0 0 0 0
1 1 0 0 0 0 1 K.9 Other volume
changes in
non-financial
assets n.e.c.
3 0 3 0 2 0 1 0 K.10 Other volume
changes in
financial
assets and
liabilities
n.e.c.−4 2 0 0 0 −2 0 −2
0 0 0 0 0 − 6 0 6 K.12 Changes in
classifications
and structure10 − 10 0 0 0 0
of which:
10 0 10 0 0 0 − 2 12 AN Non-financial
assets
− 7 − 7 0 0 − 3 − 2 − 2 AN.1 Produced
assets
17 0 17 0 0 3 0 14 AN.2 Non-produced
assets
5 0 5 0 2 1 0 2 AF Financial
assets/Liabil-
ities−3 2 −1 0 0 −2 0 −2▼B1996R2223 — EN — 07.08.2003 — 008.001 — 261
Changes in assets Changes in liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
B.10.2 Changes in
net worth due
to other
changes in
volume of
assets17 − 4 2 2 0 17 0 17
III.3.2.
Revaluation
accountK.11 Nominal
holding gains/
lossesIII.3.2.
Revaluation
account
280 0 280 8 80 44 4 144 AN Non-financial
assets
126 126 5 35 20 2 63 AN.1 Produced
assets
154 0 154 3 45 23 2 81 AN.2 Non-produced
assets
91 7 84 1 16 2 57 8 AF Financial
assets/Liabil-
ities18 51 7 0 0 76 3 78
B.10.3 Changes in
net worth due
to nominal
holding gains
(+)/losses (−)134 10 38 96 10 288 4 292▼B1996R2223 — EN — 07.08.2003 — 008.001 — 262
BALANCE SHEETS
Assets Liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
IV.1.
Opening
balance sheet9 922 0 9 922 324 2 822 1 591 144 5 041 AN. Non-financial
assetsIV.1.
Opening
balance sheet
6 047 6 047 243 1 698 1 001 104 3 001 AN.1 Produced
assets
3 875 0 3 875 81 1 124 590 40 2 040 AN.2 Non-produced
assets
7 365 573 6 792 172 1 819 396 3 508 897 AF Financial
assets/liabil-
ities1 817 3 384 687 289 121 6 298 297 6 595
B.90 Net worth 4 121 268 1 300 4 352 375 10 416 276 10 692
IV.2.
Changes in
balance sheetTotal changes
in assetsIV.2.
Changes in
balance sheet
482 0 482 25 110 56 1 290 AN Non-financial
assets
289 289 21 61 25 − 1 182 AN.1 produced
assets
193 0 193 4 49 30 2 108 AN.2 non-produced
assets▼B1996R2223 — EN — 07.08.2003 — 008.001 — 263
Assets Liabilities and net worth
Accounts TotalGoods
and
servic-
es
(resou-
rces)Rest of
the
WorldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpor-
ationsS.11
Non-
finan-
cial
corpor-
ationsCodeTransactions
and other flows,
stocks and
balancing itemsS.11
Non-
finan-
cial
corpor-
ationsS.12
Finan-
cial
corpor-
ationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myRest of
the
WorldGoods
and
servic-
es
(uses)Total Accounts
787 57 730 33 199 123 294 81 AF Financial
assets/liabil-
ities155 285 176 33 28 677 91 767
B.10 Changes in
net worth,
total216 10 2 276 31 535 − 34 501
B.10.1 Saving and
capital trans-
fers65 4 − 38 178 21 230 − 38 192
B.10.2 Other
changes in
volume of
assets17 − 4 2 2 0 17 0 17
B.10.3 Nominal
holding gains
(+)/losses (−)134 10 38 96 10 288 4 292
IV.3.
Closing
balance sheet10 404 0 10 404 349 2 932 1 647 145 5 331 AN Non-financial
assetsIV.3.
Closing
balance sheet
6 336 6 336 264 1 759 1 026 103 3 183 AN.1 produced
assets
4 068 0 4 068 85 1 173 620 42 2 148 AN.2 non-produced
assets
8 152 630 7 522 205 2 018 519 3 802 978 AF Financial
assets/liabil-
ities1 972 3 669 863 322 149 6 975 388 7 362
B.90 Net worth 4 337 278 1 302 4 628 406 10 951 242 11 193▼B1996R2223 — EN — 07.08.2003 — 008.001 — 264
▼B
AGGREGATES
8.88. The aggregates are summary indicators of the result of the activity of the
total economy and key magnitudes for purposes of macro-economic
analysis and comparisons over time and space.
GROSS DOMESTIC PRODUCT AT MARKET PRICES (GDP)
8.89. Gross domestic product at market prices is the final result of the
production activity of resident producer units. It can be defined in three
ways:
(a) GDP is the sum of gross value added of the various institutional
sectors or the various industries plus taxes and less subsidies on
products (which are not allocated to sectors and industries). It is also
the balancing item in the total economy production account.
(b) GDP is the sum of final uses of goods and services by resident
institutional units (actual final consumption and gross capital
formation), plus exports and minus imports of goods and services.
(c) GDP is the sum of uses in the total economy generation of income
account (compensation of employees, taxes on production and imports
less subsidies, gross operating surplus and mixed income of the total
economy).
8.90. By deducting consumption of fixed capital from GDP, we obtain net
domestic product at market prices (NDP).
OPERATING SURPLUS OF THE TOTAL ECONOMY
8.91. The gross (or net) operating surplus of the total economy is the sum of the
gross (or net) operating surpluses of the various industries or the various
institutional sectors.
MIXED INCOME OF THE TOTAL ECONOMY
8.92. The gross (or net) mixed income of the total economy is identical with the
gross (or net) mixed income of the household sector.
ENTREPRENEURIAL INCOME OF THE TOTAL ECONOMY
8.93. The gross (or net) entrepreneurial income of the total economy is the sum
of the gross (or net) entrepreneurial incomes of the various sectors.
NATIONAL INCOME (AT MARKET PRICES)
8.94. Gross (or net) national income (at market prices) represents total primary
income receivable by resident institutional units: compensation of
employees, taxes on production and imports less subsidies, property
income (receivable less payable), (gross or net) operating surplus and
(gross or net) mixed income.
Gross national income (at market prices) equals GDP minus primary
income payable by resident units to non-resident units plus primary
income receivable by resident units from the rest of the world.
Gross national income (at market prices) is conceptually identical with
gross national product (GNP) (at market prices), as hitherto understood in
national accounts generally.
However, the GNP was calculated differently in 1979 ESA (1).
National income is not a production concept but an income concept,
which is more significant if expressed in net terms, i. e. after deduction of
the consumption of fixed capital.
NATIONAL DISPOSABLE INCOME
8.95. Gross (or net) national disposable income is the sum of the gross (or net)
disposable incomes of the institutional sectors. Gross (or net) national
disposable income equals gross (or net) national income (at market prices)
minus current transfers (current taxes on income, wealth etc., social
contributions, social benefits and other current transfers) payable to non-1996R2223 — EN — 07.08.2003 — 008.001 — 265
(1) In 1979 ESA, GNP (at market prices) was calculated by adding to gross domestic
product (at market prices) the compensation of employees and the property incomereceived from the rest of the world and by deducting the corresponding flows paid to the
rest of the world.
▼B
resident units, plus current transfers receivable by resident units from the
rest of the world.
SAVING
8.96. This aggregate measures the portion of national disposable income that is
not used for final consumption expenditure. Gross (or net) national saving
is the sum of the gross (or net) savings of the various institutional sectors.
CURRENT EXTERNAL BALANCE
8.97 The balancing item in the external account of primary income and current
transfers represents the surplus (if it is negative) or the deficit (if it is
positive) of the total economy on its current transactions (trade in goods
and services, primary incomes, current transfers) with the rest of the
world.
NET LENDING (+) OR BORROWING (−) OF THE TOTAL ECONOMY
8.98. The net lending (+) or borrowing (−) of the total economy is the sum of
the net lending or borrowing of the institutional sectors. It represents the
net resources that the total economy makes available to the rest of the
world (if it is positive) or receives from the rest of the world (if it is
negative). The net lending (+) or borrowing (−) of the total economy is
equal but of opposite sign to the net borrowing (−) or lending (+) of the
rest of the world.
NET WORTH OF THE TOTAL ECONOMY
8.99. The net worth of the total economy is the sum of the net worth of the
institutional sectors. It represents the value of the non-financial assets of
the total economy minus the balance of financial assets and liabilities of
the rest of the world.
GENERAL GOVERNMENT EXPENDITURE AND REVENUE
8.99 (a) General government expenditure and revenue are defined by reference to
a list of ESA 95 categories.
Government expenditure comprises the following ESA 95 categories,
recorded under the use side of general government accounts, with the
exception of D.3 and D.9 which are recorded under the resource side of
general government accounts (1):
P.2 Intermediate consumption
P.5 Gross capital formation
D.1 Compensation of employees
D.29 Other taxes on productionD.3 Subsidies, payable
D.4 Property income
D.5 Current taxes on income, wealth, etc.D.62 Social benefits other than social transfers in kind
D.6311 +
D.63121 +
D.63131Social transfers in kind related to expenditure on products
supplied to households via market producers
D.7 Other current transfers
D.8 Adjustment for the change in net equity of households in
pension funds reserves
D.9 Capital transfers, payable
K.2 Acquisitions less disposals of non-financial non-produced
assets1996R2223 — EN — 07.08.2003 — 008.001 — 266
▼M2
▼M2
Government revenue comprises the following ESA 95 categories,
recorded under the resource side of general government accounts, with
the exception of D.39 which is recorded under the use side of general
government accounts:
P.11 Market output
P.12 Output for own final use
P.131 Payments for the other non-market outputD.2 Taxes on production and imports
D.39 Other subsidies on production, receivable
D.4 Property incomeD.5 Current taxes on income, wealth, etc.
D.61 Social contributions
D.7 Other current transfersD.9 (
1) Capital transfers
(1) Adjustments for taxes and social contributions assessed but never collected,
when recorded under D.9, are considered as a negative revenue.
By definition, the difference between general government revenue and
general government expenditure is net lending (+)/net borrowing (–) of
the general government sector.
The transactions D.41, D.7, D.92 and D.99 are consolidated. The other
transactions are not consolidated.
MATRIX PRESENTATION
8.100. Previous parts of this chapter have presented a sequence of (T-)accounts.
At the same time, the concepts and definitions of the system allow other
methods of presentation. These serve to provide additional insights and to
enable different types of analysis.
8.101. The input-output table is a widely used matrix framework to supply
detailed and coherently arranged information on the flow of goods and
services and on the structure of production costs. This matrix contains
more information than (T-)accounts for goods and services, production
and the generation of income; for example, final consumption expenditure
is shown by product group or industry of origin and intermediate
consumption is shown both by product group or industry of origin and by
product group or industry of destination. Disaggregated linkages between
these accounts are further developed in the ESA's supply and use tables,
through a specification of output of product groups by industry.
8.102. The rest of this section will demonstrate, first, that the full sequence of
accounts and balancing items can also be presented in a matrix format. In
this table, all transactions are presented for the total economy and for therest of the world, respectively. In addition, an aggregate goods and
services account is included.
8.103. Next, the general purposes that can be served by an accounting matrix will
be discussed. A crucial feature is the wide range of possibilities for
expanding or condensing such a matrix in accordance with specific
circumstances and needs. Finally, it will be illustrated how this works out
in practice. In particular, the linkages between the supply and use tables
and the sectoral accounts will be elaborated through the insertion of labour
accounts, to arrive at a Social Accounting Matrix (SAM) framework. A
SAM serves, among other things, to enable a more integrated analysis of
economic and social policy issues, including unemployment.
MATRIX PRESENTATION OF ESA ACCOUNTS
8.104. Table 8.19 presents the full sequence of accounts and balancing items in a
matrix. For this purpose, the accounts for the primary distribution of
income, for use of income and for other changes in assets have not been
subdivided. Besides, the option is left open whether or not to combine the
account for the redistribution of income in kind with the secondary
distribution of income. Finally, an account that records net worth has been
inserted.
8.105. The figures which are presented in the tables of this section correspond
exactly to the numerical example worked out in the preceding part of this1996R2223 — EN — 07.08.2003 — 008.001 — 267
▼B
▼B
chapter. In all matrices, the boxes containing a balancing item have been
framed with bold lines.
8.106. A matrix presentation permits each transaction to be represented by a
single entry and the nature of the transaction to be inferred from its
position. Each account is represented by a row and column pair and the
convention is followed that resources are shown in the rows and uses are
shown in the columns. For instance, net domestic product (1602) is
payable by the economy's producers and received on the primary
distribution of income account. Table 8.19 shows this in cell (3,2), that
is, in row 3 and column 2. Since this table distinguishes transactions with
the rest of the world in a separate account, its diagonal items, that is cells
(3,3), (4,4), (5,5), (6,6), (7,7) and (8,8), contain only transactions among
resident institutional units.
8.107. The row and column totals have not been named. Their main function in
matrix accounting is to ensure that all accounts indeed represent complete
balances, in the sense that total incomings (row sums) equal total
outgoings (column sums). In turn, meaningful balancing items, which
connect successive accounts, can only be derived if this condition is
fulfilled.
8.108. Row 1 shows the uses of goods and services, at purchaser's prices:
intermediate consumption (1904) in column 2, final consumption (1371)
in column 5, gross capital formation (414) in column 7 and exports (536)
in column 14.
8.109. The elements in row 1 add up to total use of goods and services, at
purchaser's prices (4225). Column 1 presents the supply of goods and
services (also totalling 4225, of course). Output (at basic prices) plus taxes
less subsidies on products (3728) is shown at the intersection with row 2.
Imports (497) originate from the external account of goods and services
(row 14).
8.110. Row 2 shows output (at basic prices) plus taxes less subsidies on products.
Because of this valuation, the sum of row 2 (3728), and the concomitant
sum of column 2, are inclusive of taxes less subsidies on products. This
ensures that these taxes are incorporated in the balancing item of account
2, net domestic product (NDP), see cell (3,2). Most balancing items can be
calculated gross or net. In this matrix, all balancing items are shown net.
Consumption of fixed capital (222) is put directly on the capital
subaccount for the acquisition of non-financial assets (row 7 and column
2).
8.111. Row 3 shows the receipts of primary income by the total economy: net
domestic product in cell (3,2), property income from other resident sectors
(341) on the diagonal, and primary income flows from the rest of the
world (72) in cell (3,15). As this matrix does not subdivide the account for
primary distribution of income, it does not break down value added
payable by producers into various categories of value added, as recorded
in the generation of income account.
8.112. Apart from the diagonal item, column 3 contains primary income payable
to the rest of the world (41) in cell (15,3) and the balancing item, net
national income (1633), that connects this account and the next one.
8.113. This matrix leaves open the option whether or not to combine the account
for the redistribution of income in kind with the secondary distribution of
income. If redistribution of income in kind is not shown, then the diagonal
contains current transfers, excluding social transfers in kind, between
resident sectors (1096). These transfers consist of current taxes on income,
wealth, etc., social contributions and benefits other than social transfers in
kind, and other current transfers. If redistribution of income in kind is
incorporated, then the diagonal of account 4 also records social transfers
in kind; aggregated with the other current transfer flows, this equals 1315.
In both cases, row 4 opens with net national income, while current
transfers from the rest of the world (10) are recorded in cell (4,15).
Column 4 shows, in addition to the diagonal item, current transfers to the
rest of the world (39), in cell (15,4), while the balancing item, (adjusted)
net disposable income (1604), is put on the use of (adjusted) disposable
income account.
8.114. If redistribution of income in kind is incorporated, then account 5 is the
use of adjusted disposable income account. Otherwise, this account is the
use of disposable income account. At the aggregate level, this is only a
matter of terminology, for total disposable income equals total adjusted
disposable income and total final consumption expenditure equals total
actual final consumption. Apart from disposable income, the row of this
account records an adjustment for changes in net equity of households on
resident pension funds (11) on the diagonal and an adjustment for changes1996R2223 — EN — 07.08.2003 — 008.001 — 268
▼B
in net equity of households on non-resident pension funds (0) in column
15. The column contains, in addition to final consumption (1371) and the
diagonal item, an adjustment for changes in net equity of non-resident
households on resident pension funds (0), see cell (15,5), and the
balancing item, net saving (233), which is put on the first capital
subaccount (account 6).
8.115. For the capital account, two subaccounts have been distinguished. First, in
the row of the account for change in net worth due to saving and capital
transfers, net saving is augmented with capital transfers receivable from
resident sectors (61), see cell (6,6), and from abroad (1), see cell (6,16).
In the column of this account, capital transfers payable are shown, to
resident sectors and to abroad (4), see cell (16,6). This yields a balancing
item, change in net worth due to saving and capital transfers (230), that is
transferred to the changes in balance sheet account (account 11).
8.116. Next, the row of the account for acquisition of non-financial assets
presents consumption of fixed capital (cell 7,2), the acquisitions less
disposals of non-produced non-financial assets by resident units (0), see
cell (7,7), and by non-resident units (0), see cell (7,17) and the changes in
assets due to saving and capital transfers (833), see cell (7,12). This yields
the total sum that is available to residents for the acquisition of assets.
That acquisition is shown in two stages: first the acquisition of non-
financial assets, in the column of this account, and then the acquisition of
financial assets (including external financial assets), in the column of the
next account. The column of this account, account 7, thus contains gross
capital formation (cell 1,7), the diagonal item (7,7) discussed above, the
changes in liabilities due to saving and capital transfers (603), see cell
(12,7), and a balancing item, net lending of the total economy (38), that is
put on the next account, for financial transactions.
8.117. Account 8, the financial account, opens with net lending of the total
economy (cell 8,7) and adds financial transactions between resident
sectors (553) on the diagonal and also the net incurrence of external
liabilities (50), see cell (8,18). The column contains the diagonal item and
the net acquisition of external financial assets (88) in cell (18,8). Of
course, the net incurrence of external liabilities plus net lending of the
total economy equals the net acquisition of external financial assets, so
that in this account too the balance between row and column totals is
maintained.
8.118. The account for other changes in assets, account 9, records in the row the
changes in assets due to other changes (379), see cell (9,12), and in the
column the changes in liabilities due to other changes (74), see cell (12,9),
and the balancing item, changes in net worth due to other changes (305),
see cell (11,9).
8.119. The last four accounts for the total economy refer to the balance sheets
and the changes therein. First, the opening balance sheet gives in the row
the opening stock of assets (16714), see cell (10,12), and in the column the
opening stock of liabilities (6298), see cell (12,10), and the opening net
worth (10416), see cell (13,10). Next, the account for changes in balance
sheet records both components of these changes in the row, see cells
(11,6) and (11,9), and the total changes in net worth (535) in the column,
see cell (13,11). Then, the closing balance sheet presents in the row the
opening stock of liabilities (cell 12,10), both components of changes in
liabilities (cells 12,7 and 12,9), and the closing net worth (10951), see cell
(12,13). Of course, the sum of these elements equals the closing stock of
assets, which is also computed in the column of this account: the opening
stock of assets (cell 10,12) plus both components of changes in assets, see
cells (7,12) and (9,12). Finally, the extra account for net worth gives
opening net worth (cell 13,10) and total changes in net worth (cell 13,11)
in the row and closing net worth in the column (cell 12,13).
8.120. For the rest of the world, the same accounts have been included as for the
total economy, albeit in a slightly more aggregate form. First, the external
account of goods and services presents in the row imports by the total
economy (cell 14,1) and in the column exports (cell 1,14) and the
balancing item (cell 15,14), the external balance of goods and services (−
39). Note that all balancing items of accounts for the rest of the world are
viewed from the perspective of the rest of the world. In order to obtain the
relevant aggregates for the total economy, the sign must therefore be
reversed.
8.121. Secondly, the external account of primary incomes and current transfers
records the balancing item of the previous account, and also primary
income, current transfers and adjustment for the change in net equity of
households on pension funds, to and from the rest of the world,1996R2223 — EN — 07.08.2003 — 008.001 — 269
▼B
respectively. These items have already been discussed above. All this
yields the current external balance (− 41), shown in cell (16,15).
8.122. Thirdly, the capital account for the rest of the world has also been split
into two sub-accounts: one for the current external balance, capital
transfers to and from the rest of the world and the balancing item, changes
in the net external financial position due to the current external balance
and capital transfers (− 38), see cell (21,16); another one for changes in
assets due to the current external balance and capital transfers (50), see
cell (17,22), acquisitions less disposals of non-produced non-financial
assets by non-resident units, see cell (7,17), changes in liabilities due to
the current external balance and capital transfers (88), see cell (22,17), and
the balancing item net lending of the rest of the world (− 38), transferred
to the next account.
8.123. Fourthly, the financial account gives the net acquisition of external
financial assets (cell 18,8) and net lending of the rest of the world (cell
18,17) in the row, and the net incurrence of external liabilities (cell 8,18)
in the column. Fifthly, the account for other changes in assets presents in
the row such changes of assets (7), see cell (19,22), and in the column
such changes of liabilities (3), see cell (22,19), and also the balancing
item, changes in the net external financial position due to other changes
(4), see cell (21,19).
8.124. Finally, the balance sheets for the rest of the world are analogous to those
for the total economy. Elements not yet mentioned above are: the opening
stock of external assets (573), see cell (20,22), the opening stock of
external liabilities (297), see cell (22,20), the opening net external
financial position of the rest of the world vis-à-vis the total economy
(276), see cell (23,20), total changes in the net external financial position
of the rest of the world (− 34), see cell (23,21), and the closing financial
position of the rest of the world vis-à-vis the total economy (242), see cell
(22,23).
8.125. As a next step, this reduced format matrix can be disaggregated to show
the full sequence of accounts, including details for transactors and
transaction categories. However, the full potential of matrix accounting
can be realized if not all accounts are detailed in the same way, but instead
for each account the most relevant classification is selected. This feature is
dealt with at greater length in the next subsection.
PROPERTIES OF ACCOUNTING MATRICES
8.126. Each entry in an aggregate matrix such as table 8.19 can be considered as
the grand total of a submatrix in which categories of transactors involved
at either end of the set of transactions under consideration are presented. A
very useful option in a matrix presentation of accounts is that different
types of transactors and groupings thereof can be selected in each account,
without giving up the coherence and the integration of the complete
accounting system. This means that one may apply ‘multiple actoring and
multiple sectoring’, by choosing in each account a unit and a classification
of units which are most relevant to the set of economic flows under
consideration.
8.127. In principle, each account can be broken down in two rather different
ways: by subdividing the total economy into groups of units, or by
assigning the categories of transactions shown in an account to various
sub-accounts. For instance, a subdivision of the total economy in the first
five accounts could run as follows:
(a) distinguish products in the goods and services account and classify
these by product groups;
(b) distinguish local kind-of-activity units in the production account and
classify these by industries;
(c) distinguish institutional units in the accounts for the primary and
secondary distribution of income and for the use of income and
classify these by institutional (sub)sectors.
8.128. these subdivisions have two major consequences. First, for all categories
of transactions distinguished in a single cell of these accounts it becomesclear which group of paying units has exchanged what with which group
of receiving units. Secondly, the interrelations among various economic
flows are revealed through detailed cross-classifications. For instance, in
the example given in the previous paragraph, a simple circular flow of
income is presented, at a meso-level, through the following mappings:
(a) sub-matrix (3,2) shows which institutional subsector receives primary
income and disposable income from which institutional subsector
(naturally, in the distribution of income accounts and in the use of1996R2223 — EN — 07.08.2003 — 008.001 — 270
▼B
income account different classifications can be applied, and then these
sub-matrices are no longer diagonal);
(b) sub-matrices (4,3) and (5,4) show which institutional subsector
receives primary income and disposable income from which
institutional subsector (naturally, in the distribution of income
accounts and in the use of income account different classifications
can be applied, and then these sub-matrices are no longer diagonal);
(c) sub-matrix (1,5) shows which product group is consumed by which
institutional subsectors; and
(d) sub-matrix (2,1) shows which industry makes which product groups.
8.129. When compiling such a matrix, it is convenient to start by designing an
accounting structure which is relevant to the applications envisaged.
Subsequently, in each account the most appropriate units and classifica-
tions of units are selected. However, in practice it will be an interactive
process. Suppose, for instance, that there is a transaction category for
which only total receipts and payments of transactors (the row and column
totals of a sub-matrix) are known, and not who paid whom (the interior
structure of the sub-matrix). This problem can be solved by the insertion
of an undivided, dummy account.
8.130. Among the general properties of a matrix presentation of accounts are the
following:
(a) a detailed matrix presentation is suitable for mathematical treatment
using matrix algebra; this can also be of help when balancing the
accounts;
(b) a detailed matrix presents a simultaneous breakdown of interrelated
transactions by paying and receiving units; as a consequence, it is an
appropriate format to reveal, at a meso-level, interrelations among
economic flows; this includes those flows which involve two different
types of units (e. g. final consumption expenditure on various
categories of goods and services by a number of household
subsectors);
(c) for a set of accounts giving a breakdown of transactions by paying and
receiving units, a matrix presentation is more concise than other
methods of presentation; the payment by one unit and the receipt byanother unit involved in each transaction are represented by a single
entry.
8.131. An aggregate matrix for the total economy can serve as a reference table
for subsequent, more detailed tables. As soon as the reader is then
introduced to a detailed presentation of parts of the system (supply and
use tables, sector accounts, etc.), the relation of the detailed submatrices to
the aggregate matrix should be clear through a system of codes. The
matrix format is particularly advantageous if it is not possible or desirableto show an equally detailed classification in all accounts of the system.
8.132. The matrix presentation is a suitable tool for exploring the flexibility of
the system. For instance, one may further elaborate on the interrelations
between the social and economic aspects of the system to arrive at a
Social Accounting Matrix. The SAM approach is set out and illustrated in
the next subsection of this chapter.
ADAPTATION OF THE REDUCED FORMAT MATRIX TO SPECIFIC
TYPES OF ANALYSIS
8.133. The supply and use tables opt for a classification of rows and columns
which is most suitable to describe the economic processes under
consideration, namely the processes of production and use of products.
However, those matrices do not incorporate the interrelations between
value added and final expenditure. By extending a supply and use table, or
an input-output table, to show the entire circular flow of income at a
meso-level, one captures an essential feature of a Social Accounting
Matrix (SAM).
8.134. A SAM is defined here as: The presentation of ESA-accounts in a matrix
which elaborates on the linkages between a supply and use table and
sector accounts. SAMs typically focus on the role of people in the
economy, which may be reflected by, among other things, extra
breakdown of the household sector and a disaggregated representation
of labour markets (i. e. distinguishing various categories of employed
persons).
8.135. An important social concern is the level and composition of (un)employ-
ment. A SAM commonly provides additional information on this issue,
via a subdivision of compensation of employees by type of person
employed. This subdivision applies to both the use of labour by industry,1996R2223 — EN — 07.08.2003 — 008.001 — 271
▼B
as shown in the supply and use tables, and the supply of labour by socio-
economic subgroup, as shown in the allocation of primary income account
for households. It implies that the matrix presents not only the supply and
use of various product groups, but also the supply and use of various
categories of labour services.
8.136. The classification of (self-)employed persons may be based on a
combination of background and (main) job characteristics, such as sex,
schooling, age and place of residence on the one hand, and occupation,
type of job contract (full-time/part-time, permanent/temporary) and region
and subsector of employment on the other hand. Another consideration
should be that within-group variations in relative wage rate changes are
smaller than between-group variations. A classification by industry of
employment is less relevant, because this is already shown in the SAM by
the cross-classification of value added.
8.137. Both resident persons employed in non-resident enterprises and non-
resident persons working for resident enterprises plus employees working
temporarily abroad should be set apart. In this way, employment can be
estimated by counting the number of (national) employed person units.
Evidently, this includes the self-employed, for whose labour input an
imputed remuneration may then be isolated from the rest of net mixed
income in the SAM.
8.138. In particular, comparing (1) labour incomes of all employed persons as
shown in the SAM, (2) a decomposition of these incomes into hours
worked and average wage rates per hour and (3) the potential supply of
labour by1996R2223 — EN — 07.08.2003 — 008.001 — 272
Table 8.19 — Matrix presentation of the full sequence of accounts and balancing items for the total economy
Account 0.
Goods and
servicesI.-IV. TOTAL ECONOMY V. REST OF THE WORLD
Total I.
ProductionII.1.
Primary
distribution
of incomeII.2./3.
Secondary
(re)distribu-
tion of
income (in
kind)II.4.
Use of
(adjusted)
disposable
incomeIII.1.1.
Saving and
capital trans-
fersIII.1.2.
Acquisition
of non-finan-
cial assetsIII.2.
FinancialIII.3.
Other
changes in
assetsIV.1.
Opening
balance
sheetIV.2.
Changes in
balance
sheetIV.3.
Closing
balance
sheetNet worth V.1.
External
goods and
servicesV.2.
External
primary
incomes and
current
transfersV.3.1.1.
Saving and
capital trans-
fersV.3.1.2.
Acquisition
of non-finan-
cial assetsV.3.2.
FinancialV.3.3.
Other
changes in
assetsV.4.1.
Opening
balance
sheetV.4.2.
Changes in
balance
sheetV.4.3.
Closing
balance
sheetNet worth
123456789 1 0 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 9 2 0 2 1 2 2 2 3
0. Goods
and
services1 Trade and
transport
marginsInter-
mediate
consump-tionFinal
consump-
tionGross
capital
formationExports of
goods and
services
0 1 904 1 371 414 536 4 225
T
O
T
A
L
E
C
ONO
M
YI. Produc-
tion2 Output &
Taxes less
subsidieson products
3 728 3 728
II.1.
Primary
distributionof income3 Net
domestic
productProperty
incomePrimary
income
from therest of theworld
1 602 341 72 2 015
II.2./3.
Secondary(re)distribu-tion of
income (in
kind)4 National
income, netCurrent
transfers(1 315)Current
transfersfrom therest of the
world
1 633 1 096 10 2 739
II.4. Use of
(adjusted)
disposable
income5 (Adjusted)
disposable
income, netAdjustment
for the
change in
net equityof house-holds on
pension
fundsAdjustment
for the
change in
net equityof house-holds on
pension
funds fromthe rest ofthe world
1 604 11 0 1 615
III.1.1.
Saving andcapitaltransfers6 Saving, net Capital
transfersCapital
transfersfrom therest of the
world
233 61 1 295
III.1.2.
Acquisitionof non-
financial
assets7 Consump-
tion offixed
capitalAcquisi-
tions lessdisposals of
non-
producednon-finan-cial assetsChanges in
assets dueto saving
and capital
transfersAcquisi-
tions lessdisposals of
non-
producednon-finan-cial assets
222 0 833 0 1 055
III.2.
Financial8 Net lending
of the totaleconomyNet acqui-
sitions offinancialassets (= net
incurrence
of liabil-ities)Net incur-
rence ofexternalliabilities
38 553 50 641▼B1996R2223 — EN — 07.08.2003 — 008.001 — 273
Account 0.
Goods and
servicesI.-IV. TOTAL ECONOMY V. REST OF THE WORLD
Total I.
ProductionII.1.
Primary
distribution
of incomeII.2./3.
Secondary
(re)distribu-
tion of
income (in
kind)II.4.
Use of
(adjusted)
disposable
incomeIII.1.1.
Saving and
capital trans-
fersIII.1.2.
Acquisition
of non-finan-
cial assetsIII.2.
FinancialIII.3.
Other
changes in
assetsIV.1.
Opening
balance
sheetIV.2.
Changes in
balance
sheetIV.3.
Closing
balance
sheetNet worth V.1.
External
goods and
servicesV.2.
External
primary
incomes and
current
transfersV.3.1.1.
Saving and
capital trans-
fersV.3.1.2.
Acquisition
of non-finan-
cial assetsV.3.2.
FinancialV.3.3.
Other
changes in
assetsV.4.1.
Opening
balance
sheetV.4.2.
Changes in
balance
sheetV.4.3.
Closing
balance
sheetNet worth
123456789 1 0 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 9 2 0 2 1 2 2 2 3
III.3. Other
changes in
assets9 Changes in
assets due
to other
changes
379 379
IV.1.
Opening
balance
sheet10 Opening
stock of
assets
16 714 16 714
IV.2.
Changes inbalance
sheet11 Change in
net worthdue to
saving and
capitaltransfersChange in
net worthdue to other
changes
230 305 535
IV.3.
Closing
balance
sheet12 Changes in
liabilities
due to
saving andcapitaltransfersChanges in
liabilities
due to other
changesOpening
stock of
liabilitiesClosing net
worth
603 74 6 298 10 951 17 926
Net worth 13 Opening
net worthChange in
net worth,total
10 416 535 10 951
R
E
S
T
O
F
T
H
E
W
O
R
L
DV.1.
External
goods andservices14 Imports of
goods and
services
497 497
V.2.
Externalprimary
incomes
and currenttransfers15 Primary
income tothe rest of
the worldCurrent
transfers tothe rest of
the worldAdjustment
for thechange in
net equity
of house-holds onpension
funds to the
rest of theworldExternal
balance ofgoods and
services
41 39 0 −3 9 41
V.3.1.1.
Saving and
capitaltransfers16 Capital
transfers to
the rest ofthe worldCurrent
external
balance
4 41 −3 7▼B1996R2223 — EN — 07.08.2003 — 008.001 — 274
Account 0.
Goods and
servicesI.-IV. TOTAL ECONOMY V. REST OF THE WORLD
Total I.
ProductionII.1.
Primary
distribution
of incomeII.2./3.
Secondary
(re)distribu-
tion of
income (in
kind)II.4.
Use of
(adjusted)
disposable
incomeIII.1.1.
Saving and
capital trans-
fersIII.1.2.
Acquisition
of non-finan-
cial assetsIII.2.
FinancialIII.3.
Other
changes in
assetsIV.1.
Opening
balance
sheetIV.2.
Changes in
balance
sheetIV.3.
Closing
balance
sheetNet worth V.1.
External
goods and
servicesV.2.
External
primary
incomes and
current
transfersV.3.1.1.
Saving and
capital trans-
fersV.3.1.2.
Acquisition
of non-finan-
cial assetsV.3.2.
FinancialV.3.3.
Other
changes in
assetsV.4.1.
Opening
balance
sheetV.4.2.
Changes in
balance
sheetV.4.3.
Closing
balance
sheetNet worth
123456789 1 0 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 9 2 0 2 1 2 2 2 3
V.3.1.2.
Acquisitionof non-
financial
assets17 Changes in
externalassets due
to current
externalbalance andcapital
transfers
50 50
V.3.2.
Financial18 Net acqui-
sition ofexternal
financial
assetsNet lending
of the restof the
world
88 −3 8 50
V.3.3.
Otherchanges in
assets19 Changes in
externalassets due
to other
changes
77
V.4.1.
Openingbalance
sheet20 Opening
stock ofexternal
assets
573 573
V.4.2.
Changes inbalancesheet21 Change in
net externalfinancialposition
due to
currentexternalbalance and
capital
transfersChange in
net externalfinancialposition
due to other
changes
−3 8 4 −3 4
V.4.3.
Closing
balance
sheet22 Changes in
external
liabilities
due tocurrentexternal
balance and
capitaltransfersChanges in
external
liabilities
due to otherchangesOpening
stock of
external
liabilitiesClosing net
external
financial
position
88 3 297 242 630
Net worth 23 Opening
net external
financial
positionChange in
net external
financial
position,total
276 − 34 242
Total 4 225 3 728 2 015 2 739 1 615 295 1 055 641 379 16 714 535 17 926 10 951 497 41 − 37 50 50 7 573 − 34 630 242▼B1996R2223 — EN — 07.08.2003 — 008.001 — 275
▼B
type of person and household group (expressed in ‘full-time’ equivalents)
yields detailed information on the composition of unemployed and an
aggregate indicator (‘full-time equivalent unemployment’) which is
consistent, both conceptually and numerically, with the other macro-
economic indicators; these can also be derived from the SAM frame-
work. Moreover, juxtaposing the head-count of the employed persons
(excluding foreigners) and the potential labour force in this data set
reveals unemployment as conventionally defined.
8.139. At this stage, it is perhaps useful to work out an illustrative SAM. For this
purpose, table 8.20 exemplifies the design of a SAM which records all
transactions distinguished in the system (that is, all flows excluding ‘other
changes in assets’). The main novelty refers to a new meaning that is
attached to the generation of income account, in order to facilitate a
linkage of detailed labour market analyses and the national accounts. The
aggregate SAM shown here is meant as a summary table, to which
subsequent, more detailed tables can refer. Possible types of classification
in each account are indicated in parentheses in the row and column
headings.
8.140. The sequence of accounts in this matrix is the same as in table 8.19.
Turning that matrix into the aggregate SAM presented here implies:
(a) deleting the other changes in assets account, the opening balance sheet,
the changes in balance sheets account, the closing balance sheet and the
net worth account, both for the total economy and for the rest of the
world, and deleting the external financial account;
(b) subdividing the primary distribution of income account and the second
capital sub-account; and
(c) combining both capital sub-accounts (excluding fixed capital forma-
tion) and combining the external account of goods and services and the
external account of primary incomes and current transfers.
8.141. The first two rows and columns of table 8.20 contain an aggregated
version of the supply and use table, here explicitly linked up with the
other accounts of the system. Note that rows and columns of the supply
table (cell II,I) have been transposed.
8.142. The third account records the generation of income and plays an important
role. It is classified by primary input category: (1) compensation of
various types of employees, (2) other taxes less subsidies on production,
(3) net operating surplus and (4) net mixed income.
8.143. Here, this account accommodates transactions between two different types
of units. In particular, this refers to compensation of employees, which is
recorded as a transaction (work in return for compensation) between an
institutional unit (employer) and a person (employee). In this SAM,
employed persons are considered as separate units who receive
compensation of employees in the generation of income account aand
distribute this income to their household in the allocation of primary
income account. These units are subsequently classified into groups of
(self-)employed persons. This representation serves to integrate labour
market analyses and the national accounts.
8.144. The (residual) mixed income and operating surplus remain with the
producing unit, but the classification of producing units need not be the
same as in the production account. In effect, some classification by
institutional subsector is particularly relevant to operating surplus and
mixed income. This implies a cross-classification of these value added
components by industry and institutional subsector in the SAM.
8.145. As the balancing item in cell (III,II) equals total domestic value added, the
primary input categories encompass all persons employed in resident
enterprises. In colum III, compensation of non-resident persons employed
in resident enterprises is then handed over to the rest of the world. A
meaningful, national balancing item is only obtained in account III if
compensation of resident persons employed in non-resident enterprises is
added first. This is done in row III and for this purpose a separate
category, resident persons employed in non-resident enterprises, may be
created. An additional advantage of inserting this category is that it
facilitates the estimation of employment as conventionally defined.
8.146. The result of all this is that the generation of income account is closed
with a new balancing item (1 473), in between the total net value added
and NNI. This balancing item, named total net generated income, at basic
prices, gives total income earned by resident institutional units as a result
of being engaged in production.
8.147. The allocation of primary income account of a detailed SAM presents
household labour income(s) as a contribution by one or more (self)-1996R2223 — EN — 07.08.2003 — 008.001 — 276
▼B
employed household members. Among other things, this will indicate to
what extent each household group depends on multiple sources of (labour)
income. Apart from this, the transaction categories in the distribution and
use of income accounts are the same as in the previous table.
8.148. In the design of this SAM, the capital and financial accounts have been
interlaced, with the financial account classified not by institutional sector
but by type of financial asset. As a consequence, a disaggregation of this
SAM would show, by institutional subsector, both acquisitions less
disposals of various types of financial assets, see cell (IX,VII), and
incurrence less repayment of various types of liabilities, see cell (VII,IX).
These two categories of transactions have been combined as far as the rest
of the world is involved. This serves to include the balancing item net
lending in table 8.20, though with a reverse sign when viewed from the
standpoint of the national economy (cell IX,XI).
8.149. A large part of total volume changes in net worth probably consists of
increases in fixed assets. If one is particularly interested in the dynamics
of an economy, it is important to show in which industries production
capacity has been expanded. This is the aim of the fixed capital formation
account (account VIII) inserted in this SAM. A more detailed table would
then present:
(a) who invests where in the rows of this account — cell (VIII,VII); and
(b) where does one invest in what in the columns — cell (I,VII).
In this case, the who refers to an institutional subsector, the where refers
to an industry, and the what refers to a product group. Through this fixed
capital formation account the SAM shows at a meso-level the linkages
which exist between fixed capital formation by institutional sector, as
presented in the capital account, and fixed capital formation by product
group, as contained in the supply and use tables.
8.150. Table 8.21 serves to illustrate what kind of information can be derived
from a more detailed SAM. Its main purpose is to show:
(a) the circular flow of income, including a subdivision of labour income
by a few categories of employed persons; this enables a more detailed
analysis of the linkage between value added of industries and primary
income of household subgroups;
(b) the interdependence between the distribution of income and the
structure of production; among other things, this is related to diverging
demand patterns of various household subgroups;
(c) the subsectoral allocation of saving, including a subdivision of fixed
capital formation by investing industry; this enables a more detailed
analysis of the linkage between fixed capital formation of subsectors
and fixed capital formation by product group.
For purposes of presentation, the number of groups in each account is kept
to a minimum. Obviously, a fully-fledged SAM should distinguish more
categories per account.
8.151. As a SAM integrates both income and expenditure flows and the supply
and use tables at a meso-level, it may serve as a format for the estimation
of a wide set of accounts. The SAM approach is particularly useful if one
wants to reconcile detailed information on, for example, production and
international trade with basic data from, for example, a labour force
survey, a household budget survey and an investment survey for
industries. In addition, casting accounts into a SAM framework implies
that matrix algebra can be applied to balance them.
8.152. Integration of more basic data entails the possibility of more policy issues
being monitored, and analysed and interrelated. Above all, the linkage of
employment and income distribution aspects to more macro-oriented
objectives such as NDP growth, balance of payments equilibrium, stable
price levels, etc. comes within reach with a SAM. In addition, the SAM
provides a framework and consistent (base-year) data for economy-wide
(general equilibrium) models with detailed classifications of actors,
including industries, labour types and household subgroups.
8.153. Table 8.22 shows part of the information contained in a fully-fledged
SAM. It looks at total net value added, i.e. cell (3,2) of the aggregate table
8.20, through a magnifying glass. To facilitate cross-reference with the
supply and use table, industries are only classified by NACE rev. 1
sections. Male and female labour incomes are broken down by category of
occupation and place of residence of the employed person. Net operating
surplus is shown according to the (sub)sector of the enterprise to which
the establishment belongs, and net mixed income according to the location
of the household enterprise. In this example, mixed income still includes1996R2223 — EN — 07.08.2003 — 008.001 — 277
▼B
an imputed remuneration for the labour of the self-employed. Obviously,
the figures in this table add up to the concomitant totals shown in tables
8.20 and 8.21. For instance, total net value added appears in the bottom
right-hand corner.
8.154. The additional insights which can be obtained from such a table include
the following:
(a) the share of female labour income by industry and region;
(b) the degree of concentration of female labour income in a certain
occupational category, by industry and region;
(c) the composition of labour income by occupation in each industry and
region, for both sexes;
(d) the regional split of mixed income by industry;
(e) the weight of public enterprise and foreign-controlled corporations in
the operating surplus of each industry.
8.155. In this table, the detailed information on compensation of employees
comes from labour statistics; its integration into a national accounts
framework will improve the relevance as well as the reliability of both this
source and the national accounts.
Labour incomes as presented in this table can be decomposed into a
volume and a price component by labour type and industry: full-timeequivalent employment and (weighted, full-time equivalent) wage rates,
respectively. Apart from that, a fully-fledged SAM also contains a table
showing the allocation of these labour incomes and the concomitant
employment to household groups. Similar transactions might be shown for
imputed labour income of the self-employed.
A data set which contains an estimate of imputed labour income of the
self-employed person units as well as a split of all labour income into a
volume and a price component yields detailed labour data which are quite
useful for all kinds of analysis and which are directly linked to all
important macro-economic aggregates, including employment (that is, the
total number of employed person units) and full-time equivalent
employment (that is, total labour input volume).1996R2223 — EN — 07.08.2003 — 008.001 — 278
Table 8.20 — Schematic presentation of a social accounting matrix
ACCOUNT0. Goods and
services
(products)TOTAL ECONOMY REST OF THE WORLD
TOTALI. Production
(industries)II.1.1 Genera-
tion of income
(primary input
categories)II.1 Allocation
of primary
income (insti-
tutional
sectors)II.2 Secondary
distribution of
income (insti-
tutional
sectors)II.4 Use of
disposable
income (insti-
tutional
sectors)Capital (insti-
tutional
sectors)Gross fixed
capital forma-
tion (indus-
tries)III.2 Financial
(financial
assets)Current Capital
I = 1 II = 2 III = 3a IV = 3b V = 4 VI = 5 VII = 6/7a VIII = 7b IX = 8 X = 14/15 XI = 16/17
0. Goods and
services
(product)I = 1 Trade and
transport
marginsInter-
mediate
consump-
tionFinal
consump-
tionChanges in
inven-
tories (1)Gross fixed
capital
formationExports of
goods and
services
0 1 904 1 371 38 376 536 4 225
T
O
T
A
L
E
C
O
N
O
M
YI. Produc-
tion (indus-
tries)II = 2 Output
3 595 3 595
II.1.1
Generation
of income
(primary
input cate-
gories)III = 3a NET
VALUE
ADDED
(BASIC
PRICES)Compensa-
tion of
employees
from the
rest of the
world
1 469 6 1 475
II.1.2 Allo-
cation of
primary
income
(institu-
tional
sectors)IV = 3b Taxes less
subsidies on
productsGENER-
ATED
INCOME,
NET
(BASIC
PRICES)Property
incomeProperty
income and
taxes less
subsidies on
production
from the
rest of the
world
133 1 473 341 66 2 013
II.2
Secondary
distribution
of income
(institu-
tional
sectors)V = 4 NATIO-
NAL
INCOME,
NETCurrent
transfersCurrent
transfers
from the
rest of the
world
1 633 1 096 10 2 739▼B1996R2223 — EN — 07.08.2003 — 008.001 — 279
ACCOUNT0. Goods and
services
(products)TOTAL ECONOMY REST OF THE WORLD
TOTALI. Production
(industries)II.1.1 Genera-
tion of income
(primary input
categories)II.1 Allocation
of primary
income (insti-
tutional
sectors)II.2 Secondary
distribution of
income (insti-
tutional
sectors)II.4 Use of
disposable
income (insti-
tutional
sectors)Capital (insti-
tutional
sectors)Gross fixed
capital forma-
tion (indus-
tries)III.2 Financial
(financial
assets)Current Capital
I = 1 II = 2 III = 3a IV = 3b V = 4 VI = 5 VII = 6/7a VIII = 7b IX = 8 X = 14/15 XI = 16/17
T
O
T
A
L
E
C
O
N
O
M
YII.4 Use of
disposable
income
(institu-
tional
sectors)VI = 5 DISPO-
SABLE
INCOME,
NETAdjustment
for the
change in
net equity
of house-
holds on
pension
fundsAdjustment
for the
change in
net equity
of house-
holds on
pension
funds from
the rest of
the world
1 604 11 0 1 615
Capital
(institu-
tional
sectors)VII = 6/7a SAVING,
NETCapital
transfers (2)Net incur-
rence of
liabilitiesCapital
transfers
from the
rest of the
world (2)
233 61 603 1 898
Gross fixed
capital
formation
(industries)VIII = 7b Consump-
tion of fixed
capitalNet fixed
capital
formation
222 154 376
III.2 Finan-
cial (finan-
cial assets)IX = 8 Net acquisi-
tions of
financial
assetsNET
LENDING
OF THE
REST OF
THE
WORLD
641 − 38 603▼B1996R2223 — EN — 07.08.2003 — 008.001 — 280
ACCOUNT0. Goods and
services
(products)TOTAL ECONOMY REST OF THE WORLD
TOTALI. Production
(industries)II.1.1 Genera-
tion of income
(primary input
categories)II.1 Allocation
of primary
income (insti-
tutional
sectors)II.2 Secondary
distribution of
income (insti-
tutional
sectors)II.4 Use of
disposable
income (insti-
tutional
sectors)Capital (insti-
tutional
sectors)Gross fixed
capital forma-
tion (indus-
tries)III.2 Financial
(financial
assets)Current Capital
I = 1 II = 2 III = 3a IV = 3b V = 4 VI = 5 VII = 6/7a VIII = 7b IX = 8 X = 14/15 XI = 16/17
R
O
WCurrent X = 14/15 Imports of
goods and
servicesCompensa-
tion of
employees
to the rest
of the worldProperty
income and
taxes less
subsidies on
production
to the rest
of the worldCurrent
transfers to
the rest of
the worldAdjustment
for the
change in
net equity
of house-
holds on
pension
funds to the
rest of the
world
497 2 39 39 0 577
Capital XI = 16/17 Capital
transfers to
the rest of
the worldCURRENT
EXTER-
NAL
BALANCE
4 − 41 − 37
TOTAL 4 225 3 595 1 475 2 013 2 739 1 615 898 376 603 577 − 37
(1) Including acquisitions less disposals of valuables.
(2) Including acquisitions less disposals of non-financial assets.▼B1996R2223 — EN — 07.08.2003 — 008.001 — 281
Table 8.21 — Example of a more detailed social accounting matrix
ACCOUNT 0. Goods and services
(products)TOTAL ECONOMY ROW TOTAL
I. Production
(industries)II.1.1. Generation of income
(primary input categories)II.1. Allocation of primary income
(institutional sectors)II.2. Secondary distribution of income
(institutional sectors)II.4. Use of disposable income
(institutional sectors)Capital
(institutional sectors)Gross fixed capital formation
(industries)III.2. Financial
(financial assets)Current Capital
Ia Ib Ic IIa IIb IIc IIIa IIIb IIIc IIId IIIe IIIf IIIg IVa IVb IVc IVd Va Vb Vc Vd VIa VIb VIc VId VIIa VIIb VIIc VIId VIIIa VIIIb VIIIc IXa IXb IXc X XI
0. Goods and services
(products)Agriculture, forestry and fishery products (0) Ia 3 71 14 16 12 - 2 - 1 - - 2 - - 7 128
Ores and minerals, electricity, manufacturing
and construction (1-5)Ib 36 969 246 339 269 - 3 2 4 28 3 9 109 233 435 2 685
Services (6-9) Ic 2 76 − 78 7 209 349 208 152 13 357 - - - - - 23 - 94 1 412
T
O
T
A
L
E
C
O
NO
M
YI. Production
(industries)Agriculture, hunting, forestry and fishing (A-B) IIa 87 2 - 89
Mining, manufacturing, electricity and
construction (C-F)IIb - 2 112 11 2 123
Services (G-P) IIc - 39 1 344 1 383
II.1.1.
Generation ofincome
(primary
input cate-gories)Compensation
of employeesDomestic Resident male IIIa 8 311 153 472
Resident
femaleIIIb 1 95 192 288
Non-residents IIIc - 1 1 2
Residents abroad IIId 66
Other taxes less subsidies on production IIIe − 2 49 11 58
Operating surplus, net IIIf 11 64 142 217
Mixed income, net IIIg 14 262 156 432
II.1.2. Alloca-
tion ofprimary
income (insti-
tutionalsectors)Households, employees IVa 452 278 - 6 - - 16 - - 15 11 - 778
Households, other IVb 20 10 - - - 60 416 - - 52 24 32 614
Corporations and NPISHs IVc - - - - - 141 - 3 28 174 11 27 384
General government IVd 2 111 20 - - - - 58 16 - - - 23 - 7 237
II.2.
Secondary
distribution of
income(institutional
sectors)Households, employees Va 771 - - 56 197 - 1 024
Households, other Vb 577 - - 23 92 - 692
Corporations and NPISHs Vc 94 58 59 16 12 4 243
General government Vd 191 320 134 37 92 6 780
II.4. Use of
disposableincome (insti-tutional
sectors)Households, employees VIa 646 - - 2 - - 648
Households, other VIb 499 - - 9 - - 508
Corporations and NPISHs VIc 107 - - - - - 107
General government VId 352 - - - - - 352
Capital
(institutional
sectors)Households, employees VIIa 85 - - - - - - 1 - 86
Households, other VIIb 75 - - 16 7 - 28 4 - 130
Corporations and NPISHs VIIc 83 - 4 4 25 130 95 175 - 516
General government VIId − 10 1 4 - - 2 94 74 1 166▼B1996R2223 — EN — 07.08.2003 — 008.001 — 282
ACCOUNT 0. Goods and services
(products)TOTAL ECONOMY ROW TOTAL
I. Production
(industries)II.1.1. Generation of income
(primary input categories)II.1. Allocation of primary income
(institutional sectors)II.2. Secondary distribution of income
(institutional sectors)II.4. Use of disposable income
(institutional sectors)Capital
(institutional sectors)Gross fixed capital formation
(industries)III.2. Financial
(financial assets)Current Capital
Ia Ib Ic IIa IIb IIc IIIa IIIb IIIc IIId IIIe IIIf IIIg IVa IVb IVc IVd Va Vb Vc Vd VIa VIb VIc VId VIIa VIIb VIIc VIId VIIIa VIIIb VIIIc IXa IXb IXc X XI
Gross fixed
capital forma-tion(industries)Agriculture, hunting, forestry and fishing (A-B) VIIIa 11 -- - - 1 1
Mining, manufacturing, electricity and
construction (C-F)VIIIb 92 - 4 36 - 132
Services (G-P) VIIIc 119 1 14 92 7 233
III.2. Finan-
cial
(financialassets)Currency and deposits IXa 56 12 44 7 13 132
Loans IXb - 5 194 45 − 27 217
Other financial assets IXc 26 82 102 68 − 24 254
ROW Current X 37 345 115 2 4 9 26 - - - 4 35 - - - - 577
Capital XI -- - 4 − 4 1 − 3 7
TOTAL 128 2 685 1 412 89 2 123 1 383 472 288 2 6 58 217 432 778 614 384 237 1 024 692 243 780 648 508 107 352 86 130 516 166 11 132 233 132 217 254 577 − 37▼B1996R2223 — EN — 07.08.2003 — 008.001 — 283
Table 8.22 — Example of a detailed submatrix: net value added (basic prices)
(Table 8.20, cell 3,2)INDUSTRIES (by NACE-sections) Total
Agricul-
ture,
hunting
and
forestryFishing Mining
and quar-
ryingManufac-
turingElectri-
city, gas
and water
supplyConstruc-
tionWhole-
sale, retail
trade,
repair of
motor
vehicles
house-
holds
goodsHotels and
restau-
rantsTransport,
storage,
communi-
cationFinancial
interme-
diationReal
estate,
renting
and busi-
ness
servicesPublic
adminis-
tration,
defence
and
compul-
sory social
securityEducation Health
and social
workOther
commu-
nity
social,
personal
servicesFinancial
intermedi-
tation
services
indirectly
measured
IIa1 IIa2 IIb1 IIb2 IIb3 IIb4 IIc1 IIc2 IIc3 IIc4 IIc5 IIc6 IIc7 IIc8 IIc9 IIc10 II
Compe-
nsationofemploy-ees
D
O
M
E
S
T
I
CResident
maleAgricultural Rural IIIa1 6,2 0,5 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,1 0,0 0,0 0,0 6,8
Urban IIIa2 0,2 0,2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,1 0,0 0,0 0,0 0,5
Manual Rural IIIa3 0,2 0,0 3,2 21,1 0,6 12,4 1,9 0,1 2,8 0,6 0,1 0,2 0,8 0,2 1,8 46,0
Urban IIIa4 0,0 0,0 1,8 105,3 9,8 27,4 4,0 0,4 7,9 1,5 0,4 0,9 1,0 0,8 4,7 165,9
Clerical, sales, service Rural IIIa5 0,2 0,0 0,5 5,9 0,0 0,9 3,0 0,2 0,5 3,7 0,6 1,5 0,6 0,0 2,4 20,0
Urban IIIa6 0,0 0,1 1,5 35,6 2,1 3,7 6,6 0,5 1,8 6,9 3,0 5,8 0,6 0,4 7,3 75,9
Professional, managerial, etc. Rural IIIa7 0,1 0,0 1,7 17,7 0,2 2,6 0,7 0,2 0,3 1,8 1,3 2,7 14,0 1,0 1,8 46,1
Urban IIIa8 0,0 0,0 2,5 47,7 2,7 4,4 1,3 0,4 1,0 5,6 5,9 10,6 20,1 4,1 4,7 111,0
Resident
femaleAgricultural Rural IIIb1 1,0 0,1 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 1,1
Urban IIIb2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0
Manual Rural IIIb3 0,0 0,0 0,0 5,7 0,0 0,0 0,1 0,1 0,0 0,1 0,0 0,1 0,4 0,2 0,8 7,5
Urban IIIb4 0,0 0,0 0,0 13,6 0,0 0,1 0,2 0,2 0,1 0,3 0,2 0,3 0,4 0,8 2,6 18,8
Clerical, sales, service Rural IIIb5 0,0 0,0 0,4 5,6 0,1 1,3 6,2 0,6 0,4 1,6 0,8 1,8 4,3 0,6 24,2 47,8
Urban IIIb6 0,0 0,0 1,2 49,6 2,9 4,6 14,3 2,5 1,0 8,8 4,7 9,0 4,9 2,0 36,6 142,1
Professional, managerial, etc. Rural IIIb7 0,0 0,0 0,0 1,3 0,0 0,1 0,2 0,0 0,0 1,0 0,3 0,9 9,3 2,4 5,5 21,0
Urban IIIb8 0,0 0,0 0,1 7,3 0,1 0,3 0,3 0,1 0,0 3,6 1,1 4,8 10,6 9,8 11,2 49,3
Non-resident employees IIIc 0,1 0,1 0,1 0,9 0,0 0,2 0,2 0,0 0,1 0,0 0,0 0,3 0,0 0,0 0,0 2,0
Residents in non-resident enterprises IIId
Other taxes less subsidies on production IIIe − 2,0 0,0 − 2,0 41,1 4,9 5,0 0,0 0,0 − 6,0 8,3 3,7 1,0 0,0 0,0 4,0 58,0▼B1996R2223 — EN — 07.08.2003 — 008.001 — 284
(Table 8.20, cell 3,2)INDUSTRIES (by NACE-sections) Total
Agricul-
ture,
hunting
and
forestryFishing Mining
and quar-
ryingManufac-
turingElectri-
city, gas
and water
supplyConstruc-
tionWhole-
sale, retail
trade,
repair of
motor
vehicles
house-
holds
goodsHotels and
restau-
rantsTransport,
storage,
communi-
cationFinancial
interme-
diationReal
estate,
renting
and busi-
ness
servicesPublic
adminis-
tration,
defence
and
compul-
sory social
securityEducation Health
and social
workOther
commu-
nity
social,
personal
servicesFinancial
intermedi-
tation
services
indirectlymeasured
IIa1 IIa2 IIb1 IIb2 IIb3 IIb4 IIc1 IIc2 IIc3 IIc4 IIc5 IIc6 IIc7 IIc8 IIc9 IIc10 II
Operating
surplus, netHouseholds (owner-occupied housing) IIIf1 60,0 60,0
NPISHd and government unincorporated enterprises IIIf2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 21,0 21,0
Corpora-
tionsPublic IIIf3 0,1 0,0 2,7 8,0 9,0 1,1 − 12,1 0,1 3,6 1,5 1,0 0,0 6,2 10,1 − 5,0 26,3
National private IIIf4 10,7 0,2 0,4 13,0 0,1 21,9 6,0 2,7 7,1 14,8 49,0 0,0 1,3 11,5 − 35,0 103,7Foreign IIIf5 0,0 0,0 1,4 6,0 0,0 0,4 0,5 0,3 1,8 2,2 1,5 0,0 0,0 0,0 − 8,0 6,1
Mixed income, net Rural IIIg1 12,3 1,4 0,0 65,4 0,0 9,4 10,7 0,5 0,5 3,0 32,9 0,0 0,0 3,4 2,1 141,6
Urban IIIg2 0,2 0,2 0,0 161,6 0,0 25,6 20,4 4,3 2,5 2,0 61,1 0,0 0,0 7,6 4,9 290,4
Subtotals:
Compensation of employees (paid by resident production) 8,0 1,0 13,0 317,3 18,5 58,0 39,0 5,3 15,9 35,5 18,4 39,1 67,0 22,3 103,6 761,8— Resident male IIIa 6,9 0,8 11,1 233,3 15,4 51,4 17,5 1,8 14,3 20,1 11,3 21,9 37,1 6,5 22,7 472,2— Resident female IIIb 1,0 0,1 1,7 83,1 3,0 6,4 21,3 3,5 1,5 15,4 7,1 16,9 29,9 15,8 80,9 287,6
— Non-resident IIIc 0,1 0,1 0,1 0,9 0,0 0,2 0,2 0,0 0,1 0,0 0,0 0,3 0,0 0,0 0,0 2,0
Mixed income and operating surplus 23,2 1,8 4,5 254,0 9,1 58,4 25,5 8,0 15,5 23,5 205,5 0,0 0,0 18,5 49,6 − 48,0 649,1— Operating surplus, net IIIf 10,8 0,2 4,5 27,0 9,1 23,4 − 5,6 3,1 12,5 18,5 111,5 0,0 0,0 7,5 42,6 − 48,0 217,1— Mixed income, net IIIg 12,4 1,6 0,0 227,0 0,0 35,0 31,1 4,9 3,0 5,0 94,0 0,0 0,0 11,0 7,0 432,0
Total net value added III 29,2 2,8 15,5 612,4 32,5 121,4 64,5 13,3 25,4 67,3 227,6 40,1 67,0 40,8 157,2 − 48,0 1 468,9▼B1996R2223 — EN — 07.08.2003 — 008.001 — 285
▼B
CHAPTER 9
INPUT-OUTPUT FRAMEWORK
9.01. The input-output framework consists of three types of tables:
(a) supply and use tables;
(b) tables linking the supply and use tables to the sector accounts;
(c) symmetric input-output tables.
9.02. Supply and use tables are matrices by industry and product describing the
domestic production processes and the transactions in products of the
national economy in great detail. These tables show:
(a) the structure of the costs of production and the income generated in
the production process;
(b) the flows of goods and services produced within the national
economy;
(c) the flows of goods and services with the rest of the world.
9.03. A supply table shows the supply of goods and services by product and by
type of supplier, distinguishing output by domestic industries and imports.
A simplified example of a supply table is given in table 9.1.
Table 9.1 — A simplified supply table
SuppliesIndustries Rest of the World Total
(1) (2) (3)
Products (1) Output by product
and by industryImports by product Total supply by
product
Total (2) Total output by
industryTotal imports Total supply
9.04. A use table shows the use of goods and services by product and by type of
use, i.e. as intermediate consumption (by industry), final consumption,
gross capital formation or exports. Furthermore, the table shows the
components of gross value added, i.e. compensation of employees, other
taxes less subsidies on production, net mixed income, net operating
surplus and consumption of fixed capital. A simplified example of a use
table is given in table 9.2.
Table 9.2 — A simplified use table
UsesIndustries ROWFinal
consumptionGross capital
formationTotal
(1) (2) (3) (4) (5)
Products (1) Inter-
mediate
consump-
tion by
product
and by
industryExports Final
consump-
tion
expendi-
tureGross
capital
formationTotal use
by
product
Components of
value added(2) Value
added by
compo-
nent and
by
industry
Total (3) Total
inputs by
industry1996R2223 — EN — 07.08.2003 — 008.001 — 286
▼B
9.05. Between the supply and use tables, two types of identities hold good
(provided supplies and uses are valued consistently, see tables 9.5 and
9.6):
(a) the identity by industry: Output by industry = Input by industry. In
terms of our simplified supply and use table, this indicates that the
row vector in cell (2,1) in table 9.1 should be equal to that in cell (3,1)
in table 9.2.
So, for each industry:Output = Intermediate consumption + Value added;
(b) the identity by product: Total supply by product = Total use by
product.
In terms of our simplified tables, the column vector in cell (1,3) of
table 9.1 should be equal to the column vector in cell (1,5) of table
9.2.
So, for each product:Output + Imports = Intermediate consumption + Exports + Final
consumption expenditure + Gross capital formation.
These identities by industry and product can be used to check and improve
the consistency and completeness of estimates (see paragraph 9.11).
9.06. Supply and use tables are the central framework for all tables by industry,
e.g. those on employment, gross fixed capital formation and capital stock.
9.07. The supply and use tables contain all the flows in the following accounts:
(a) the goods and services account;
(b) the production account;
(c) the generation of income account.
9.08. A supply table and a use table can also be combined and presented as a
single table. This can be achieved by adding two rows and a column to the
table, for output and imports (see table 9.3). Note that the rows and
columns from the supply table presented in paragraph 9.03 have been
transposed here.
Table 9.3 — A simplified combined supply and use table
Products Industries ROWFinal
consump-
tionGross
capital
formationTotal
(1) (2) (3) (4) (5) (6)
Products (1) — Inter-
mediate
consu-
mptionExports Final
consu-
mption
expen-
ditureGross
capital
forma-
tionTotal
use by
product
Industries (2) Output — — — — Total
output
by
industr-
y
Components of
value added(3) — Value
added
ROW (4) Imports —
Total (5) Total
supply
by
productTotal
inputs
by
industr-
y
9.09. A symmetric input-output table is a product by product or industry by
industry matrix describing the domestic production processes and the
transactions in products of the national economy in great detail. A
symmetric input-output table rearranges both supply and use in a single
table. There is one major conceptual difference between a symmetric1996R2223 — EN — 07.08.2003 — 008.001 — 287
▼B
input-output table and a combined supply and use table: in the supply and
use table, the statistics relate products to industries, while in the
symmetric input-output table the statistics relate products to products or
industries to industries. So, in a symmetric input-output table either a
product or an industry classification is employed for both rows and
columns (see table 9.4).
Table 9.4 — A simplified symmetric input-output table (product by product)
Products ROWFinal
consumption
expenditureGross capital
formationTotal
(1) (2) (3) (4) (5)
Products (1) Inter-
mediate
consump-
tionExports Final
consump-
tion
expendi-
tureGross
capital
formationTotal use
by product
Components of
value added(2) Value
added————
ROW (3) Imports — — — —
Total (3) Total
supply by
product— — — Total
supply = To-
tal use
9.10. Most statistical information that can be obtained from producer units
indicates what type of products they have produced/sold and, usually less
detailed, what type of products they have bought/used. The format of the
supply and use tables is designed to fit in with this type of statistical
information (i.e. industry by product). By contrast, information of a
product by product or industry by industry nature as required by the
symmetric input-output table is not often available. For example, surveys
of industries usually provide information about the type of products used
and about the products produced. However, information on the inputs in
terms of products and value added components for each product produced
is usually not collectable. Ideally, the administration of an enterprise
should show all costs allocated to the various types of output and,
simultaneously, show the composition of intermediate consumption by
type of product. In practice, information arranged in the form of supply
and use tables is therefore a practical starting point for constructing the
more analytic information in the symmetric input-output tables. The
industry by product information in the supply and use tables can be
converted into product by product or industry by industry statistics by
adding extra statistical information on the input structures, or by assuming
constant input structures by product or by industry (see paragraphs
9.54—9.60).
9.11. The supply and use tables serve both statistical and analytical purposes.
Important statistical purposes are:
(a) identifying gaps and inconsistencies in basic data sources;
(b) weighting and calculation of index numbers and price and volume
measures;
(c) making estimates by residual (estimating a variable by first estimating
all other variables in the identity), e.g. for the production or final
consumption of specific products;
(d) checking and improving the consistency, plausibility and complete-
ness of figures in the supply and use tables and the derived figures
(such as those in the production accounts). To this end, the balancing
process should not be limited to the supply and use tables at current
prices:
1. by compiling supply and use tables at current and constant prices
for two or more years, estimates of changes in volumes, values and
prices can be balanced simultaneously: compared to integrating
supply and use tables for a single year in isolation, this is a major
extension of the effectiveness of the integration framework;1996R2223 — EN — 07.08.2003 — 008.001 — 288
▼B
2. with the aid of the tables showing the linkage with the sector
accounts, a direct comparison can be made with information from
the latter, e.g. information on the distribution of income, on saving
and on net lending (calculated as the result of financial
transactions). This at least guarantees that, after the balancing
process, consistency is obtained between the supply and use tables
and the sector accounts;
3. trying to derive symmetric input-output tables from the supply and
use tables may reveal inconsistencies and weaknesses in the supply
and use tables. In this respect, there is therefore also a feedback
from the symmetric input-output tables to the supply and use
tables;
(e) estimating figures for periods on which less reliable information is
available, e.g. estimating annual figures on the basis of the detailed
supply and use figures for a benchmark year or estimating quarterly
figures on the basis of annual supply and use tables.
9.12. The supply and use tables and symmetric input-output tables give a
detailed picture of the composition of the supply and use of goods,
services and labour and the primary incomes involved. These tables and
the ratios that can be derived from them, such as productivity figures, are
an important subject for economic analysis.
9.13. The supply and use tables and symmetric input-output tables can also be
used as tools of economic analysis. Both types of tables have different
merits. For calculating direct and indirect effects, the supply and use
tables need to be accommodated with specific assumptions or extra
statistical information. For calculating cumulative effects, these assump-
tions and extra data requirements are the strongest. In fact, the
requirements for calculating cumulative effects with a supply and use
table amount to constructing a symmetric input-output table. Therefore,
for calculating cumulative effects, the symmetric input-output table is the
preferable tool. However, for calculating direct effects and first-order
effects, the supply and use tables adjusted with a selected amount of
assumptions (or extra statistical information) is in general to be preferred,
because:
(a) the calculation is less dependent on assumptions;
(b) the supply and use table provides more detail than the symmetric
input-output table;
(c) the information in the supply and use table can be better linked to
other types of statistical data.
These features are also helpful when the supply and use tables are
integrated in a macro-economic model: the resulting overall model is
closer to real statistics, can show a lot of detail and can relatively easily be
linked to areas on which other statistical data are available, e.g. on the
labour market or the environment.
9.14. The supply and use tables and symmetric input-output tables can be used
to calculate:
(a) effects of changes in prices or tax rates on the values of supply or use;
(b) effects of changes in volumes on the values of supply or use;
(c) effects of changes in prices of supply on prices of use;
(d) effects of changes in the volume of use on the volume of supply;
(e) effects of changes in the volume of supply on the volume of use.
The calculations can show indirect as well as direct effects. For example,
a significant increase in energy prices will affect not only those industries
that use energy intensively, but also those industries that use the outputs of
the energy-intensive producers. With the aid of some assumptions,
estimates of the size of such indirect effects can be deduced from the
supply and use and symmetric input-output tables. Examples of common
assumptions are:
(a) a constant input structure in terms of values;
(b) a constant composition of the value of output by industry and by
product;
(c) a constant composition of the value of final consumption expenditure
of households by product.
These assumptions are rather rigid as they imply that relative prices do not
change, that the production processes remain technically the same and that
no substitution occurs between categories of final consumption expendi-
ture by households. However, these general assumptions can be modified1996R2223 — EN — 07.08.2003 — 008.001 — 289
▼B
by allowing first for changes in relative prices, e.g. the Leontief-price
model. This can then be extended with econometric or other estimates of
the influence of relative prices and other variables on technical
coefficients or final consumption expenditure by households.
The calculations need to be confined to the supply and use of goods and
services. They could also be applied to the supply and use of labour and
the components of value added.
9.15. The supply and use tables and the symmetric input-output table can be
integrated into macro-economic models to provide the latter with a
detailed meso-economic foundation. Specific types of analysis served by
supply and use tables and the symmetric input-output table are, for
example:
(a) analysis of production, cost structures and productivity
(b) analysis of prices;
(c) analysis of employment;
(d) analysis of the structure of capital formation, final consumption,
exports, etc.;
(e) analysis of the relationship between domestic production and the
environment (e.g. focusing on the use of specific products like fuel,
paper and glass);
(f) analysis of imports of energy required;
(g) impact analysis of new technologies;
(h) sensitivity analysis of the effects of changes in tax rates and
regulation.
SUPPLY AND USE TABLES
9.16. Tables 9.5 and 9.6 show the supply and use tables in more detail.
9.17. The classification used for industries in the NACE rev. 1 and the
classification employed for products is the CPA; these classifications are
fully aligned to each other: at each level of aggregation, the CPA shows
the principal products of the industries according to the NACE rev. 1.
9.18. In the supply and use tables, the classification for products is at least as
detailed as the classification for industries, e.g. the three digit-level of the
CPA and the two digit-level of the NACE rev. 1.
9.19. The distinction between market output, output for own final use and other
non-market output is only to be used for the total output by industry; the
distinction is not required for each product group.
9.20. The distinction between market producers and producers for own final use
on the one hand and other non-market producers on the other hand should
only be used by industry when both types of producers are present within
one industry. In general, this distinction will therefore only be used for
subclassifying a very limited number of industries, e.g. health care and
education (see paragraph 3.66.).
9.21. Imports and exports should be subdivided into:
(a) intra-European Union deliveries;
(b) imports and exports with other countries.1996R2223 — EN — 07.08.2003 — 008.001 — 290
Table 9.5 — A supply table at basic prices, including a transformation into purchasers' prices
Industries (NACE)
1234……nΣ(1) Imports cifTotal supply at
basic pricesTrade and trans-
port marginsTaxes less subsi-
dies on productsTotal supply at
purchasers' prices
(1) (2) (3) (4) (5) (6) (7)
Products
(CPA)1
(1)Output by product and by industry at basic
prices2
3
4
.
..
.
.
.
m
(Adjustment items)
Σ(1) (2) Total output by industry 0
Total of which:
Market output
(3)For own final use 00
Other non-market output 00▼B1996R2223 — EN — 07.08.2003 — 008.001 — 291
Table 9.6 — A use table at purchasers' prices
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Intermediate consumption at
purchasers' prices by product and byindustryFinal uses at purchasers' prices/fob:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation
and valuables
(e) changes in inventories
(f) exports (fob)2
3
4
.
.
.
.
.
m
(Adjustment items)
Σ(1) (2) Total intermediate consumption by
industryTotal final uses by type Total use
Compensation of employees
Other net taxes on production (3) Components of value added by
industry
Consumption of fixed capital
Operating surplus, net
Σ(3) (4) Value added by industry
Σ(1) + Σ(3) (5) Output at basic prices by industry
Supplementary information:
Gross fixed capital formation
Stocks of fixed assetsLabour inputs(6)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 292
▼B
9.22. In the supply table, flows of goods and services are valued at basic prices.
In the use table, the flows of goods and services are valued at purchasers'
prices. In order to attain identities between supply and use, table 9.5 also
shows the transition of supply at basic prices to supply at purchasers'
prices. As supply should be equal to use, the table reveals also the
transition of uses at purchasers' prices to uses at basic prices. As a
consequence, two identities can be derived from this transition:
(a) supply at purchasers' prices is equal to use at purchasers' prices;
(b) supply at basic prices is equal to use at basic prices.
9.23. Value added is recorded at basic prices. It is the net result of output valued
at basic prices less intermediate consumption valued at purchasers' prices.
9.24. Value added at factor cost is not a concept in the ESA. Nevertheless, it
could be derived from value added at basic prices by subtracting other
taxes less subsidies on production.
9.25. GDP is valued at market prices. This aggregate can be derived from the
supply and use tables in three different ways:
(a) the aggregate of output at basic prices by industry minus the aggregate
of intermediate consumption at purchasers' prices by industry plus net
taxes on products (the production approach); the intermediate
consumption by industry includes the use of financial intermediation
services indirectly measured that are recorded in a nominal industry
(see paragraph 9.33);
(b) the aggregates of the various components of value added at basic
prices by industry minus the use of financial intermediation services
indirectly measured (recorded in a nominal industry, see paragraph
9.33) plus the net taxes on products (the income approach);
(c) the sum of final uses categories minus imports: exports −
imports + final consumption expenditure + gross capital formation
(all at purchasers' prices) (the expenditure approach).
9.26. The use table 9.6 also contains some supplementary information: gross
fixed capital formation, stocks of fixed asssets and labour inputs by
industry. This information is crucial for productivity analysis and may
also serve several other types of analyses, e.g. analysis of employment.
9.27. In the ESA, the stocks of fixed assets are valued at the market prices
prevailing on the data of the balance sheet. For fixed assets bought in
earlier years, this implies that consumption of fixed capital of theforegoing years is to be deducted from the current market prices of new
assets of the same type and quality. This net concept of fixed capital stock
could be used in calculating capital intensity. However, for productivity
analysis more often a specific gross concept of fixed capital stock is used.
According to this gross concept all fixed assets should be valued at the
current market prices of new assets of the same type and quality; no
deduction should be made for capital consumption in the last and earlier
years. This gross concept of fixed capital stock is not a standard concept
in the ESA, but can easily be calculated with the aid of the Perpetual
Inventory Method. Considering the great use of such gross figures, it is
recommended that both gross and net figures on fixed capital stock be
included as supplementary information.
9.28. For productivity analysis, hours worked is the preferable labour input
variable. In drawing inferences about employed persons, however, the
number of jobs may also be relevant. Both variables can be subclassified,
e.g. into the part pertaining to employees and to self-employed persons.
9.29. For a proper compilation and understanding of the supply and use tables,
it is important to recall some of the accounting conventions employed in
the ESA:
(a) the outputs of ancillary activities are not recorded separately; all the
inputs consumed by an ancillary activity are treated as inputs into the
principal or secondary activity which it supports. Ancillary activities
may be, for example, marketing, accounting, storage and cleaning (see
paragraphs 3.12 and 3.13);
(b) goods or services produced and consumed within the same accounting
period and within the same local KAU are not separately identified.
They are therefore not recorded as part of the output or intermediate
consumption of that local KAU. This may pertain for example to:
1. seeds and plans for sowing and planting;
2. hard coal consumed in the production of briquettes by coal mines;3. electrical energy consumed by power stations;1996R2223 — EN — 07.08.2003 — 008.001 — 293
▼B
(c) minor processing, maintenance, servicing or repair on behalf of other
local KAUs is to be recorded net, i.e. excluding the value of the goods
involved. By contrast, when the goods are subject to a substantial
physical change, the transaction should be recorded gross, i.e. as the
purchase and sale of the goods involved;
(d) durable goods can be rented or be subject to operating leasing. In such
instances, they are recorded as fixed capital formation and fixed
capital stock in their owner's industry; in the industry of the user
intermediate consumption by amount of the rent is recorded;
(e) persons working via temporary agencies are recorded as being
employed in the industry of these agencies and not the industries in
which they are actually working. As a consequence, in the latter
industries, the payments for these persons are recorded as inter-
mediate consumption and not as compensation of employees. Labour
contracted out is treated similarly;
(f) employment and compensation of employees in the ESA are broad
concepts:
1. employment for social reasons is also counted as employment; this
applies, for example, to work placements for disabled people,
employment projects for people who have been unemployed for a
long time and employment programmes for young people seeking
jobs. As a consequence, the people involved are employees and
receive compensation of employees (not social transfers), though
their productivity may be (much) lower than that of the other
employees;
2. employment includes also some cases in which the persons
involved are not expected to work at all, e.g. persons dismissed but
receiving for some period payments from their former employer.
However, labour input in terms of hours worked is not distorted by
this convention, as no hours are actually worked.
9.30. In the supply and use tables, two adjustment items should be introduced
for reconciling the valuation of imports in the supply and use tables and in
the sector accounts (see also tables 9.5 and 9.6).
In the supply table, imports of goods are valued at cif values. This is an
overstatement of the costs of imports when the transport and insurance
services incorporated in the cif value are provided by residents (e.g. own-
account transport or transport by specialized resident carriers). In order to
obtain the right balance between imports and exports, exports of services
should thus also be increased by amount of this overstatement of imports.
In the sector accounts, imports of goods are valued at fob values. This is
an overstatement of imports as in the case of cif valuation. However, in
the case of fob valuation the overstatement is smaller, which implies that
the imputed increase in exports is smaller too. The results of employing
different valuation principles is thus that net total imports are the same,
but that both total imports and total exports are larger for cif valuation.
The two valuation principles can be reconciled in the supply and use
tables by introducing adjustment items for imports as well as exports. The
adjustment items should be equal to the value of the transport and
insurance services by residents incorporated in the cif value but not in the
fob value, i.e. referring to the transport and insurance from the border of
the exporting country to the border of the importing country. These
adjustment items, once incorporated in the supply and use tables, need no
special treatment in the input-output calculations.
9.31. The transfer of existing goods is recorded in the use table as a negative
expenditure for the seller and a positive expenditure for the purchaser. For
the product group involved, the transfer of an existing good amounts to a
reclassification among uses. Only the transaction costs are not a
reclassification: they are recorded as a use of business or professional
services. For the purposes of description and analysis, it can be useful to
show for some product groups the relative size of the transfer of existing
goods separately, e.g. the importance of second-hand cars or the
importance of recycled paper.
9.32. Direct purchases abroad by residents and purchases on the domestic
territory by non-residents are commonly estimated as a special exercise in
the statistical compilation process. They are introduced as adjustments to
initial estimates of imports, exports and, by amount of the consumptionpart of the purchases abroad, final consumption expenditure. In order to
obtain a balance between supply and use by product, all these purchases
should be split over the various product groups involved. For the product
groups where these types of purchases are important, they could be shown
as a subcategory, e.g. expenditure on accommodation.1996R2223 — EN — 07.08.2003 — 008.001 — 294
▼B
9.33. Throughout the supply and use tables, the NACE rev. 1 industry
classification is extended with a nominal industry for the use of financial
intermediation services indirectly measured. In the supply table, no
transactions are recorded at all for this industry. In the use table, the total
use of financial intermediation services indirectly measured is recorded as
the intermediate consumption of this nominal industry. As this nominal
industry does not have any other transactions, its net operating surplus is
negative by the amount of its intermediate consumption; all other
components of its value added are zero. As a consequence, its total gross
value added is equal to its (negative) net operating surplus.
9.34. The transition from supply and use at basic prices to purchasers' prices
involves:
(a) reallocating trade margins;
(b) reallocating transport margins;
(c) adding taxes on products (except deductible VAT);
(d) deducting subsidies on products.
The estimation of this transition is an important part of the balancing
process. Separate tables can show the transition in more detail (see tables
9.7 and 9.8). These tables can also serve important analytical purposes,
e.g. analysis of prices and analysis of the consequences of changes in the
rates of taxes on products.
9.35. In general, when preparing supply and use tables and making the proper
balancing between the two sides, there is always a choice of emphasis
between two opposite ways of adjusting statistical data:
(a) supply of each product at basic prices could be adjusted to a
purchasers' price valuation to allow balancing with uses at purchasers'
prices;
(b) each of the uses at purchasers' prices could be adjusted to a basic
prices' valuation to match with supply at basic prices.
9.36. In practice, both types of balances may be needed to build up a supply and
use table. Both alternatives deal with or require similar kinds of
adjustments, i.e. for taxes less subsidies on products and trade and
transport margins by products. In fact, the first alternative is not possible
without the second, since it is usually not possible to know the columns of
taxes on products, subsidies on products and trade and transport margins
broken down by products in the supply table unless the distribution among
uses of the individual products is known from the use table at purchaser's
prices (table 9.6).
9.37. Thus, the following tables are involved in the balancing process:
(a) the supply and use tables 9.5 and 9.6 showing the final results of
balancing totals of supply and use by products at purchasers' prices
and at basic prices;
(b) the tables on trade and transport margins and on taxes less subsidies
on products (tables 9.7 and 9.8).
9.38. The transition of supply and use from basic prices to purchasers' prices
(see paragraph 9.34) amounts to reallocating trade margins: valuation at
basic prices implies that the trade margins are recorded as part of the
product trade, while valuation at purchasers' prices implies that the trade
margins are allocated to the products to which they pertain. An analogous
situation holds for transport margins.
9.39. The total of trade margins by product is equal to the total of trade margins
by the trade industries plus the secondary trade margins by other
industries. An analogous equation holds for the transport margins.1996R2223 — EN — 07.08.2003 — 008.001 — 295
Table 9.7 — A simple trade and transport margins table
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Trade and transport margins on inter-
mediate consumption by product and by
industryTrade and transport margins on final
uses:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation and
valuables
(e) changes in inventories
(f) exports2
3
.
.
.
.
.
.
m
Σ(1) (2) Trade and transport margins on inter-
mediate consumption by industryTrade and transport margins on final
uses by typeTotal trade and transport margins▼B1996R2223 — EN — 07.08.2003 — 008.001 — 296
Table 9.8 — A simple taxes less subsidies on products table
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Taxes less subsidies on products on
intermediate consumption by product
and by industryTaxes less subsidies on products for
final uses:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation and
valuables
(e) changes in inventories
(f) exports2
3
.
.
.
.
.
.
m
Σ(1) (2) Taxes less subsidies on products for
intermediate consumption by industryTaxes less subsidies on products for
final uses by typeTotal taxes less subsidies on products▼B1996R2223 — EN — 07.08.2003 — 008.001 — 297
▼B
9.40. The transport margins include transportation costs paid separately by the
purchasers and included in the use of products at purchasers' prices but not
in the basic prices of a manufacturers' output or in the trade margins of
wholesale or retail traders. Such transport margins include in particular:
(a) transport of goods from the place where it is manufactured to the
place where the purchaser takes delivery of it in case the manufacturer
pays a third party for the transport, if this amount is invoiced
separately to the purchaser;
(b) transport of goods arranged by the manufacturer or by the wholesale
or retail trader in such a way that the purchaser has to pay separately
for the transport costs even when the transport is done by the
manufacturer or the wholesale or retail trader himself.
All other costs of transporting goods are not recorded as transport
margins, e.g.:
(a) if the manufacturer transports the goods himself, these transportation
costs will be included in the basic prices of the manufacturer's output;
this transport represents an ancillary activity and the individual costs
of transport will be not identifiable as transportation costs;
(b) if the manufacturer arranges for the goods to be transported without a
separate invoice for the transport services, these transportation costs
will be included in the basic prices of the manufacturer's output; these
transportation costs will be identifiable as such and be recorded as
part of the manufacturer's intermediate consumption;
(c) if wholesale and retail traders arrange for goods to be moved from
where they take delivery of them to where another purchaser takes
delivery, these costs will be included in the trade margin if no separate
charge is made for transportation to the purchaser. Again, as with
manufacturers, these costs may represent ancillary activity of
wholesale and retail traders or the purchasers of an intermediate
service, thus entering trade margins but not transport margins;
(d) if a household buys goods for final consumption purposes and
arranges for transport by a third party, these transport costs are
recorded as final consumption expenditure on transport services and
not included in some trade or transport margin.
9.41. Table 9.7 shows a somewhat simplified picture of a trade and transport
margins matrix, because:
(a) no explicit distinction is made between trade and transport margins.
Both types of margins could be shown for each product group.
Another solution is to have separate tables: one for trade margins and
one for transport margins;
(b) for trade margins, a distinction between wholesale trade and retail
trade should be made in order to take account of the differences in
their prices. In drawing up the tables, it should be realized that
wholesale traders may also sell directly to households (e.g. furniture)
and that retail traders may also sell to industries (e.g. to cafes and
restaurants);
(c) in calculating and analysing trade margins on products for final
consumption expenditure by households, for each product group the
most important distribution channels could also be distinguished in
order to take account of the differences in their prices; the distinction
between wholesale trade and retail trade is in fact too rough. For
example, goods and services can be bought by households in the
supermarket, the grocery, flower shop, department store, abroad or
obtained as income in kind. Furthermore, for some products,
secondary sales may be very important, e.g. in the case of cigarettes
this can pertain to the sales by cafes, restaurants and petrol stations.
Of course, such more refined distinctions can only be introduced if the
available data sources provide sufficient information for at least rough
estimates of the importance of each of the distribution channels;
(d) in calculating transport margins, a distinction by type of transport (e.g.
by rail, air, sea/inland waterway or road) could be very useful.
9.42. Taxes on production and imports consist of:
(a) taxes on products (D.21):
1. value-added-type taxes (VAT) (D.211);
2. taxes and duties on imports; except VAT (D.212);3. taxes on products, except VAT and import taxes (D.214);
(b) other taxes on production (D.29).1996R2223 — EN — 07.08.2003 — 008.001 — 298
▼B
Similar categories are distinguished for subsidies on production and
imports. Subsidies are treated as if they were negative taxes on production
and imports.
The definitions of all these categories are given in paragraphs 4.14 to 4.39.
9.43. Supply at basic prices includes net other taxes on production, i.e. less
other subsidies on production. In order to make the transition from basic
prices to purchasers' prices (or vice versa; see paragraph 9.34), the various
taxes on products should be added and the subsidies on products should be
deducted (or vice versa).
9.44. VAT may be deductible, non-deductible or just not applicable:
(a) deductible VAT usually applies to most of intermediate consumption,
most of gross fixed capital formation and part of changes in
inventories;
(b) non-deductible VAT often applies to final consumption expenditure,
parts of gross fixed capital formation, part of changes in inventories
and part of intermediate consumption;
(c) VAT is in general not applicable for:
1. exports (at least those to countries outside the European Union);
2. any goods or services subject to a zero rate of VAT regardless of
their use;
3. any producers exempted from VAT registration, e.g. small
business and religious organizations.
9.45. VAT is recorded net in the ESA: all supplies are valued at basic prices, i.e.
excluding invoiced VAT; intermediate and final uses are recorded at
purchasers' prices, i.e. excluding deductible VAT.
9.46. Table 9.8 on taxes less subsidies on products is simplified, because:
(a) the different types of taxes on products are not distinguished and
subsidies are not shown separately;
(b) different tax rates and subsidies can apply to different distribution
channels; the latter should therefore also be distinguished when
relevant and sufficient information exists.
9.47.►M4 The way of recording taxes and subisidies on products is defined in
points 4.27 and 4.40 respectively. ◄Taxes (and subsidies) on products
are usually estimated by product by applying the official tax (subsidy)
rates to the various flows. Afterwards an analysis should be made of the
differences with the tax assessments or the amounts actually paid.
(a) Some of these differences indicate that the initial estimate of taxes on
products does not comply to the ESA definitions:
1. in case of exemption the initial estimate of taxes on products
should therefore be lowered;
2. in case of evasion of the payment of taxes on products (e.g. the
payment of taxes is compulsory but there is no tax assessment), the
estimate of taxes on products should therefore be lowered;
3. in case of fines the estimate of taxes on products should be
increased.
Changes in the estimates of taxes on products have concomitant effects on
variables estimated by adding up or deducting the estimates of taxes on
products. For example, output at basic prices of a specific product group
may be estimated by deducting inter alia taxes on products from the
estimated use at purchasers's prices. However, an estimate of output at
basic prices may also be combined with inter alia estimates of taxes on
products to arrive at an estimate of uses at purchasers' prices.
(b) Several other types of differences should not be accounted for in the
supply and use table:
1. differences in timing, e.g. payments may relate to tax assessments
of several years;
2. enterprises being unable to pay (bankruptcies)
►M4 ◄.
(c) In some instances, the differences may also indicate that the initial
estimate for taxes and subsidies on products is subject to serious error,
e.g. because the output of some product is underestimated. Then also
modifications of the estimates of the flows of goods and services can
be justified.1996R2223 — EN — 07.08.2003 — 008.001 — 299
▼B
In the transition from uses by product at purchasers' prices to basic prices,
the modification of the initial estimate of taxes and subsidies on products
may be shown as a separate item. However, for all input-output
calculations it will be necessary to allocate this modification by product,
even if this can only be based on a simple mathematical device, e.g.
proportional allocation.
9.48. The use table 9.6 does not show to what extent the goods and services
used have been produced domestically or imported. This information is
necessary for all analyses in which the link between supply and use of
goods and services within the national economy plays a role. A case in
point is the analysis of the impact of changes in exports or final
consumption expenditure on imports, domestic production and related
variables such as employment. In fact, it applies to most analyses
indicated in paragraphs 9.14 and 9.15. The input-output framework
therefore contains also a use table for imported products and one for
domestically produced goods and services (see tables 9.9 and 9.10).
9.49. The use table for imported products should be compiled by exploiting all
information available on the uses of imports, e.g. for some products the
major importing enterprises may be known and for some producers
information on the amount of imports may exist. However, in general,
direct statistical information on the use of imports in scarce. This
information has therefore usually to be supplemented by assumptions by
product group.
9.50. The use table for goods and services produced domestically can then be
obtained by deducting the use table for imported products from the
general use table.1996R2223 — EN — 07.08.2003 — 008.001 — 300
Table 9.9 — A use table for imports
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)For imported products: Intermediate
consumption at cif values by product
and by industryFor imported products: Final uses at cif
values:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation and
valuables
(e) changes in inventories
(f) exports2
3
.
.
.
.
.
m
Σ(1) (2) Total intermediate consumption of
imported products by industryTotal final uses of imported products by
typeTotal imports▼B1996R2223 — EN — 07.08.2003 — 008.001 — 301
Table 9.10 — A use table at basic prices for domestic output
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)For domestic output: Intermediate
consumption at basic prices by product
and by industryFor domestic output: Final uses at basic
prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation and
valuables
(e) changes in inventories
(f) exports2
3
.
.
.
.
.
m
Σ(1) (2) Total intermediate consumption of
domestic output at basic prices by
industryFinal use of domestic output at basic
pricesTotal domestic output
Use of imported products (3) Total intermediate consumption of
imported products by industryFinal use of imported products at basic
pricesTotal imports
Net taxes on products (4) Net taxes on products for intermediate
consumption by industryNet taxes on products for final use Total net taxes on products
Σ(1) + (3) + (4) (5) Total intermediate consumption at
purchasers' prices by industryTotal final uses by type Total use
Compensation of employees
Other net taxes on production
Consumption of fixed capitalOperating surplus, net(6) Components of value added by industry
Σ(6) (7) Value added by industry
Σ(1) + (3) + (4) + Σ(6) (8) Output at basic prices by industry▼B1996R2223 — EN — 07.08.2003 — 008.001 — 302
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Fixed capital formation
Fixed capital stockLabour inputs(9)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 303
▼B
9.51. In order to serve more specific purposes, the supply and use tables
presented above can be modified by introducing alternative and
supplementary classifications. Important cases in point are:
(a) more detailed product and industry classifications based on national
classifications or to take account of specific purposes, e.g. for the
analysis of the role of research and development in the national
economy;
(b) more detailed geographical breakdown of imports and exports, e.g.
intra-European Union trade subclassified by country and extra-
European Union trade subclassified by economic regions and some
specific countries such as the United States and Japan;
(c) classification of imports into:
1. imports of products that are also domestically produced (‘compe-
titive imports’);
2. imports of products that are not domestically produced (‘comple-
mentary imports’).
Both types of imports can be expected to have a different relationship
with and importance for the national economy. Competitive imports
can be the subject of analysis and economic policy as they may be a
substitute for domestic output; they could therefore be incorporated as
a separate category of (potential) final use in the use tables. For
complementary imports, analyses will mainly focus on the impact of
changes in their prices or volume (e.g. in the case of an oil crisis) on
the national economy;
(d) classification of compensation of employees by criteria such as level
of education, part-time/full-time, age and sex. This classification
could then also be applied to the supplementary information on
employment. In this way, the supply and use tables can also be used
for all kinds of analyses of the labour market.
(e) breakdown of compensation of employees into:
1. wages and salaries, of which:
— social contributions by employees (1);
2. employers' social contributions.
This breakdown permits analysis of the role of social contributions for
the price of labour inputs and the shifting of this burden towards gross
operating surplus;
(f) classification of final consumption by purpose (for households:
Coicop and for government: Cofog). The functional classification of
this expenditure enables the impact of each function of the rest of the
economy to be assessed. For example, the importance of public and
private expenditure on health care, transport and education can then
be assessed. Another case in point is the analysis of the impact of
government expenditure on defence for some domestic industries, in
particular the producers of aircraft, trucks and weapons;
(g) reclassification of fixed capital formation and fixed capital stock for
fixed assets that are rented out by the owner, e.g. in the case of
operating leasing: the fixed assets can be recorded as if owned by the
user (unlike the standard treatment in the ESA). The purpose of this
reclassification is to make the cost structures of industries that rent
fixed assets and those that own similar fixed assets comparable. For a
consistent accounting treatment, this reclassification requires also the
modification of the intermediate consumption of the lessee and the
output of the lessor by the amount of the rent of the fixed asset;
(h) reclassification of employment and compensation of employees for
labour contracted out and persons working via temporary employment
agencies: the purpose of this reclassification is to make the cost
structure of industries more comparable by recording persons as
employees in the industries ‘where they actually work’. This
reclassification also amounts to a modification of the concepts of
intermediate consumption and output of the industries involved.1996R2223 — EN — 07.08.2003 — 008.001 — 304
(1) Global estimation of this concept may be necessary when the social contribution of an
employee depends not only on the wage and salary but also on, e.g. the other revenues of
the employee, the age and the marital status.
▼B
TABLES LINKING THE SUPPLY AND USE TABLES TO THE SECTOR
ACCOUNTS
9.52. The information in the supply and use tables should be linked to the sector
accounts, to ensure that the supply and use table is consistent with the
sector accounts. This is achieved by introducing a table with variables
cross-classified by industry and by sector (see table 9.11).
SYMMETRIC INPUT-OUTPUT TABLES
9.53. In the ESA, the product-by-product input-output table is the most
important symmetric input-output table and this table is described here.
9.54. The product-by-product input-output table (see tables 9.4 and 9.12) can be
compiled by converting the supply and use tables, both at basic prices.
This involves a change in format, i.e. from two asymmetric tables to one
symmetric table (see paragraph 9.09). The conversion can be divided into
three steps:
(a) allocation of secondary products in the supply table to the industries
of which they are the principal products;
(b) rearrangement of the columns of the use table from inputs into
industries to inputs into homogeneous branches (without aggregation
of the rows);
(c) aggregation of the detailed products (rows) of the new use table to the
homogeneous branches shown in the columns, if appropriate.
9.55. Step (a) involves transfers of outputs in the form of secondary products in
the supply table. Since secondary products appear as ‘off-diagonal’ entries
in the supply table, this kind of transfer is a comparatively simple matter.
These secondary products are treated as additions into the industries for
which they are principal and removed from the industries in which they
were produced.
9.56. Step (b) is more complicated, as the basic data on inputs relate to
industries and not to each individual product produced by each industry.1996R2223 — EN — 07.08.2003 — 008.001 — 305
▼B
The kind of conversion to be made here entails the transfer of inputs
associated with secondary outputs from the industry in which that
secondary output has been produced to the industry to which they
principally (characteristically) belong. In making this transfer, two
different approaches might be taken:
1. by means of supplementary statistical and technical information;
2. by means of assumptions.
9.57. Supplementary statistical and technical information should be utilized as
much as possible. For example, it might be possible to obtain specific
information on the inputs required to produce certain kinds of output.
However, information of this kind is usually incomplete. Ultimately it will
usually be necessary to resort to simple assumptions to make the transfers.1996R2223 — EN — 07.08.2003 — 008.001 — 306
Table 9.12 — A symmetric input-output table at basic prices (product by product)
Product
(CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Intermediante consumption at basic prices by
product and by productFinal uses at basic prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation and valuables
(e) changes in inventories
(f) exports2
3
.
.
.
.
.
.
n
Σ(1) (2) Total intermediate consumption at basic prices
by productFinal use at basic prices by type Total use at basic
prices
Taxes on products
Subsidies on product (−)(3) Net taxes on products by product Net taxes on products by type of final use Total net taxes on
products
Σ(1) + (3) (4) Total intermediate consumption at purchasers'
prices by productTotal final uses by type at purchasers' prices Total net taxes at
purchasers' prices
Compensation of employees
Other net taxes on production
Consumption of fixed capital
Operating surplus, net(5) Components of value added by product
Σ(5) (6) Value added by product
Σ(1) + (3) + Σ(5) (7) Output at basic prices by product
Imports (8) Imports cif by product(7) + (8) (9) Supply at basic prices by product▼B1996R2223 — EN — 07.08.2003 — 008.001 — 307
Product
(CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Fixed capital formation
Fixed capital stock
Labour inputs(10)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 308
▼B
9.58. The assumptions used to transfer outputs and associated inputs hinge on
two types of technology assumptions:
(a) industry technology, assuming that all products produced by local
KAUs in an industry are produced with the same input structure;
(b) product technology, assuming that all products in a product group
have the same input structure, whichever industry produces them.
The choice of the best assumption to apply in each case is not an easy one.
It must, in fact, depend on the structure of national industries, e.g. the
degree of specialization, and on the homogeneity of the national
technologies used to produce products within the same product group.
For example, boots may be made from leather and from plastic. Assuming
the same product technology for all boots (or, when a higher level of
aggregation is used, e.g. footwear) can thus be problematic; assuming
industry technology can then be a better alternative.
Simple application of the product technology assumption has often shown
results that are unacceptable, insofar as the input-output coefficients
sometimes generated are improbable or even impossible, for example,negative coefficients. Improbable coefficients may be due to errors in
measurement and to heterogeneity (product-mix) in the industry of which
the transferred product is the principal product. This might be overcome
by making adjustments based on supplementary information or exploiting
informed judgment to the fullest extent possible. Of course, another
solution is to apply the alternative assumption of industry technology. In
practice, employing mixed technology assumptions combined with
supplementary information is the best strategy for compiling symmetric
input-output tables.
9.59. The importance of the role played by the assumptions depends on the
extent of secondary production, which in turn depends not only on how
production is organized in the economy but also on the product
breakdown. The more detailed the product breakdown, the more
secondary output can be expected.
9.60. Step (c) involves the aggregation of the products in the new use table to
the industries that generate them according to step (a) and this results in a
symmetric input-output table with products cross-classified against by-
products. While these amendments start from data based on local KAUs,
the resulting entries are made to conform to those of ‘homogeneous units
of production’.
9.61. The classifications in the symmetric input-output table coincide with those
in the supply and use tables, as the former is a transformation of the latter
(except of course the classification by industry/homogeneous branch).
9.62. The symmetric input-output table 9.12 should be accompanied by at least
two tables:
(a) a matrix showing the use of imports; the format of this table is the
same as that of the import table supporting the supply and use tables
(see table 9.10), except that the product-by-product classification is
used;
(b) a symmetric input-output table for domestic output (table 9.13).
The latter table should be used in calculating the cumulated coefficients,
i.e. the Leontief-inverse. In terms of table 9.13, the Leontief-inverse is the
inverse of the difference between the identity matrix I and the matrix of
technical coefficients obtained from the matrix ((1), (1)). The Leontief-
inverse could also have been calculated for domestic output and
competitive imports (see paragraph 9.51). It should then be assumed
that the competitive imports have been produced in the same way as the
competing domestic produce.1996R2223 — EN — 07.08.2003 — 008.001 — 309
Table 9.13 — A symmetric input-output table for domestic output (product by product)
Products
(CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)For domestic output: Intermediate consump-
tion at basic prices by product and by productFor domestic output: Final uses at basic prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Cross capital formation:
(d) gross fixed capital formation and valuables
(e) changes in inventories
(f) exports2
3
..
.
...
n
Σ(1) (2) Total intermediate consumption of domestic
output at basic prices by productFinal use of domestic output at basic prices Total domestic
output
Use of imported products (3) Total intermediate consumption of imported
products by productFinal use of imported products at basic prices Total imports
Net taxes on products (4) Net taxes on products for intermediate
consumption by productNet taxes on products for final use Total net taxes on
products
Σ(2) + (3) + (4) (5) Total intermediate consumption at purchasers'
prices by productTotal final uses by type Total use
Compensation of employees
Other net taxes on production
Consumption of fixed capital
Operating surplus, net(6) Components of value added by product
Σ6 (7) Value added by product
Σ(1) + (3) + (4) + Σ(6) (8) Output at basic prices by product▼B1996R2223 — EN — 07.08.2003 — 008.001 — 310
Products
(CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Fixed capital formation
Fixed capital stock
Labour inputs(9)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 311
▼B
CHAPTER 10
PRICE AND VOLUME MEASURES
10.01. In a system of economic accounts, all the flows and stocks are expressed
in monetary units. The monetary unit is the only common denominator
which can be used to value the extremely diverse transactions recorded in
the accounts and to derive meaningful balancing items.
The problem when using the monetary unit as a measuring unit is that this
unit is neither a stable nor an international standard. A major concern in
economic analysis is to measure economic growth in volume terms
between different periods. It is then necessary to distinguish, in the value
changes for certain economic aggregates, the changes arising solely from
price changes from the remainder which is called the change in ‘volume’.
Economic analysis is also concerned with comparisons in space, i.e.
between different national economies. These focus on international
comparisons in volume terms of the level of production and income,
but the level of prices is also of interest. It is therefore necessary to factor
the differences in value of economic aggregates between pairs or groups
of countries into components, which reflect the differences in volume and
the differences in price.
10.02. When time comparisons of flows and stocks are concerned, equal
importance should be attached to the accurate measurement of changes in
prices and in volumes. In the short term, observation of price changes is of
no less interest than the measurement of the volume of supply and
demand. On a longer term basis, the study of economic growth has to take
account of movements in the relative prices of the different types of goods
and services.
The primary objective is not simply to provide comprehensive measures
of changes in prices and volumes for the main aggregates of the system
but to assemble a set of interdependent measures which make it possible
to carry out systematic and detailed analyses of inflation and economic
growth and fluctuations.
10.03. The general rule for comparisons in space is that accurate measures must
be made for both the volume and the price components of the economic
aggregates. As the spread between the Laspeyres and Paasche formulae is
often significant in spatial comparisons, the Fisher index formula is the
only acceptable one for this purpose.
10.04. The economic accounts have the advantage of providing a suitable
framework for constructing a system of volume and price indices as well
as ensuring the consistency of the statistical data.
The advantages of an accounting approach can be summarized as follows:
(a) on a conceptual level, the use of an accounting framework covering
the entire economic system requires the prices and physical units for
the different products and flows in the system to be specified
consistently. In a framework of this type it is imperative that, for
example, the price and volume concepts for a given group of products
should be defined identically in both resources and uses;
(b) on a statistical level, the use of the economic accounts framework
imposes accounting constraints which must be respected at both
current and constant prices and will normally require some
adjustments to be made to ensure consistency of the price and
volume data;
(c) furthermore, the creation of an integrated system of price and volume
indices in the context of a system of economic accounts provides the
national accountant with extra checks. Assuming the existence of a
balanced system of supply and use tables at current prices, the
construction of such balanced tables at constant prices means that a
system of implicit price indices can be automatically derived.
Examination of the plausibility of these derived indices can lead to
revision and correction of the data at constant prices and even, in
some cases, of the values at current prices;
(d) finally, the accounting approach permits the measurement of price and
volume changes for certain balancing items in the accounts, the latter
being derived by definition from the other elements in the accounts.
10.05. Despite the advantages of an integrated system based on the balance, both
overall and by industry, of transactions in goods and services, it has to be
acknowledged that the price and volume indices thus obtained do not meet
all needs or answer all possible questions on the subject of change in
prices or volume. Accounting constraints and the choice of price and
volume index formulae, although essential for the construction of a1996R2223 — EN — 07.08.2003 — 008.001 — 312
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coherent system, can sometimes be a hindrance. There is also a need for
information for shorter periods such as months or quarters. In these cases,
other forms of price and volume indices may prove useful.
SCOPE OF PRICE AND VOLUME INDICES IN THE ACCOUNTS
SYSTEM
10.06. Among the flows which appear in economic accounts at current prices,
there are some (mainly concerning products) where the distinction
between changes in price and volume is similar to that made at
microeconomic level. For many other flows in the system, the distinction
is far less obvious.
In the former case, the flows cover a group of elementary transactions in
goods and services, the value of each being equivalent to the product of a
number of physical units and their respective unit price. In this case it is
sufficient to know the breakdown of the flow in question into elementary
transactions in order to determine its average variation in price and
volume.
In the latter case, which concerns a number of transactions relating to
distribution and financial intermediation as well as to balancing items
such as value-added, it is difficult or even impossible to separate directly
current values into price and volume components and special solutions
have to be adopted.
There is also a need to measure the real purchasing power of a number of
aggregates, such as compensation of employees, disposable income of
households or national income. This can be done, for example, by
deflating them by means of an index of the prices of the goods and
services which can be bought with them.
10.07. It must be emphasized that the objective and the procedure followed when
measuring the real purchasing power are fundamentally different from
those followed when deflating goods and services and balancing items.
For these an integrated system of price and volume indices can be
established, which is useful, among other things, for measuring economic
growth. The valuation in real terms of flows of the last type uses price
indices of flows other than those considered, which may differ according
to the objectives of the analysis: it can only be a convention and cannot be
done in a unique way within an integrated system of price and volume
indices.
THE INTEGRATED SYSTEM OF PRICE AND VOLUME INDICES
10.08. The systematic division of changes in current values into the components
‘changes in price’ and ‘changes in volume’ is restricted to flows
representing transactions, recorded in the goods and services accounts (0)
and in the production accounts (I); it is carried out both for the data
relating to individual industries and for those relating to the total
economy. Flows representing balancing items, for example value added,
cannot be directly factored into price and volume components; this can
only be done indirectly using the relevant flows of transactions.
The use of the accounting framework imposes a double constraint on the
calculation of the data:
(a) the balance of the goods and services account must for any sequence
of two years be obtained at both constant and current prices;
(b) each flow at the level of the total economy must be equal to the sum
of the corresponding flows for the various industries.
A third constraint, not inherent in the use of an accounting framework but
resulting from a deliberate choice, is that every change in the value of
transactions must be attributed either to a change in price or to a change in
volume, or to a combination of the two.
If these three requirements are fulfilled, valuation of the goods and
services accounts and production accounts at constant prices means that
an integrated set of price and volume indices can be obtained.
10.09. The items to be considered when constructing such an integrated set are as
follows:
Transactions in products
Output P.1
Market output P.11
Output for own final use P.121996R2223 — EN — 07.08.2003 — 008.001 — 313
▼B
Other non-market output P.13
Intermediate consumption P.2
Final consumption expenditure P.3
Individual final consumption expenditure P.31
Collective final consumption expenditure P.32
Actual final consumption P.4
Actual final individual consumption P.41
Actual final collective consumption P.42
Gross capital formation P.5
Gross fixed capital formation P.51
Changes in inventories P.52
Acquisition less disposals of valuables P.53
Exports of goods and services P.6
Exports of goods P.61
Exports of services P.62
Imports of goods and services P.7
Imports of goods P.71Imports of services P.72
Taxes and subsidies on products
Taxes on products, excluding VAT D.212 and D.214
Subsidies on products D.31
VAT on products D.211
Consumption of fixed capital K.1
Balancing items
Value-added B.1
Gross domestic product B.1*g
PRICE AND VOLUME INDICES FOR OTHER AGGREGATES
10.10. In addition to the price and volume measures considered above, the
following aggregates can also be decomposed into their own price and
volume components. The objectives for these measures vary.
Inventories AN.12
Stock of produced fixed assets AN.11
Compensation of employees D.1
Inventories at the beginning and at the end respectively of each period
may have to be calculated at constant prices in order to estimate the
volume change in inventories during the period.
The stock of produced fixed assets has to be calculated at constant prices
to estimate capital output ratios, as well as to obtain a basis for estimating
consumption of fixed capital at constant prices.
Compensation of employees has to be calculated at constant prices for
purposes of measuring productivity and in some instances also when
outputs have been estimated by using constant price data on inputs.
10.11. Compensation of employees is an element of income. For the purpose of
measuring purchasing power it can be valued in real terms by deflating
with an index reflecting the prices of products purchased by employees.
Other income elements too, such as disposable income of households and
national income, can be measured in real terms in the same general way.1996R2223 — EN — 07.08.2003 — 008.001 — 314
▼B
GENERAL PRINCIPLES OF MEASURING PRICE AND VOLUME
INDICES
DEFINITION OF PRICES AND VOLUMES OF MARKET PRODUCTS
10.12. The creation of an integrated system of price and volume indices is based
on the assumption that, at the level of a single homogeneous good or
service, value (v) is equal to the price per unit of quantity (p), multiplied
by the number of quantity units (q), that is
v/C17p/C2q
10.13. Definition: Price is defined as the value of one unit of a product, for
which the quantities are perfectly homogeneous not only in a
physical sense but also in respect of a number of other
characteristics described in paragraph 10.16. To be additive
in an economic sense, quantities must be identical and have
the same unit price. For each aggregate of transactions in
goods and services shown in the accounts, price and quantity
measures have to be constructed so that
value index ¼price index /C2volume index
This means that each and every change in the value of a
given flow must be attributed either to a price change or to a
change in volume or to a combination of the two.
10.14. For transactions in goods it is in many cases easy to define the physical
unit involved in the transaction and hence the price per unit. In a number
of cases, for example for unique capital goods, it is more difficult and
special solutions have to be adopted.
For transactions in services it is frequently more difficult to specify the
characteristics which determine the physical units and differences of
opinion on the criteria to be used may arise. This may concern important
industries such as financial intermediation services, wholesale and retail
trade, services to enterprises, education, research and development, health
or recreation. In view of the growing importance of the service industries,
it is essential to find common solutions to the problem of the choice of
physical units, even if they are only conventional ones.
DIFFERENCES IN QUALITY AND DIFFERENCES IN PRICE
10.15. The physical and other characteristics to be taken into consideration when
identifying products constitute differences in quality and play an
important role, while at the same time raising difficult statistical problems.
The fact is that for many goods and services intended for a specific
purpose there exist several varieties of differing qualities, each with its
own price.
10.16. Differences in quality are reflected by the following factors:
(a) physical characteristics;
(b) deliveries in different locations;
(c) deliveries at different times of the day or at different periods of the
year;
(d) differences in conditions of sale or the circumstances or environment
in which goods or services are supplied.
With given physical characteristics, the differences in the other factors
imply that the physical units are not identical in an economic sense, and
that the value differs among the units. These differences in unit values are
considered to be differences in volume and not as differences in price.
In reality, the payment made when a good is purchased covers not only
the price of a good but also the price of the services associated with the
supply of goods. This means that in principle identical goods sold at
different prices and in different circumstances should be considered to be
different products. This conclusion is explicitly acknowledged in the
supply and use tables, where the value of trade and transport margins
(which represent the main services associated with the provision of goods)
is recorded separately.
10.17. Within a given market and in a single period, the coexistence of several
unit values can, except in the cases described in paragraph 10.19, be
considered as evidence of the existence of quality differences. Accord-
ingly, the various models of cars and even different versions of the same1996R2223 — EN — 07.08.2003 — 008.001 — 315
▼B
model must be treated as different products: similarly, a distinction must
be made between first-class and second-class railway journeys.
For the purposes of calculating price and volume measures, it is necessary
to use as detailed a product classification as possible so that each product
identified has maximum homogeneity, regardless of the level of detail
used in the presentation of results.
10.18. The dimension of quality has to be taken into account also when changes
over time are to be recorded. The change in quality due, for example, to
the modification of the physical characteristics of a product must be
considered to be a change in volume and not in price. Also the effects of
aggregation have to be considered. Variations in the composition of a flow
which imply, for example, a shift in favour of higher average quality have
to be recorded as a volume increase and not as a price increase. It follows
that for outputs, the effect of shifts between markets with differing prices,
for example domestic versus external, or industrial uses versus markets for
consumer products, will be treated as changes in volume and not as
changes in price. It also follows that a price change for a given flow can
occur only as result of changes in prices at the level of individual
transactions.
10.19. Definition: The existence of observed unit value differences is not to be
considered as an indicator of differences in quality when the
following circumstances apply, namely lack of information,
price discrimination reflecting limitations in freedom of
choice and the existence of parallel markets. In these cases,
the unit value differences are considered as differences in
price.
10.20. Lack of information means that purchasers may not always be properly
informed about existing price differences and may therefore inadvertently
buy at higher prices. This, or the opposite, may occur also in situations
where individual buyers and sellers negotiate or bargain over the price. On
the other hand, the difference between the average price of a good
purchased in a market or a bazaar, where such bargaining often occurs,
and the price of the same good sold in a different type of retail outlet, such
as a department store, should normally be treated as reflecting differences
in quality due to different sales conditions.
10.21. Price discrimination implies that sellers may be in a position to charge
different prices to different categories of purchasers for identical goods
and services sold under exactly the same circumstances. In these cases,
there is no or limited freedom of choice on the part of a purchaser
belonging to a special category. The principle adopted is that variations in
price are to be regarded as price discrimination when different prices are
charged for identical units sold under exactly the same circumstances in a
clearly separable market. Price variations due to such discrimination do
not constitute differences in volume.
The possibility of the retrading of goods in a given market implies that
price discrimination for these types of products in most cases can be
assumed to be insignificant. The price differences that may exist for goods
can normally be interpreted as due to lack of information or to the
existence of parallel markets.
In service industries, for example in transportation, producers may charge
lower prices to groups of individuals with typically lower incomes, such
as pensioners or students. If these are free to travel at whatever time they
choose, this must be treated as a price discrimination. However, if they are
charged lower fares on condition that they travel only at certain times,
typically off-peak times, they are being offered lower-quality transporta-
tion.
10.22. Parallel markets may exist for several reasons. Buyers may be unable to
buy as much as they would like at a lower price because there is
insufficient supply available at that price, and a secondary, parallel
market, where higher prices are quoted, may exist. There is also the
possibility that a parallel market exists, where sellers can charge lower
prices because they can avoid certain taxes. In these cases too, a price
variation constitutes a difference in price and not in volume.
10.23. A change in the structure of a flow affecting its total value may occur
when in the circumstances of lack of information, price discrimination and
the existence of parallel markets identical products are sold at different
prices.
Suppose that a certain quantity of a particular good or service is sold at a
lower price to a particular category of purchaser without any difference
whatever in the nature of the good or service offered, location, timing or
conditions of sale, or other factors. A subsequent decrease in the1996R2223 — EN — 07.08.2003 — 008.001 — 316
▼B
proportion sold at the lower price raises the average price paid by
purchasers of the good or service. This must be recorded as a price and not
a volume increase.
PRINCIPLES FOR NON-MARKET SERVICES
10.24. The establishment of a comprehensive system of price and volume indices
covering all supply and uses of goods and services encounters a particular
difficulty when measuring the output of non-market services. These
services differ from market services in that they are not sold at a market
price and their value at current prices is calculated by convention as the
sum of the costs incurred. These costs are intermediate consumption,
compensation of employees, other taxes less subsidies on production and
consumption of fixed capital.
10.25. In the absence of a unit market price, the change in the ‘unit cost’ of a
non-market service can be considered as an approximation of the change
in the price. If non-market services are consumed on an individual basis, it
is inprinciple possible to estimate quantities which are homogeneous and
which reflect the utilization of these services and apply the unit costs of a
base year to obtain data in constant prices. By such type of output-
measurement it will be possible to analyse changes in productivity for
individual non-market services. For collective services it is generally not
possible to establish unit costs and quantities reflecting their utilization. If
attempts are made to account for changes in productivity for collective
services by indirect methods, users should be made aware of this.
10.26. In the context of the economic accounts, it is of prime importance to adopt
the principle that the production and consumption of non-market services,
like the production and consumption of goods and market services, must
be defined in terms of the actual flows of these goods and services and not
in terms of final results obtained from their use. As these results depend
on several other factors as well, it is not possible to measure, for example,
the volume of teaching services by the rise in the level of education, or the
volume of health services by the improvement in the health of the
population.
PRINCIPLES FOR VALUE-ADDED AND GDP
10.27. Value-added, the balancing item in the production account, is the only
balancing item to form part of the integrated system of price and volume
indices. The very special characteristics of this item must, however, be
emphasized, as must the significance of its related volume and price
indices.
Unlike the various flows of goods and services, value-added does not
represent any single category of transaction. It cannot, therefore, be
directly broken down into a price component and a volume component.
10.28. Definition: Value-added at constant prices is defined as the difference
between output at constant prices and intermediate consump-
tion at constant prices.
VA¼ΣP0ðÞQ1ðÞ /C0 Σp0ðÞq1ðÞ
where P and Q are prices and quantities for output and p and
q are prices and quantities for intermediate consumption.
The theoretically correct method to calculate value-added at
constant prices is by double deflation, i.e. deflating
separately the two flows of the production account (output
and intermediate consumption) and calculating the balance
of these two revalued flows.
10.29. In some cases, where the statistical data remain incomplete or not
sufficiently reliable, it may be necessary to use a single indicator. If there
are good data on value-added at current prices, one alternative to double
deflation is to deflate current value-added directly by a price index for
output. This implies the assumption that prices for intermediate
consumption change at the same rate as for output. Another possible
procedure is to extrapolate value-added in the base year by a volume
index for output. This volume index can be calculated either directly from
quantity data or by deflating the current value of output by an appropriate
price index. This method in fact assumes that the volume changes are the
same for output and for intermediate consumption.
For certain market and non-market service industries, such as finance,
business services, education or defence, it may not be possible to obtain
satisfactory estimates of price or volume changes for output. In these
cases the movements of value-added at constant prices can be estimated
by means of changes in compensation of employees at constant wage rates1996R2223 — EN — 07.08.2003 — 008.001 — 317
▼B
and consumption of fixed capital at constant prices. Compilers of data
may be forced to adopt such expedients, even when there is no good
reason to assume that labour productivity remains unchanged in the short
or long term.
10.30. By their very nature, therefore, the indices of volume and price for value-
added are different from the corresponding indices for the flows of goods
and services.
The same applies to price and volume indices of aggregate balancing
items such as gross domestic product. The latter is equivalent to the sum
of all the values added minus Fisim, i.e. to an addition of balancing items,
plus taxes less subsidies on products and from another point of view can
be seen to represent the balancing item between total final uses and
imports.
PROBLEMS IN THE APPLICATION OF THE PRINCIPLES
10.31. To apply the principles of price and volume to the different flows in the
system it is necessary to specify the solutions to be adopted for a number
of problems which arise in this connection.
GENERAL APPLICATION
10.32. The need to determine which of the various factors described in the
previous section explain differences in price arises whenever one studies
time series of value data and has to separate price changes and volume
changes. It follows that, even at a fine level of detail, series of quantitydata may give only crude measures of volume changes, as they do not
properly reflect changes that may have occurred in the mix of different
qualities. This means that, for example, a constant number of physical
units, recorded for a certain flow, understates the volume change if the
composition has changed in favour of units with higher quality. This shift
implies a change in average quality and must be registered as an increase
in the volume index. In general, the best method of estimating volume
changes for flows of goods and services is deflating value data with price
indices. Since all changes in average quality are correctly reflected in the
value series, dividing by a representative price index, which is adjusted for
quality changes, gives a correct volume index.
10.33. Deflation with price indices may not always be best in practice and other
methods have to be adopted. Value series may, for example, have been
established by multiplying price and quantity data and constant price data
can then be obtained by using prices from the base year. Alternatively,
some value series may be of an inferior quality or difficulties may exist in
obtaining reliable price indices. Estimates can then be made on the basis
of quantity indicators. In these cases care must be taken that the quantities
refer to products that are as homogeneous as possible. If none of the
methods described above are applicable, constant price data on outputs
may have to be based on estimates of inputs at constant prices.
10.34. For non-market services the possibility of deflating values by using price
indices does not exist and other solutions have to be applied. These are
described in paragraphs 10.41 to 10.46.
APPLICATION TO SPECIFIC FLOWS
Flows of goods and market services
10.35. Of all the flows in the economy, the changes in the value of the flows of
goods and market services are the most readily broken down into price
and volume changes. In this context a clear distinction should be made
between:
(a) flows representing transactions actually carried out on the market at a
certain price;
(b) flows representing output for own final use (e.g. own-account
production of agricultural products and services from owner-occupied
dwellings);
(c) flows whose value is defined as a balance between transactions in
goods and services (e.g. trade margins);
(d) flows whose value is defined as a difference between distributive and/
or financial transactions (e.g. financial intermediation services
indirectly measured and insurance services).
10.36. The flows in category (a) are by far the most numerous and commonplace.
Changes in the values of these flows can, by their very nature, be split into
volume and price changes. The general method of deflating the current1996R2223 — EN — 07.08.2003 — 008.001 — 318
▼B
value of these flows by price indices is applicable in all cases where goods
and services can be expressed in units, the majority of which are
homogeneous from one year to the next.
10.37. The flows in category (b), which are notional transactions, are typified by
the absence of an actual price for the transaction. This is the case for such
goods as agricultural products for own final use and goods for fixed
capital formation on own-account. For services, the most important type
refers to owner-occupied dwellings. Values for these imputed flows are to
be obtained by applying prices of similar products when marketed and the
deflator should therefore be the same. Since it is usually necessary to
value output of own-account construction by costs of production rather
than prices, the deflator has to be adjusted in this respect.
10.38. The most important flows in category (c) are those whose value at current
prices is obtained as a difference between the values of two flows of
goods. This arises in the case of trade margins, whose value at current
prices is defined as the difference between the actual or imputed price
realized on a good purchased for resale by the wholesale and retail trades
and the price that would have to be paid by the distributor to replace the
good at the time it was sold or otherwise disposed of. By one method,
estimates of trade margins at constant prices can therefore also be made
by difference, by subtracting the constant-price value of goods bought for
resale from the constant-price value of goods resold by these trades. An
alternative method of measurement would be to extrapolate the trade
margins of the base year either by the volume of sales or by the volume of
purchases made by the wholesale and retail trades. To be correct, this
alternative has to take into account the fact that trade margins vary among
different products and uses. This is explicitly acknowledged in the supply
and use tables.
10.39. Category (c) also includes output of travel agency services measured as
the value of service charges of agencies (fees and commission charges).
These services can also be measured as the difference between two flows:
the full payment made by the purchaser and the expenditure made for
transport and accommodation by the producer. The volume measure can
be obtained as the difference between these flows calculated at constant
prices. Alternatively, the fee or commission can be defined as the price
per unit of the type of transportation or accommodation arranged and the
volume indicator for the service charge would therefore move in the same
way as these flows.
10.40. The flows in category (d) consist of financial intermediation services:
service charges from insurance and pension funds are also included.
Financial intermediation services are provided by banks and other
financial corporations and consist of lending money to businesses or
households, providing a safe and convenient means of saving, safe-
guarding money and other valuables, buying and selling foreign
currencies, clearing cheques, providing general economic intelligence,
dealing in stocks and bonds, and offering investment advice. In some
cases these services are easily defined and specifically paid for, for
example in the case of renting space in bank vaults, or when fees are
charged in connection with issues of stocks, bonds or loans. The current
value of transactions can then be defined, as well as prices and quantities
necessary for price and volume measurement. However, a breakdown into
price and volume components for financial intermediation services
indirectly measured and for insurance services can usually only be
made on arbitrary grounds and would have to be based on conventions.
Flows of non-market services
10.41. The non-market services produced by general government and non-profit
institutions serving households (NPISH) cover a vast range of services
both necessary and useful to society. They fall into two main categories:
(a) services provided to individuals, i.e. whose consumers or beneficiaries
are individually identifiable. Consumption of these services requires
individual initiative on the part of those concerned;
(b) pure collective services, i.e. services which are consumed jointly by
the entire population.
10.42. The services provided to individuals can be given to single individuals
(e.g. medical care) or to groups of individuals (e.g. teaching). By their
nature, these services can be supplied on a market or a non-market basis;
in many cases, the individual can obtain services of this type either by
applying to a market unit (paying the price) or by turning to a non-market
unit of general government or NPISH (getting the services free, or almost
free).1996R2223 — EN — 07.08.2003 — 008.001 — 319
▼B
For market units the method of deflating current values by price indices
should be used, since the variations in the mix of products with differing
prices are then correctly shown as influencing volumes rather than prices.
For non-market services provided to individuals, output estimates can be
based on quantity indicators. For education these may relate to numbers of
hours spent by pupils in classes or in individual tutoring, and for non-
market health services the indicators should reflect treatment in hospitals
or visits to doctors or nurses. In both cases there is a quality dimension
reflected in the amount of resources provided per pupil or patient. Care
must be taken to use data with a detailed breakdown so that each indicator
for which calculations are made is as homogeneous as possible in respect
of costs. It is only then that changes in the mix of products are shown
correctly as volume changes.
In the case of services provided to individuals, changes in the volume of
their output and consumption should, in principle, be measured on the
basis of the use which is made of these services; this will avoid using
different criteria for the same services depending on whether they are
market or non-market. Of course, any change in quality must be treated as
a change in volume; but this applies as much to market services as to non-
market services provided to individuals.
10.43. The pure collective services are produced by general government for the
benefit of the entire population. In fact, they cover a vast range of
activities such as general public services, national defence, foreign affairs,
justice and the police, town planning and the environment, economic
policy, etc. Since these services are consumed collectively, indirectly and
continuously, the volume of their output cannot be measured by the extent
to which they are utilised.
10.44. It may not be possible in practice to obtain reliable quantity indicators for
non-market services provided for individuals and these may therefore
have to be measured in terms of volume by the same methods as for pure
collective services. It is then necessary to start from a valuation at
constant prices of the different cost elements of this output, i.e.:
(a) intermediate consumption;
(b) compensation of employees;
(c) other taxes on production, less other subsidies on production;
(d) consumption of fixed capital.
The use of input-measures as proxies for output implies that analysis of
productivity is not possible.
10.45. The calculation of intermediate consumption at constant prices poses no
particular theoretical problems base-year since intermediate consumption
relates to goods and market services. It can be done either by deflating
current values by a price index of intermediate consumption or on the
basis of quantities revalued at base-year prices.
10.46. Calculation at constant prices of the compensation of employees and the
consumption of fixed capital in non-market service industries is done by
the general methods described in paragraphs 10.53 and 10.54 for example.
Other taxes on production are often of a type that can be related to a
volume indicator, for example volume of employment, number of cars
used.
Taxes and subsidies on products and imports
10.47. Although essentially limited to transactions involving goods and services,
the integrated system of price and volume indices does not exclude the
possibility of calculating measures of changes in price and volume for
certain other transactions. This possibility exists, in particular, in the case
of taxes and subsidies directly linked to the quantity or value of the goods
and services which are the subject of certain transactions. In the supply
and use tables, the values of these are shown explicitly. By applying the
rules described below, it is possible to obtain price and volume measures
for the categories of taxes and subsidies which are recorded in the goods
and services accounts, namely:
(a) taxes on products, excluding VAT (D.212 and D.214);
(b) subsidies on products (D.31);
(c) VAT on products (D.211).1996R2223 — EN — 07.08.2003 — 008.001 — 320
▼B
10.48. The simplest case is that of taxes which represent a fixed amount per unit
of quantity of the product which is the subject of the transaction. The
value of the revenue from such a tax depends on:
(a) the quantity of products involved in the transaction;
(b) the amount levied per unit, i.e. the taxation price.
The breakdown of the value change into its two components presents
virtually no difficulties. The variation in volume is determined by the
change in the quantities of products taxed; the price variation corresponds
to the change in the amount levied per unit, i.e. to the change in the
taxation price.
10.49. A more frequent case is that in which the tax represents a certain
percentage of the value of the transaction. The value of the revenue from
such a tax then depends on:
(a) the quantity of products involved in the transaction;
(b) the price of the products involved in the transaction;
(c) the tax rate (as a percentage).
The taxation price is then obtained by applying the rate to the price of the
product. The change in value of the revenue from a tax of this type can
also be divided into a volume change, determined by the change in the
quantities of products taxed, and a price change corresponding to the
change in the taxation price (b × c).
10.50. The amount of tax on products (excluding VAT) (D.215 and D.214) is
measured in terms of volume by applying to the quantities of products
produced or imported the taxation prices of the base year or by applying to
the value of output or imports, revalued at the prices of the base year, the
tax rates of the base year. Attention has to be paid to the fact that taxation
prices may differ among different uses. This is taken into account in the
supply and use tables.
10.51. Similarly, the amount of subsidies on products (D.31) is measured in
terms of volume by applying to the quantities of products produced or
imported the subsidy prices of the base-year or by applying to the value of
output or imports, revalued at the prices of the base-year, the rates of
subsidy of the base-year, taking into account different subsidy prices for
different uses.
10.52. VAT on producs (D.211) is, both for the whole economy and for
individual industries and other users, calculated on a net basis and refers
only to non-deductible VAT. This is defined as the difference between
VAT invoiced on the products and VAT deductible by the users of these
products. Alternatively, it is also possible to define VAT on products as
the sum of all non-deductible amounts which have to be paid by users.
Non-deductible VAT at constant prices can be calculated by applying the
VAT rates in force in the base-year to the flows expressed in the prices of
the base-year. Any change in the rate of VAT for the current year will
therefore be reflected in the price index and not in the volume index of
non-deductible VAT.
The fraction of deductible VAT in invoiced VAT and hence non-
deductible VAT may change:
(a) either because of a change in the right to deduct VAT, resulting from
a change in tax laws or regulations, taking effect with or without a
time lag;
(b) or because of changes in the pattern of uses of the product (e.g.
increase in the proportion of uses on which VAT may be deducted).
A change in the amount of deductible VAT resulting from a change in
the right to deduct VAT will by the method described be treated as a
change in the taxation price, as will a change in the rate of invoiced
VAT.
On the other hand, a change in the amount of deductible VAT
resulting from a change in the pattern of uses of the product
constitutes a change in the volume of deductible VAT to be reflected
in the index of the volume of VAT on products.
Consumption of fixed capital
10.53. The calculation of volume measures of the consumption of fixed capital
poses few problems when good data on the composition of the stock of
fixed capital goods are available. The perpetual inventory method, used by
most countries, already implies, for the estimation of the consumption of1996R2223 — EN — 07.08.2003 — 008.001 — 321
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fixed capital at current prices, the need to pass via a calculation of the
stock of fixed capital goods at constant prices. To go from a valuation at
historic cost to one at replacement cost, it is first necessary to value capital
goods acquired over a number of different periods on a homogeneous
basis, i.e. base-year prices. The price and volume indices derived in the
process can therefore be used to calculate the value of the consumption of
fixed capital at constant prices and the associated price index.
Where there is no perpetual inventory of the stock of fixed capital goods,
the change in the consumption of fixed capital at constant prices can be
obtained by deflating the current price data by price indices derived from
data on gross fixed capital formation by product. Account has then to be
taken of the age structure of the capital goods acquired.
Compensation of employees
10.54. For the purpose of measuring the volume of input from employee labour,
the quantity unit for compensation of employees may be considered to be
an hour's work of a given type and level of skill. As with goods and
services, different qualities of work must be recognized and quantity
relatives calculated for each separate type of work. The price associated
with each type of work is the compensation paid per hour, which may
vary, of course, between different types of work. A volume measure of
work done may be calculated as a weighted average of the quantity
relatives for different kinds of work, weighted by the values of
compensation of employees in the previous year or fixed base year.
Alternatively, a wage rate index may be calculated for work by calculating
a weighted average of the proportionate changes in hourly rates of
compensation for different types of work, again using compensation of
employees as weights. If a Laspeyres-type volume index is calculated
indirectly by deflating the changes in compensation of employees at
current values by an index of the average change in hourly compensation,
the latter should be a Paasche-type index.
10.55. For the purpose of measuring the real purchasing power of compensation
of employees, this flow can be deflated by an index reflecting the uses
made of these earnings. The price index normally chosen for this purpose
is the implicit deflator for individual consumption expenditure or the
consumer price index.
Stocks of produced fixed assets and inventories
10.56. Constant-price data are needed both for stocks of produced fixed assets
and for inventories. For the former, such data as are necessary for the
calculation of capital output ratios are available if use is made of the
perpetual inventory method. In other cases information on the values of
stocks of assets may be collected from producers and deflation made by
the price indices used for fixed capital formation, taking into account the
age structure of stocks.
Changes in inventories are measured by the value of entries into
inventories less the value of withdrawals from inventories, and the value
of any recurrent losses of goods held in inventories during a given period.
Constant-price estimates can be derived by the deflation of these
components. When changes in the volume and the prices of inventories
are fairly regular, estimates of changes in inventories can also be obtained
by multiplying the volume change of inventories by average prices for the
current year or the base year. As a second alternative and as a cross-check,
estimates of changes in inventories can also be obtained as the difference
between stocks of inventories held at the end and the beginning of the
period, respectively. For this purpose the value of inventories minus
revaluation according to the accounts of producers has to be revalued and
expressed at the average prices, either relating to the current year or to the
base-year. If they refer to the current year, the value measures the volume
changes in inventories at current prices. If the average prices refer to a
base-year, the value corresponds to volume changes in inventories at base-
year prices.
Measures of real income for the total economy
10.57. It is not possible to divide income flows into a price and a quantity
component and for this reason price and volume measures cannot be
defined in the same way as for the flows and stocks described earlier.
Income flows can be measured in real terms only if one chooses some
selected basket of goods and services on which the income is typically
spent and uses the price index for this basket as a deflator of current
incomes. The choice is always arbitrary in the sense that income is seldom
spent specifically for purchases during the period in question. Some of it1996R2223 — EN — 07.08.2003 — 008.001 — 322
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may be saved for purchases in later periods or, alternatively, the purchases
during the period may be partly financed from savings made earlier.
10.58. Gross domestic product at constant prices measures the total production
(less the intermediate consumption) in volume terms for the total
economy. The total real income of residents is influenced not only by
this volume of production but also by the rate at which exports can be
traded against imports from the rest of the world. If the terms of trade
improve, fewer exports are needed to pay for a given volume of imports,
so that at a given level of domestic production goods and services can be
reallocated from exports to consumption or capital formation.
10.59. The real gross domestic income can be derived by adding the so-called
trading gain to volume figures on gross domestic product. The trading
gain — or, as the case may be, loss — is defined as:
T¼X/C0M
P/C0X
Px/C0M
Pm/C20/C21
i.e. the current balance of exports less imports, deflated by a price index P,
less the difference between the deflated value of exports and the deflated
value of imports. The choice of an appropriate deflator P for the current
trade balances should be left to the statistical authorities in a country,
taking account of the particular circumstances of that country. In the
circumstances in which there is uncertainty about the choice of deflator an
average of the import and the export price indices is likely to provide a
suitable deflator.
10.60. Various real income aggregates are identified and defined in the way
shown in the following.
Gross domestic product at constant prices
plus the trading gain or loss from changes in the terms of trade
equals real gross domestic income
plus real primary incomes receivable from abroad
minus real primary incomes payable to abroad
equals real gross national income
plus real current transfers receivable from abroad
minus real current transfers payable to abroad
equals real gross national disposable income
minus consumption of fixed capital at constant prices
equals real net national disposable income.
To be able to express the various national income aggregates in real terms,
it is recommended that receivables and payables of primary incomes and
transfers from and to abroad should be deflated with an index of gross
domestic final expenditure. Real national disposable income is to be
expressed on a net basis by deducting from its gross value the
consumption of fixed capital at constant prices.
CHOICE OF INDEX NUMBER FORMULAE AND THE BASE YEAR
10.61. The construction of an integrated system of price and volume indices
entails a deliberate choice as to the types of indices to be used.
10.62. The preferred measure of year-to-year changes in volume is a Fisher
volume index which is defined as the geometric mean of the Laspeyres
and the Paasche indices. Changes in volume over longer periods are
obtained by chaining, i.e. by cumulating the year-to-year volume
movements.
10.63. The preferred measure of year-to-year changes in prices is a Fisher price
index. Price changes over long periods are obtained by chaining the year-
to-year price movements.
10.64. Chain indices that use Laspeyres volume indices to measure changes in
volume and Paasche price indices to measure year-to-year price move-
ments provide acceptable alternatives to Fisher indices.
10.65. Although the preferred measure of volume and price is a chain index, it
must be recognized that the lack of additive consistency can be a serious
disadvantage for many types of analysis.1996R2223 — EN — 07.08.2003 — 008.001 — 323
▼B
An aggregate is defined as the sum of its components. Additivity requires
this identity to be preserved when the values of both an aggregate and its
components in some reference period are extrapolated over time using a
set of volume index numbers.
10.66. It is therefore recommended that disaggregated constant price data, i.e.
direct valuation of current quantities at base-year prices, are compiled in
addition to the chain indices for the main aggregates.
Estimating accounts data in constant prices has to be done at the finest
level of detail possible if the data are to be consistent within the
framework of an integrated system of price and volume measures. The
supply and use tables form the central, conceptual and statistical
framework for all the measures at constant prices. Additional data are
found in supplementary tables.
Constant price series have nevertheless to be rebased in the course of time.
The ESA has adopted the principle of changing the base year every five
years as from 1995. When the base year is changed it is customary to link
the data on the old base to the date on the new base rather than to carry the
rebasing backwards. When the base year is updated additivity is lost as a
result of linking.
10.67. When base-year values are extrapolated by chain volume indices, it will
have to be explained to users why there is no additivity in the tables.
The non-additive ‘constant price’ data is published without any
adjustment. This method is transparent and indicates to users the extent
of the problem.
This does not preclude the possibility that there may be circumstances in
which compilers may judge it preferable to eliminate the discrepancies in
order to improve the overall consistency of the data.
INTERSPATIAL PRICE AND VOLUME INDICES
10.68. Comparisons of prices and volumes between countries have to overcome
the difficulty in comparing different national currencies. Since exchange
rates are not sufficiently stable for this purpose and do not reflect
differences in purchasing power in a correct way, it is necessary to use a
methodology similar to the one used for intertemporal comparisons
between different periods within a single country. Price and volume
indices have therefore to be compiled between pairs of countries, applying
the same kinds of index number formulae as when measuring changes
between time periods. Either of the two countries A and B can be used to
give the weights and, viewed from the angle of country A, a Laspeyres-
type index with weights from country A can be calculated as well as a
Paasche-type using weights from country B.
10.69. If the economies of the two countries differ much from one another, the
spread between these two indices may be quite large and the results would
depend too much on which one is chosen. For binary comparisons theESA therefore requires an average between the two, in the form of a
Fisher index.
10.70. Direct quantitative comparisons between economic situations that have
little in common with each other are inherently difficult and the method of
deflation of current values with price indices is therefore the best
alternative. This applies even more in international than in intertemporal
comparisons. By careful specification and identification of products, price
relatives can be calculated from information collected in price surveys in
each country. As prices are quoted in national currencies, the interpreta-
tion of the price relatives introduces the concept of purchasing power
parity (PPP). For a given product the PPP between two currencies of
countries A and B is defined as the number of units of country B's
currency that are needed in country B to purchase the same quantity of the
product as one unit of country A's currency will purchase in country A.
PPPs for groups of products and successively higher levels of aggregation
up to GDP are obtained by weighting PPPs for products by their share in
expenditure. In order to arrive at a price level index between the two
countries, the PPP index has to be divided by the current exchange rate
between the two currencies concerned.
10.71. For non-market services, international comparisons face the same problem
as intertemporal comparisons. This means that outputs are measured as the
sum of inputs. The method used at present in interspatial comparisons is to
obtain PPPs on the basis of price relatives for important elements in these
inputs. This method, which implies volume comparisons of inputs, fails to
take into account differences in productivity in non-market service
production in the countries compared. It is important, therefore, to develop1996R2223 — EN — 07.08.2003 — 008.001 — 324
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methods which instead lead to comparisons of the volume of output of
non-market services. This should in principle be feasible for individual
non-market services, in the same general way as when intertemporal
comparisons are concerned.
10.72. The need to make international comparisons of prices and volumes
between countries is recognized in the ESA. The main objective is volume
comparisons of GDP and its uses and the condition of transitivity must be
met. Transitivity means that the direct index for country C based on
country A is equal to the indirect index obtained by multiplying the direct
index for country B based on country A by the direct index for country C
based on country B.
10.73. The approach adopted in the ESA to the calculation of a set of multilateral
volume measures and PPPs is to start from binary comparisons between
all possible pairs of countries considered. The Fisher indices used for this
purpose are not transitive, but it is possible to derive from them a set of
transitive indices that resemble the original Fisher indices as closely as
possible, using the traditional criterion of least squares for this purpose.
Minimising the deviations between the original Fisher indices and the
desired transitive indices leads to the so-called EKS formula.
10.74. The EKS index utilizes all the indirect indices linking country i to country
k as well as the direct index between them. Between countries i and k it is
the geometric mean of the direct index between i and k and every possible
indirect index connecting countries i and k. The direct index is given
twice the weight of each indirect index. Transitivity is achieved by
involving every other country in the EKS index for any given pair of
countries.1996R2223 — EN — 07.08.2003 — 008.001 — 325
▼B
CHAPTER 11
POPULATION AND LABOUR INPUTS
11.01. Certain comparisons between countries, or between industries or sectors
within the same economy, become meaningful only when the aggregates
in the national accounts (for example, gross domestic product, the final
consumption of households, the value-added of an industry, compensation
of employees) are considered in relation to the number of inhabitants and
labour input variables. It is therefore necessary to have definitions of the
total population, employment, jobs, total hours worked, full-time
equivalence and employee labour input at constant compensation, which
are closely linked to the concepts used in the national accounts.
11.02. These titles are defined in the system on the basis of the concepts of
economic territory and centre of interest.
11.03. Labour inputs must be classified on the basis of the same statistical units
as used for the analysis of production, namely the local kind-of-activity
unit and the institutional unit.
11.04. The aggregates to which the figures for population and labour inputs are
related are annual totals. Therefore, average population and labour inputs
during the year should be used.
When inquiries are conducted at several times during the course of the
year, the figure taken is the average of the results obtained on these
various dates.
When a single inquiry is made, is is important to examine if the period
used is fully representative; the last available information on variations
throughout the year should be used in estimating data for the year as a
whole. For example, when estimating the mean employment, some
allowance should be made for the fact that certain people do not work
throughout the whole year (casual and/or seasonal workers).
TOTAL POPULATION
11.05. Definition: On a given date, the total population of a country consists of
all persons, national or foreign, who are permanently settled
in the economic territory of the country, even if they are
temporarily absent from it. For some purposes, an annual
average of head counts will provide an appropriate basis for
estimating national accounts variables or for use as a
denominator in comparisons.
11.06. Total population is defined for national accounts according to the concept
of residence (see units and grouping of units chapter).
A person who is staying, or intends to stay, on the economic territory of
the country for a period of one year or more is regarded as permanently
settled there.
A person is regarded as being temporarily absent if he or she is
permanently settled in the country but is staying, or intends to stay, in the
rest of the world for a period of less than one year.
All individuals who belong to the same household (1) are resident where
the household has a centre of economic interest: this is where thehousehold maintains a dwelling, or succession of dwellings, which
members of the household treat, and use, as their principal residence. A
member of a resident household continues to be a resident even if that
individual makes frequent journeys outside the economic territory because
its centre of economic interest remains in the economy in which the
household is resident.
11.07. The total population of a country includes:
(a) nationals settled in the country;
(b) national civilians who are staying abroad for a period of less than one
year (frontier workers, seasonal workers, tourists, patients, etc.);
(c) foreign civilians settled in the country for a period of one year or more
(including the personnel (
2) of the institutions of the European
Communities and of international civilian organizations located
within the geographic territory of the country);1996R2223 — EN — 07.08.2003 — 008.001 — 326
(1) The concept of household is defined in the chapter ‘Units and groupings of units’.
(2) Including accompanying members of their households.
▼B
(d) foreign military personnel (1) working with international military
organizations located within the geographic territory of the country;
(e) foreign technical assistance personel (1) on long-term assignments
who work in the country and are deemed to be employed by their host
government on behalf of the government, or international organiza-
tion, which is actually financing their work.
By convention, the total population also includes the following,
irrespective of the length of their stay outside the country:
(a) national students however long they study abroad;
(b) members (1) of the country's armed forces stationed in the rest of the
world;
(c) nationals (1) who are on the staff of national scientific bases
established outside the geographic territory of the country;
(d) nationals (1) who are on the staff of diplomatic missions abroad;
(e) nationals (1) who are members of the crews of fishing boats, other
ships, aircraft and floating platforms operating partly, or wholly,
outside the economic territory.
11.08. Conversely, the total population of a country does not include:
(a) foreign civilians staying on the territory for less than a year (frontier
workers, seasonal workers, tourists, patients, etc.);
(b) national civilians staying abroad for a period of one year or more;
(c) national military personnel working with international organizations
located in the rest of the world;
(d) national technical assistance personnel on long-term assignments who
work abroad and are deemed to be employed by their host government
on behalf of the government, or international organization, which is
actually financing their work.
and also, by convention:
(a) foreign students however long they study in the country;
(b) members of the armed forces of a foreign country who are stationed in
the country;
(c) the foreign personnel of foreign scientific bases located on the
geographic territory of the country;
(d) members of foreign diplomatic missions stationed in the country.
11.09. The definition given above differs from the present (or de facto )
population, which consists of persons actually present on the geographic
territory of a country at a given date.
ECONOMICALLY ACTIVE POPULATION
11.10. Definition: The economically active population comprises all persons of
either sex, and above a certain age, who furnish the supply of
labour for the productive activities (falling in the production
boundary of the system), during a specified time-reference
period. It includes all persons who fulfil the requirements for
inclusion among the employed (employees or self-
employed) or the unemployed.
The ‘employees’ and ‘self-employed’ are defined under the title
‘employment’.
The ‘unemployed’ are defined under the title ‘unemployment’.
EMPLOYMENT
11.11. Definition: Employment covers all persons — both employees and self-
employed — engaged in some productive activity that falls
within the production boundary of the system.1996R2223 — EN — 07.08.2003 — 008.001 — 327
(1) Including accompanying members of their households.
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EMPLOYEES (1)
11.12. Definition: Employees are defined as all persons who, by agreement,
work for another resident institutional unit and receive a
remuneration (recorded as D.1 compensation of employees).
The relationship of employer to employee exists when there is an
agreement, which may be formal or informal, between an enterprise and a
person, normally entered into voluntarily by both parties, whereby the
person works for the enterprise in return for remuneration in cash or in
kind.
Employees are classified here if they are not also in self-employment
which constitutes their principal activity: in that case they are classified
under self employed persons.
11.13. The following categories are included:
(a) persons (manual and non-manual workers, management personnel,
domestic staff, people carrying out remunerated productive activity
under employment programs) engaged by an employer under a
contract of employment;
(b) civil servants and other government employees whose terms and
conditions of employment are laid down by public law;
(c) the armed forces, consisting of those who have enlisted for both long
and short engagements and also conscripts (including conscripts
working for civil purposes);
(d) ministers of religion, if they are paid directly by general government
or a non-profit institution;
(e) owners of corporations and quasi-corporations if they work in these
enterprises;
(f) students who have a formal commitment whereby they contribute
some of their own labour as an input into an enterprise's process of
production in return for remuneration and (or) education services;
(g) outworkers (2) if there is an explicit agreement that the outworker is
remunerated on the basis of the work done: that is, the amount of
labour which is contributed as an input into some process of
production;
(h) disabled workers, provided the formal or informal relationship of
employer to employee exists;
(i) persons employed by temporary employment agencies, who are to be
included in the industry of the agency which employs them, and not in
the industry of the enterprise for which they actually work. But for
input-output analysis, reclassifications of these people and of all the
related costs can be considered (see paragraph 9.51).
11.14. Persons temporarily not at work are also considered as employees
provided they have a formal job attachment. This formal attachment
should be determined according to one or more of the following criteria:
(a) the continued receipt of wage or salary;
(b) an assurance of return to work following the end of the contingency,
or an agreement as to the date of return;
(c) the elapsed duration of absence from the job which, wherever
relevant, may be that duration for which workers can receive
compensation benefits without obligations to accept other jobs.
This covers persons temporarily not at work because of illness or injury,
holiday or vacation, strike or lockout, educational or training leave,
maternity or parental leave, reduction in economic activity, temporary
disorganization or suspension of work due to such reasons as bad weather,
mechanical or electrical breakdown, or shortage of raw materials or fuels,
or other temporary absence with or without leave.
SELF-EMPLOYED PERSONS
11.15. Definition: Self-employed persons are defined as persons who are the
sole owners, or joint owners, of the unincorporated1996R2223 — EN — 07.08.2003 — 008.001 — 328
(1) ‘Employees’ corresponds to the International Labour Organization definition of ‘paid
employment’.
(2) An outworker is a person who agrees to work for a particular enterprise or to supply a
certain quantity of goods or services to a particular enterprise by prior arrangement or
contract with that enterprise, but whose place of work is not within it.
▼B
enterprises in which they work, excluding those unincorpo-
rated enterprises that are classified as quasi-corporations.
Self-employed persons are classified here if they are not also
in a paid employment which constitutes their principal
activity: in that latter case they are classified as employees.
They may be temporarily not at work during the reference period for any
specific reason. The compensation for self-employment is mixed income.
11.16. Self-employed persons also include the following categories:
(a) unpaid family workers, including those working in unincorporated
enterprises engaged wholly or partly in market production;
(b) outworkers whose income is a function of the value of the outputs
from some process of production for which they are responsible,
however much, or little work was put in;
(c) workers engaged in production undertaken entirely for their own final
consumption or own capital formation, either individually or
collectively.
Unpaid voluntary workers are included with self-employed persons if their
volunteer activities result in goods, for example the construction of a
dwelling, church or other building. But if their volunteer activities result
in services, for example care taking or cleaning without payment, they are
not included with employment, because those volunteer services are
excluded from production (see paragraph 3.08).
There is no labour input into the production of the services of owner-
occupied dwellings; the owner-occupiers of dwellings are not, as such,
considered as self-employed persons.
EMPLOYMENT AND RESIDENCE
11.17. The results of the activity of producer units can only be compared with
employment if the latter includes both the residents and the non-residents
who work for resident producer units.
Employment therefore also includes the following categories:
(a) non-resident frontier workers, i.e. persons who cross the border each
day to work in the economic territory;
(b) non-resident seasonal workers, i.e. persons who move into the
economic territory and stay there for less than one year in order to
work in industries which periodically require additional labour;
(c) members of the country's armed forces stationed in the rest of the
world;
(d) nationals who are on the staff of national scientific bases established
outside the geographic territory of the country;
(e) nationals who are on the staff of diplomatic missions abroad;
(f) members of the crews of fishing boats, other ships, aircraft and
floating platforms operated by resident units;
(g) local employees of general government bodies situated outside the
economic territory.
11.18. On the other hand, the following are excluded from employment:
(a) residents who are frontier workers or seasonal workers, i.e. who work
in another economic territory;
(b) nationals who are members of the crews of fishing boats, other ships,
aircraft and floating platforms operated by non-resident units;
(c) local employees of foreign government agencies located on the
geographic territory of the country;
(d) the personnel of the institutions of the European Communities and
international civilian organizations located within the geographic
territory of the country (including local employees directly recruited);
(e) members of the armed forces working with international military
organizations located on the geographic territory of the country;
(f) nationals working in foreign scientific bases established in the
economic territory.1996R2223 — EN — 07.08.2003 — 008.001 — 329
▼B
11.19. In order to be able to make the transition to the concepts generally used in
labour force statistics (employment on a national basis), the ESA
especially provides for the following items to be shown separately:
(a) the conscripted forces (not included in the labour force statistics, but
included in the ESA under general government services);
(b) residents working for non-resident producer units (included in labour
force statistics but not included in employment as defined in the
ESA);
(c) non-residents working with resident producer units (not included in
labour force statistics but included in employment as defined in the
ESA);
(d) resident workers living permanently in an institution;
(e) resident workers under the age considered in labour force statistics.
UNEMPLOYMENT
11.20. Definition: In accordance with the norms established by the Interna-
tional Labour Organization (13th International Conference
of Labour Statisticians), the ‘unemployed’ comprise all
persons above a specified age who during the reference
period were:
(a) ‘without work’, i.e. not in paid employment or self-
employment;
(b) ‘currently available for work’, i.e. were available for
paid employment or self-employment during the refer-
ence period; and
(c) ‘seeking work’, i.e. had taken specific steps in a
specified recent period to seek paid employment or
self-employment.
The specific steps may include registration at a public or private
employment exchange; application to employers; checking at worksites,
farms, factory gates, market or other assembly places; placing or
answering newspaper advertisements; seeking assistance of friends or
relatives; looking for land, building, machinery or equipment to establish
own enterprise; arranging for financial resources; applying for permits and
licences, etc.
11.21. Definition: Unemployment rates represent unemployed persons as a
percentage of the economically active population.
They are usually calculated for sex-age groups and sometimes further
cross-classified by other demographic variables such as marital status,
qualifications or nationality.
JOBS
11.22. Definition: A job is defined as an explicit or implicit contract (1)
between a person and a resident institutional unit to perform
work (2) in return for compensation (3) for a defined period or
until further notice.
In that definition, both employee and self-employment jobs are covered:
that is, an employee job if the person belongs to another institutional unit
than the employer and a self-employment job if the person belongs to the
same institutional unit as the employer.
11.23. The concept of jobs differs from the concept of employment as defined
above:
(a) it includes second, third, etc. jobs of the same person. Those second,
third, etc. jobs of a person may either successively follow one another
within the reference period (usually, a week) or, as when someone has
an evening job as well as a daytime job, run in parallel;
(b) on the other hand, it excludes persons temporarily not at work but
who have a ‘formal attachment to their job’ in the form, for instance,1996R2223 — EN — 07.08.2003 — 008.001 — 330
(1) The explicit or implicit contract relates to the provision of labour input, not to supplying
output of a good or service.
(2) Work means any activity which contributes to the production of goods or services within
the production boundary. The legality of the work and the age of the worker are, inprinciple, irrelevant.
(
3) Compensation must be interpreted here in a wide sense including mixed income of self-
employed persons.
▼B
of ‘an assurance of return to work or an agreement as to the date of
return’. Such an understanding between an employer and a person on
lay-off or away on training is not counted as a job in the system.
JOBS AND RESIDENCE
11.24. A job in the economic territory of the country is an explicit or implicit
contract between a person (who may be resident in another economic
territory) and an institutional unit resident in the country.
For measuring labour input into economic activity, only the residence of
the producer institutional unit is relevant, because resident producers
alone contribute to gross domestic product.
11.25. Moreover:
(a) jobs are included in the count of jobs in the economic territory when
the employees of a resident producer are working temporarily in
another economic territory and when the nature and duration of the
activity do not warrant its treatment as a notional resident unit of that
other territory;
(b) jobs are excluded from the count of jobs in the economic territory
when performed for non-resident institutional units, that is, for units
with a centre of interest in another country which have no intention of
being active on the domestic territory for a year or more;
(c) the jobs of the staff of international organizations and those of locally
recruited staff engaged by foreign embassies are excluded from the
count, since the employing units are not resident.
TOTAL HOURS WORKED
11.26. Definition: Total hours worked represent the aggregate number of hours
actually worked as an employee or self-employed during the
accounting period, when their output is within the production
boundary.
Because of the broad definition of employees which covers persons
temporarily not at work but with a formal attachment, and part-time
workers, the ESA recommends that the appropriate measure for
productivity calculation is not a head count but total hours worked.
Total hours worked is the preferred measure of labour inputs for the
system.
11.27. In accordance with the norms established by the International Labour
Organization (10th International Conference of Labour Statisticians), total
hours actually worked cover:
(a) hours actually worked during normal working hours;
(b) hours worked in addition to those worked during normal working
hours, and generally paid at higher rates than normal rate (overtime);
(c) time which is spent at the place of work on tasks such as preparing the
site, repair and maintenance work, the preparation and cleaning of
tools, and the making-out of receipts, invoices, records of the length
of time worked and other reports;
(d) idle time spent at the place of work waiting or standing by because,
for example, of temporary lack of work, the breakdown of machinery
or accidents, or time spent at the place of work during which no work
is done but for which payment is made under a guaranteed
employment contract;
(e) time corresponding to short periods of rest at the work place,
including refreshment breaks.
11.28. On the other hand, hours actually worked do not include:
(a) hours which are paid but not worked, such as paid annual holidays,
public holidays, or sick-leave;
(b) breaks for meals;
(c) time spent travelling between home and the place of work, even when
paid (construction workers). However, such travel organized in
employers' time is included in hours of work.1996R2223 — EN — 07.08.2003 — 008.001 — 331
▼B
11.29. Total hours worked is the aggregate number of hours actually worked
during the accounting period in employee and self-employment jobs
within the economic territory:
(a) including work outside the economic territory for resident employer
institutional units who have no centre of economic interest there;
(b) excluding work for foreign employer institutional units who have no
centre of economic interest within the economic territory.
11.30. Many surveys of enterprises record hours paid not hours worked.
In those cases, hours worked have to be estimated for each job group,
using whatever information is available about paid leave etc.
11.31. For business cycle analysis, it may be useful to adjust total hours worked
by adopting a standard number of working days per year.
FULL-TIME EQUIVALENCE
11.32. Definition: Full-time equivalent employment, which equals the number
of full-time equivalent jobs, is defined as total hours worked
divided by the average annual number of hours worked in
full-time jobs within the economic territory.
11.33. This definition does not necessarily describe how the concept is estimated:
since the length of a full-time job has changed through time and differs
between industries, methods which establish the average proportion and
average hours of less than full-time jobs in each job group have to be
used. A normal full time week must first be estimated in each job group. If
possible, a job group can be defined, inside an industry, according to sex
and (or) kind of work of people. Hours contractually agreed upon
constitute, for employee jobs, the appropriate criteria for determining
those figures. Full-time equivalent is calculated separately in each job
group, then summed.
11.34. In spite of the fact that total hours worked are the best measure of labour
inputs, there are some advantages in the full-time equivalence: it can be
estimated more easily and this facilitates international comparisons with
countries which can only estimate full-time equivalent employment.
EMPLOYEE LABOUR INPUT AT CONSTANT COMPENSATION
11.35. Definition: Employee labour input at constant compensation measures
current labour inputs valued at the levels of compensation of
employee jobs ruling during a selected base period.
11.36. Compensation of employees at current prices divided by employee labour
input at constant prices yields an implicit compensation price index
comparable with the implicit price index of final uses.
11.37. The purpose of the concept of employee labour input at constant
compensation is to express the changes in the composition of the work
force, for example from lower paid to higher paid workers. To be
effective, the analysis should be undertaken on an industry basis.1996R2223 — EN — 07.08.2003 — 008.001 — 332
▼B
CHAPTER 12
QUARTERLY ECONOMIC ACCOUNTS
12.01. The quarterly economic accounts form an integral part of the system of
national accounts and, among other uses, are very important for the
analysis of the current year and calculation of provisional estimates for the
last year. The quarterly economic accounts constitute a coherent set of
transactions, accounts and balancing items, defined in both non-financial
and financial domains, recorded on a quarterly basis. They adopt the same
principles, definitions and structure as the annual accounts, subject to
certain modifications, due to the period of time covered.
12.02. The importance of quarterly economic accounts derives essentially from
the consideration that they are the only coherent set of indicators,
available with a short time lag, able to provide a short term overall picture
of both non-financial and financial economic activity.
12.03. The period of time to which the quarterly accounts relate and the need to
have reliable information as quickly as possible determine certain typical
features. These features include statistical methods of compiling accounts,
seasonality and the treatment thereof, consistency of quarterly and annual
accounts and some account particularities related to the reference period.
These typical features will be extensively analysed in a handbook of
quarterly accounts that Eurostat intends to publish before the application
of this methodology.
12.04. The statistical methods used for compiling quarterly accounts may differ
quite considerably from those used for the annual accounts. They can be
classified in two major categories: direct procedures and indirect
procedures. Direct procedures are based on the availability at quarterly
intervals, with appropriate simplifications, of the similar sources as used
to compile the annual accounts. On the other hand, indirect procedures are
based on time disaggregation of the annual accounts data in accordance
with mathematical or statistical methods using reference indicators which
permit the extrapolation for the current year. The choice between the
different indirect procedures must above all take into account the
minimization of the forecast error for the current year, in order that the
provisional annual estimates correspond as closely as possible to the final
figures. The choice between these approaches depends, among otherthings, on the information available at quarterly level.
12.05. The quarterly accounts series quite often show very short-term variations
due to weather, habits, legislation, etc., usually defined as seasonal
fluctuations. Although seasonality is an integral part of quarterly data, it is
often an impediment to the correct identification and analysis of the cycle-
trend component. From this consideration follows the need to compile
both raw and seasonally adjusted accounts. The accounting consistency of
seasonally adjusted figures should be ensured. A closely related problem
to seasonal adjustment is that of the working days correction, which needs
further consideration in the Eurostat handbook.
12.06. Since quarterly accounts adopt the same framework as annual accounts
they have to be consistent over time with them. This implies, in the case
of flow variables, that the sum of the quarterly data is equal to the annual
figures for each year. In principle there are no obstacles to this condition
being met for previous years. However, for the current year there is a
problem of time priority between quarterly and annual data as quarterly
data are normally available earlier than the annual figures. This problem
may be solved by agreeing that the provisional estimates of annual figures
are obtained by the aggregation of quarterly figures. When new annual
information becomes available resulting in a revision of the provisional
figures, the quarterly data have to be modified accordingly. Within some
systems, the annual accounts are a by-product of the quarter system and
there is no separate annual calculation.
12.07. The time consistency must be ensured for raw data and, compatibly with
the seasonally adjustment procedures, for adjusted figures too.
12.08. If, in principle, most of the operations and balancing items are distributed
with a certain regularity on all the quarters, there are anyway some
operations that appear concentrated in one or two quarters of the year.
This is the case for taxes on income, dividends, interest, etc. The treatment
of these cases depends essentially on the underlying generation process.
12.09. From a theoretical point of view there are no obstacles to the layout used
for the quarterly accounts being the same as that used for the annual
accounts. However, in practice, it is useful to simplify and aggregate this
scheme in order to obtain reliable quarterly figures as quickly as possible
(see programme of tables and data to be supplied in the framework of the
1955 ESA).1996R2223 — EN — 07.08.2003 — 008.001 — 333
▼B
CHAPTER 13
REGIONAL ACCOUNTS
13.01. Regional accounts are a regional specification of the corresponding
accounts of the total economy. The regional accounts make use of the
concepts used for the accounts of the total economy unless indicated
otherwise in this section.
13.02. A full set of accounts at the regional level implies treating each region as a
separate economic entity. In this context, transactions with other regions
become a kind of external transaction. External transactions of the region
should of course, be distinguished according to transactions with other
regions of the country and transactions with the rest of the world.
13.03. Conceptual difficulties (see paragraphs 13.10 to 13.14) partly explain why
regional accounts are limited to recording production activities by
industry and to accounts for some institutional sectors like households.
REGIONAL TERRITORY
13.04. The regional economy of a country is part of the total economy of that
country. The total economy is defined in terms of institutional units. It
consists of all the institutional units which have a centre of interest in the
economic territory of a country (see paragraph 2.04). The economic
territory, although consisting essentially of the geographic territory, does
not coincide exactly (see paragraph 2.05). The economic territory of a
country can be divided into regional territories and the ‘extraregio’
territory.
13.05. The regional territory includes:
(a) the region that is part of the geographic territory of a country;
(b) any free zones, including bonded warehouses and factories under
customs control in the region.
13.06. The extraregio territory is made up of parts of the economic territory of a
country which cannot be attached directly to a single region. It consists of:
(a) the national air-space, territorial waters and the continental shelf lying
in international waters over which the country enjoys exclusive rights;
(b) territorial enclaves (i.e. geographic territories situated in the rest of the
world and used, under international treaties or agreements between
States, by general government agencies of the country (embassies,
consulates, military bases, scientific bases, etc.);
(c) deposits of oil, natural gas, etc. in international waters, outside the
continental shelf of the country, worked by resident units.
13.07. The nomenclature of territorial units for statistics (NUTS) provides a
single, uniform breakdown of the economic territory of the European
Union. The NUTS is the territorial classification for the compilation of
regional accounts.
UNITS AND RESIDENCE
13.08. Two types of unit are distinguished. First of all the local KAU for the
analysis of flows occurring in the process of production and in the use of
goods and services. Secondly the institutional unit to analyse flows
affecting income, capital and financial transactions, other flows and
balance sheets.
13.09. The local KAU is the part of a KAU which corresponds to a local unit.
The local unit is an institutional unit producing goods and services or a
part thereof situated in a geographically identified place (see paragraph
2.106). Therefore, in principle the regional residence of a local KAU can
be unambiguously determined.
Regarding the transactions with relation to the production activities, it is
necessary to record flows between local KAUs, which belong to the same
institutional unit and are located in different regions. The ESA
recommends including deliveries between local KAUs in the definition
of output and this is especially important in regional accounts.
13.10. In the case of institutional units two types of institutional units have to be
considered in the context of regional accounts. First of all, there are
uniregional units, the centre of economic interest of which is in one region
and most of their activities take place in this region. Among uniregional
units are households, corporations whose local KAUs are all located in the
same region, local and State governments, at least part of social security
and many NPIs serving households.1996R2223 — EN — 07.08.2003 — 008.001 — 334
▼B
Secondly, there are multiregional units, the centre of economic interest of
which is in more than one region. Many corporations and a number of
NPIs are in this situation. To a greater extent, this is also the case for
institutional units whose activities span the whole country such as central
government and a small number of corporations, generally in a
monopolistic or quasi-monopolistic situation, like the national railway
corporation or the national electricity corporation.
13.11. All transactions of the uniregional institutional units are allocated to the
region in which they have their centre of economic interest. Regarding
households, the centre of economic interest is the region where they live,
not the region where they work. Other uniregional units have their centre
of economic interest in the region where they are located.
13.12. Some of the transactions of multiregional units cannot, strictly speaking,
be regionalized. This is the case for most distributive and financial
transactions. Consequently, balancing items of multiregional units may
not be unambiguously defined at the regional level for multiregional units.
13.13. One may think of allocating all transactions of multiregional units
between regions according to some rules of thumb. However, this should
not be considered simply as a practical approximation. It implies a
conceptual adaptation of the ESA, since the reasons which prevent
including a full sequence of accounts for local KAUs/industries in the
central framework also forbid, in principle, completely distributing all
institutional units and their accounts between regions; for this would
mean, in principle, building up a full set of accounts for local KAUs.
13.14. Due to the abovementioned considerations, the system of regional
accounts is limited to:
(a) regional industry aggregates on production activities:
(1) gross value-added;
(2) compensation of employees;(3) employment;
(4) employees;
(5) gross fixed capital formation;
(b) gross domestic product per region (GDPR);
(c) regional household accounts.
METHODS OF REGIONALIZATION
13.15. Regional accounts are based on the transactions of units that are resident
in a regional territory. In general the regionalization can be done by using
bottom-up methods, top-down methods or mixed methods. The methods
may be described as follows:
(a)bottom-up methods:
the bottom-up methods of estimation involve the use of information
on units that are resident in the region, and ascending by addition until
the regional value of the aggregate is established. The regional values
must add up to the corresponding national value;
(b)top-down methods:
the top-down methods involve the distribution of a national figure
among regions, without attempting to single out resident units, by
means of a distribution key which reflects as closely as possible the
feature to be estimated. The methods are called top-down because the
aggregate is allocated to a region and not to a single unit. However,
the notion of a resident unit is needed in order to have a correct
regional coverage of the key to be used;
(c)mixed methods:
the bottom-up methods are rarely encountered in their pure form.
Therefore mixed methods may also be considered. For example, it can
occur that a variable or an aggregate of variables can only be
regionalized with the help of the bottom-up method at level NUTS-1.
For a further regionalization at level NUTS-2 or NUTS-3 a top-down
method has to be used.
13.16. In principle, the advantage of bottom-up methods is that they directly
employ relevant sources at the regional level. An advantage of top-down
methods is the guaranteed numerical consistency between national and
regional accounts. A disadvantage is that the estimates are not produced
with direct data but with a key that is supposedly correlated with the
phenomenon to be measured.1996R2223 — EN — 07.08.2003 — 008.001 — 335
▼B
13.17. Whenever possible regional values which directly correspond in concept
with the national values should be estimated directly by means of the
bottom-up methods. The top-down procedures do not lead to a solid,
reliable data basis for judging the accuracy of the estimated values,
whereas in the bottom-up methods attention is drawn to a possible
divergence with the national totals.
AGGREGATES BY INDUSTRY
13.18. An industry for a region consists of a group of local KAUs engaged in the
same, or similar, kind of activity (see paragraph 2.108). The local KAU is
the unit on which the data related to production activities (output,
intermediate consumption, etc.) are based.
13.19. As a general principle, aggregates on production activities should be
allocated to the region where the unit carrying out the relevant
transactions is resident. The residence of the local KAU is an essential
criterion for the allocation of these aggregates to a particular region.
13.20. The general principle of allocating gross fixed capital formation by region
is ownership, just as in the accounts of the total economy (see paragraph
2.05, footnote (1)). Fixed assets owned by a multiregional unit are
allocated to the local KAUs where they are used. As in national accounts
fixed assets obtained through operational leasing are recorded in the
region of the owner and those obtained through financial leasing in the
region of the user.
13.21. In practice, it may be that information is only available at the level of
units which contain several local KAUs engaged in different activitiesand/or regions. In this case, available indicators (e.g. compensation of
employees or employment per region) have to be used to regionalize the
figures by industry.
13.22. When defining a local KAU three situations can be distinguished:
(a) a production activity with significant (
1) labour input at a fixed
location raises no problems. However, in some cases further
clarification is needed (see paragraphs 13.24 to 13.27);
(b) a production activity without significant labour input at a fixed
location is not considered as a separate local KAU and the production
should be attributed to the local unit that is responsible for managing
this production;
(c) for a production activity without a fixed location the concept of
residence at the national level should be applied.
13.23. Ancillary activities are not isolated to form distinct entities or separated
from the principal or secondary activities or entities they serve (see
paragraph 2.104). Accordingly, ancillary activities should be integrated
with the local KAUs they serve.
Ancillary activities may be carried out in separate locations, located in
another region than the local KAUs they serve. The strict application of
the abovementioned rule for the geographical allocation of the ancillary
activities would result in the underestimation of the aggregates in the
regions where ancillary activities are concentrated. Therefore according to
the principle of residence, they have to be allocated to the region where
the ancillary activities are situated; they remain in the same industry as the
local KAUs they serve.
13.24. For some industries, the methods for regionalization need some further
clarification. The industries are:
(a) construction;
(b) transport storage and communication;
(c) financial intermediation.
13.25. For the construction industry, building sites should be treated as
independent local KAUs when the activity is significant (see paragraph
2.09, footnote (4)). Given the mobility of some equipment, for example
pile-drivers and cranes, between local units of the same KAU and the
absence of information at site level, it is recommended that gross fixed
capital formation of such equipment be allocated to the headquarters of
the KAU.1996R2223 — EN — 07.08.2003 — 008.001 — 336
(1) Significant labour input, in this context, has to be considered as a minimum of the yearly
equivalent of one person working half-day.
▼B
13.26. For transport industries including pipeline transport it is essential to define
the local KAUs to which the production and capital formation should be
attached. For land transport industries (excluding railways) the production
and capital formation should be attached to depots or similar local KAUs
where the equipment is based. For water transport industries the
production and mobile equipment should be allocated to the home base
of the unit. Pipeline networks should be attached to the local KAU that
exploits it.
For rail and air transport industries top-down methods, breaking down the
national aggregates into regions according to suitable indicators, should be
used. Compensation of employees should be allocated to the region where
the people are employed. The gross operating surplus should be allocated
to the regions according to indicators relating to the activity of the train or
air routes.
Regarding communication industries, telephone boxes, telephone sets,
telecommunication lines, etc. perform only a supporting role. Therefore,
they do not form distinct entities and should be attributed to the local
KAU responsible for managing them. The investment in infrastructure
should also be allocated to these local units.
13.27. For financial intermediation industries, value-added should be allocated
according to the income approach. Compensation of employees should be
allocated to the local KAUs where the people are employed. Gross
operating surplus of credit institutions should be distributed between local
KAUs in proportion to the sum of loans and deposits, and gross operating
surplus of insurance institutions in proportion to the premiums received.
Gross fixed capital formation mainly consists of buildings; therefore, it
should be allocated to the region where they are situated.
13.28. Output is to be valued at basic prices (see paragraph 3.47). Products used
for intermediate consumption are to be valued at purchasers' prices at the
time they enter the process of production (see paragraph 3.72). As a
consequence gross value-added per industry is valued at basic prices.
Gross fixed capital formation is valued at purchasers' prices including
installation charges and other costs of ownership transfer. When produced
on own-account it is valued at basic prices of similar fixed assets or at
costs of production if such prices are not available (see paragraph 3.113).
13.29. The regional equivalent of GDP is GDPR (gross domestic product per
region). GDPR is valued at market prices by adding the regionalized taxes
less subsidies on products and imports to values added per region at basic
prices. The sum of GDPR at market prices per region, including GDPR of
theextraregio territory, equals GDP at market prices.
HOUSEHOLD ACCOUNTS
13.30. Gross domestic product per region is the result of the productive activities
of the local KAUs resident in a region. The processes of distribution and
redistribution of income result in other meaningful balancing items,
namely primary income and disposable income. Due to the considerations
mentioned in paragraphs 13.10 to 13.14, in regional accounts these
income concepts are limited to households.
13.31. Regional accounts of households are a regional specification of the
corresponding accounts at the national level. For practical reasons the
accounts are limited to:
(a) allocation of primary income account;
(b) secondary distribution of income account.
In general terms, they aim at measuring primary income and disposable
income of households which are resident in a region.
13.32. The regional household accounts are based on the households that are
resident in a regional territory. For the definition of households as
institutional units and for the definition of the institutional sector
households, see paragraphs 2.13, 2.16, 2.75 and 2.76. The number of
persons that are members of the resident households add up to the total
resident population of the region.
13.33. In general the rules for determining the residence of households at
national level also apply to the regional accounts of households. However,
concerning the residence of students and long-term patients an exception
is made when the host region is in the same country. In regional accounts,
they are treated as resident of the host region if they stay there more than
one year.1996R2223 — EN — 07.08.2003 — 008.001 — 337
▼B
13.34. In the regional accounts of households, two considerations have to be
made regarding households owning an unincorporated enterprise, land
and/or a second dwelling in another region:
(a)a household owning an unincorporated enterprise (not viewed as a
quasi-corporation at the national level) in another region
the unincorporated enterprise is considered to be a resident (notional
unit) in the host region. As a consequence, mixed income resulting
from the compilation of aggregates by industry is part of the mixed
income of the host region. However mixed income as registered in the
allocation of primary income account of households per region is to
be equal to total mixed income received by households resident in a
region, irrespective of the region in which this income is generated;
(b)a household owning land and/or a second dwelling in another region
here, the land and/or the second dwelling are also considered to be
notional units resident in the host region. Consequently, the rents
payable by the tenants of the land and/or the dwelling are paid to the
notional unit. If the second dwelling is used by the owner for own
final consumption, the rental value should be registered as an
interregional export from the region where the dwelling is located to
the region where the owner resides. The latter region thus imports this
service and uses it for final consumption expenditure of households.
As in the case of mixed income, the operating surplus resulting from
this production process will differ from the operating surplus in the
allocation of primary income accounts of households; for the total
economy, both are equal.1996R2223 — EN — 07.08.2003 — 008.001 — 338
▼B
ANNEX I
FINANCIAL INTERMEDIATION SERVICES INDIRECTLY MEASURED
CHANGES TO BE MADE IN THE ESA CHAPTERS IF FISIM IS TO BE ALLOCATED
Chapter 1
1.13, fifth para-
graph, (d)Delete after ‘The ESA also contains
many specific conventions, e.g.:’:
‘recording the use of financial services
indirectly measured as the inter-
mediate consumption of a nominal
sector or a nominal industry.’Replace by:
‘allocating the use of financial inter-
mediation services indirectly
measured (FISIM) to user sectors/
industries.’
1.25, second
paragraphAdd after the list of points introduced
by‘Some of the major differences in
concepts are:’ the following point:
‘(i) the use of financial intermediation
services indirectly measured
(FISIM) is now allocated to user
sectors/industries instead of to a
nominal sector (industry). As a
consequence, the use of FISIM is
not anymore by convention
recorded entirely as intermediate
consumption, but can also be final
consumption and exports. This
implies then that imports of
FISIM can also occur.’
Chapter 3
3.63 Delete all the text from the beginning
until ‘… is valued on the basis of the
fees of commissions charged’
included, at the end of the fourth
paragraph.Replace by:
‘J.Financial intermediation services
(this includes insurance services and
pension funds services)
Financial intermediation services
(excluded insurance services and
pension funding services) consist in:
(a) financial intermediation services
directly charged by financial inter-
mediaries to their clients and
measured as the sum of fees and
commission charged.
Financial intermediaries can
charge explicitly for the interme-
diation services which they
provide. The output of such
services is valued on the basis of
fees and commissions charged;
(b) financial intermediation services
indirectly charged and indirectly
measured (FISIM).
Financial intermediaries provide
services for which they do not
charge explicitly fees and
commissions. They pay lower
rates of interest than would other-
wise be the case to those who lend
them money and charge higher
rates of interest to those who
borrow from them.
Consequently, FISIM output is1996R2223 — EN — 07.08.2003 — 008.001 — 339
▼M1
▼M1
generated by the management by
financial intermediaries of loans
and deposits whose rates they
control; in contrast, there is no
intermediation service for securi-
ties other than shares.
The output of the subsectors S122
(other financial institutions) and
S123 (other financial intermedi-
aries excluding insurance
corporations and pension funds),
except investment funds is valued
on the basis of the difference
between the actual rates of interest
payable and receivable and a
“reference” rate of interest. For
those to whom the intermediaries
lend funds, both resident and non-
resident, it is measured by the
difference between the effective
interest charged on loans and the
amount that would be paid if a
reference rate were used. For
those from whom the intermedi-
aries borrow funds, both resident
and non-resident, it is measured
by the difference between the
interest they would receive if areference rate were used and the
effective interest they actually
receive;
(c) financial intermediation services
provided by the central bank.
The central bank must not be
included in the calculation of
FISIM: its output is measured as
the sum of costs.’
3.70(j) Delete:
‘only for the total economy: all
financial intermediation services indir-
ectly measured (FISIM) provided by
resident producers.’Replace by:
‘the use of financial intermediation
services indirectly measured by resi-
dent producers.’
3.70. Add:
‘(k) By convention, the central bank
output should be entirely allo-
cated to the intermediate
consumption of other financial
intermediaries (subsectors S122
— S123).’
3.76(e) Add to ‘financial services directly
charged;’:
‘and the part of financial intermedia-
tion services indirectly measured used
for final consumption purposes by
households;’
3.142(h) Add immediately after ‘financial
services by the amount of the explicit
commissions and fees;’ the phrase:
‘and the part of financial intermedia-
tion services indirectly measured used
by non-residents;’1996R2223 — EN — 07.08.2003 — 008.001 — 340
▼M1
Chapter 4
4.51, second
paragraph Delete:
‘The value of the services provided by
financial intermediaries not being
allocated among different customers,
the actual payments or receipts of
interest to or from financial interme-
diaries are not adjusted to eliminate
the margins that represent the implicit
charges made by financial intermedi-
aries. An adjustment item is needed in
the allocation of primary income
account of financial intermediaries
and of a nominal industry to which,
by convention, the whole output of
financial intermediaries is allocated as
intermediate consumption.’Replace by:
‘The value of the services provided by
financial intermediaries being allo-
cated among different customers, the
actual payments or receipts of interest
to or from financial intermediaries
need to be adjusted to eliminate the
margins that represent the implicit
charges made by financial intermedi-
aries. The amounts of interest paid by
borrowers to financial intermediaries
must be reduced by the estimated
values of the charges payable, while
the amounts of interest receivable by
depositors must be similarly increased.
The values of the charges are treated
as payments for services rendered by
financial intermediaries to their custo-
mers and not as payments of interest.’
Chapter 8
8.09.
EXPLANATORY NOTE
Add to figures presented: Tables A.I.1
and A.I.2, to show the consequences
of allocation of FISIM on figures
presented in the chapter 8, ‘Sequence
of accounts and balancing items’
(numerical example).
8.14. Delete:
‘As financial intermediation services
indirectly measured (FISIM) are not
allocated to user sectors, the whole of
the value of the output of FISIM is
treated as the intermediate consump-tion of a nominal sector with zero
output and negative value added equal
in size but opposite in sign to inter-
mediate consumption. In this way, the
value added of all sectors and indus-
tries together is reduced in total by this
amount. To lighten the presentation of
accounts, it is possible not to insert a
supplementary column for the nominal
sector, but instead to take into account
the corresponding figure in the column
total economy.’Replace by:
‘As financial intermediation services
indirectly measured (FISIM) are allo-
cated to user sectors, certain parts of
interest payments are reclassified as
payments of services. This reclassifi-cation has consequences for the values
of output and intermediate consump-
tion (as well as for the values of
imports, exports and final consump-
tion).’
8.24. Delete:
‘As financial intermediation services
indirectly measured (FISIM) are not
allocated to user sectors, the entries
shown for interest are those for actual
interest payable and receivable. An
adjustment is made to resources in the
column financial corporations (with a
negative sign) and in the column
nominal sector (with a positive sign).
To lighten the presentation of
accounts, it is possible not to insert a
supplementary column for the nominal
sector, but instead to present the
corresponding figure in the column
total economy.’Replace by:
‘As financial intermediation services
(FISIM) are alloced to user sectors, the
item “interest” in the allocation of
primary income account corresponds
to interest payable and receivable after
FISIM has been deducted from actual
payables by borrowers and added to
actual receivables by lenders.’1996R2223 — EN — 07.08.2003 — 008.001 — 341
▼M1
Chapter 9
9.25(a)
Delete:
‘the intermediate consumption by
industry includes the use of financial
intermediation services indirectly
measures that are recorded in a
nominal industry (see paragraph
9.33);’
9.25(b) Delete:
‘minus the use of financial intermedia-
tion services indirectly measured
(recorded in a nominal industry, see
paragraph 9.33.)’
9.33. Delete:
‘Throughout the supply and use tables,
the NACE REV 1 industry classifica-
tion is extended with a nominal
industry for the use of financial
intermediation services indirectly
measured. In the supply table, no
transactions are recorded at all for
this industry. In the use table, that total
use of financial intermediation
services indirectly measured is
recorded as the intermediate consump-
tion of this nominal industry. As this
nominal industry does not have any
other transactions, its net operating
surplus is negative by the amount of
its intermediate consumption; all other
components of its value added are
zero. As a consequence, its total gross
value added is equal to its (negative)
net operating surplus.’1996R2223 — EN — 07.08.2003 — 008.001 — 342
Table A.I.1 — Effect of allocating FISIM to institutional sectors, including changes for non-market producers
Uses Resources
Accounts TotalGoods
and
servic-
es
(res.)S.2
Rest of
the
worldS.1
Total
econo-
myS.15
NPIS-
HsS.14
House-
holdsS.13
Gener-
al
gover-
nmentS.12
Finan-
cial
corpo-
rationsS.11
Non-
finan-
cial
corpo-
rationsTransactions and balancing itemsS.11
Non-
finan-
cial
corpo-
rationsS.12
Finan-
cial
corpo-
rationsS.13
Gener-
al
gover-
nmentS.14
House-
holdsS.15
NPIS-
HsS.1
Total
econo-
myS.2
Rest of
the
worldGoods
and
servic-
es
(uses)Total Accounts
I.
Production
account/
external
account2 2 P.72 Imports of services 2 2 I.
Production
account/
external
account4 4 P.62 Exports of services 4 4
P.1 Output 48 6 3 57 57
27 27 3 0 6 0 18 P.2 Intermediate
consumption
30 − 2 30 48 − 18 B.1 Value added/external
balance−1 8 4 8 3 0 3 0
II.1.1.
Generation of
income
account30 30 48 − 18 B.2 Operating surplus − 18 48 30 30 II.1.1.
Generation of
income
account
II.1.2.
Allocation of
primary
income
account230 13 217 6 14 35 106 56 D.41 Interest 33 106 14 49 7 209 21 230 II.1.2.
Allocation of
primary
income
account22 22 1 35 − 21 48 − 41 B.5 Balance of primary
incomes− 41 48 − 21 35 1 22 22
II.2.
Secondary
distribution of
income
account22 22 1 35 − 21 48 − 41 B.6 Disposable income − 41 48 − 21 35 1 22 22 II.2.
Secondary
distribution of
income
account
II.4.
Use of income
account28 28 3 19 6 P.3 Final consumption
expenditureII.4.
Use of
income
account6 − 6 − 2 16 − 27 48 − 41 B.8n Saving, net/external
balance▼M11996R2223 — EN — 07.08.2003 — 008.001 — 343
Table A.I.2 — Effect to allocating FISIM to nominal sector only
Uses Resources
Accounts TotalGoods
and
servi-
ces
(res.)S.2
Rest
of the
worldS.1
Total
econ-
omyS.15
PISHsS.14
Hous-
eholdsS.13
Gene-
ral
gover-
nmentS.12
Finan-
cial
corpo-
ration-
sS.11
Non-
finan-
cial
corpo-
ration-
sNomi-
nalTransactions and balancing itemsNomi-
nalS.11
Non-
finan-
cial
corpo-
ration-
sS.12
Finan-
cial
corpo-
ration-
sS.13
Gene-
ral
gover-
nmentS.14
Hous-
eholdsS.15
PISHsS.1
Total
econ-
omyS.2
Rest
of the
worldGoods
and
servi-
ces
(uses)Total Accounts
I.
Production
accountP.1 Output 48 48 48 I.
Production
account48 48 48 P.2 Intermediate
consumption48 48
48 − 48 B.1 Value added/
external balance−4 8 4 8
II.1.1.
Generation
of income
account48 − 48 B.2 Operating surplus − 48 48 II.1.1.
Generation
of income
account
II.1.2.
Allocation of
primary
income
account222 16 206 7 17 39 77 66 D.41 Interest 25 125 12 33 5 200 22 222 II.1.2.
Allocation of
primary
income
accountP.119 Adjustment for
FISIM48 − 48
− 6 − 2 16 − 27 48 − 41 B.5 Balance of primary
incomes− 41 48 − 27 16 − 2 − 6
II.2.
Secondary
distribution
of income
account− 6 − 2 16 − 27 48 − 41 B.6 Disposable income − 41 48 − 27 16 − 2 − 6 II.2.
Secondary
distribution
of income
account
II.4.
Use of
income
account6 − 6 − 2 16 − 27 48 − 41 B.8n Saving, net/external
balanceII.4.
Use of
income
account▼M11996R2223 — EN — 07.08.2003 — 008.001 — 344
▼B
ANNEX II
LEASING AND HIRE PURCHASE OF DURABLE GOODS
DEFINITIONS
1. In addition to purchasing durable goods outright, institutional units can
obtain the use of them in the following ways: operating leasing, financial
leasing and hire purchase. In all three cases the institutional unit in question
acquires the right to use a durable good, although the good legally remains
the property of another unit.
Leasing
2. When one institutional unit A owns a durable good and transfers the right to
use this good to another unit B, A is said to be the ‘lessor’ and B the
‘lessee’. Payments from B to A in exchange for the transfer of user rights
are called ‘rental payments’. The lessor may be identical with, or a
subsidiary of, the producer or seller of the durable good, but the lessor may
also be a completely independent unit with no ties to the producer or seller.
All sorts of produced durable goods, from buildings and structures to
consumer durables, may be the subject of leasing, and any kind of
institutional unit may use leasing to obtain user rights over durable goods.
The two types of leasing, operating and financial leasing, are treated quite
differently in the system.
Operating leasing
3. The lessee acquires the right to use a durable good for a certain period of
time, which may be long or short and not necessarily settled in advance.
When the leasing period expires, the lessor expects to receive his good back
in more or less the same condition as when he hired it, apart from normal
wear and tear. The lessor is then likely to hire the good to another lessee or
to use it otherwise. Thus, the leasing period does not cover all, or a
predominant part of, the good's economic lifetime.
Units engaged in operating leasing possess expert knowledge about the
kinds of durable goods they hire. They keep stocks of these goods to be able
to hire them on demand or at short notice. Usually they offer a variety of
models to choose from. In order to keep their durable goods in good
working order, lessors must carry out maintenance and repair services on
goods awaiting hire. Lessors also normally assume responsibility for repairand maintenance of a good, as well as replacement in case of a breakdown,
while the good is hired to a lessee.
Operating leasing does not cover situations where the owner of equipment
also provides staff to operate the equipment, or the hiring of non-produced
assets, as these activities are classified elsewhere (see paragraph 7).
Financial leasing
4. The lessee acquires the right to use a durable good in exchange for rental
payments over a predetermined and protracted term. If all risks and rewards
of ownership are, de facto though not de jure , transferred from lessor to
lessee, the lease is a financial one. In financial leasing, the leasing period
covers all, or most of, the economic lifetime of the durable good. At the end
of the leasing period the lessee often has the option to buy the good at a
nominal price. The lessor does not need to possess any expertise about the
good in question. He offers no repair, maintenance or replacement services
to the lessee. Normally, the good is chosen by the lessee and delivered
directly to him by the producer or seller. The lessor's role is thus purely
financial.
The ESA recognizes the economic reality behind financial leasing by
recording it as follows: the lessor provides the lessee with a loan enabling
the lessee to purchase a durable good, of which the lessee becomes the de
facto owner. Thus, the system treats the durable good as if owned by the
lessee from the beginning of the leasing period. Rentals actually paid by the
lessee to the lessor have to be subdivided into repayments of principal and
interest payments related to the imputed loan.
Hire purchase
5. A durable good is sold to a purchaser in return for agreed future payments.
The buyer takes possession of the good immediately, though in law it
remains the property of the seller or financier as collateral/guarantee until1996R2223 — EN — 07.08.2003 — 008.001 — 345
▼B
all agreed payments have been made. Hire purchase is usually restricted to
consumer durables, and most purchasers are households. Financiers of hire
purchase contracts are typically separate institutional units operating in
close cooperation with sellers of durable goods.
TREATMENT IN THE ACCOUNTS
Operating leasing
6. A durable good purchased by a lessor for the purpose of leasing is part of
the lessor's gross fixed capital formation (P.51) and is shown as a tangible
fixed asset (AN.III) in the lessor's balance sheet during its entire economic
life. Subsequent capital consumption (K.1) in respect of the durable good is
recorded in the lessor's accounts.
Rental payments received by a lessor are shown in his production account as
output (P.1) of leasing services. If the lessee is a producer, rental payments
are part of his intermediate consumption (P.2). When the lessee is a
household acting as a final consumer, rental payments are part of his final
consumption expenditure (P.3).
7. In NACE Rev. 1, operating leasing of real estate is classified in class 70.20
‘Letting of own property’. Operating leasing of other durable goods is
classified in division 71 ‘Renting of machinery and equipment without
operator and of personal and household goods’. Operating leasing does not
comprise the renting of machinery or equipment with operating staff, which
is classified according to the services provided by the equipment and staff.
For example, the hiring of a lorry with driver is classified in class 60.24
‘Freight transport by road’. Institutionally, operating leasing corporations
are classified in sector S.11 ‘Non-financial corporations’, but operating
lessors may also be found in sector S.14 ‘Households’.
If the lessor is resident while the lessee is non-resident, rental payments are
shown as exports of services (P.62). As the leased good remains on the
balance sheet of a resident unit (the lessor), the good does not appear in any
of the rest of the world accounts. If the lessor is non-resident while the
lessee is resident, rental payments are recorded as imports of services
(P.72). In this case the good itself is not considered to enter the economic
territory (only its services are). Thus the leased good appears neither in the
rest of the world accounts nor in any other account.
Financial leasing
8. If the lessee is a producer, the durable good is shown as gross fixed capital
formation (P.51) for the lessee at the beginning of the leasing period.
Throughout the leasing period (unless the lessee defaults on the rental
payments) the good is shown as a tangible fixed asset (AN.III) in the
balance sheet of the lessee. Subsequent capital consumption (K.1) is shown
in the accounts of the lessee. At the end of the leasing period, either (i) the
lessee buys the good at its residual value when it remains on his balance
sheet, or (ii) the good reverts to the lessor, when it is shown as negative
gross fixed capital formation for the lessee and thus leaves the lessee's
balance sheet, and may enter the balance sheet of the lessor or that of a third
party, to whom the lessor has sold on.
9. If the lessee is a household acting as a final consumer, the durable good is
treated as if bought by the lessee for the purpose of final consumption at the
beginning of the leasing period. This means that the purchaser's price of the
leased good is part of the lessee's final consumption expenditure (P.3) at the
beginning of the leasing period and that the good appears only as a
consumer durable in the memorandum item to his balance sheet.
A loan (F.4) is imputed from lessor to lessee. The principal of this loan is
the purchaser's price of the leased good plus transfer costs (if any). The
outstanding imputed loan (AF.4) is shown in the lessor's and lessee's
balance sheets as a financial asset and liability, respectively. Payments of
rental are considered to comprise two elements, repayment of principal (F.4)
and interest (D.41), with the final repayment coinciding with the
termination of the financial lease..
10. The interest rate on the imputed loan is implicitly determined so that
accumulated repayments over the leasing period exactly equal the principal.
When rental remains constant from period to period, the interest part of
rental will decline over time, while the repayment part will increase
correspondingly, as for a loan payable in equal instalments. When principal,
rental and length of the leasing period are known for each contract, the
interest rate, the interest payments and the repayments can easily be
calculated using standard formulae. When detailed data on each leasing
contract are not available, which is often the case in practice, reasonable1996R2223 — EN — 07.08.2003 — 008.001 — 346
▼B
assumptions must be made in order to carry out these calculations. In many
countries business accounting treats financial leasing in a similar way as
described here, which facilitates the data situation.
11. Financial lessors' productive activity is financial intermediation. Usually
lessors do not charge explicitly for their intermediation services. Their
output is therefore mainly or exclusively financial intermediation services
indirectly measured (Fisim), calculated similarly to other financial
intermediaries ►M1 ◄(1). Some financial lessors incur
liabilities to other independent units when interest payable is observable and
the calculation of Fisim is straightforward. Other financial lessors incur
liabilities only to their parent companies when interest payable may be
difficult to observe. In the latter case it may be necessary to estimate the
amount of interest payable by using an appropriate interest rate.
Financial leasing corporations are classified in the institutional subsector
S.123 ‘Other financial intermediaries except insurance corporations and
pension funds’. The activity classification is NACE Rev. 1 class 65.21
‘Financial leasing’.
12. The ESA's treatment of financial leasing implies that the leased good does
not appear in any of the lessor's accounts. Whether or not the lessor is
resident or non-resident is thus of no consequence to the treatment of the
good itself. If the producer or seller of the good is resident while the lessee
is non-resident, the leased good is treated as exported (P.61) when the lessee
takes possession of it, i.e. at the beginning of the leasing period. If the
producer/seller is non-resident while the lessee is resident, the good is
considered to be imported (P.71) when the leasing period begins.
If the lessor is resident while the lessee is not, a loan (F.4/AF.4) is imputed
from a resident unit (the lessor) to a non-resident unit (the lessee). If the
lessor is non-resident and the lessee is resident, a loan is imputed from a
non-resident unit (the lessor) to a resident unit (the lessee). As in the case of
leasing transactions between residents, rental payments are broken down
into interest (D.41) and repayments of principal (F.4).
Hire purchase
13. The durable good is recorded as if bought by the purchaser the day he takes
possession of it at the price the purchaser would have paid in a cash
transaction. The purchaser receives an imputed loan (F.4/AF.4) of
equivalent value. The ESA splits the payments from purchaser to financier
into repayments of principal (F.4) and interest payments (D.41), using the
same method as the one applied for financial leasing.
The productive activity carried out by financiers of hire purchase contracts
is financial intermediation. As they do not usually charge explicitly for their
services, their entire output is financial intermediation services indirectly
measured (Fisim), calculated as property income receivable less interest
payable, excluding any property income receivable from own funds. As in
the case of financial leasing, the amount of interest payable may be difficult
to observe and must therefore be estimated.
14. In NACE Rev. 1, financiers of hire purchase contracts are classified in class
65.22 ‘Other credit granting’. Hire purchase corporations are classified in
institutional subsector S.123 ‘Other financial intermediaries except
insurance corporations and pension funds’, but financiers of hire purchase
contracts may also be encountered in sector S.14 ‘Households’.
If the purchaser is non-resident while the financier is resident, the good is
treated as exported (P.61) when the purchaser takes possession of it. In this
case, the financier provides a non-resident unit (the purchaser) with a loan
(F.4/AF.4). If the purchaser is a resident unit while the financier is not, the
good is recorded as imported (P.71) when delivered to the purchaser, who at
the same time obtains a loan (F.4/AF.4) from the non-resident financier.
Repayments of principal (F.4) and interest payments (D.41) are treated in
the same way as for financial leasing involving non-resident units.1996R2223 — EN — 07.08.2003 — 008.001 — 347
(1) For further details see Chapter 3, paragraph 3.63.
▼B
ANNEX III
INSURANCE
INTRODUCTION
1. There are two main types of insurance: social insurance and other insurance.
Social insurance may be subdivided into
(a) social security schemes of government,
(b) private funded social insurance schemes, and
(c) unfunded social insurance schemes operated by employers.
Other insurance may be subdivided into
(a) other life insurance, and
(b) other non-life insurance.
Reinsurance and insurance auxiliaries are treated in separate sections of this
Annex. These topics relate mainly to other insurance, but they may also
relate to social insurance.
DEFINITIONS
Social insurance
2. Social insurance schemes are schemes in which social contributions are paid
by employees or other individuals, or by employers on behalf of their
employees, in order to secure entitlement to social insurance benefits for the
employees or other contributors, their dependants or survivors. Social
insurance schemes cover social risks or needs (1). Unlike social assistance
benefits, social insurance benefits are conditional on participation in a
scheme.
3. Social insurance schemes are often organized collectively so that those
participating do not have to take out individual insurance policies in their
own names. However, some social insurance schemes may permit, or even
require, participants to take out policies in their own names. Individual
policies are treated as part of a social insurance scheme if they cover social
risks or needs and if at least one of the following three conditions is
satisfied:
(a) participation in the scheme is compulsory either by law or by the
conditions of employment,
(b) the scheme is operated on behalf of a group and restricted to group
members, or
(c) an employer makes a contribution to the scheme on behalf of an
employee.
Social security schemes of government
4. These schemes are imposed, controlled and financed by government units
and cover the entire community, or large sections of the community. Social
security schemes of government may be funded or unfunded. When separate
funds can be identified, they remain the property of the government and not
of the beneficiaries of the schemes. Social security schemes' receipts consist
mainly of contributions paid by individuals and by employers on behalf of
their employees, but they may also include transfers from other government
units. Participation in social security schemes is usually, though not always,
compulsory. The benefits paid to individuals are not necessarily determined
by the amounts previously paid in contributions.
It should be noted that social insurance schemes organized by government
units for their own employees are not classified as social security schemes,
but as private funded or unfunded social insurance schemes.
Private funded social insurance schemes
5. There are two categories of such schemes. The first consists of schemes in
which the social contributions are paid to insurance enterprises or
autonomous pension funds that are separate institutional units from both1996R2223 — EN — 07.08.2003 — 008.001 — 348
(1) See Chapter 4, paragraphs 4.83 to 4.86, for a definition of social risks or needs.
▼B
the employers and the employees. The insurance enterprises or autonomous
pension funds are responsible for managing the resulting funds and paying
the social benefits. The second category consists of schemes in which
employers maintain special reserves to defray social benefits. These
reserves are segregated from their other reserves, but they do not constitute
separate institutional units from the employers and are referred to as non-
autonomous pension funds.
Unfunded social insurance schemes operated by employers
6. These are schemes in which employers pay social benefits to their
employees, former employees or their dependants out of their own resources
without creating special reserves for the purpose.
Other insurance
7. Other insurance provides individual institutional units exposed to certain
risks with financial protection against the consequences of the occurrence of
specified events. It is also a form of financial intermediation in which funds
are collected from policy holders and invested in financial or other assets
which are held as technical reserves to meet future claims arising from the
occurrence of the events specified in the insurance policies.
Other insurance policies held by households may cover the same risks or
needs as those covered by social insurance schemes. However, other
insurance policies held by households are distinguished from social
insurance policies by the fact that they are taken out on the individual
household's own initiative and for their own benefit, independently of their
employers or government.
Other life insurance
8. Holders of other life insurance policies are exclusively households, resident
or non-resident. The policyholder makes regular payments to an insurer in
return for which the insurer guarantees to provide a benefit at a given date
or earlier if the policyholder dies before. If the policyholder cancels the
policy before the agreed expiration date, the policyholder is entitled to a
partial benefit from the insurer. A benefit is thus always paid to the
policyholder or his survivors. Policies that provide a benefit in the case ofdeath within a given period but in no other circumstances, usually called
term insurance, are not regarded as other life insurance, but as other non-life
insurance. In practice, because of the way in which insurance corporations
keep their accounts, it may not always be possible to separate term
insurance from other life insurance. In these circumstances, term insurance
may have to be treated in the same way as life insurance for purely practical
reasons.
A life insurance claim may be paid as a lump sum or as an annuity. The
claim may be fixed or may vary to reflect the income earned from the
investment of premiums during the period for which the policy operates
(‘with-profit’ policies). A special kind of with-profit policy is a unit-linked
policy, where the claim varies according to the value of a segregated fund.
Other non-life insurance
9. All kinds of institutional units may be holders of other non-life insurance
policies. Other non-life insurance includes term insurance and insurance
against every risk other than death, for example accidents, sickness or fire.
Claims are usually paid as lump sums but may also be paid as annuities. A
claim is not always paid in respect of an other non-life insurance policy.
Typically the number of claimants is much smaller than the number of
policyholders. For an individual policyholder there is no relationship
between the premiums paid and the claims received, even in the long term.
Reinsurance
10. An insurance enterprise undertaking insurance with policyholders often
transfers some of the risks incurred to other insurance enterprises. These
transactions between insurance enterprises are called reinsurance.
Both life and non-life insurers are involved in reinsurance transactions.
Insurance enterprises that accept reinsurance may engage in both
reinsurance and insurance with policyholders, or they may be specialist
reinsurers.1996R2223 — EN — 07.08.2003 — 008.001 — 349
▼B
Insurance auxiliaries
11. Insurance auxiliaries are units that engage primarily in activities closely
related to insurance but which do not themselves incur risks. Insurance
auxiliaries include in particular:
(a) insurance brokers;
(b) private non-profit institutions serving insurance enterprises and pension
funds;
(c) units whose main activity is to act as supervisory authorities of
insurance enterprises and pension funds and of insurance markets.
TREATMENT IN THE ACCOUNTS
12. For ease of exposition, the following description of the different types of
insurance concentrates on cases where only resident units are involved. At
the end of each section, special features for cases involving non-resident
units are considered.
Social insurance
Social security schemes of government
13. The output produced by those employed in managing these schemes is part
of government output, valued at the cost of production. Consequently, no
service charge is calculated for social security schemes of government.
Employers' contributions to government social security schemes (D.121) are
treated as part of employees' compensation, shown as payable by the
employer's sector in the generation of income account and receivable by the
household sector in the allocation of primary income account. Employers'
contributions reappear in the secondary distribution of income account as
part of employers' actual social contributions (D.6111), payable by the
household sector and receivable by government. Employees' contributions
(D.6112) and contributions by self-employed and non-employed persons
(D.6113) are also recorded in the secondary distribution of income account
as payable by the household sector and receivable by government. Social
security benefits in cash (D.621) are shown in the secondary distribution of
income account as payable by government and receivable by households,
while social security benefits in kind are shown as item D.6311 and D.6312,
payable by government and receivable by households in the redistribution of
income in kind account.
14. The units managing social security schemes of government are classified in
subsector S.1314 ‘Social security funds’. The activity classification
according to NACE Rev. 1 is class 75.30 ‘Compulsory social security
activities’.
When a resident works for a non-resident employer, the employer's
contributions are shown as payable by the rest of the world in the external
account of primary incomes and current transfers. If the employee also
participates in a social security scheme run by a non-resident government,
all receivables and payables normally concerning the government sector are
receivable or payable by the rest of the world, recorded in the external
account of primary incomes and current transfers. However, in the ESA
social transfers in kind occur only between resident units. Any benefits from
non-resident social security schemes to residents are therefore by definition
social benefits other than social transfers in kind (D.62).
When a non-resident works for a resident employer, the employer's
contributions are recorded as receivable by the rest of the world in the
external account of primary incomes and current transfers. If the non-
resident employee is covered by a resident social security scheme, the
transactions between the employee and the government sector are recorded
in the external account of primary incomes and current transfers. By
definition, any benefits to non-resident employees are social benefits other
than social transfers in kind (D.62)
An example of the flows recorded for social security schemes of
government is shown in Table A.III.1.1996R2223 — EN — 07.08.2003 — 008.001 — 350
▼B
Private funded social insurance schemes
15. Schemes financed by autonomous funds are treated differently from
schemes financed by non-autonomous funds. For autonomous funds, a
service charge is calculated as (A):
total actual contributions earned
plus total contribution supplements
less benefits due
less increases (plus decreases) in pension fund reserves.
16. All four items are recorded exclusive of holding gains or losses. Total
contribution supplements are identical to property income attributed to
policyholders, which is income earned by private social insurance funds by
investing their technical and pension reserves. The ESA regards these
reserves as owned by the policyholders, who therefore receive the income
generated by these reserves. The service charge is recorded as output (P.1)
for the autonomous funds and as final consumption expenditure (P.3) for the
household sector.
For non-autonomous funds no service charge is calculated. The costs of
managing these funds are included with the other elements of costs in the
employers' production account.
17. The remaining transactions apply to both autonomous and non-autonomous
funds. Employers' actual contributions (D.121) are shown as part of
compensation of employees, payable by the employer's sector in the
generation of income account and receivable by employee households in the
allocation of primary income account. The employer's sector may be any
institutional sector, including general government and households (as
employers). Property income attributed to policyholders (part of D.4) is
shown in the allocation of primary income account as payable by the fund'ssector and receivable by the household sector. Resident autonomous funds
are located in the insurance enterprises and pension funds subsector (S.125).
Non-autonomous funds obviously belong to the same sector as the employer
in question. NACE Rev. 1 classifies the activity of pension funds in class
66.02 ‘Pension funding’.
18. Employers' actual contributions are recorded again in the secondary
distribution of income account as part of D.6111, payable by households
and receivable by the fund's sector. Employees' contributions (D.6112) and
contributions by self-employed and non-employed persons (D.6113) are
also recorded in the secondary distribution of income account as payable by
the household sector and receivable by the fund's sector. The contributionsmade by employees and by self-employed and non-employed persons equal
the direct payments made plus property income attributed to policyholders
less service charge (this last being zero for non-autonomous funds). Private
funded social benefits, including pensions, are shown in the secondary
distribution of income account as payable by funds and receivable by
households. By definition, all private funded social benefits are part of
D.62, social benefits other than social transfers in kind.
19. The entry in the financial account contains two elements:
(a) prepayments of insurance premiums and reserves for outstanding claims
(F.62), which comprise any difference between contributions payable
and contributions earned and between benefits due and benefits
payable (
1). By convention this element is shown as a change (negative
if necessary) in funds' liabilities and household assets,
(b) net equity of households in pension funds reserves (F.612), also shown
as a change (negative if necessary) in funds' liabilities and household
reserves. This element equals employers' and employees' contributions
in respect of pensions, as recorded in the secondary distribution of
income account, less pensions payable.
20. As a consequence of the entry in the financial account, F.612 and F.62
appear in the balance sheets of the household sector (as an asset) and the
fund's sector (as a liability).1996R2223 — EN — 07.08.2003 — 008.001 — 351
(1) Actual contributions earned, which cover risks incurred during the current period,
usually differ from actual contributions payable. The latter often cover risks in both thecurrent and subsequent periods. Similarly, benefits due are not always equal to benefitspayable. Benefits due to an event occurring in one accounting period may not become
payable until a later period.
▼B
In the use of disposable income account, an adjustment for change in net
equity of households in pension funds reserves (D.8) is recorded as
receivable by households and payable by funds. This entry equals the
second element of the entry in the financial account.
Employers and general government occasionally make extraordinary
payments to private social insurance funds in order to increase the reserves
of these funds. Such payments are recorded in the capital account as other
capital transfers (D.99), payable by the employer's sector or the government
sector and receivable by the fund's sector. As social insurance funds'
reserves are treated as if owned by the household sector, an accompanying
adjustment between the fund's sector and the household sector is required.
This adjustment is recorded as other capital transfers (D.99), payable by the
fund's sector and receivable by the household sector.
21. If a resident employee works for a non-resident employer, the employer's
actual contributions (D.121) are recorded as part of compensation of
employees, payable by the rest of the world and receivable by households.
When the employer is non-resident, any non-autonomous social insurance
fund will also be non-resident, while an autonomous fund may be resident
or non-resident. If the employee is covered by a non-resident fund, all flows
between the household sector and the fund's sector are shown as transactions
between the household sector and the rest of the world. The service charge
(in the case of autonomous, on-resident funds) is shown as imports of
services (P.72). The change in net equity of insurance technical reserves
(F.6) is shown in the financial account of the rest of the world, while the
remaining flows are shown in the external account of primary incomes and
current transfers.
22. If a non-resident employee works for a resident employer, the employer's
actual contributions (D.121) are part of compensation of employees,
payable by the employer's sector and receivable by the rest of the world. If
the non-resident employee is covered by a resident social insurance fund,
any service charge is recorded as exports of services (P.62). All other flows
between fund and employee are shown as between the fund's sector and the
rest of the world.
Especially when non-resident units are involved, all the requisite data are
not always available. The calculations of some of the items to be recorded
sometimes have to be based on assumptions.
An example of the flows recorded for private funded social insurance
schemes is shown in Table A.III.2.
Unfunded social insurance schemes operated by employers
23. Similar to schemes financed by non-autonomous funds, the costs of
managing unfunded social insurance schemes are included with the other
elements of costs on the employer's production account. Thus, no service
charge is calculated.
As unfunded social insurance schemes do not form separate institutional
units from the employers operating them, all transactions are between the
employer's sector and the household sector.
24. The ESA regards an employer operating an unfunded scheme as making an
imputed contribution to the scheme on behalf of his employees. This
imputed social contribution (D.122) is part of compensation to employees
and is shown as payable by the employer in the generation of income
account and receivable by households in the allocation of primary income
account. The employer's imputed contribution is shown again in the
secondary distribution of income account as item D.612, payable by
households and receivable by the employer. The amount of this contribution
should be determined by reference to the employer's future obligations to
provide benefits. In practice, however, the contribution is usually set equal
to benefits payable in the current period (less employees' social
contributions).
25. Actual contributions by employees, if any, are shown as part of D.6112,
payable by households and receivable by the employer's sector. The
secondary distribution of income account also shows pensions and other
benefits as part of D.62, receivable by households and payable by the
employer.
Unfunded social insurance schemes obviously belong to the same
institutional sector as the employer in question. NACE Rev. 1 regards
them as an ancillary activity.
26. If a resident works for a non-resident employer operating an unfunded social
insurance scheme, all transactions are between the household sector and the
rest of the world, recorded in the external account of primary incomes and1996R2223 — EN — 07.08.2003 — 008.001 — 352
▼B
current transfers. If a non-resident works for a resident employer operating
such a scheme, all transactions are between the rest of the world and the
employer's sector, shown in the external account of primary incomes and
current transfers.
An example of the flows recorded for unfunded social insurance schemes
operated by employers is shown in Table A.III.3.
Other insurance
27. The output of other insurance services, both life and non-life, is calculated
as (B):
actual premiums earned
plus premium supplements
less claims due
less increases (plus decreases) in technical provisions against
outstanding risks and technical provisions for with-
profits insurance.
28. Actual premiums earned are the actual premiums that cover the risks
incurred during the current period. Actual premiums earned are usually not
equal to actual premiums receivable, as the latter often cover risks incurring
in both the current and subsequent periods.
Premium supplements are identical to property income attributed to
policyholders, which is the entire income earned by insurance enterprises
by investing their insurance technical reserves, excluding any income from
insurance enterprises' own funds. Insurance technical reserves contain two
elements: (a) prepayments of insurance premiums and reserves for
outstanding claims, arising from the difference between premiums earned
and premiums receivable and between claims payable and claims due, and
(b) technical provisions against outstanding risks and technical provisions
for with-profits insurance. The latter element applies only to life insurance.
Insurance technical reserves are usually invested in financial assets which
yield income in the form of interest or dividends. However, these reserves
may also be invested in real estate, for example, in which case income is
earned as operating surplus.
29. Claims due cover events that occur within the current period. Frequently,
claims do not become payable until a later period than when the event
giving rise to them occurred. Claims due are therefore not equal to claims
payable.
Changes in technical provisions against outstanding risks and technical
provisions for with-profits insurance consist of allocations to technical
provisions against outstanding risks and provisions for with-profits
insurance policies to build up the capital sums guaranteed under these
policies. These provisions relate to life insurance only.
All four items in equation (B) should be measured excluding holding gains
and losses.
Other life insurance
30. Total output of other life insurance is calculated according to equation (B)
and shown as item P.1 in the production account of the insurance enterprises
and pension funds subsector. Unless consumed by non-resident households,
the output of other life insurance is entirely used as final consumption by
resident households. The output of life insurance services should be
distributed between the household sector and the rest of the world in
proportion to premiums payable by resident and non-resident households.
Life insurance services consumed by residents are shown as part of
households' final consumption expenditure (P.3), while services consumed
by non-residents are part of exports of services (P.62).
31. Two further transactions are recorded for other life insurance. In the
allocation of primary income account, property income attributed to
policyholders (part of D.4) is shown as payable by the insurance enterprises'
sector and receivable by households. In the financial account, the item net
equity of households in life insurance reserves is shown as a change
(negative if necessary) in households' assets and life insurance enterprises'
liabilities. The change in the net equity of households is due to changes in
life insurance reserves, that is technical provisons against outstanding risks
and technical provisions for with-profits insurance (F.611). The change in
net equity therefore equals actual premiums payable (not earned) plus1996R2223 — EN — 07.08.2003 — 008.001 — 353
▼B
premium supplements less claims receivable (not due) and less service
charge.
32. Because of this entry in the financial account, F.611 is also shown in the
balance sheets of the household sector (as an asset) and the insurer's sector
(as a liability).
As with the service charge, property income attributed to policyholders (=
premium supplements) should be distributed between the household sector
and the rest of the world in proportion to premiums.
Institutionally, life insurance enterprises are classified in S.125 ‘Insurance
corporations and pension funds’. The activity classification according to
NACE Rev. 1 is class 66.01 ‘Life insurance’.
33. When a resident life insurance enterprise provides services to non-resident
households, the service charge is recorded as exports of services (P.62).
Property income attributed to policyholders is shown as payable by the
insurance sector and receivable by the rest of the world in the external
account of primary incomes and current transfers. The change in net equity
of non-resident households on life insurance reserves is shown in the
financial account of the rest of the world as a change in the rest of the
world's assets and the insurance sector's liabilities.
When resident households purchase cover from non-resident life insurers,
the procedure is in principle straightforward: the service charge is recorded
as imports of services (P.72), attributed property income is shown in the
external account of primary incomes and current transfers as payable by the
rest of the world and receivable by households, and change in net equity is
shown as a change in households' assets and the rest of the world's
liabilities. However, the data required to calculate these items are normallynot available; usually only premiums payable are known. Assumptions are
therefore necessary, for example applying the ratios of service charge to
premiums and attributed property income to premiums for resident life
insurers to the premiums paid by resident households to non-resident life
insurers.
An example of the flows recorded for other life insurance is shown in Table
A.III.4.
Other non-life insurance
34. The output (P.1) of other non-life insurance enterprises is calculated
according to equation (B) and shown in the production account of the
insurance enterprises and pension funds subsector. Non-life insurance
services may be used as intermediate consumption (P.2) by any resident
sector, as final consumption by the household sector when they are part of
households' final consumption expenditure (P.3), or as exports (P.62). Non-
life insurance services used as intermediate consumption should be broken
down by industry.
Equation (B) should be used to estimate the total value of non-life insurance
output. The output should then be distributed among user sectors and
industries in proportion to actual premiums payable by each sector. Whereas
all resident sectors except households use non-life insurance services for
intermediate consumption only, the household sector uses them for both
final and intermediate consumption. Households' use of non-life insurance
services should be broken down into intermediate and final consumption in
proportion to actual premiums payable. Premiums clearly associated with
the productive activity of unincorporated enterprises should be regarded as
related to intermediate consumption, while the remaining premiums paid by
households should be considered as being related to final consumption.
35. In the allocation of primary income account, property income attributed to
policyholders is recorded as part of D.4, payable by the insurance sector and
receivable by the policyholder sectors. Ideally, property income attributed to
policyholders should be distributed among sectors in proportion to the
reserves attributed to each policyholder sector, but this is hardly feasible in
practice. Property income attributed to policyholders should therefore be
distributed in proportion to actual premiums paid by each policyholder
sector.1996R2223 — EN — 07.08.2003 — 008.001 — 354
▼B
36. In the secondary distribution of income account net premiums earned are
shown as payable by all policyholder sectors and receivable by the
insurance sector. Net premiums earned are calculated as actual premiums
earned plus property income attributed to policyholders less the value of
services consumed. By equation (B), net premiums earned equal claims
due (1). The secondary distribution of income account also shows claims due
as payable by the insurance sector and receivable by all policyholder
sectors. Both net premiums earned and claims due are part of item D.7,
‘Other current transfers’.
Some claims arise because of damage or injuries that the policyholder
causes to the property or persons of third parties. In such cases, valid claims
are recorded as being payable directly by the insurance enterprise to the
injured parties and not indirectly via the policyholder.
37. In the financial account, net equity of policyholders in non-life insurance
reserves is shown as a change in assets of policyholder sectors and a change
in liabilities of the insurance sector. The change in net equity, classified as
F.62, is due to prepayments of premiums and reserves for outstanding
claims. F.62 also appears as a liability in the non-life insurer's balance sheet
and an asset in policyholders' balance sheets.
Non-life insurance enterprises belong to NACE Rev. 1 class 66.03 ‘Non-life
insurance’. Their institutional sector is S.125, ‘Insurance corporations and
pension funds’.
38. When non-resident units purchase cover from resident non-life insurers, the
service charge is shown as exports of services (P.62). Property income
attributed to policyholders, net premiums earned and claims due are all
recorded in the external account of primary incomes and current transfers,
while net equity of policyholders in non-life insurance reserves is shown in
the financial account of the rest of the world. In this case, the calculations
for the rest of the world are no more difficult than those for any resident
policyholder sector.
When resident units are insured by non-resident non-life insurers, the data
situation is far more difficult; only data on premiums payable and claims
receivable are normally available. A simplified method, ignoring non-life
insurance reserves and their subsequent property income, is therefore used:
the service charge, which is recorded as imports of services (P.72), is
calculated as premiums payable less claims receivable (2). Net premiums
payable are calculated as premiums payable less service charge, thus
equalling claims receivable. Both net premiums payable and claims
receivable are shown in the external account of primary incomes and
current transfers.
An example of the flows recorded for other non-life insurance is shown in
Table A.III.5.
Reinsurance
39. The ESA records reinsurance transactions in a simpler way than direct
insurance transactions (the latter meaning transactions between insurance
enterprises and ordinary policyholders). Instead of showing the flows
involved (premiums earned, claims due, commissions, etc.) separately,
reinsurance transactions are simply shown as a service delivered from
reinsurer to direct insurer. The value of this service is measured as the
balance of all flows occurring between reinsurer and direct insurer.
For resident life and non-life insurance enterprises, reinsurance services
produced are shown as output (P.1), while reinsurance services received are
shown as intermediate consumption (P.2). Reinsurance services delivered
from resident reinsurers to non-resident insurers are shown as exports of
services (P.62), while services delivered from non-resident reinsurers to
resident insurers are recorded as imports of services (P.72).
40. For resident insurance enterprises data on output and intermediate
consumption of reinsurance services can be obtained from insurance
statistics. Calculating imports and exports of reinsurance services may be
more difficult, depending mainly on the availability and quality of balance
of payments statistics. However, the external balance of reinsurance
services can easily be derived from insurance statistics.1996R2223 — EN — 07.08.2003 — 008.001 — 355
(1) ‘Claims due’ means the amounts due to be transferred to claimants. Claims due are thus
not the same as ‘claims incurred’ in insurance enterprises' accounts, as the latter alsoinclude claims management expenses, which in the national accounts are part of eitherintermediate consumption or compensation of employees.
(
2) If available, premiums earned and claims due should be used rather than premiums
payable and claims receivable.
▼B
Reinsurance transactions between resident insurance enterprises are often
consolidated. However, in order to be in accordance with the EC insurance
directives, the ESA recommends reinsurance services be recorded without
consolidation. Whether or not reinsurance services between residents are
consolidated affects the level of output of insurance services, but balancing
items such as value added, operating surplus and saving are not affected.
Insurance auxiliaries
41. The output of auxiliary insurance services is valued on the basis of the fees
or commissions charged. In the case of non-profit institutions operating as
business associations for insurance enterprises and pension funds, their
output is valued by the amounts of subscriptions paid by the members of the
associations. This output is used as intermediate consumption by the
members of the associations.
Institutional units principally engaged in auxiliary insurance activities are
classified in S.124, ‘Financial auxiliaries’. The activity classification
according to NACE Rev. 1 is class 67.20, ‘Activities auxiliary to insurance
and pension funding’.1996R2223 — EN — 07.08.2003 — 008.001 — 356
INSURANCE: NUMERICAL EXAMPLE
A.III.1 — Social security schemes of Government
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
Generation of
income account
155 0 155 8 0 45 4 98 D.121 Employers'
social security
contributions
Distribution of
primary income
account
D.121 Employers'
social security
contributions 155 155 0 155
Secondary distri-
bution of income
account
155 0 155 155 D.6111 Employers'
social security
contributions 155 155 0 155
76 0 76 76 D.6112 Employees'
social security
contributions 76 76 0 76
32 32 32 D.6113 Social contribu-
tions by self-
employed and
non-employed
persons 32 32 0 32▼B1996R2223 — EN — 07.08.2003 — 008.001 — 357
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
232 0 232 232 D.621 Social security
benefits in cash 232 232 0 232
Redistribution of
income in kind
account
78 78 78 D.6311 Social security
benefits in kind,
reimbursements 78 78 78
65 65 65 D.6312 Other social
security benefits
in kind 65 65 65▼B1996R2223 — EN — 07.08.2003 — 008.001 — 358
A.III.2 — Private funded social insurance schemes
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
External account
0 0 P.6 Exports of goods
and services 0 0
0 0 P.7 Imports of goods
and services 0 0
Production
account
3 3 P.1 Output 3 3 3
Generation of
income account
19 0 19 2 0 3 0 14 D.121 Employers'
actual social
contributions to
private funded
schemes
Allocation of
primary income
account
D.121 Employers'
actual social
contributions to
private funded
schemes 19 19 0 19▼B1996R2223 — EN — 07.08.2003 — 008.001 — 359
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
12 0 12 12 D.44 Property income
attributable to
insurance policy-
holders 12 12 0 12
Secondary distri-
bution of income
account
19 0 19 19 D.121 Employers'
actual social
contributions to
private funded
schemes 1 18 0 0 0 19 0 19
21 0 21 21 D.6112 Employees' net
social contribu-
tions 1 20 0 0 0 21 0 21
29 0 29 0 0 0 28 1 D.622 Private funded
benefits 29 29 0 29
Use of dispo-
sable income
account 0
3 3 3 0 P.3 Final consump-
tion expenditure 3 3
11 0 11 0 0 10 1 D.8 Adjustment for
the change in net
equity of house-
holds in pension
funds reserves 11 11 0 11▼B1996R2223 — EN — 07.08.2003 — 008.001 — 360
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
Financial
account
11 11 11 F.612 Net equity of
households in
pension funds
reserves 1 10 0 0 11 0 11
1 1 1 F.62 Prepayments of
insurance
premiums and
reserves for
outstanding
claims 1 1 1▼B1996R2223 — EN — 07.08.2003 — 008.001 — 361
A.III.3 — Unfunded schemes operated by employers
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
PISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
PISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
Generation of
income account
19 0 19 1 0 5 1 12 D.122 Employers,
imputed social
contributions
Distribution of
primary income
account
D.122 Employers,
imputed social
contributions 19 19 0 19
Secondary distri-
bution of income
account
19 0 19 19 D.612 Imputed social
contributions 12 1 5 0 1 19 0 19
19 0 19 1 0 5 1 12 D.623 Unfunded
employee social
benefits 19 19 0 19▼B1996R2223 — EN — 07.08.2003 — 008.001 — 362
A.III.4 — Other life insurance
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
External account
0 0 P.6 Exports of goods
and services 0 0
0 0 P.7 Imports of goods
and services 0 0
Production
account
4 4 P.1 Output 4 4 4
Distribution of
primary income
account
7 7 7 D.44 Property income
attributable to
insurance policy-
holders 7 7 0 7
Use of dispo-
sable income
account
4 0 4 4 P.3 Final consump-
tion expenditure 4 4
Financial
account▼B1996R2223 — EN — 07.08.2003 — 008.001 — 363
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
22 0 22 22 F.611 Net equity of
households in
life insurance
reserves 22 22 0 22▼B1996R2223 — EN — 07.08.2003 — 008.001 — 364
A.III.5 — Other non-life insurance
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
External account
0 0 P.6 Exports of goods
and services 0 0
0 0 P.7 Imports of goods
and services 0 0
Production
account
6 6 P.1 Output 6 6 6
4 0 4 0 3 0 0 1 P.2 Intermediate
consumption 4 4
Distribution of
primary income
account
6 6 6 D.44 Property income
attributable to
insurance policy-
holders 5 0 0 1 0 6 0 6
Secondary distri-
bution of income
account
45 2 43 0 31 4 0 8 D.71 Net non-life
insurance
premiums 45 45 45▼B1996R2223 — EN — 07.08.2003 — 008.001 — 365
Uses Resources
TotalCorresponding
entries of theS.1
Total
economyS.15
NPISHsS.14
House-
holdsS.13
General
govern-
mentS.12
Financial
corpora-
tionsS.11
Non-
financial
corpora-
tionsTransactions and balancing itemsS.11
Non-
financial
corpora-
tionsS.12
Financial
corpora-
tionsS.13
General
govern-
mentS.14
House-
holdsS.15
NPISHsS.1
Total
economyCorresponding
entries of the
Total Goods
and
services
accountRest of
the
world
accountRest of
the
world
accountGoods
and
services
account
45 0 45 45 D.72 Non-life insur-
ance claims 6 0 1 35 0 42 3 45
Use of dispo-
sable income
account
2 2 2 P.3 Final consump-
tion expenditure 2 2
Financial
account
2 0 2 0 2 0 0 0 F.62 Prepayments of
insurance
premiums and
reserves for
outstanding
claims 2 2 2▼B1996R2223 — EN — 07.08.2003 — 008.001 — 366
▼B
ANNEX IV
CLASSIFICATIONS AND ACCOUNTS
CLASSIFICATIONS
CLASSIFICATION OF INSTITUTIONAL SECTORS (S)
S.1 Total economy
S.11 Non-financial corporationsS.11001 Public non-financial corporations
S.11002 National private non-financial corporations
S.11003 Foreign controlled non-financial corporationsS.12 Financial corporations
S.121 The Central Bank
S.122 Other monetary financial institutionsS.12201 Public
S.12202 National private
S.12203 Foreign controlledS.123 Other financial intermediaries, except insurance corporations
and pension funds
S.12301 Public
S.12302 National private
S.12303 Foreign controlledS.124 Financial auxiliaries
S.12401 Public
S.12402 National privateS.12403 Foreign controlled
S.125 Insurance corporations and pension funds
S.12501 PublicS.12502 National privateS.12503 Foreign controlled
S.13 General government
S.1311 Central governmentS.1312 State government
S.1313 Local government
S.1314 Social security fundsS.14 Households
S.141 + S.142 Employers (including own-account workers)
S.143 EmployeesS.1441 Recipients of property income
S.1442 Recipients of pensions
S.1443 Recipients of other transfer incomesS.145 Other households
S.15 Non-profit institutions serving households
S.2 Rest of the worldS.21 The European Union
S.211 The member countries of the EU
S.212 The institutions of the EU1996R2223 — EN — 07.08.2003 — 008.001 — 367
▼B
S.22 Third countries and international organisations
CLASSIFICATION OF TRANSACTIONS AND OTHER FLOWS
Transactions in goods and services (products) (P)
P.1 Output
P.11 Market output
P.119 Adjustment FisimP.12 Output for own final use
P.13 Other non-market output
P.131 Payments for the other non-market output
P.132 Other non-market output, other
P.2 Intermediate consumption
P.3 Final consumption expenditureP.31 Individual consumption expenditure
P.32 Collective consumption expenditure
P.4 Actual final consumptionP.41 Actual individual consumption
P.42 Actual collective consumption
P.5 Gross capital formationP.51 Gross fixed capital formation
P.511 Acquisitions less disposals of tangible fixed assets
P.5111 Acquisitions of new tangible fixed assetsP.5112 Acquisitions of existing tangible fixed assets
P.5113 Disposals of existing tangible fixed assets
P.512 Acquisitions less disposals of intangible fixed assetsP.5121 Acquisitions of new intangible fixed assets
P.5122 Acquisitions of existing intangible fixed assets
P.5123 Disposals of existing intangible fixed assetsP.513 Addition to the value of non-financial non-produced assets
P.5131 Major improvements to non-financial non-produced assets
P.5132 Costs of ownership transfer on non-financial non-produced
assets
P.52 Changes in inventories
P.53 Acquisitions less disposals of valuablesP.6 Exports of goods and services
P.61 Exports of goods
P.62 Exports of servicesP.7 Imports of goods and services
P.71 Imports of goods
P.72 Imports of services
Distributive transactions (D)
D.1 Compensation of employees
D.11 Wages and salaries
D.12 Employers' social contributions1996R2223 — EN — 07.08.2003 — 008.001 — 368
▼M2
▼B
▼B
D.121 Employers' actual social contributions
D.122 Employers' imputed social contributions
D.2 Taxes on production and imports
D.21 Taxes on products
D.211 Value-added type taxes (VAT)
D.212 Taxes and duties on imports excluding VAT
D.2121 Import duties
D.2122 Taxes on imports excluding VAT and import duties
D.214 Taxes on products, except VAT and import taxes
D.29 Other taxes on production
D.3 Subsidies
D.31 Subsidies on products
D.311 Import subsidies
D.319 Other subsidies on products
D.39 Other subsidies on production
D.4 Property income
D.41 Interest
D.42 Distributed income of corporations
D.421 Dividends
D.422 Withdrawals from income of quasi-corporations
D.43 Reinvested earnings on direct foreign investment
D.44 Property income attributed to insurance policy holders
D.45 Rents
D.5 Current taxes on income, wealth, etc.
D.51 Taxes on income
D.59 Other current taxes
D.6 Social contributions and benefits
D.61 Social contributions
D.611 Actual social contributions
D.6111 Employers' actual social contributions
D.61111 Compulsory employers' actual social contributions
D.61112 Voluntary employers' actual social contributions
D.6112 Employees' social contributions
D.61121 Compulsory employees' social contributions
D.61122 Voluntary employees' social contributionsD.6113 Social contributions by self- and non-employed persons
D.61131 Compulsory social contributions by self- and non-employed
persons
D.61132 Voluntary social contributions by self- and non-employed
persons
D.612 Imputed social contributions
D.62 Social benefits other than social transfers in kind
D.621 Social security benefits in cash
D.622 Private funded social benefits
D.623 Unfunded employee social benefits
D.624 Social assistance benefits in cash
D.63 Social transfers in kind1996R2223 — EN — 07.08.2003 — 008.001 — 369
▼B
D.631 Social benefits in kind
D.6311 Social security benefits, reimbursements
D.6312 Other social security benefits in kind
D.63121 Other social security benefits in kind provided by market
producers
D.63122 Other social security benefits in kind provided by non-market
producers
D.6313 Social assistance benefits in kind
D.63131 Social assistance benefits in kind provided by market
producers
D.63132 Social assistance benefits in kind provided by non-market
producers
D.632 Transfers of individual non-market goods and services
D.7 Other current transfersD.71 Net non-life insurance premiums
D.72 Non-life insurance claims
D.73 Current transfers within general governmentD.74 Current international cooperation
D.75 Miscellaneous current transfers
D.8 Adjustment for the change in net equity of households in
pension funds reserves
D.9 Capital transfers
D.91 Capital taxesD.92 Investment grants
D.99 Other capital transfers
D.995 Capital transfers from general government to relevant sectors
representing taxes and social contributions assessed but
unlikely to be collected
D.99521 Taxes on products assessed but unlikely to be collectedD.99529 Other taxes on production assessed but unlikely to be collected
D.99551 Taxes on income assessed but unlikely to be collected
D.99559 Other current taxes assessed but unlikely to be collectedD.9956111 Employers' actual social contributions assessed but unlikely to
be collected
D.9956112 Employees' social contributions assessed but unlikely to be
collected
D.9956113 Social contributions by self- and unemployed persons assessed
but unlikely to be collected
D.99591 Capital taxes assessed but unlikely to be collected
Transactions in financial instruments (F) (Net acquisition of financial assets/
net incurrence of liabilities)
F.1 Monetary gold and special drawing rights (SDRs)
F.11 Monetary goldF.12 Special drawing rights (SDRs)
F.2 Currency and deposits
F.21 Currency1996R2223 — EN — 07.08.2003 — 008.001 — 370
▼M2
▼B
▼M2
▼B
▼M4
▼B
▼B
F.22 Transferable deposits
F.29 Other deposits
F.3 Securities other than shares
F.33 Securities other than shares, excluding financial derivativesF.331 Short-term-securities other than shares, excluding financial
derivatives
F.332 Long-term-securities other than shares, excluding financial
derivatives
F.34 Financial derivativesF.4 Loans (
a)
F.41 Short-term loans
F.42 Long-term loansF.5 Shares and other equity (
a)
F.51 Shares and other equity, excluding mutual fund shares
F.511 Quoted sharesF.512 Unquoted shares
F.513 Other equity
F.52 Mutual fund sharesF.6 Insurance technical reserves
F.61 Net equity of households in life insurance reserves and in
pension fund reserves
F.611 Net equity of households in life insurance reserves
F.612 Net equity of households in pension fund reserves
F.62 Prepayments of insurance premiums and reserves for
outstanding claims
F.7 Other accounts receivable/payable (
a)
F.71 Trade credits and advances
F.79 Other accounts receivable/payable, except trade credits and
advances
(a) Memo item: F.m: direct foreign investment.
Other accumulation entries (K)
K.1 Consumption of fixed capital
K.2 Acquisitions less disposals of non-financial non-produced
assets
K.21 Acquisitions less disposals of land and other tangible non-
produced assets
K.211 Acquisitions of land and other tangible non-produced assets
K.212 Disposals of land and other tangible non-produced assetsK.22 Acquisitions less disposals of intangible non-produced assets
K.221 Acquisitions of intangible non-produced assets
K.222 Disposals of intangible non-produced assetsK.3 Economic appearance of non-produced assets
K.4 Economic appearance of produced assets
K.5 Natural growth of non-cultivated biological resourcesK.6 Economic disappearance of non-produced assets
K.61 Depletion of natural economic assets
K.62 Other economic disappearance of non-produced assets1996R2223 — EN — 07.08.2003 — 008.001 — 371
▼B
K.7 Catastrophic losses
K.8 Uncompensated seizures
K.9 Other volume changes in non-financial assets n.e.c.
K.10 Other volume changes in financial assets and liabilities
n.e.c.
K.11 Nominal holding gains/losses
K.11.1 Neutral holding gains/lossesK.11.2 Real holding gains/losses
K.12 Changes in classifications and structure
K.12.1 Changes in sector classification and structureK.12.2 Changes in classification of assets and liabilities
K.12.21 Monetization/demonetization of gold
K.12.22 Changes in classification of assets or liabilities other than
monetization/demonetization of gold
CLASSIFICATION OF BALANCING ITEMS (b) (B)
B.1 Value-added/B.1* Domestic product
B.2 Operating surplus
B.3 Mixed incomeB.4 Entrepreneurial income
B.5 Balance of primary incomes/B.5* National income
B.6 Disposable incomeB.7 Adjusted disposable income
B.8 Saving
B.9 Net lending/net borrowingB.10 Changes in net worth
B.10.1 Changes in net worth due to saving and capital transfers (
c), (d)
B.10.2 Changes in net worth due to other changes in volume of assetsB.10.3 Changes in net worth due to nominal holding gains/losses
B.10.31 Changes in net worth due to neutral holding gains/losses
B.10.32 Changes in net worth due to real holding gains/lossesB.11 External balance of goods and services
B.12 Current external balance
B.90 Net worthBF.90 Net financial assets
(c) ‘Changes in net worth due to saving and capital transfers’ is not a balancing item in the
structure of the system. It is the total of the right side of the capital account. However, as
a significant component of changes in net worth, it is coded with the other componentsof the latter.
(
d) ‘Changes in net worth due to saving and capital transfers’ for the rest of the world refers
to changes in net worth due to current external balance and capital transfers.
CLASSIFICATION OF ASSETS (A)
Non-financial assets (AN)1996R2223 — EN — 07.08.2003 — 008.001 — 372
(b) All balancing items can be measured gross or net of consumption of fixed capital. The
code for gross balancing items is constituted of the code of the item plus the letter ‘g’.
Similarly, the letter ‘h’ attached to a code indicates net value.
▼B
AN.1 Produced assets
AN.11 Fixed assets
AN.111 Tangible fixed assets
AN.1111 DwellingsAN.1112 Other buildings and structuresAN.11121 Non-residential buildings
AN.11122 Other structures
AN.1113 Machinery and equipmentAN.11131 Transport equipmentAN.11132 Other machinery and equipment
AN.1114 Cultivated assets
AN.11141 Livestock for breeding, dairy, draught, etc.AN.11142 Vineyards, orchards and other plantations of trees yielding
repeat products
AN.112 Intangible fixed assetsAN.1121 Mineral explorationAN.1122 Computer software
AN.1123 Entertainment, literary or artistic originals
AN.1129 Other intangible fixed assetsAN.12 InventoriesAN.121 Materials and supplies
AN.122 Work in progress
AN.1221 Work in progress on cultivated assetsAN.1222 Other work in progressAN.123 Finished goods
AN.124 Goods for resale
AN.13 ValuablesAN.131 Precious metals and stones
AN.132 Antiques and other art objects
AN.139 Other valuablesAN.2 Non-produced assetsAN.21 Tangible non-produced assets
AN.211 Land
AN.2111 Land underlying buildings and structuresAN.2112 Land under cultivationAN.2113 Recreational land and associated surface water
AN.2119 Other land and associated surface water
AN.212 Subsoil assetsAN.2121 Coal, oil and natural gas reservesAN.2122 Metallic mineral reserves
AN.2123 Non-metallic mineral reserves
AN.213 Non-cultivated biological resourcesAN.214 Water resourcesAN.22 Intangible non-produced assets
AN.221 Patented entities
AN.222 Leases and other transferable contracts1996R2223 — EN — 07.08.2003 — 008.001 — 373
▼B
AN.223 Purchased goodwill
AN.229 Other intangible non-produced assets
Financial assets/liabilities (AF)
AF.1 Monetary gold and drawing rights (SDRs)
AF.11 Monetary goldAF.12 Special drawing rights (SDRs)
AF.2 Currency and deposits
AF.21 CurrencyAF.22 Transferable deposits
AF.29 Other deposits
AF.3 Securities other than sharesAF.33 Securities other than shares, excluding financial derivatives
AF.331 Short-term securities other than shares, excluding financial
derivatives
AF.332 Long-term securities other than shares, excluding financial
derivatives
AF.34 Financial derivatives
AF.4 Loans (
e)
AF.41 Short-term loansAF.42 Long-term loans
AF.5 Shares and other equity (
e)
AF.51 Shares and other equity, excluding mutual fund sharesAF.511 Quoted shares
AF.512 Unquoted shares
AF.513 Other equityAF.52 Mutual fund shares
AF.6 Insurance technical reserves
AF.61 Net equity of households in life insurance reserves and in
pension fund reserves
AF.611 Net equity of households in life insurance reserves
AF.612 Net equity of households in pension fund reservesAF.62 Prepayments of insurance premiums and reserves for
outstanding claims
AF.7 Other accounts receivable/payable
AF.71 Trade credits and advances
AF.79 Other accounts receivable/payable, except trade credits and
advances
(e) Memorandum item AF.m: direct foreign investment.
REGROUPING AND CODING OF INDUSTRIES (A), PRODUCTS
(P) AND INVESTMENTS (FIXED CAPITAL FORMATION) (PI)
A60
Code DescriptionReference
NACE Rev.1
01 Agriculture, hunting and related service activ-
ities01
02 Forestry, logging and related service activities 021996R2223 — EN — 07.08.2003 — 008.001 — 374
▼B
Code DescriptionReference
NACE Rev.1
05 Fishing; operation of fish hatcheries and fish
farms; service activities incidental to fishing05
10 Mining of coal and lignite; extraction of peat 10
11 Extraction of crude petroleum and natural gas;
service activities incidental to oil and gas
extraction excluding surveying11
12 Mining of uranium and thorium ores 12
13 Mining of metal ores 13
14 Other mining and quarrying 14
15 Manufacture of food products and beverages 1516 Manufacture of tobacco products 1617 Manufacture of textiles 1718 Manufacture of wearing apparel; dressing and
dyeing of fur18
19 Tanning and dressing of leather; manufacture of
luggage, handbags, saddlery, harness and foot-
wear19
20 Manufacture of wood and of products of wood
and cork, except furniture; manufacture of
articles of straw and plaiting materials20
21 Manufacture of pulp, paper and paper products 21
22 Publishing, printing and reproduction of
recorded media22
23 Manufacture of coke, refined petroleum
products and nuclear fuel23
24 Manufacture of chemicals and chemical
products24
25 Manufacture of rubber and plastic products 25
26 Manufacture of other non-metallic mineral
products26
27 Manufacture of basic metals 27
28 Manufacture of fabricated metal products,
except machinery and equipment28
29 Manufacture of machinery and equipment n.e.c. 29
30 Manufacture of office machinery and computers 3031 Manufacture of electrical machinery and appa-
ratus n.e.c.31
32 Manufacture of radio, television and commu-
nication equipment and apparatus32
33 Manufacture of medical, precision and optical
instruments, watches and clocks33
34 Manufacture of motor vehicles, trailers and
semi-trailers34
35 Manufacture of other transport equipment 35
36 Manufacture of furniture; manufacturing n.e.c. 3637 Recycling 3740 Electricity, gas, steam and hot water supply 4041 Collection, purification and distribution of
water41
45 Construction 45
50 Sale, maintenance and repair of motor vehicles
and motorcycles; retail sale of automotive fuel50
51 Wholesale trade and commission trade, except
of motor vehicles and motorcycles511996R2223 — EN — 07.08.2003 — 008.001 — 375
▼B
Code DescriptionReference
NACE Rev.1
52 Retail trade, except of motor vehicles and
motorcycles; repair of personal and household
goods52
55 Hotels and restaurants 55
60 Land transport; transport via pipelines 60
61 Water transport 61
62 Air transport 62
63 Supporting and auxiliary transport activities;
activities of travel agencies63
64 Post and telecommunications 64
65 Financial intermediation, except insurance and
pension funding65
66 Insurance and pension funding, except compul-
sory social security66
67 Activities auxiliary to financial intermediation 67
70 Real estate activities 70
71 Renting of machinery and equipment without
operator and of personal and household goods71
72 Computer and related activities 72
73 Research and development 73
74 Other business activities 74
75 Public administration and defence; compulsory
and social security75
80 Education 80
85 Health and social work 85
90 Sewage and refuse disposal, sanitation and
similar activities90
91 Activities of membership organization n.e.c. 91
92 Recreational, cultural and sporting activities 92
93 Other service activities 93
95 Private households with employed persons 95
99 Extra-territorial organizations and bodies 99
A31
Code DescriptionReference
NACE Rev.1
AA Agriculture, hunting and forestry A
BB Fishing B
CA Mining and quarrying of energy-producing
materialsCA
CB Mining and quarrying except energy-producing
materialsCB
DA Manufacture of food products; beverages and
tobaccoDA
DB Manufacture of textiles and textile products DB
DC Manufacture of leather and leather products DC
DD Manufacture of wood and wood products DD
DE Manufacture of pulp, paper and paper products;
publishing and printingDE
DF Manufacture of coke, refined petroleum
products and nuclear fuelDF1996R2223 — EN — 07.08.2003 — 008.001 — 376
▼B
Code DescriptionReference
NACE Rev.1
DG Manufacture of chemicals, chemical products
and man-made fibresDG
DH Manufacture of rubber and plastic products DH
DI Manufacture of other non-metallic mineral
productsDI
DJ Manufacture of basic metals and fabricated
metal productsDJ
DK Manufacture of machinery and equipment n.e.c. DK
DL Manufacture of electrical and optical equipment DL
DM Manufacture of transport equipment DM
DN Manufacturing n.e.c. DN
EE Electricity, gas and water supply E
FF Construction F
GG Wholesale and retail trade; repair of motor
vehicles, motorcycles and personal and house-
hold goodsG
HH Hotels and restaurants H
II Transport, storage and communication I
JJ Financial intermediation J
KK Real estate, renting and business activities K
LL Public administration and defence; compulsory
social securityL
MM Education M
NN Health and social work N
OO Other community, social and personal service
activitiesO
PP Private households with employed persons P
QQ Extra-territorial organizations and bodies Q
A17
Code DescriptionReference
NACE Rev.1
A Agriculture, hunting and forestry A
B Fishing B
C Mining and quarrying C
D Manufacturing D
E Electricity, gas and water supply E
F Construction F
G Wholesale and retail trade; repair of motor
vehicles, motorcycles and personal and house-
hold goodsG
H Hotels and restaurants H
I Transport, storage and communication I
J Financial intermediation J
K Real estate, renting and business activities K
L Public administration and defence; compulsory
social securityL
M Education M
N Health and social work N
O Other community, social and personal service
activitiesO1996R2223 — EN — 07.08.2003 — 008.001 — 377
▼B
Code DescriptionReference
NACE Rev.1
P Private households with employed persons P
Q Extra-territorial organizations and bodies Q
P60
Code DescriptionReference
CPA
01 Products of agriculture, hunting and related
services01
02 Products of forestry, logging and related
services02
05 Fish and other fishing products, services
incidental to fishing05
10 Coal and lignite; peat 10
11 Crude petroleum and natural gas; services
incidental to oil and gas extraction excluding
surveying11
12 Uranium- and thorium ores 12
13 Metal ores 13
14 Other mining and quarrying products 14
15 Food products and beverages 15
16 Tobacco products 16
17 Textiles 17
18 Wearing apparel; furs 18
19 Leather and leather products 19
20 Wood and products of wood and cork (except
furniture), articles of straw and plaiting mate-
rials20
21 Pulp, paper and paper products 21
22 Printed matter and recorded media 22
23 Coke, refined petroleum products and nuclear
fuels23
24 Chemicals, chemical products and man-made
fibres24
25 Rubber and plastic products 25
26 Other non-metallic mineral products 26
27 Basic metals 27
28 Fabricated metal products, except machinery
and equipment28
29 Machinery and equipment n.e.c. 29
30 Office machinery and computers 30
31 Electrical machinery and apparatus n.e.c. 31
32 Radio, television and communication equip-
ment and apparatus32
33 Medical, precision and optical instruments,
watches and clocks33
34 Motor vehicles, trailers and semi-trailers 34
35 Other transport equipment 35
36 Furniture; other manufactured goods n.e.c. 36
37 Recovered secondary raw materials 37
40 Electrical energy, gas, steam and hot water 40
41 Collected and purified water, distribution
services of water411996R2223 — EN — 07.08.2003 — 008.001 — 378
▼B
Code DescriptionReference
CPA
45 Construction work 45
50 Trade, maintenance and repair services of motor
vehicles and motorcycles; retail trade services
of automotive fuel50
51 Wholesale trade and commission trade services,
except of motor vehicles and motorcycles51
52 Retail trade services, except of motor vehicles
and motorcycles; repair services of personal and
household goods52
55 Hotel and restaurant services 55
60 Land transport and transport via pipeline
services60
61 Water transport services 61
62 Air transport services 62
63 Supporting and auxiliary transport services;
travel agency services63
64 Post and telecommunication services 64
65 Financial intermediation services, except insur-
ance and pension-funding services65
66 Insurance and pension-funding services, except
compulsory social security services66
67 Services auxiliary to financial intermediation 67
70 Real estate services 70
71 Renting services of machinery and equipment
without operator and of personal and household
goods71
72 Computer and related services 72
73 Research and development services 73
74 Other business services 74
75 Public administration and defence services;
compulsory social security services75
80 Education services 80
85 Health and social work services 85
90 Sewage and refuse disposal services, sanitation
and similar services90
91 Membership organization services n.e.c. 91
92 Recreational, cultural and sporting services 92
93 Other services 93
95 Private households with employed persons 95
99 Services provided by extra-territorial organiza-
tions and bodies99
P31
Code DescriptionReference
CPA
AA Products of agriculture, hunting and forestry A
BB Fish B
CA Coal and lignite; peat; crude petroleum and
natural gas; uranium and thoriumCA
CB Metal ores and other mining and quarrying
productsCB
DA Food products, beverages and tobacco DA
DB Textiles and textile products DB1996R2223 — EN — 07.08.2003 — 008.001 — 379
▼B
Code DescriptionReference
CPA
DC Leather and leather products DC
DD Wood and wood products DD
DE Pulp, paper and paper products; recorded
media; printing servicesDE
DF Coke, refined petroleum products and nuclear
fuelDF
DG Chemicals, chemical products and man-made
fibresDG
DH Rubber and plastic products DH
DI Other non-metallic mineral products DI
DJ Basic metals and fabricated metal products DJ
DK Machinery and equipment n.e.c. DK
DL Electrical and optical equipment DL
DM Transport equipment DM
DN Other manufactured goods n.e.c. DN
EE Electrical energy, gas, steam and hot water E
FF Construction work F
GG Wholesale and retail trade services; repair
services of motor vehicles, motorcycles and
personal and household goodsG
HH Hotel and restaurant services H
II Transport, storage and communication services I
JJ Financial intermediation services J
KK Real estate, renting and business services K
LL Public administration and defence services,
compulsory social security servicesL
MM Education services M
NN Health and social services N
OO Other community, social and personal services O
PP Private households with employed persons P
QQ Services provided by extra-territorial organiza-
tions and bodiesQ
P17
Code DescriptionReference
CPA
A Products of agriculture, hunting and forestry A
B Fish B
C Products from mining and quarrying C
D Manufactured products D
E Electrical energy, gas, steam and hot water E
F Construction work F
G Wholesale and retail trade services; repair
services of motor vehicles, motorcycles and
personal and household goodsG
H Hotel and restaurant services H
I Transport, storage and communication services I
J Financial intermediation services J
K Real estate, renting and business services K
L Public administration and defence services,
compulsory social security servicesL1996R2223 — EN — 07.08.2003 — 008.001 — 380
▼B
Code DescriptionReference
CPA
M Education services M
N Health and social services N
O Other community, social and personal services O
P Private households with employed persons P
Q Services provided by extra-territorial organiza-
tions and bodiesQ
A6—A3
A6
Code DescriptionReference
NACE Rev.1
1 Agriculture, hunting and forestry; fishing and
operation of fish hatcheries and fish farmsA+B
2 Industry, including energy C + D + E
3 Construction F
4 Wholesale and retail trade, repair of motor
vehicles and household goods, hotels and
restaurants; transport and communicationsG+H+I
5 Financial, real estate, renting and business
activitiesJ+K
6 Other service activities L to P
A3
Code DescriptionReference
NACE Rev.1
1 Agriculture, hunting and forestry; fishing and
operation of fish hatcheries and fish farmsA+B
2 Industry, including energy and construction C + D + E + F
3 Service activities G to P
P6—P3
P6
Code DescriptionReference
CPA
1 Products of agriculture, forestry, fisheries and
aquacultureA+B
2 Products from mining and quarrying, manufac-
tured products, energy productsC+D+E
3 Construction work F
4 Wholesale and retail trade, repair services, hotel
and restaurant services, transport and commu-
nication servicesG+H+I
5 Financial intermediation services, real estate,
renting and business servicesJ+K
6 Other services L to P1996R2223 — EN — 07.08.2003 — 008.001 — 381
▼B
P3
Code DescriptionReference
CPA
1 Products of agriculture, forestry, fisheries and
aquacultureA+B
2 Products from mining and quarrying, manufac-
tured products and energy products and
construction workC+D+E+F
3 Services G to P
Pi6—Pi3
Pi6
Code DescriptionReference
CPA
1 Products of agriculture, forestry, fisheries and
aquaculture01 + 02 + 05
Equipment: —
2 Metal products and machinery 28 to 33 + 363 Transport equipment 34 + 35
Construction: 45
4 Of which housing —
5 Of which other constructions —
6 Other products Remaining
divisions
Pi3
Code DescriptionReference
CPA
1 Metal products and machinery, transport equip-
ment28 to 36
2 Construction 45
3 Other products Remaining
divisions1996R2223 — EN — 07.08.2003 — 008.001 — 382
▼M6
CLASSIFICATION OF INDIVIDUAL CONSUMPTION BY
PURPOSE (COICOP)
1. Food and non-alcoholic beverages
1.1. Food
1.2. Non-alcoholic beverages
2. Alcoholic beverages, tobacco and narcotics
2.1. Alcoholic beverages
2.2. Tobacco2.3. Narcotics
3. Clothing and footwear
3.1. Clothing
3.2. Footwear
4. Housing, water, electricity, gas and other fuels
4.1. Actual rentals for housing
4.2. Imputed rentals for housing4.3. Maintenance and repair of the dwelling
4.4. Water supply and miscellaneous services relating to the dwelling
4.5. Electricity, gas and other fuels
5. Furnishings, household equipment and routine households mainte-
nance
5.1. Furniture and furnishings, carpets and other floor coverings
5.2. Household textiles5.3. Household appliances5.4. Glassware, tableware and household utensils5.5. Tools and equipment for house and garden5.6. Goods and services for routine household maintenance
6. Health
6.1. Medical products, appliances and equipment
6.2. Outpatient services6.3. Hospital services
7. Transport
7.1. Purchase of vehicles
7.2. Operation of personal transport equipment7.3. Transport services
8. Communication
8.1. Postal services
8.2. Telephone and fax equipment8.3. Telephone and fax services
9. Recreation and culture
9.1. Audio-visual, photographic and information processing equipment
9.2. Other major durables for recreation and culture9.3. Other recreational items and equipment, gardens and pets9.4. Recreational and cultural services9.5. Newspapers, books and stationery9.6. Package holidays1996R2223 — EN — 07.08.2003 — 008.001 — 383
▼M6
10. Education
10.1. Pre-primary and primary education
10.2. Secondary education10.3. Post-secondary non-tertiary education
10.4. Tertiary education
10.5. Education not definable by level
11. Restaurants and hotels
11.1. Catering services
11.2. Accommodation services
12. Miscellaneous goods and services
12.1. Personal care
12.2. Prostitution12.3. Personal effects n.e.c.12.4. Social protection
12.5. Insurance
12.6. Financial services n.e.c.12.7. Other services n.e.c.
13. Individual consumption expenditure of non-profit institutions serving
households (NPISHs)
13.1. Housing
13.2. Health13.3. Recreation and culture13.4. Education13.5. Social protection13.6. Other services
14. Individual consumption expenditure of general government
14.1. Housing
14.2. Health
14.3. Recreation and culture
14.4. Education14.5. Social protection
CLASSIFICATION OF THE FUNCTIONS OF THE GOVERNMENT
(COFOG)
1. General public services
1.1. Executive and legislative organs, financial and fiscal affairs, external
affairs
1.2. Foreign economic aid1.3. General services1.4. Basic research
1.5. R & D general public services
1.6. General public services n.e.c.1.7. Public debt transactions1.8. Transfers of a general character between different levels of government
2. Defence
2.1. Military defence
2.2. Civil defence2.3. Foreign military aid
2.4. R & D defence
2.5. Defence n.e.c.1996R2223 — EN — 07.08.2003 — 008.001 — 384
▼M6
3. Public order and safety
3.1. Police services
3.2. Fire-protection services
3.3. Law courts
3.4. Prisons
3.5. R & D public order and safety
3.6. Public order and safety n.e.c.
4. Economic affairs
4.1. General economic, commercial and labour affairs
4.2. Agriculture, forestry, fishing and hunting
4.3. Fuel and energy
4.4. Mining, manufacturing and construction
4.5. Transport
4.6. Communication
4.7. Other industries
4.8. R & D economic affairs
4.9. Economic affairs n.e.c.
5. Environmental protection
5.1. Waste management
5.2. Waste water management
5.3. Pollution abatement
5.4. Protection of biodiversity and landscape5.5. R & D environmental protection
5.6. Environmental protection n.e.c.
6. Housing and community amenities
6.1. Housing development
6.2. Community development
6.3. Water supply
6.4. Street lighting6.5. R & D housing and community amenities
6.6. Housing and community amenities n.e.c.
7. Health
7.1. Medical products, appliances and equipment
7.2. Outpatient services
7.3. Hospital services
7.4. Public health services7.5. R & D health
7.6. Health n.e.c.
8. Recreation, culture and religion
8.1. Recreational and sporting services
8.2. Cultural services
8.3. Broadcasting and publishing services
8.4. Religious and other community services8.5. R & D recreation, culture and religion
8.6. Recreation, culture and religion n.e.c.
9. Education
9.1. Pre-primary and primary education
9.2. Secondary education
9.3. Post-secondary non-tertiary education1996R2223 — EN — 07.08.2003 — 008.001 — 385
▼M6
9.4. Tertiary education
9.5. Education not definable by level
9.6. Subsidiary services to education9.7. R & D education9.8. Education n.e.c.
10. Social protection
10.1. Sickness and disability
10.2. Old age
10.3. Survivors
10.4. Family and children10.5. Unemployment10.6. Housing
10.7. Social exclusion n.e.c.
10.8. R & D social protection10.9. Social protection n.e.c.
CLASSIFICATION OF THE PURPOSES OF NON-PROFIT INSTITU-
TIONS SERVING HOUSEHOLDS (COPNI)
1. Housing
1.0. Housing
2. Health
2.1. Medical products, appliances and equipment
2.2. Outpatient services
2.3. Hospital services
2.4. Public health services2.5. R & D health
2.6. Other health services
3. Recreation and culture
3.1. Recreational and sporting services
3.2. Cultural services
4. Education
4.1. Pre-primary and primary education
4.2. Secondary education
4.3. Post-secondary non-tertiary education
4.4. Tertiary education4.5. Education not definable by level4.6. R & D education
4.7. Other educational services
5. Social protection
5.1. Social protection services
5.2. R & D social protection
6. Religion
6.0. Religion
7. Political parties, labour and professional organisations
7.1. Services of political parties
7.2. Services of labour organisations7.3. Services of professional organisations1996R2223 — EN — 07.08.2003 — 008.001 — 386
▼M6
8. Environmental protection
8.1. Environmental protection services
8.2. R & D environmental protection
9. Services n.e.c.
9.1. Services n.e.c.
9.2. R & D services n.e.c.1996R2223 — EN — 07.08.2003 — 008.001 — 387
▼B
ACCOUNTS
Table A.IV.1 — Account 0: Goods and services account
Uses Resources
P.1 Output 3 595 P.2 Intermediate consumption 1 904
P.11 Market output 3 048P.12 Output for own use 171 P.3/P.4 Final consumption expendi-
ture/Actual final
consumption 1 371
P.31/
P.41Individual consumption
expenditure/Actual indivi-
dual consumption 1 215
P.13 Other non-market output 376 P.32/
P.42Collective consumption
expenditure/Actual collective
consumption 156
D.21 Taxes on products 141D.31 Subsidies on products −8 P.51 Gross fixed capital formation 376
P.511 Acquisitions less disposals of
tangible fixed assets 303
P.7 Imports of goods and
services 497P.5111 Acquisitions of new tangible
fixed assets 305
P.71 Imports of goods 392 P.5112 Acquisitions of existing
tangible fixed assets 11
P.72 Imports of services 105 P.5113 Disposals of existing tangible
fixed assets −13
P.512 Acquisitions less disposals of
intangible fixed assets 51
P.5121 Acquisitions of new intan-
gible fixed assets 53
P.5122 Acquisitions of existing
intangible fixed assets 6
P.5123 Disposals of existing intan-
gible fixed assets −8
P.513 Additions to the value of
non-produced non-financial
assets 22
P.5131 Major improvements to non-
produced non-financial assets 5
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 17
P.52 Changes in inventories 28
P.53 Acquisitions less disposals of
valuables 101996R2223 — EN — 07.08.2003 — 008.001 — 388
▼B
Uses Resources
P.6 Exports of goods and
services 536
P.61 Exports of goods 462
P.62 Exports of services 74
Table A.IV.2 — Full sequence of accounts for the total economy
I:Production account
Uses Resources
P.2 Intermediate consumption 1 904 P.1 Output 3 595
P.11 Market output 3 048
P.12 Output for own final use 171P.13 Other non-market output 376D.21-
D.31Taxes less subsidies on
products133
B.1*g Gross domestic product 1 824
K.1 Consumption of fixed capital 222B.1*n Net domestic product 1 602
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 762 B.1* Domestic product 1 602
D.11 Wages and salaries 569D.12 Employers' social contribu-
tions 193
D.121 Employers' actual social
contributions 174
D.122 Employers' imputed social
contributions 19
D.2 Taxes on production and
imports 235
D.21 Taxes on products 141
D.211 Value-added type taxes
(VAT) 121
D.212 Taxes and duties on imports
excluding VAT 17
D.2121 Import duties 171996R2223 — EN — 07.08.2003 — 008.001 — 389
▼B
Uses Resources
D.2122 Taxes on imports excluding
VAT and duties 0
D.214 Taxes on products except
VAT and import taxes 3
D.29 Other taxes on production 94
D.3 Subsidies −44
D.31 Subsidies on products −8D.311 Import subsidies 0
D.319 Other subsidies on products −8
D.39 Other subsidies on produc-
tion −36
B.2 Operating surplus 217
B.3 Mixed income 432
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 380 B.2 Operating surplus 217
D.41 Interest 206 B.3 Mixed income 432
D.42 Distributed income of
corporations 84
D.421 Dividends 60 D.1 Compensation of employees 766D.422 Withdrawals from income of
quasi-corporations 24D.11 Wages and salaries 573
D.43 Reinvested earnings on direct
foreign investment 0D.12 Employers' social contribu-
tions 193
D.44 Property income attributed to
insurance policyholders 25D.121 Employers' actual social
contributions 174
D.45 Rent 65 D.122 Employers' imputed social
contributions 19
D.2 Taxes on production and
imports 235
D.21 Taxes on products 141D.211 Value-added type taxes
(VAT) 121
D.212 Taxes and duties on imports
excluding VAT 17
D.2121 Import duties 171996R2223 — EN — 07.08.2003 — 008.001 — 390
▼B
Uses Resources
D.2122 Taxes on imports excluding
VAT and duties 0
D.214 Taxes on products except
VAT and import taxes 3
D.29 Other taxes on production 94
D.3 Subsidies −44
D.31 Subsidies on products −8D.311 Import subsidies 0
D.319 Other subsidies on products −8
D.39 Other subsidies on produc-
tion −36
D.4 Property income 407
D.41 Interest 200P.119 Adjustment for Fisim 0D.42 Distributed income of
corporations 103
D.421 Dividends 46D.422 Withdrawals from income of
quasi-corporations 57
D.43 Reinvested earnings on direct
foreign investment 14
D.44 Property income attributed to
insurance policyholders 25
D.45 Rent 65
B.5* National income 1 633
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 217 B.2 Operating surplus 217
D.41 Interest 147 B.3 Mixed income 432D.44 Property income attributed to
insurance policyholders 25
D.45 Rent 45 D.4 Property income 247
D.41 Interest 150P.119 Adjustment for Fisim 0
D.42 Distributed income of
corporations 371996R2223 — EN — 07.08.2003 — 008.001 — 391
▼B
Uses Resources
D.421 Dividends 37
D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 11
D.44 Property income attributed to
insurance policyholders 5
D.45 Rent 44
B.4 Entrepreneurial income 679
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 163 B.4 Entrepreneurial income 679
D.41 Interest 59
D.42 Distributed income of
corporations 84D.1 Compensation of employees 766
D.421 Dividends 60 D.11 Wages and salaries 573
D.422 Withdrawals from income of
quasi-corporations 24D.12 Employers' social contribu-
tions 193
D.43 Reinvested earnings on direct
foreign investment 0D.121 Employers' actual social
contributions 174
D.45 Rent 20 D.122 Employers' imputed social
contributions 19
D.2 Taxes on production and
imports 235
D.21 Taxes on products 141D.211 Value-added type taxes
(VAT) 121
D.212 Taxes and duties on imports
excluding VAT 17
D.2121 Import duties 17
D.2122 Taxes on imports excluding
VAT and duties 0
D.214 Taxes on products except
VAT and import taxes 3
D.29 Other taxes on production 94
D.3 Subsidies −44
D.31 Subsidies on products −81996R2223 — EN — 07.08.2003 — 008.001 — 392
▼B
Uses Resources
D.311 Import subsidies 0
D.319 Other subsidies on products −8D.39 Other subsidies on produc-
tion −36
D.4 Property income 160
D.41 Interest 50
D.42 Distributed income of
corporations 66
D.421 Dividends 9
D.422 Withdrawals from income of
quasi-corporations 57
D.43 Reinvested earnings on direct
foreign investment 3
D.44 Property income attributed to
insurance policyholders 20
D.45 Rent 21
B.5* National income 1 633
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc. 212B.5* National income 1 633
D.51 Taxes on income 203
D.59 Other current taxes 9 D.5 Current taxes on income,
wealth, etc. 213
D.51 Taxes on income 204
D.61 Social contributions 322 D.59 Other current taxes 9D.611 Actual social contributions 303 D.61 Social contributions 322D.6111 Employers' actual social
contributions 174D.611 Actual social contributions 303
D.61111 Compulsory employers'
actual social contributions 160D.6111 Employers' actual social
contributions 174
D.61112 Voluntary employers' actual
social contributions 14D.61111 Employers' compulsory
actual social contributions 160
D.6112 Employees' social contribu-
tions 97D.61112 Voluntary employers' actual
social contributions 14
D.61121 Compulsory employees'
social contributions 85D.6112 Employees' social contribu-
tions 97
D.61122 Voluntary employees' social
contributions 12D.61121 Compulsory employers'
actual social contributions 851996R2223 — EN — 07.08.2003 — 008.001 — 393
▼B
Uses Resources
D.6113 Social contributions by self-
and non-employed persons 32D.61122 Voluntary employers' actual
social contributions 12
D.61131 Compulsory social contribu-
tions by self- and non-
employed persons 22D.6113 Social contributions by self-
and non-employed persons 32
D.61132 Voluntary social contribu-
tions by self- and non-
employed persons 10D.61131 Compulsory social contribu-
tions by self- and non-
employed persons 22
D.612 Imputed social contributions 19 D.61132 Voluntary social contribu-
tions by self- and non-
employed persons 10
D.612 Imputed social contributions 19
D.62 Social benefits other than
social transfers in kind 332
D.621 Social security benefits in
cash 232D.62 Social benefits other than
social transfers in kind 332
D.622 Private funded social benefits 29 D.621 Social security benefits in
cash 232
D.623 Unfunded employee social
benefits 19D.622 Private funded social benefits 29
D.624 Social assistance benefits in
cash 52D.623 Unfunded employee social
benefits 19
D.624 Social assistance benefits in
cash 52
D.7 Other current transfers 269D.71 Net non-life insurance
premiums 43D.7 Other current transfers 239
D.72 Non-life insurance claims 45 D.71 Net non-life insurance
premiums 45
D.73 Current transfers within
general government 96D.72 Non-life insurance claims 42
D.74 Current international coop-
eration 31D.73 Current transfers within
general government 96
D.75 Miscellaneous current trans-
fers 54D.74 Current international coop-
eration 1
D.75 Miscellaneous current trans-
fers 55
B.6 Disposable income 1 604
II.3: Redistribution of income in kind account
Uses Resources
D.63 Social transfers in kind 219 B.6 Disposable income 1 604
D.631 Social benefits in kind 162D.6311 Social security benefits,
reimbursements 78D.63 Social transfers in kind 2191996R2223 — EN — 07.08.2003 — 008.001 — 394
▼B
Uses Resources
D.6312 Other social security benefits
in kind 65D.631 Social benefits in kind 162
D.6313 Social assistance benefits in
kind 19D.6311 Social security benefits,
reimbursements 78
D.632 Transfers of individual non-
market goods and services 57D.6312 Other social security benefits
in kind 65
D.6313 Social assistance benefits in
kind 19
D.632 Transfers of individual non-
market goods and services 57
B.7 Adjusted disposable income 1 604
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
P.3 Final consumption expendi-
ture 1 371B.6 Disposable income 1 604
P.31 Individual consumption
expenditure 1 215
P.32 Collective consumption
expenditure 156D.8 Adjustment for the change in
net equity of households on
pension funds 11
D.8 Adjustment for the change in
net equity of households in
pension fund reserves 11
B.8 Saving 233
II.4.2: Use of adjusted di sposable income account
Uses Resources
P.4 Actual final consumption 1 371 B.7 Adjusted disposable income 1 604
P.41 Actual individual consump-
tion 1 215
P.42 Actual collective consump-
tion 156D.8 Adjustment for the change in
net equity of households on
pension funds 11
D.8 Adjustment for the change in
net equity of households in
pension fund reserves 11
B.8 Saving 2331996R2223 — EN — 07.08.2003 — 008.001 — 395
▼B
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10. Changes in net worth due to
saving and capital transfers 230B.8n Saving, net 233
D.9 Capital transfers, receivable 62
D.91 Capital taxes 2
D.92 Investment grants 23D.99 Other capital transfers 37
D.9 Capital transfers, payable −65
D.91 Capital taxes −2D.92 Investment grants −27
D.99 Other capital transfers −36
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 376 B.10.1 Changes in net worth due to
saving and capital transfers 230
P.511 Acquisitions less disposals of
tangible fixed assets 303
P.5111 Acquisitions of new tangible
fixed assets 305
P.5112 Acquisitions of existing
tangible fixed assets 11
P.5113 Disposals of existing tangible
fixed assets −13
P.512 Acquisitions less disposals of
intangible fixed assets 51
P.5121 Acquisitions of new intan-
gible fixed assets 53
P.5122 Acquisitions of existing
intangible fixed assets 6
P.5123 Disposals of existing intan-
gible fixed assets −8
P.513 Additions to the value of
non-produced non-financial
assets 221996R2223 — EN — 07.08.2003 — 008.001 — 396
▼B
Changes in assets Changes in liabilities and net worth
P.5131 Major improvements to non-
produced non-financial assets 5
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 17
K.1 Consumption of fixed capital −222
P.52 Changes in inventories 28
P.53 Acquisitions less disposals of
valuables 10
K.2 Acquisitions less disposals of
non-produced non-financial
assets 0
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 0
K.22 Acquisitions less disposals of
intangible non-producedassets 0
B.9 Net lending (+) Net
borrowing (−) 38
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets 641F Net incurrence of liabilities 603
F.1 Monetary gold and SDRs −1
F.2 Currency and deposits 119 F.2 Currency and deposits 132
F.21 Currency 34 F.21 Currency 35F.22 Transferable deposits 62 F.22 Transferable deposits 65F.29 Other deposits 23 F.29 Other deposits 32
F.3 Securities other than shares 138 F.3 Securities other than shares 1231996R2223 — EN — 07.08.2003 — 008.001 — 397
▼B
Changes in assets Changes in liabilities and net worth
F.4 Loans 244 F.4 Loans 217
F.41 Short-term 83 F.41 Short-term 76F.42 Long-term 161 F.42 Long-term 141
F.5 Shares and other equity 44 F.5 Shares and other equity 43
F.6 Insurance technical reserves 36 F.6 Insurance technical reserves 36
F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 33F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 33
F.611 Net equity of households in
life insurance reserves 22F.611 Net equity of households in
life insurance reserves 22
F.612 Net equity of households in
pension fund reserves 11F.612 Net equity of households in
pension fund reserves 11
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 3F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 3
F.7 Other accounts payable 61 F.7 Other accounts receivable 52
F.71 Trade credits and advances 18 F.71 Trade credits and advances 18F.79 Other accounts payable,
except trade credits and
advances 43F.79 Other accounts receivable,
except trade credits and
advances 34
B.9 Net lending (+) net borro-
wing(−) 38
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 10 AF Liabilities −2
AN.1 Produced assets −7 K.7 Catastrophic losses 0
K.4 Economic appearance of
produced assets 3K.8 Uncompensated seizures 0
K.7 Catastrophic losses −9 K.10 Other volume changes in
financial assets and net liabil-
ities n.e.c. −2
K.8 Uncompensated seizures 0 K.12 Changes in classifications
and structure 0
K.9 Other volume changes in
non-financial assets n.e.c. 1K.12.1 Changes in sector classifica-
tion and structure 01996R2223 — EN — 07.08.2003 — 008.001 — 398
▼B
Changes in assets Changes in liabilities and net worth
K.12 Changes in classifications
and structure −2K.12.2 Changes in classification of
assets and liabilities 0
K.12.1 Changes in sector classifica-
tion and structure 0K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
K.12.2 Changes in classification of
assets and liabilities −2
K.12.21 Monetization/demonetization
of gold −2of
which:
AF.2 Currency and deposits 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0AF.3 Securities other than shares 0
of
which:
AN.11 Fixed assets −4AF.4 Loans −4
AF.5 Shares and other equity 0
AN.12 Inventories −1 AF.6 Insurance technical reserves 2AN.13 Valuables −2 AF.7 Other accounts payable 0
AN.2 Non-produced assets 17
K.3 Economic appearance of
non-produced assets 24
K.5 Natural growth of non-culti-
vated biological resources 4
K.6 Economic disappearance of
non-produced assets −9
K.61 Depletion of natural assets −8K.62 Other economic disappear-
ance of non-produced assets −1
K.7 Catastrophic losses −2K.8 Uncompensated seizures 0K.9 Other volume changes in
non-financial assets n.e.c. 0
K.12 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AN.21 Tangible non-produced assets 171996R2223 — EN — 07.08.2003 — 008.001 — 399
▼B
Changes in assets Changes in liabilities and net worth
AN.22 Intangible non-produced
assets 0
AF Financial assets 5
K.7 Catastrophic losses 0K.8 Uncompensated seizures 0
K.10 Other volume changes in
financial assets and liabilities
n.e.c. 3
K.12 Changes in classifications
and structure 2
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 2
K.12.21 Monetization/demonetization
of gold 2
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.1 Monetary gold and SDRs 7
AF.2 Currency and deposits 0AF.3 Securities other than shares 0
AF.4 Loans −4
AF.5 Shares and other equity 0AF.6 Insurance technical reserves 2AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 17
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains(+)/
losses(−):K.11 Nominal holding gains(−)/
losses(+):
AN Non-financial assets 280 AF Liabilities 76
AN.1 Produced assets 126 AF.2 Currency and deposits 0AN.11 Fixed assets 111 AF.3 Securities other than shares 421996R2223 — EN — 07.08.2003 — 008.001 — 400
▼B
Changes in assets Changes in liabilities and net worth
AN.12 Inventories 7 AF.4 Loans 0
AN.13 Valuables 8 AF.5 Shares and other equity 34AN.2 Non-produced assets 154 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 152 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 2
AF Financial assets 84
AF.1 Monetary gold and SDRs 12AF.2 Currency and deposits 0AF.3 Securities other than shares 40
AF.4 Loans 0
AF.5 Shares and other equity 31AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains losses 288
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains(+)/
losses(−)K.11.1 Neutral holding gains(−)/
losses(+)
AN Non-financial assets 198 AF Liabilities 126
AN.1 Produced assets 121 AF.2 Currency and deposits 29AN.11 Fixed assets 111 AF.3 Securities other than shares 26
AN.12 Inventories 5 AF.4 Loans 29
AN.13 Valuables 5 AF.5 Shares and other equity 28AN.2 Non-produced assets 78 AF.6 Insurance technical reserves 7AN.21 Tangible non-produced assets 76 AF.7 Other accounts payable 6
AN.22 Intangible non-produced
assets 1
AF Financial assets 136
AF.1 Monetary gold and SDRs 15AF.2 Currency and deposits 301996R2223 — EN — 07.08.2003 — 008.001 — 401
▼B
Changes in assets Changes in liabilities and net worth
AF.3 Securities other than shares 25
AF.4 Loans 28AF.5 Shares and other equity 26
AF.6 Insurance technical reserves 7
AF.7 Other accounts receivable 5
B.10.31 Changes in net worth due to
neutral holding gains losses 208
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+):
AN Non-financial assets 81 AF Liabilities −50
AN.1 Produced assets 5 AF.2 Currency and deposits −29
AN.11 Fixed assets 0 AF.3 Securities other than shares 16
AN.12 Inventories 3 AF.4 Loans −29AN.13 Valuables 2 AF.5 Shares and other equity 6AN.2 Non-produced assets 77 AF.6 Insurance technical reserves −7
AN.21 Tangible non-produced assets 76 AF.7 Other accounts payable −6
AN.22 Intangible non-produced
assets 1
AF Financial assets −52
AF.1 Monetary gold and SDRs −3AF.2 Currency and deposits −30
AF.3 Securities other than shares 15
AF.4 Loans −28AF.5 Shares and other equity 5AF.6 Insurance technical reserves −7
AF.7 Other accounts receivable −5
B.10.32 Changes in net worth due to
real holding gains losses 801996R2223 — EN — 07.08.2003 — 008.001 — 402
▼B
IV: Balance sheets
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 9 922 AF Liabilities 6 298
AN.1 Produced assets 6 047 AF.2 Currency and deposits 1 471
AN.11 Fixed assets 5 544 AF.3 Securities other than shares 1 311
AN.12 Inventories 231 AF.4 Loans 1 437AN.13 Valuables 272 AF.5 Shares and other equity 1 406AN.2 Non-produced assets 3 875 AF.6 Insurance technical reserves 371
AN.21 Tangible non-produced assets 3 809 AF.7 Other accounts payable 302
AN.22 Intangible non-produced
assets 66
AF Financial assets 6 792
AF.1 Monetary and gold SDRs 770AF.2 Currency and deposits 1 482
AF.3 Securities other than shares 1 263
AF.4 Loans 1 384AF.5 Shares and other equity 1 296AF.6 Insurance technical reserves 370AF.7 Other accounts receivable 227
B.10.32 Net worth 10 416
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 482 AF Liabilities 677
AN.1 Produced assets 289 AF.2 Currency and deposits 132AN.11 Fixed assets 239 AF.3 Securities other than shares 165
AN.12 Inventories 34 AF.4 Loans 213
AN.13 Valuables 16 AF.5 Shares and other equity 77AN.2 Non-produced assets 193 AF.6 Insurance technical reserves 38AN.21 Tangible non-produced assets 191 AF.7 Other accounts payable 52
AN.22 Intangible non-produced
assets 21996R2223 — EN — 07.08.2003 — 008.001 — 403
▼B
Assets Liabilities and net worth
AF Financial assets 730
AF.1 Monetary gold and SDRs 18
AF.2 Currency and deposits 119
AF.3 Securities other than shares 178AF.4 Loans 240AF.5 Shares and other equity 75
AF.6 Insurnce technical reserves 38
AF.7 Other accounts receivable 61
B.10 Changes in net worth, total
due to: 535
B.10.1 Saving and capital transfers 230
B.10.2 Other changes in volume of
assets 17
B.10.3 Nominal holding gains/losses 288
B.10.31 Neutral holding gains/losses 208B.10.32 Real holding gains/losses 80
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 10 404 AF Liabilities 6 975
AN.1 Produced assets 6 336 AF.2 Currency and deposits 1 603AN.11 Fixed assets 5 783 AF.3 Securities other than shares 1 476AN.12 Inventories 265 AF.4 Loans 1 650
AN.13 Valuables 288 AF.5 Shares and other equity 1 483
AN.2 Non-produced assets 4 068 AF.6 Insurance technical reserves 409AN.21 Tangible non-produced assets 4 000 AF.7 Other accounts payable 354AN.22 Intangible non-produced
assets 68
AF Financial assets 7 522
AF.1 Monetary gold and SDRs 788
AF.2 Currency and deposits 1 601
AF.3 Securities other than shares 1 441AF.4 Loans 1 6241996R2223 — EN — 07.08.2003 — 008.001 — 404
▼B
Assets Liabilities and net worth
AF.5 Shares and other equity 1 371
AF.6 Insurance technical reserves 408AF.7 Other accounts receivable 288
B.90 Net worth 10 951
Table A.IV.3 — Full sequence of accounts for non-financial corporations
I:Production account
Uses Resources
P.2 Intermediate consumption 881 P.1 Output 1 753
P.11 Market output 1 722P.12 Output for own final use 31
B.1g Value-added, gross 872
K.1 Consumption of fixed capital 137B.1n Value-added, net 735
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 545 B.1n Value-added, net 735
D.11 Wages and salaries 421D.12 Employers' social contribu-
tions 124
D.121 Employers' actual social
contributions 112
D.122 Employers' imputed social
contributions 12
D.29 Other taxes on production 86
D.39 Other subsidies on produc-
tion −35
B.2 Operating surplus 139
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 145 B.2 Operating surplus 1391996R2223 — EN — 07.08.2003 — 008.001 — 405
▼B
Uses Resources
D.41 Interest 66
D.42 Distributed income of
corporations 48D.4 Property income 78
D.421 Dividends 24 D.41 Interest 25
D.422 Withdrawals from income of
quasi-corporations 24D.42 Distributed income of
corporations 3
D.43 Reinvested earnings on direct
foreign investment 0D.421 Dividends 3
D.45 Rent 31 D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 4
D.44 Property income attributed to
insurance policyholders 5
D.45 Rent 41
B.5 Balance of primary incomes 72
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 97 B.2 Operating surplus 139
D.41 Interest 66D.45 Rent 31 D.4 Property income 78
D.41 Interest 25D.42 Distributed income of
corporations 3
D.421 Dividends 3D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 4
D.44 Property income attributed to
insurance policyholders 5
D.45 Rent 41
B.4 Entrepreneurial income 120
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 48 B.4 Entrepreneurial income 120
D.42 Distributed income of
corporations 481996R2223 — EN — 07.08.2003 — 008.001 — 406
▼B
Uses Resources
D.421 Dividends 24
D.422 Withdrawals from income of
quasi-corporations 24
D.43 Reinvested earnings on direct
foreign investment 0
B.5 Balance of primary incomes 72
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc.24 B.5 Balance of primary incomes 72
D.51 Taxes on income 20
D.59 Other current taxes 4 D.61 Social contributions 14
D.611 Actual social contributions 2
D.62 Social benefits other than
social transfers in kind 13D.6111 Employers' actual social
contributions 1
D.622 Private funded social bene-
fits 1D.61111 Compulsory employers'
actual social contributions 1
D.623 Unfunded employee social
benefits 12D.61112 Voluntary employers' actual
social contributions 1
D.6112 Employees' social contribu-
tions 1
D.7 Other current transfers 11 D.61121 Compulsory employees'
social contributions 1
D.71 Net non-life insurance
premiums 8D.61122 Voluntary employees' social
contributions 0
D.75 Miscellaneous current trans-
fers 3D.612 Imputed social contributions 12
D.7 Other current transfers 10
D.72 Non-life insurance claims 6
D.75 Miscellaneous current trans-
fers 4
B.6 Disposable income 48
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
D.8 Adjustment for the change in
net equity of households in
pension fund reserves 0B.6 Disposable income 481996R2223 — EN — 07.08.2003 — 008.001 — 407
▼B
Uses Resources
B.8 Saving 48
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10.1 Changes in net worth due to
saving and capital transfers 65B.8n Saving, net 48
D.9 Capital transfers, receivable 33
D.92 Investment grants 23
D.99 Other capital transfers 10
D.9 Capital transfers, payable −16
D.91 Capital taxes 0
D.99 Other capital transfers −16
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 250 B.10.1 Changes in net worth due to
saving and capital transfers65
P.511 Acquisitions less disposals of
tangible fixed assets 209
P.5111 Acquisitions of new tangible
fixed assets 211
P.5112 Acquisitions of existing
tangible fixed assets 4
P.5113 Disposals of existing tangible
fixed assets −6
P.512 Acquisitions less disposals of
intangible fixed assets 21
P.5121 Acquisitions of new intan-
gible fixed assets 21
P.5122 Acquisitions of existing
intangible fixed assets 1
P.5123 Disposals of existing intan-
gible fixed assets −11996R2223 — EN — 07.08.2003 — 008.001 — 408
▼B
Changes in assets Changes in liabilities and net worth
P.513 Additions to the value of
non-produced non-financial
assets 20
P.5131 Major improvements to non-
produced non-financial assets 3
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 17
K.1 Consumption of fixed capital −137
P.52 Changes in inventories 26
P.53 Acquisitions less disposals of
valuables 2
K.2 Acquisitions less disposals of
non-produced non-financial
assets −7
K.21 Acquisitions less disposals of
land and other tangible non-produced assets −6
K.22 Acquisitions less disposals of
intangible non-produced
assets −1
B.9 Net lending(+)/net borro-
wing(−) −69
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets71 F Net incurrence of liabilities 140
F.2 Currency and deposits 17 F.2 Currency and deposits 0
F.21 Currency 5 F.22 Transferable deposits 0F.22 Transferable deposits 10 F.29 Other deposits 0F.29 Other deposits 2
F.3 Securities other than shares 6
F.3 Securities other than shares 18
F.4 Loans 711996R2223 — EN — 07.08.2003 — 008.001 — 409
▼B
Changes in assets Changes in liabilities and net worth
F.4 Loans 27 F.41 Short-term 16
F.41 Short-term 16 F.42 Long-term 55F.42 Long-term 11
F.5 Shares and other equity 26
F.5 Shares and other equity 2
F.6 Insurance technical reserves 0
F.6 Insurance technical reserves 0 F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 0
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 0F.612 Net equity of households in
pension fund reserves 0
F.7 Other accounts receivable 7 F.7 Other accounts payable 37
F.71 Trade credits and advances 6 F.71 Trade credits and advances 8F.79 Other accounts receivable,
except trade credits and
advances 1F.79 Other accounts payable,
except trade credits and
advances 29
B.9 Net lending (+)/net borro-
wing(−) −69
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 12 AF Liabilities −3
AN.1 Produced assets −2 K.7 Catastrophic losses 0K.4 Economic appearance of
produced assets 0K.8 Uncompensated seizures 0
K.7 Catastrophic losses −5 K.10 Other volume changes in
financial assets and liabilities
n.e.c. −4
K.8 Uncompensated seizures −1 K.12 Changes in classifications
and structure 1
K.9 Other volume changes in
non-financial assets n.e.c. 1K.12.1 Changes in sector classifica-
tion and structure 1
K.12 Changes in classifications
and structure 3K.12.2 Changes in classification of
assets and liabilities 0
K.12.1 Changes in sector classifica-
tion and structure 3K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 01996R2223 — EN — 07.08.2003 — 008.001 — 410
▼B
Changes in assets Changes in liabilities and net worth
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0of
which:
AF.2 Currency and deposits 0
of
which:
AN.11 Fixed assets −1AF.3 Securities other than shares 0
AF.4 Loans −3
AN.12 Inventories −1 AF.5 Shares and other equity 0AN.13 Valuables 0 AF.6 Insurance technical reserves 0AN.2 Non-produced assets 14 AF.7 Other accounts payable 0
K.3 Economic appearance of
non-produced assets 24
K.5 Natural growth of non-culti-
vated biological resources 0
K.6 Economic disappearance of
non-produced assets −7
K.61 Depletion of natural assets −6K.62 Other economic disappear-
ance of non-produced assets −1
K.7 Catastrophic losses 0
K.8 Uncompensated seizures −4K.9 Other volume changes in
non-financial assets n.e.c. 0
K.12 Changes in classifications
and structure 1
K.12.1 Changes in sector classifica-
tion and structure 1
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AN.21 Tangible non-produced assets 14
AN.22 Intangible non-produced
assets 0
AF Financial assets 2
K.7 Catastrophic losses 0
K.8 Uncompensated seizures 01996R2223 — EN — 07.08.2003 — 008.001 — 411
▼B
Changes in assets Changes in liabilities and net worth
K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.12 Changes in classifications
and structure 2
K.12.1 Changes in sector classifica-
tion and structure 2
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.2 Currency and deposits 0
AF.3 Securities other than shares 0AF.4 Loans 0AF.5 Shares and other equity 2
AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 17
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains(+)/
losses(−):K.11 Nominal holding gains(−)/
losses(+):
AN Non-financial assets 144 AF Liabilities 18
AN.1 Produced assets 63 AF.2 Currency and deposits 0AN.11 Fixed assets 58 AF.3 Securities other than shares 1AN.12 Inventories 4 AF.4 Loans 0AN.13 Valuables 1 AF.5 Shares and other equity 16
AN.2 Non-produced assets 81 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 80 AF.7 Other accounts payable 0AN.22 Intangible non-produced
assets 1
AF Financial assets 81996R2223 — EN — 07.08.2003 — 008.001 — 412
▼B
Changes in assets Changes in liabilities and net worth
AF.2 Currency and deposits 0
AF.3 Securities other than shares 3AF.4 Loans 0
AF.5 Shares and other equity 5
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains losses 134
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains(+)/
losses(−):K.11.1 Neutral holding gains(−)/
losses(+):
AN Non-financial assets 101 AF Liabilities 36
AN.1 Produced assets 60 AF.2 Currency and deposits 1
AN.11 Fixed assets 58 AF.3 Securities other than shares 1AN.12 Inventories 2 AF.4 Loans 18AN.13 Valuables 1 AF.5 Shares and other equity 14
AN.2 Non-produced assets 41 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 40 AF.7 Other accounts payable 3AN.22 Intangible non-produced
assets 1
AF Financial assets 18
AF.2 Currency and deposits 8
AF.3 Securities other than shares 2
AF.4 Loans 1AF.5 Shares and other equity 4AF.6 Insurance technical reserves 1
AF.7 Other accounts receivable 3
B.10.31 Changes in net worth due to
neutral holding gains/losses 821996R2223 — EN — 07.08.2003 — 008.001 — 413
▼B
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+):
AN Non-financial assets 43 AF Liabilities −18
AN.1 Produced assets 3 AF.2 Currency and deposits −1AN.11 Fixed assets 0 AF.3 Securities other than shares 1AN.12 Inventories 3 AF.4 Loans −18
AN.13 Valuables 0 AF.5 Shares and other equity 3
AN.2 Non-produced assets 40 AF.6 Insurance technical reserves 0AN.21 Tangible non-produced assets 40 AF.7 Other accounts payable −3AN.22 Intangible non-produced
assets 0
AF Financial assets −10
AF.2 Currency and deposits −8
AF.3 Securities other than shares 1
AF.4 Loans −1AF.5 Shares and other equity 1AF.6 Insurance technical reserves −1
AF.7 Other accounts receivable −3
B.10.32 Changes in net worth due to
real holding gains/losses 51
IV: Balance sheets
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 5 041 AF Liabilities 1 817
AN.1 Produced assets 3 001 AF.2 Currency and deposits 40AN.11 Fixed assets 2 878 AF.3 Securities other than shares 44
AN.12 Inventories 85 AF.4 Loans 897
AN.13 Valuables 38 AF.5 Shares and other equity 687AN.2 Non-produced assets 2 040 AF.6 Insurance technical reserves 12AN.21 Tangible non-produced assets 1 989 AF.7 Other accounts payable 137
AN.22 Intangible non-produced
assets 511996R2223 — EN — 07.08.2003 — 008.001 — 414
▼B
Assets Liabilities and net worth
AF Financial assets 897
AF.2 Currency and deposits 382
AF.3 Securities other than shares 90
AF.4 Loans 50AF.5 Shares and other equity 200AF.6 Insurance technical reserves 25
AF.7 Other accounts receivable 150
B.90 Net worth 4 121
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 290 AF Liabilities 155
AN.1 Produced assets 182 AF.2 Curency and deposits 0
AN.11 Fixed assets 150 AF.3 Securities other than shares 7
AN.12 Inventories 29 AF.4 Loans 68AN.13 Valuables 3 AF.5 Shares and other equity 42AN.2 Non-produced assets 108 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 108 AF.7 Other accounts payable 37
AN.22 Intangible non-produced
assets 0
AF Financial assets 81
AF.2 Currency and deposits 17AF.3 Securities other than shares 21AF.4 Loans 27
AF.5 Shares and other equity 9
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 7
B.10 Changes in net worth, total
due to: 216
B.10.1 Saving and capital transfers 651996R2223 — EN — 07.08.2003 — 008.001 — 415
▼B
Assets Liabilities and net worth
B.10.2 Other changes in volume of
assets 17
B.10.3 Nominal holding gains/losses 134
B.10.31 Neutral holding gains/losses 82B.10.32 Real holding gains/losses 51
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 5 331 AF Liabilities 1 972
AF.2 Currency and deposits 40
AN.1 Produced assets 3 183 AF.3 Services other than shares 51
AN.11 Fixed assets 3 028 AF.4 Loans 965
AN.12 Inventories 114 AF.5 Shares and other equity 729AN.13 Valuables 41 AF.6 Insurance technical reserves 12AN.2 Non-produced assets 2 148 AF.7 Other accounts payable 174
AN.21 Tangible non-produced assets 2 097
AN.22 Intangible non-produced
assets 51
AF Financial assets 978
AF.2 Currency and deposits 389AF.3 Securities other than shares 111AF.4 Loans 77
AF.5 Shares and other equity 209
AF.6 Insurance technical reserves 25AF.7 Other accounts receivable 157
B.90 Net worth 4 337
Table A.IV.4 — Full sequence of accounts for financial corporations
I:Production account
Uses Resources
P.2 Intermediate consumption 29 P.1 Output 102
P.11 Market output 102
P.12 Output for own final use 0
B.1g Value-added, gross 731996R2223 — EN — 07.08.2003 — 008.001 — 416
▼B
Uses Resources
K.1 Consumption of fixed capital 10
B.1n Value-added, net 63
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 15 B.1n Value-added, net 63
D.11 Wages and salaries 10D.12 Employers' social contribu-
tions 5
D.121 Employers' actual social
contributions 4
D.122 Employers' imputed social
contributions 1
D.29 Other taxes on production 3
D.39 Other subsidies on produc-
tion 0
B.2 Operating surplus 45
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 138 B.2 Operating surplus 45
D.41 Interest 77D.42 Distributed income of
corporations 36D.4 Property income 160
D.421 Dividends 36 D.41 Interest 125
P.119 Adjustment for Fisim −48
D.422 Withdrawals from income of
quasi-corporations 0D.42 Distributed income of
corporations 25
D.43 Reinvested earnings on direct
foreign investment 0D.421 Dividends 25
D.44 Property income attributed to
insurance policyholders 25D.422 Withdrawals from income of
quasi-corporations 0
D.45 Rent 0 D.43 Reinvested earnings on direct
foreign investment 7
D.44 Property income attributed to
insurance policyholders 01996R2223 — EN — 07.08.2003 — 008.001 — 417
▼B
Uses Resources
D.45 Rent 3
B.5 Balance of primary incomes 19
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 102 B.2 Operating surplus 45
D.41 Interest 77D.44 Property income attributed to
insurance policyholders 25D.4 Property income 160
D.45 Rent 0 D.41 Interest 125
P.119 Adjustment for Fisim −48
D.42 Distributed income of
corporations 25
D.421 Dividends 25
D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 7
D.44 Property income attributed to
insurance policyholders 0
D.45 Rent 3
B.4 Entrepreneurial income 55
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 36 B.4 Entrepreneurial income 55
D.42 Distributed income of
corporations 36
D.421 Dividends 36D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 0
B.5 Balance of primary incomes 19
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc.10 B.5 Balance of primary incomes 191996R2223 — EN — 07.08.2003 — 008.001 — 418
▼B
Uses Resources
D.51 Taxes on income 7
D.59 Other current taxes 3 D.61 Social contributions 39
D.611 Actual social contributions 38
D.62 Social benefits other than
social transfers in kind 29D.6111 Employers' actual social
contributions 18
D.622 Private-funded social benefits 28 D.61111 Compulsory employers'
actual social contributions 15
D.623 Unfunded employee social
benefits 1D.61112 Voluntary employers' actual
social contributions 3
D.6112 Employees' social contribu-
tions 20
D.7 Other current transfers 46 D.61121 Compulsory employees'
social contributions 15
D.71 Net non-life insurance
premiums 0D.61122 Voluntary employees' social
contributions 5
D.72 Non-life insurance claims 45 D.612 Imputed social contributions 1D.75 Miscellaneous current trans-
fers 1
D.7 Other current transfers 49D.71 Net non-life insurance
premiums 45
D.72 Non-life insurance claims 0D.75 Miscellaneous current trans-
fers 4
B.6 Disposable income 22
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
D.8 Adjustment for the change in
net equity of households in
pension fund reserves11 B.6 Disposable income 22
B.8 Saving 111996R2223 — EN — 07.08.2003 — 008.001 — 419
▼B
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10.1 Changes in net worth due to
saving and capital transfers 4B.8n Saving, net 11
D.9 Capital transfers, receivable 0
D.92 Investment grants 0D.99 Other capital transfers 0
D.9 Capital transfers, receivable −7
D.91 Capital taxes 0
D.99 Other capital transfers −7
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 9 B.10.1 Changes in net worth due to
saving and capital transfers 4
P.511 Acquisitions less disposals of
tangible fixed assets 8
P.5111 Acquisitions of new tangible
fixed assets 7
P.5112 Acquisitions of existing
tangible fixed assets 1
P.5113 Disposals of existing tangible
fixed assets 0
P.512 Acquisitions less disposals of
intangible fixed assets 1
P.5121 Acquisitions of new intan-
gible fixed assets 1
P.5122 Acquisitions of existing
intangible fixed assets 0
P.5123 Disposals of existing intan-
gible fixed assets 0
P.513 Additions to the value of
non-produced non-financial
assets 0
P.5131 Major improvements to non-
produced non-financial assets 0
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 01996R2223 — EN — 07.08.2003 — 008.001 — 420
▼B
Changes in assets Changes in liabilities and net worth
K.1 Consumption of fixed capital −10
P.52 Changes in inventories 0
P.53 Acquisitions less disposals of
valuables 0
K.2 Acquisitions less disposals of
non-produced non-financial
assets 0
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 0
K.22 Acquisitions less disposals of
intangible non-produced
assets 0
B.9 Net lending(+)/Net borro-
wing(−) 5
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets 237F Net incurrence of liabilities 232
F.1 Monetary gold and SDRs −1
F.2 Currency and deposits 15 F.2 Currency and deposits 130
F.21 Currency 15 F.21 Currency 35F.22 Transferable deposits 0 F.22 Transferable deposits 63F.29 Other deposits 0 F.29 Other deposits 32
F.3 Securities other than shares 53 F.3 Securities other than shares 53
F.4 Loans 167 F.4 Loans 0
F.41 Short-term 63 F.41 Short-term 0
F.42 Long-term 104 F.42 Long-term 01996R2223 — EN — 07.08.2003 — 008.001 — 421
▼B
Changes in assets Changes in liabilities and net worth
F.5 Shares and other equity 3 F.5 Shares and other equity 13
F.6 Insurance technical reserves 0 F.6 Insurance technical reserves 36
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 0F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 33
F.611 Net equity of households in
life insurance reserves 22
F.7 Other accounts receivable 0 F.612 Net equity of households in
pension fund reserves 11
F.71 Trade credits and advances 0 F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 3
F.79 Other accounts receivable,
except trade credits and
advances 0
F.7 Other accounts payable 0F.71 Trade credits and advances 0F.79 Other accounts payable,
except trade credits and
advances 0
B.9 Net lending(+) net borrowing
(−) 5
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets −2 AF Liabilities 2
AN.1 Produced assets −2 K.7 Catastrophic losses 0
K.4 Economic appearance of
produced assets 0K.8 Uncompensated seizures 0
K.7 Catastrophic losses 0 K.10 Other volume changes in
financial assets and liabilities
n.e.c. 2
K.8 Uncompensated seizures 0 K.12 Changes in classifications
and structure 0
K.9 Other volume changes in
non-financial assets n.e.c. 0K.12.1 Changes in sector classifica-
tion and structure 0
K.12 Changes in classifications
and structure −2K.12.2 Changes in classification of
assets and liabilities 0
K.12.1 Changes in sector classifica-
tion and structure 0K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 01996R2223 — EN — 07.08.2003 — 008.001 — 422
▼B
Changes in assets Changes in liabilities and net worth
K.12.2 Changes in classification of
assets and liabilities −2
K.12.21 Monetization/demonetization
of gold −2of
which:
AF.2 Currency and deposits 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0AF.3 Securities other than shares 0
of
which:
AN.11 Fixed assets 0AF.4 Loans 0
AF.5 Shares and other equity 0
AN.12 Inventories 0 AF.6 Insurance technical reserves 2AN.13 Valuables −2 AF.7 Other accounts payable 0AN.2 Non-produced assets 0
K.3 Economic appearance of
non-produced assets 0
K.5 Natural growth of non-culti-
vated biological resources 0
K.6 Economic disappearance of
non-produced assets 0
K.61 Depletion of natural assets 0K.62 Other economic disappear-
ance of non-produced assets 0
K.7 Catastrophic losses 0K.8 Uncompensated seizures 0K.9 Other volume changes in
non-financial assets n.e.c. 0
K.12 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AN.21 Tangible non-produced assets 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 01996R2223 — EN — 07.08.2003 — 008.001 — 423
▼B
Changes in assets Changes in liabilities and net worth
K.7 Catastrophic losses 0
K.8 Uncompensated seizures −3K.10 Other volume changes in
financial assets and liabilities
n.e.c. 1
K.12 Changes in classifications
and structure 2
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 2
K.12.21 Monetization/demonetization
of gold 2
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.1 Monetary gold and SDRs 7
AF.2 Currency and deposits 0AF.3 Securities other than shares −3AF.4 Loans −4
AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets −4
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains(+)/
losses(−)K.11 Nominal holding gains(−)/
losses(+)
AN Non-financial assets 4 AF Liabilities 51
AN.1 Produced assets 2 AF.2 Currency and deposits 0AN.11 Fixed assets 2 AF.3 Securities other than shares 34
AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 0 AF.5 Shares and other equity 17AN.2 Non-produced assets 2 AF.6 Insurance technical reserves 01996R2223 — EN — 07.08.2003 — 008.001 — 424
▼B
Changes in assets Changes in liabilities and net worth
AN.21 Tangible non-manufacture of
produced assets 1AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 57
AF.1 Monetary gold and SDRs 11AF.2 Currency and deposits 0AF.3 Securities other than shares 30
AF.4 Loans 0
AF.5 Shares and other equity 16AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains/losses 10
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains(+)/
losses(−):K.11.1 Neutral holding gains(−)/
losses(+):
AN Non-financial assets 3 AF Liabilities 68
AN.1 Produced assets 2 AF.2 Currency and deposits 26AN.11 Fixed assets 2 AF.3 Securities other than shares 21AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 0 AF.5 Shares and other equity 14
AN.2 Non-produced assets 1 AF.6 Insurance technical reserves 7AN.21 Tangible non-produced assets 1 AF.7 Other accounts payable 0AN.22 Intangible non-produced
assets 0
AF Financial assets 70
AF.1 Monetary gold and SDRs 14
AF.2 Currency and deposits 0
AF.3 Securities other than shares 19AF.4 Loans 241996R2223 — EN — 07.08.2003 — 008.001 — 425
▼B
Changes in assets Changes in liabilities and net worth
AF.5 Shares and other equity 13
AF.6 Insurance technical reserves 1AF.7 Other accounts receivable 0
B.10.31 Changes in net worth due to
neutral holding gains/losses 5
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+):
AN Non-financial assets 1 AF Liabilities −17
AN.1 Produced assets 0 AF.2 Currency and deposits −26AN.11 Fixed assets 0 AF.3 Securities other than shares 13AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 0 AF.5 Shares and other equity 3
AN.2 Non-produced assets 1 AF.6 Insurance technical reserves −7AN.21 Tangible non-produced assets 1 AF.7 Other accounts payable 0AN.22 Intangible non-produced
assets 0
AF Financial assets −13
AF.1 Monetary gold and SDRs −3
AF.2 Currency and deposits 0AF.3 Securities other than shares 11AF.4 Loans −24
AF.5 Shares and other equity 3
AF.6 Insurance technical reserves −1AF.7 Other accounts receivable 0
B.10.32 Changes in net worth due to
real holding gains/losses 5
IV: Balance sheets
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 144 AF Liabilities 3 3841996R2223 — EN — 07.08.2003 — 008.001 — 426
▼B
Assets Liabilities and net worth
AN.1 Produced assets 104 AF.2 Currency and deposits 1 281
AN.11 Fixed assets 99 AF.3 Securities other than shares 1 053AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 5 AF.5 Shares and other equity 715
AN.2 Non-produced assets 40 AF.6 Insurance technical reserves 335AN.21 Tangible non-produced assets 37 AF.7 Other accounts payable 0AN.22 Intangible non-produced
assets 3
AF Financial assets 3 508
AF.1 Monetary gold and SDRs 690
AF.2 Currency and deposits 0
AF.3 Securities other than shares 950AF.4 Loans 1 187AF.5 Shares and other equity 651
AF.6 Insurance technical reserves 30
AF.7 Other accounts receivable 0
B.90 Net worth 268
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 1 AF Liabilities 285
AN.1 Produced assets −1 AF.2 Currency and deposits 130
AN.11 Fixed assets 1 AF.3 Securities other than shares 87AN.12 Inventories 0 AF.4 Loans 0AN.13 Valuables −2 AF.5 Shares and other equity 30
AN.2 Non-produced assets 2 AF.6 Insurance technical reserves 38
AN.21 Tangible non-produced assets 1 AF.7 Other accounts payable 0AN.22 Intangible non-produced
assets 0
AF Financial assets 294
AF.1 Monetary gold and SDRs 171996R2223 — EN — 07.08.2003 — 008.001 — 427
▼B
Assets Liabilities and net worth
AF.2 Currency and deposits 15
AF.3 Securities other than shares 80AF.4 Loans 163
AF.5 Shares and other equity 19
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10 Changes in net worth, total
due to: 10
B.10.1 Saving and capital transfers 4
B.10.2 Other changes in volume of
assets −4
B.10.3 Nominal holding gains/losses 10
B.10.31 Neutral holding gains/losses 5B.10.32 Real holding gains/losses 5
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 145 AF Liabilities 3 669
AN.1 Produced assets 103 AF.2 Currency and deposits 1 411AN.11 Fixed assets 100 AF.3 Securities other than shares 1 140
AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 3 AF.5 Shares and other equity 745AN.2 Non-produced assets 42 AF.6 Insurance technical reserves 373AN.21 Tangible non-produced assets 38 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 3
AF Financial assets 3 802
AF.1 Monetary gold and SDRs 707
AF.2 Currency and deposits 15AF.3 Securities other than shares 1 030AF.4 Loans 1 350
AF.5 Shares and other equity 670
AF.6 Insurance technical reserves 30AF.7 Other accounts receivable 01996R2223 — EN — 07.08.2003 — 008.001 — 428
▼B
Assets Liabilities and net worth
B.90 Net worth 278
Table A.IV.5 — Full sequence of accounts for general government
I:Production account
Uses Resources
P.2 Intermediate consumption 246 P.1 Output 434
P.11 Market output 74
P.12 Output for own final use 0P.13 Other non-market output 360
B.1g Value-added, gross 188
K.1 Consumption of fixed capital 30
B.1n Value-added, net 158
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 140 B.1n Value-added, net 158
D.11 Wages and salaries 87
D.12 Employers' social contribu-
tions 53
D.121 Employers' actual social
contributions 48
D.122 Employers' imputed social
contributions 5
D.29 Other taxes on production 2
D.39 Other subsidies on produc-
tion 0
B.2 Operating surplus 16
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 46 B.2 Operating surplus 16
D.41 Interest 39
D.42 Distributed income of
corporations 0D.2 Taxes on production and
imports 2351996R2223 — EN — 07.08.2003 — 008.001 — 429
▼B
Uses Resources
D.422 Withdrawals from income of
quasi-corporations 24D.21 Taxes on products 141
D.43 Reinvested earnings on direct
foreign investment 0D.211 Value-added type taxes
(VAT) 121
D.45 Rent 7 D.212 Taxes and duties on imports
excluding VAT 17
D.2121 Import duties 17D.2122 Taxes on imports excluding
VAT and duties 0
D.214 Taxes on products except
VAT and import taxes 3
D.29 Other taxes on production 94
D.3 Subsidies −44
D.31 Subsidies on products −8
D.311 Import subsidies 0D.319 Other subsidies on products −8D.39 Other subsidies on produc-
tion −36
D.4 Property income 30
D.41 Interest 12
D.42 Distributed income of
corporations 18
D.421 Dividends 5
D.422 Withdrawals from income of
quasi-corporations 13
D.43 Reinvested earnings on direct
foreign investment 0
D.44 Property income attributed to
insurance policyholders 0
D.45 Rent 0
B.5 Balance of primary incomes 191
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 9 B.2 Operating surplus 16
D.41 Interest 2D.45 Rent 7 D.4 Property income 41996R2223 — EN — 07.08.2003 — 008.001 — 430
▼B
Uses Resources
D.41 Interest 0
D.42 Distributed income of
corporations 4
D.421 Dividends 4D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 0
D.44 Property income attributed to
insurance policyholders 0
D.45 Rent 0
B.4 Entrepreneurial income 11
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 37 B.4 Entrepreneurial income 11
D.41 Interest 37
D.2 Taxes on production and
imports 235
D.21 Taxes on products 141
D.211 Value-added type taxes
(VAT) 121
D.212 Taxes and duties on imports
excluding VAT 17
D.2121 Import duties 17D.2122 Taxes on imports excluding
VAT and duties 0
D.214 Taxes on products except
VAT and import taxes 3
D.29 Other taxes on production 94
D.3 Subsidies −44
D.31 Subsidies on products −8
D.311 Import subsidies 0
D.319 Other subsidies on products −8D.39 Other subsidies on produc-
tion −36
D.4 Property income 261996R2223 — EN — 07.08.2003 — 008.001 — 431
▼B
Uses Resources
D.41 Interest 12
D.42 Distributed income of
corporations 14
D.421 Dividends 1D.422 Withdrawals from income of
quasi-corporations 13
B.5 Balance of primary incomes 191
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc.0 B.5 Balance of primary incomes 191
D.59 Other current taxes 0
D.5 Current taxes on income,
wealth, etc. 213
D.62 Social benefits other than
social transfers in kind 289D.51 Taxes on income 204
D.621 Social security benefits in
cash 232D.59 Other current taxes 9
D.622 Private funded social bene-
fits 0
D.623 Unfunded employee social
benefits 5D.61 Social contributions 268
D.624 Social assistance benefits in
cash 52D.611 Actual social contributions 263
D.6111 Employers' actual social
contributions 155
D.7 Other current transfers 139 D.61111 Compulsory employers'
actual social contributions 144
D.71 Net non-life insurance
premiums 4D.61112 Voluntary employers' actual
social contributions 11
D.73 Current transfers within
general government 96D.6112 Employees' social contribu-
tions 76
D.74 Current international coop-
eration 31D.61121 Compulsory employees'
social contributions 69
D.75 Miscellaneous current trans-
fers 8D.61122 Voluntary employees' social
contributions 7
D.6113 Social contributions by self-
and non-employed persons 32
D.61131 Compulsory social contribu-
tions by self- and non-
employed persons 22
D.61132 Voluntary social contribu-
tions by self- and non-
employed persons 101996R2223 — EN — 07.08.2003 — 008.001 — 432
▼B
Uses Resources
D.612 Imputed social contributions 5
D.7 Other current transfers 108D.72 Non-life insurance claims 1
D.73 Current transfers within
general government 96
D.74 Current international
corporations 1
D.75 Miscellaneous current trans-
fers 10
B.6 Disposable income 352
II.3: Redistribution of income in kind account
Uses Resources
D.63 Social transfers in kind 206 B.6 Disposable income 352
D.631 Social benefits in kind 162D.6311 Social security benefits,
reimbursements 78
D.6312 Other social security benefits
in kind 65
D.6313 Social assistance benefits in
kind 19
D.632 Transfers of individual non-
market goods and services 44
B.7 Adjusted disposable income 146
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
P.3 Final consumption expendi-
ture362 B.6 Disposable income 352
P.31 Individual consumption
expenditure 206
P.32 Collective consumption
expenditure 156
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0
B.8 Saving −101996R2223 — EN — 07.08.2003 — 008.001 — 433
▼B
II.4.2: Use of adjusted di sposable income account
Uses Resources
P.4 Actual final consumption 156 B.7 Adjusted disposable income 1 468
P.42 Actual collective consump-
tion 156
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0
B.8 Saving −10
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10.1 Changes in net worth due to
saving and capital transfers−38 B.8n Saving, net −10
D.9 Capital transfers, receivable 6
D.91 Capital taxes 2D.92 Investment grants 0D.99 Other capital transfers 4
D.9 Capital transfers, payable −34
D.91 Capital taxes 0D.92 Investment grants −27
D.99 Other capital transfers −7
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 37 B.10.1 Changes in net worth due to
saving and capital transfers−38
P.511 Acquisitions less disposals of
tangible fixed assets 23
P.5111 Acquisitions of new tangible
fixed assets 241996R2223 — EN — 07.08.2003 — 008.001 — 434
▼B
Changes in assets Changes in liabilities and net worth
P.5112 Acquisitions of existing
tangible fixed assets 1
P.5113 Disposals of existing tangible
fixed assets −2
P.512 Acquisitions less disposals of
intangible fixed assets 12
P.5121 Acquisitions of new intan-
gible fixed assets 12
P.5122 Acquisitions of existing
intangible fixed assets 2
P.5123 Disposals of existing intan-
gible fixed assets −2
P.513 Additions to the value of
non-produced non-financial
assets 2
P.5131 Major improvements to non-
produced non-financial assets
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 0
K.1 Consumption of fixed capital −30
P.52 Changes in inventories 0
P.53 Acquisitions less disposals of
valuables 3
K.2 Acquisitions less disposals of
non-produced non-financial
assets 2
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 2
K.22 Acquisitions less disposals of
intangible non-produced
assets 0
B.9 Net lending(+)/net borro-
wing(−) −50
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets120 F Net incurrence of liabilities 1701996R2223 — EN — 07.08.2003 — 008.001 — 435
▼B
Changes in assets Changes in liabilities and net worth
F.1 Monetary gold and SDRs 0
F.2 Currency and deposits 7 F.2 Currency and deposits 2
F.21 Currency 2 F.21 Currency 0F.22 Transferable deposits 4 F.22 Transferable deposits 2F.29 Other deposits 1 F.29 Other deposits 0
F.3 Securities other than shares 26 F.3 Securities other than shares 64
F.4 Loans 45 F.4 Loans 94
F.41 Short-term 1 F.41 Short-term 32
F.42 Long-term 44 F.42 Long-term 62
F.5 Shares and other equity 36 F.5 Shares and other equity 0
F.6 Insurance technical reserves 0 F.6 Insurance technical reserves 0
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 0F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 0
F.612 Net equity of households in
pension fund reserves 0
F.7 Other accounts receivable 6F.71 Trade credits and advances 1 F.7 Other accounts receivable 10F.79 Other accounts receivable,
except trade credits and
advances 5F.71 Trade credits and advances 6
F.79 Other accounts receivable,
except trade credits and
advances 4
B.9 Net lending(+) net borro-
wing(−) −50
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 0 AF Liabilities −11996R2223 — EN — 07.08.2003 — 008.001 — 436
▼B
Changes in assets Changes in liabilities and net worth
AN.1 Produced assets −3 K.7 Catastrophic losses 0
K.4 Economic appearance of
produced assets 3K.8 Uncompensated seizures 0
K.7 Catastrophic losses −4 K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.8 Uncompensated seizures 1 K.12 Changes in classifications
and structure −1
K.9 Other volume changes in
non-financial assets n.e.c. 0K.12.1 Changes in sector classifica-
tion and structure −1
K.12 Changes in classifications
and structure −3K.12.2 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure −3K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
K.12.2 Changes in classifications
and structure 0
K.12.21 Monetization/demonetization
of gold 0of
which:
AF.2 Currency and deposits 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0AF.3 Securities other than shares 0
of
which:AN.11 Fixed assets −3AF.4 Loans −1
AF.5 Shares and other equity 0
AN.12 Inventories 0 AF.6 Insurance technical reserves 0AN.13 Valuables 0 AF.7 Other accounts payable 0AN.2 Non-produced assets 3K.3 Economic appearance of
non-produced assets 0
K.5 Natural growth of non-culti-
vated biological resources 4
K.6 Economic disappearance of
non-produced assets −2
K.61 Depletion of natural assets −2
K.62 Other economic disappear-
ance of non-produced assets 0
K.7 Catastrophic losses −2
K.8 Uncompensated seizures 4K.9 Other volume changes in
non-financial assets n.e.c. 0
K.12 Changes in classifications
and structure −11996R2223 — EN — 07.08.2003 — 008.001 — 437
▼B
Changes in assets Changes in liabilities and net worth
K.12.1 Changes in sector classifica-
tion and structure −1
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AN.21 Tangible non-produced assets 3
AN.22 Intangible non-produced
assets 0
AF Financial assets 1
K.7 Catastrophic losses 0K.8 Uncompensated seizures 3
K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.12 Changes in classifications
and structure −2
K.12.1 Changes in sector classifica-
tion and structure −2
K.12.2 Changes in classification of
assets and liabilities 0
K.12.21 Monetization/demonetization
of gold 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.1 Monetary gold and SDRs 0
AF.2 Currency and deposits 0AF.3 Securities other than shares 3
AF.4 Loans 0
AF.5 Shares and other equity −2AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 21996R2223 — EN — 07.08.2003 — 008.001 — 438
▼B
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains(+)/
losses(−):K.11 Nominal holding gains(−)/
losses(+):
AN Non-financial assets 44 AF Liabilities 7
AN.1 Produced assets 20 AF.2 Currency and deposits 0
AN.11 Fixed assets 18 AF.3 Securities other than shares 7AN.12 Inventories 1 AF.4 Loans 0AN.13 Valuables 1 AF.5 Shares and other equity 0AN.2 Non-produced assets 23 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 23 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 2
AF.1 Monetary gold and SDRs 1AF.2 Currency and deposits 0
AF.3 Securities other than shares 0
AF.4 Loans 0AF.5 Shares and other equity 0AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains/losses 38
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains(+)/
losses(−):K.11.1 Neutral holding gains(−)/
losses(+):
AN Non-financial assets 32 AF Liabilities 14
AN.1 Produced assets 20 AF.2 Currency and deposits 2AN.11 Fixed assets 18 AF.3 Securities other than shares 4
AN.12 Inventories 1 AF.4 Loans 7
AN.13 Valuables 1 AF.5 Shares and other equity 0AN.2 Non-produced assets 12 AF.6 Insurance technical reserves 01996R2223 — EN — 07.08.2003 — 008.001 — 439
▼B
Changes in assets Changes in liabilities and net worth
AN.21 Tangible non-produced assets 12 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 8
AF.1 Monetary gold and SDRs 2
AF.2 Currency and deposits 3
AF.3 Securities other than shares 0AF.4 Loans 2AF.5 Shares and other equity 0AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable 0
B.10.31 Changes in net worth due to
neutral holding gains/losses 26
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+):
AN Non-financial assets 12 AF Liabilities −7
AN.1 Produced assets 0 AF.2 Currency and deposits −2
AN.11 Fixed assets 0 AF.3 Securities other than shares 3
AN.12 Inventories 0 AF.4 Loans −7AN.13 Valuables 0 AF.5 Shares and other equity 0AN.2 Non-produced assets 12 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 12 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets −6
AF.1 Monetary gold and SDRs 0AF.2 Currency and deposits −3
AF.3 Securities other than shares 0
AF.4 Loans −2AF.5 Shares and other equity 01996R2223 — EN — 07.08.2003 — 008.001 — 440
▼B
Changes in assets Changes in liabilities and net worth
AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable 0
B.10.32 Changes in net worth due to
real holding gains/losses 12
IV: Balance sheet
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 1 591 AF Liabilities 687
AN.1 Produced assets 1 001 AF.2 Currency and deposits 102AN.11 Fixed assets 913 AF.3 Securities other than shares 212AN.12 Inventories 47 AF.4 Loans 328
AN.13 Valuables 41 AF.5 Shares and other equity 4
AN.2 Non-produced assets 590 AF.6 Insurance technical reserves 19AN.21 Tangible non-produced assets 578 AF.7 Other accounts payable 22AN.22 Intangible non-produced
assets 12
AF Financial assets 396
AF.1 Monetary gold and SDRs 80
AF.2 Currency and deposits 150AF.3 Securities other than shares 0AF.4 Loans 115
AF.5 Shares and other equity 12
AF.6 Insurance technical reserves 20AF.7 Other accounts receivable 19
B.90 Net worth 1 300
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 56 AF Liabilities 176
AN.1 Produced assets 25 AF.2 Currency and deposits 2AN.11 Fixed assets 20 AF.3 Securities other than shares 711996R2223 — EN — 07.08.2003 — 008.001 — 441
▼B
Assets Liabilities and net worth
AN.12 Inventories 1 AF.4 Loans 93
AN.13 Valuables 4 AF.5 Shares and other equity 0AN.2 Non-produced assets 30 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 30 AF.7 Other accounts payable 10
AN.22 Intangible non-produced
assets 0
AF Financial assets 123
AF.1 Monetary gold and SDRs 1AF.2 Currency and deposits 7AF.3 Securities other than shares 29
AF.4 Loans 45
AF.5 Shares and other equity 34AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 6
B.10 Changes in net worth, total
due to: 2
B.10.1 Saving and capital transfers −38
B.10.2 Other changes in volume of
assets 2
B.10.3 Nominal holding gains/losses 38
B.10.31 Neutral holding gains/losses 26
B.10.32 Real holding gains/losses 12
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 1 647 AF Liabilities 863
AN.1 Produced assets 1 026 AF.2 Currency and deposits 104AN.11 Fixed assets 933 AF.3 Securities other than shares 283AN.12 Inventories 48 AF.4 Loans 421
AN.13 Securities other than shares 45 AF.5 Shares and other equity 4
AN.2 Non-produced assets 620 AF.6 Insurance technical reserves 19AN.21 Tangible non-produced assets 608 AF.7 Other accounts payable 32AN.22 Intangible non-produced
assets 121996R2223 — EN — 07.08.2003 — 008.001 — 442
▼B
Assets Liabilities and net worth
AF Financial assets 519
AF.1 Monetary gold and SDRs 81AF.2 Currency and deposits 157
AF.3 Securities other than shares 29
AF.4 Loans 160AF.5 Shares and other equity 46AF.6 Insurance technical reserves 20
AF.7 Other accounts receivable 25
B.90 Net worth 1 302
Table A.IV.6 — Full sequence of accounts for households
I:Production account
Uses Resources
P.2 Intermediate consumption 694 P.1 Output 1 269
P.11 Market output 1 129
P.12 Output for own final use 140
B.1g Value-added, gross 575
K.1 Consumption of fixed capital 42
B.1n Value-added, net 533
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 39 B.1n Value-added, net 533
D.11 Wages and salaries 39
D.12 Employers' social, contribu-
tions 0
D.121 Employers' actual social
contributions 0
D.122 Employers' imputed social
contributions 0
D.29 Other taxes on production 3
D.39 Other subsidies on produc-
tion −11996R2223 — EN — 07.08.2003 — 008.001 — 443
▼B
Uses Resources
B.2 Operating surplus 60
B.3 Mixed income 432
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 44 B.2 Operating surplus 60
D.41 Interest 17 B.3 Mixed income 432
D.45 Rent 27
D.1 Compensation of employees 766
D.11 Wages and salaries 573
D.12 Employers' social contribu-
tions 193
D.121 Employers' actual social
contributions 174
D.122 Employers' imputed social
contributions 19
D.4 Property income 134
D.41 Interest 33
D.42 Distributed income of
corporations 57
D.421 Dividends 13
D.422 Withdrawals from income of
quasi-corporations 44
D.43 Reinvested earnings on direct
foreign investment 3
D.44 Property income attributed to
insurance policyholders 20
D.45 Rent 21
B.5 Balance of primary incomes 1 348
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 7 B.2 Operating surplus 60
D.41 Interest 0 B.3 Mixed income 432
D.45 Rent 7
D.4 Property income 51996R2223 — EN — 07.08.2003 — 008.001 — 444
▼B
Uses Resources
D.41 Interest 0
D.42 Distributed income of
corporations 5
D.421 Dividends 5D.422 Withdrawals from income of
quasi-corporations 0
D.44 Property income attributed to
insurance policyholders 0
B.4 Entrepreneurial income 490
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 37 B.4 Entrepreneurial income 490
D.41 Interest 17D.45 Rent 20 D.1 Compensation of employees 766
D.11 Wages and salaries 573
D.12 Employers' social contribu-
tions 193
D.121 Employers' actual social
contributions 174
D.122 Employers' imputed social
contributions 19
D.4 Property income 129
D.41 Interest 33
D.42 Distributed income of
corporations 52
D.421 Dividends 8
D.422 Withdrawals from income of
quasi-corporations 44
D.43 Reinvested earnings on direct
foreign investment 3
D.44 Property income attributed to
insurance policyholders 20
D.45 Rent 21
B.5 Balance of primary incomes 1 3481996R2223 — EN — 07.08.2003 — 008.001 — 445
▼B
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc.178 B.5 Balance of primary incomes 1 348
D.51 Taxes on income 176
D.59 Other current taxes 2 D.61 Social contributions 0
D.611 Actual social contributions 0
D.61 Social contributions 322 D.6111 Employers' actual social
contributions 0
D.611 Actual social contributions 303 D.61111 Compulsory employers'
actual social contributions 0
D.6111 Employers' actual social
contributions 174D.61112 Voluntary employers' actual
social contributions 0
D.61111 Compulsory employers'
social contributions 160D.6112 Employees' social contribu-
tions 0
D.61112 Voluntary employers' actual
social contributions 14D.61121 Compulsory employees'
social contributions 0
D.6112 Employees' social contribu-
tions 97D.61122 Voluntary employees' social
contributions 0
D.61121 Compulsory employees'
social contributions 85
D.61122 Voluntary employees' social
contributions 12D.62 Social benefits other than
social transfers in kind 332
D.6113 Social contributions by self-
and non-employed persons 32D.621 Social security benefits in
cash 232
D.61131 Compulsory social contribu-
tions by self- and non-
employed persons 22D.622 Private funded social benefits 29
D.61132 Voluntary social contribu-
tions by self- and non-
employed persons 10D.623 Unfunded employee social
benefits 19
D.612 Imputed social contributions 19 D.624 Social assistance benefits in
cash 52
D.62 Social benefits other than
social transfers in kind 0D.7 Other current transfers 36
D.622 Private funded social benefits 0 D.72 Non-life insurance claims 35
D.75 Miscellaneous current trans-
fers 1
D.7 Other current transfers 71
D.71 Net non-life insurance trans-
fers 31
D.75 Miscellaneous current trans-
fers 401996R2223 — EN — 07.08.2003 — 008.001 — 446
▼B
Uses Resources
B.6 Disposable income 1 145
II.3: Redistribution of income in kind account
Uses Resources
B.6 Disposable income 1 145
D.63 Social transfers in kind 219
D.631 Social benefits in kind 162D.6311 Social security benefits,
reimbursements 78
D.6312 Other social security benefits
in kind 65
D.6313 Social assistance benefits in
kind 19
D.632 Transfers of individual non-
market goods and services 57
B.7 Adjusted disposable income 1 364
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
P.3 Final consumption expendi-
ture996 B.6 Disposable income 1 145
P.31 Individual consumption
expenditure 996
D.8 Adjustment for the change in
net equity of households in
pension fund reserves 11
B.8 Saving 160
II.4.2: Use of adjusted di sposable income account
Uses Resources
P.4 Actual final consumption 1 215 B.7 Adjusted disposable income 1 364
P.41 Actual individual consump-
tion 1 215
D.8 Adjustment for the change in
net equity of households in
pension fund reserves 11
B.8 Saving 1601996R2223 — EN — 07.08.2003 — 008.001 — 447
▼B
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10.1 Changes in net worth due to
saving and capital transfers178 B.8n Saving, net 160
D.9 Capital transfers, receivable 23
D.92 Investment grants 0D.99 Other capital transfers 23
D.9 Capital transfers, payable −5
D.91 Capital taxes −2
D.99 Other capital transfers −3
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 61 B.10.1 Changes in net worth due to
saving and capital transfers178
P.511 Acquisitions less disposals of
tangible fixed assets 49
P.5111 Acquisitions of new tangible
fixed assets 50
P.5112 Acquisitions of existing
tangible fixed assets 4
P.5113 Disposals of existing tangible
fixed assets −5
P.512 Acquisitions less disposals of
intangible fixed assets 12
P.5121 Acquisitions of new intan-
gible fixed assets 9
P.5122 Acquisitions of existing
intangible fixed assets 3
P.5123 Disposals of existing intan-
gible fixed assets 0
P.513 Additions to the value of
non-produced non-financial
assets 0
P.5131 Major improvements to non-
produced non-financial assets 0
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 01996R2223 — EN — 07.08.2003 — 008.001 — 448
▼B
Changes in assets Changes in liabilities and net worth
K.1 Consumption of fixed capital −42
P.52 Changes in inventories 2
P.53 Acquisitions less disposals of
valuables 5
K.2 Acquisitions less disposals of
non-produced non-financial
assets 4
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 3
K.22 Acquisitions less disposals of
intangible non-produced
assets 1
B.9 Net lending (+)/net borro-
wing(−) 148
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets181 F Net incurrence of liabilities 33
F.2 Currency and deposits 68 F.2 Currency and deposits 0
F.21 Currency 10 F.22 Transferable deposits 0F.22 Transferable deposits 41 F.29 Other deposits 0F.29 Other deposits 17
F.3 Securities other than shares 0
F.3 Securities other than shares 29
F.4 Loans 28
F.4 Loans 5 F.41 Short-term 11F.41 Short-term 3 F.42 Long-term 17
F.42 Long-term 2
F.7 Other accounts payable 5
F.5 Shares and other equity 3 F.71 Trade credits and advances 41996R2223 — EN — 07.08.2003 — 008.001 — 449
▼B
Changes in assets Changes in liabilities and net worth
F.79 Other accounts payable,
except trade credits and
advances 1
F.6 Insurance technical reserves 36F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 33
F.611 Net equity of households in
life insurance reserves 22
F.612 Net equity of households in
pension fund reserves 11
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 3
F.7 Other accounts receivable 40
F.71 Trade credits and advances 11F.79 Other accounts receivable,
except trade credits and
advances 29
B.9 Net lending (+)/net borro-
wing(−) 148
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 0 AF Liabilities 0
AN.1 Produced assets 0 K.7 Catastrophic losses 0
K.4 Economic appearance of
produced assets 0K.8 Uncompensated seizures 0
K.7 Catastrophic losses 0 K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.8 Uncompensated seizures 0 K.12 Changes in classifications
and structure 0
K.9 Other volume changes in
non-financial assets n.e.c. 0K.12.1 Changes in sector classifica-
tion and structure 0
K.12 Changes in classifications
and structure 0K.12.2 Changes in classification of
assets and liabilities 0
K.12.1 Changes in sector classifica-
tion and structure 0K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
K.12.2 Changes in classification of
assets and liabilities 01996R2223 — EN — 07.08.2003 — 008.001 — 450
▼B
Changes in assets Changes in liabilities and net worth
K.12.21 Monetization/demonetization
of gold 0of which
AF.2 Currency and deposits 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0AF.3 Securities other than shares 0
of
which:
AN.11 Fixed assets 0AF.4 Loans 0
AF.7 Other accounts payable 0
AN.12 Inventories 0
AN.13 Valuables 0
AN.2 Non-produced assets 0K.3 Economic appearance of
non-produced assets 0
K.5 Natural growth of non-culti-
vated biological resources 0
K.6 Economic disappearance of
non-produced assets 0
K.61 Depletion of natural assets 0
K.62 Other economic disappear-
ance of non-produced assets 0
K.7 Catastrophic losses 0
K.8 Uncompensated seizures 0
K.9 Other volume changes in
non-financial assets 0
K.12 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AN.21 Tangible non-produced assets 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 2
K.7 Catastrophic losses 0
K.8 Uncompensated seizures 01996R2223 — EN — 07.08.2003 — 008.001 — 451
▼B
Changes in assets Changes in liabilities and net worth
K.10 Other volume changes in
financial assets and liabilities
n.e.c. 2
K.12 Changes in classification and
structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.2 Currency and deposits 0
AF.3 Securities other than shares 0AF.4 Loans 0AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 2
AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 2
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains(+)/
losses(−):K.11 Nominal holding gains(−)/
losses(+):
AN Non-financial assets 80 AF Liabilities 0
AN.1 Produced assets 35 AF.2 Currency and deposits 0AN.11 Fixed assets 28 AF.3 Securities other than shares 0AN.12 Inventories 2 AF.4 Loans 0AN.13 Valuables 5 AF.7 Other accounts payable 0
AN.2 Non-produced assets 45
AN.21 Tangible non-produced assets 45AN.22 Intangible non-produced
assets 0
AF Financial assets 161996R2223 — EN — 07.08.2003 — 008.001 — 452
▼B
Changes in assets Changes in liabilities and net worth
AF.2 Currency and deposits 0
AF.3 Securities other than shares 6AF.4 Loans 0
AF.5 Shares and other equity 10
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains/losses 96
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains(+)/
losses(−):K.11.1 Neutral holding gains(−)/
losses(+):
AN Non-financial assets 56 AF Liabilities 6
AN.1 Produced assets 34 AF.2 Currency and deposits 0
AN.11 Fixed assets 28 AF.3 Securities other than shares 0AN.12 Inventories 2 AF.4 Loans 3AN.13 Valuables 4 AF.5 Shares and other equity 0
AN.2 Non-produced assets 22 AF.7 Other accounts payable 2
AN.21 Tangible non-produced assets 22AN.22 Intangible non-produced
assets 0
AF Financial assets 36
AF.2 Currency and deposits 17
AF.3 Securities other than shares 4
AF.4 Loans 0AF.5 Shares and other equity 8AF.6 Insurance technical reserves 6
AF.7 Other accounts receivable 1
B.10.31 Changes in net worth due to
neutral holding gains/losses 871996R2223 — EN — 07.08.2003 — 008.001 — 453
▼B
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+):
AN Non-financial assets 24 AF Liabilities −6
AN.1 Produced assets 1 AF.2 Currency and deposits 0AN.11 Fixed assets 0 AF.3 Securities other than shares 0AN.12 Inventories 0 AF.4 Loans −3
AN.13 Valuables 1 AF.7 Other accounts payable −2
AN.2 Non-produced assets 22AN.21 Tangible non-produced assets 22AN.22 Intangible non-produced
assets 0
AF Financial assets −20
AF.2 Currency and deposits −17
AF.3 Securities other than shares 2
AF.4 Loans 0AF.5 Shares and other equity 2AF.6 Insurance technical reserves −6
AF.7 Other accounts receivable −1
B.10.32 Changes in net worth due to
real holding gains/losses 9
IV: Balance sheets
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 2 822 AF Liabilities 289
AN.1 Produced assets 1 698 AF.2 Currency and deposits 10AN.11 Fixed assets 1 423 AF.3 Securities other than shares 2
AN.12 Inventories 97 AF.4 Loans 169
AN.13 Valuables 178 AF.7 Other accounts payable 108AN.2 Non-produced assets 1 124AN.21 Tangible non-produced assets 1 124
AN.22 Intangible non-produced
assets 01996R2223 — EN — 07.08.2003 — 008.001 — 454
▼B
Assets Liabilities and net worth
AF Financial assets 1 819
AF.2 Currency and deposits 840
AF.3 Securities other than shares 198
AF.4 Loans 24AF.5 Shares and other equity 411AF.6 Insurance technical reserves 291
AF.7 Other accounts receivable 55
B.90 Net worth 4 352
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 110 AF Liabilities 33
AN.1 Produced assets 61 AF.2 Currency and deposits 0
AN.11 Fixed assets 47 AF.3 Securities other than shares 0AN.12 Inventories 4 AF.4 Loans 28AN.13 Valuables 10 AF.7 Other accounts payable 5
AN.2 Non-produced assets 49
AN.21 Tangible non-produced assets 48AN.22 Intangible non-produced
assets 1
AF Financial assets 199
AF.2 Currency and deposits 68AF.3 Securities other than shares 35
AF.4 Loans 5
AF.5 Shares and other equity 13AF.6 Insurance technical reserves 38AF.7 Other accounts receivable 40
B.10 Changes in net worth, total
due to:276
B.10.1 Saving and capital transfers 1781996R2223 — EN — 07.08.2003 — 008.001 — 455
▼B
Assets Liabilities and net worth
B.10.2 Other changes in volume of
assets 2
B.10.3 Nominal holding gains/losses 96
B.10.31 Neutral holding gains/losses 87B.10.32 Real holding gains/losses 9
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 2 932 AF Liabilities 322
AN.1 Produced assets 1 759 AF.2 Currency and deposits 10AN.11 Fixed assets 1 470 AF.3 Securities other than shares 2
AN.12 Inventories 101 AF.4 Loans 197
AN.13 Valuables 188 AF.7 Other accounts payable 113AN.2 Non-produced assets 1 173AN.21 Tangible non-produced assets 1 172
AN.22 Intangible non-produced
assets 1
AF Financial assets 2 018
AF.2 Currency and deposits 908AF.3 Securities other than shares 233AF.4 Loans 29AF.5 Shares and other equity 424
AF.6 Insurance technical reserves 329
AF.7 Other accounts receivable 95
B.90 Net worth 4 628
Table A.IV.7 — Full sequence of accounts for non-profit institutions serving households
I:Production account
Uses Resources
P.2 Intermediate consumption 6 P.1 Output 37
P.11 Market output 21
P.12 Output for own final use 0
P.13 Other non-market output 16
B.1g Value-added, gross 311996R2223 — EN — 07.08.2003 — 008.001 — 456
▼B
Uses Resources
K.1 Consumption of fixed capital 3
B.1n Value-added, net 28
II:Distribution and use of income accounts
II.1: Primary distribution of income account
II.1.1: Generation of income account
Uses Resources
D.1 Compensation of employees 23 B.1n Value-added, net 28
D.11 Wages and salaries 12
D.12 Employers' social contribu-
tions 11
D.121 Employers' actual social
contributions 10
D.122 Employers' imputed social
contributions 1
D.29 Other taxes on production 0
D.39 Other subsidies on produc-
tion 0
B.2 Operating surplus 5
II.1.2: Allocation of primary income account
Uses Resources
D.4 Property income 7 B.2 Operating surplus 5
D.41 Interest 7D.42 Distributed income of
corporations 0D.4 Property income 5
D.422 Withdrawals from income of
quasi-corporations 0D.41 Interest 5
D.43 Reinvested earnings on direct
foreign investment 0D.42 Distributed income of
corporations 0
D.44 Property income attributed to
insurance policyholders 0D.421 Dividends 0
D.45 Rent 0 D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 0
D.44 Property income attributed to
insurance policyholders 01996R2223 — EN — 07.08.2003 — 008.001 — 457
▼B
Uses Resources
D.45 Rent 0
B.5 Balance or primary incomes 3
II.1.2.1: Entrepreneurial income account
Uses Resources
D.4 Property income 2 B.2 Operating surplus 5
D.41 Interest 2D.45 Rent 0 D.4 Property income 0
D.41 Interest 0
D.42 Distributed income of
corporations 0
D.421 Dividends 0
D.422 Withdrawals from income of
quasi-corporations 0
B.4 Entrepreneurial income 3
II.1.2.2: Allocation of other primary income account
Uses Resources
D.4 Property income 5 B.4 Entrepreneurial income 3
D.41 Interest 5
D.45 Rent 0 D.4 Property income 5
D.41 Interest 5D.42 Distributed income of
corporations 0
D.421 Dividends 0D.422 Withdrawals from income of
quasi-corporations 0
D.43 Reinvested earnings on direct
foreign investment 0
D.44 Property income attributed to
insurance policyholders 0
D.45 Rent 0
B.5 Balance of primary incomes 3
II.2: Secondary distribution of income account
Uses Resources
D.5 Current taxes on income,
wealth, etc.0 B.5 Balance of primary incomes 3
D.59 Other current taxes 01996R2223 — EN — 07.08.2003 — 008.001 — 458
▼B
Uses Resources
D.61 Social contributions 1
D.62 Social benefits other than
social transfers in kind 1D.611 Actual social contributions 0
D.622 Private funded social benefits 0 D.6111 Employers' actual social
contributions 0
D.623 Unfunded employee social
benefits 1D.61111 Compulsory employers'
actual social contributions 0
D.6112 Employees' social contribu-
tions 0
D.7 Other current transfers 2 D.61121 Compulsory employees'
social contributions 0
D.71 Net non-life insurance
premiums 0D.61122 Voluntary employees' social
contributions 0
D.75 Miscellaneous current trans-
fers 2D.612 Imputed social contributions 1
D.7 Other current transfers 36
D.72 Non-life insurance claims 0D.75 Miscellaneous current trans-
fers 36
B.6 Disposable income 37
II.3: Redistribution of income in kind account
Uses Resources
D.63 Social transfers in kind 13 B.6 Disposable income 37
D.631 Social benefits in kind 0
D.6313 Social assistance benefits in
kind 0
D.632 Transfers of individual non-
market goods and services 13
B.7 Adjusted disposable income 24
II.4: Use of income account
II.4.1: Use of disposable income account
Uses Resources
P.3 Final consumption expendi-
ture 13B.6 Disposable income 37
P.31 Individual consumption
expenditure 131996R2223 — EN — 07.08.2003 — 008.001 — 459
▼B
Uses Resources
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0
B.8 Saving 24
II.4.2: Use of adjusted di sposable income account
Uses Resources
D.8 Adjustment for the change in
net equity of households in
pension funds reserves 0B.7 Adjusted disposable income 24
B.8 Saving 24
III: Accumulation accounts
III.1: Capital account
III.1.1: Change in net worth due to saving and capital transfers
account
Changes in assets Changes in liabilities and net worth
B.10.1 Changes in net worth due to
saving and capital transfers21 B.8n Saving, net 24
D.9 Capital transfers, receivable 0
D.92 Investment grants 0
D.99 Other capital transfers 0
D.9 Capital transfers, payable −3
D.91 Capital taxes 0
D.99 Other capital transfers −3
III.1.2: Acquisition of non-financial assets account
Changes in assets Changes in liabilities and net worth
P.51 Gross fixed capital formation 19 B.10.1 Changes in net worth due to
saving and capital transfers21
P.511 Acquisitions less disposals of
tangible fixed assets 14
P.5111 Acquisitions of new tangible
fixed assets 13
P.5112 Acquisitions of existing
tangible fixed assets 11996R2223 — EN — 07.08.2003 — 008.001 — 460
▼B
Changes in assets Changes in liabilities and net worth
P.5113 Disposals of existing tangible
fixed assets 0
P.512 Acquisitions less disposals of
intangible fixed assets 5
P.5121 Acquisitions of new intan-
gible fixed assets 10
P.5122 Acquisitions of existing
intangible fixed assets 0
P.5123 Disposals of existing intan-
gible fixed assets −5
P.513 Additions to the value of
non-produced non-financial
assets 0
P.5131 Major improvements to non-
produced non-financial assets 0
P.5132 Costs of ownership transfer
on non-produced non-finan-
cial assets 0
K.1 Consumption of fixed capital −3
P.52 Changes in inventories 0
P.53 Acquisitions less disposals of
valuables 0
K.2 Acquisitions less disposals of
non-produced non-financial
assets 1
K.21 Acquisitions less disposals of
land and other tangible non-
produced assets 1
K.22 Acquisitions less disposals of
intangible non-produced
assets 0
B.9 Net lending (+): net
borrowing (−) 4
III.2: Financial account
Changes in assets Changes in liabilities and net worth
F Net acquisition of financial
assets32 F Net incurrence of liabilities 281996R2223 — EN — 07.08.2003 — 008.001 — 461
▼B
Changes in assets Changes in liabilities and net worth
F.2 Currency and deposits 12 F.2 Currency and deposits 0
F.21 Currency 2 F.22 Transferable deposits 0F.22 Transferable deposits 7 F.29 Other deposits 0
F.29 Other deposits 3
F.3 Securities other than shares 0
F.3 Securities other than shares 12
F.4 Loans 24
F.4 Loans 0 F.41 Short-term 17
F.41 Short-term 0 F.42 Long-term 7F.42 Long-term 0
F.5 Shares and other equity 4
F.5 Shares and other equity 0 F.6 Insurance technical reserves 0
F.6 Insurance technical reserves 0 F.61 Net equity of households in
life insurance reserves and in
pension fund reserves 0
F.62 Prepayments of insurance
premiums and reserves for
outstanding claims 0F.612 Net equity of households in
pension fund reserves 0
F.7 Other accounts receivable 8 F.7 Other accounts payable 0
F.71 Trade credits and advances 0 F.71 Trade credits and advances 0
F.79 Other accounts receivable,
except trade credits and
advances 8F.79 Other accounts payable,
except trade credits and
advances 0
B.9 Net lending (+) net
borrowing (−) 4
III.3: Other changes in assets accounts
III.3.1: Other changes in volume of assets account
Changes in assets Changes in liabilities and net worth
AN Non-financial assets 0 AF Liabilities 0
AN.1 Produced assets 0 K.7 Catastrophic losses 0
K.4 Economic appearance of
produced assets 0K.8 Uncompensated seizures 0
K.7 Catastrophic losses 0 K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.8 Uncompensated seizures 0 K.12 Changes in classifications
and structure 01996R2223 — EN — 07.08.2003 — 008.001 — 462
▼B
Changes in assets Changes in liabilities and net worth
K.9 Other volume changes in
non-financial assets n.e.c. 0K.12.1 Changes in sector classifica-
tion and structure 0
K.12 Changes in classifications
and structure 0K.12.2 Changes in classification of
assets and liabilities 0
K.12.1 Changes in sector classifica-
tion and structure 0K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0of
which:
AF.2 Currency and deposits 0
AF.3 Securities other than shares 0
AF.4 Loans 0
of
which:
AN.11 Fixed assets 0
AN.12 Inventories 0 AF.5 Shares and other equity 0AN.13 Valuables 0 AF.6 Insurance technical reserves 0AN.2 Non-produced assets 0 AF.7 Other accounts payable 0K.3 Economic appearance of
non-produced assets 0
K.5 Natural growth of non-culti-
vated biological resources 0
K.6 Economic disappearance of
non-produced assets 0
K.61 Depletion of natural assets 0K.62 Other economic disappear-
ance of non-produced assets 0
K.7 Catastrophic losses 0K.8 Uncompensated seizures 0K.9 Other volume changes in
non-financial assets n.e.c. 0
K.12 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 01996R2223 — EN — 07.08.2003 — 008.001 — 463
▼B
Changes in assets Changes in liabilities and net worth
of
which:
AN.21 Tangible non-produced assets 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 0
K.7 Catastrophic losses 0K.8 Uncompensated seizures 0K.10 Other volume changes in
financial assets and liabilities
n.e.c. 0
K.12 Changes in classifications
and structure 0
K.12.1 Changes in sector classifica-
tion and structure 0
K.12.2 Changes in classification of
assets and liabilities 0
K.12.22 Changes in classification of
assets or liabilities other than
monetization/demonetization
of gold 0
of
which:
AF.2 Currency and deposits 0
AF.3 Securities other than shares 0AF.4 Loans 0
AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.2 Changes in net worth due to
other changes in volume of
assets 0
III.3.2: Revaluation account
Changes in assets Changes in liabilities and net worth
K.11 Nominal holding gains (+)/
losses(−):K.11 Nominal holding gains(−)/
losses(+):
AN Non-financial assets 8 AF Liabilities 0
AN.1 Produced assets 5 AF.2 Currency and deposits 0AN.11 Fixed assets 5 AF.3 Securities other than shares 01996R2223 — EN — 07.08.2003 — 008.001 — 464
▼B
Changes in assets Changes in liabilities and net worth
AN.12 Inventories 0 AF.4 Loans 0
AN.13 Valuables 0 AF.5 Shares and other equity 0AN.2 Non-produced assets 3 AF.6 Insurance technical reserves 0
AN.21 Tangible non-produced assets 3 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 2
AF.2 Currency and deposits 0AF.3 Securities other than shares 1AF.4 Loans 0
AF.5 Shares and other equity 1
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.3 Changes in net worth due to
nominal holding gains losses 10
III.3.2.1: Neutral holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.1 Neutral holding gains (+)/
losses(−):K.11.1 Neutral holding gains (−)/
losses(+):
AN Non-financial assets 7 AF Liabilities 2
AN.1 Produced assets 5 AF.2 Currency and deposits 1AN.11 Fixed assets 5 AF.3 Securities other than shares 0AN.12 Inventories 0 AF.4 Loans 1
AN.13 Valuables 0 AF.5 Shares and other equity 0
AN.2 Non-produced assets 2 AF.6 Insurance technical reserves 0AN.21 Tangible non-produced assets 2 AF.7 Other accounts payable 1AN.22 Intangible non-produced
assets 0
AF Financial assets 3
AF.2 Currency and deposits 2
AF.3 Securities other than shares 1AF.4 Loans 01996R2223 — EN — 07.08.2003 — 008.001 — 465
▼B
Changes in assets Changes in liabilities and net worth
AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 0
B.10.31 Changes in net worth due to
neutral holding gains/losses 8
III.3.2.2: Real holding gains/losses account
Changes in assets Changes in liabilities and net worth
K.11.2 Real holding gains(+)/
losses(−):K.11.2 Real holding gains(−)/
losses(+)
AN Non-financial assets 2 AF Liabilities −2
AN.1 Produced assets 0 AF.2 Currency and deposits −1AN.11 Fixed assets 0 AF.3 Securities other than shares 0AN.12 Inventories 0 AF.4 Loans −1
AN.13 Valuables 0 AF.5 Shares and other equity 0
AN.2 Non-produced assets 2 AF.6 Insurance technical reserves 0AN.21 Tangible non-produced assets 2 AF.7 Other accounts payable −1AN.22 Intangible non-produced
assets 0
AF Financial assets −2
AF.2 Currency and deposits −2
AF.3 Securities other than shares 0AF.4 Loans 0AF.5 Shares and other equity 0
AF.6 Insurance technical reserves 0
AF.7 Other accounts receivable 0
B.10.32 Changes in net worth due to
real holding gains losses 2
IV: Balance sheets
IV.1: Opening balance sheet
Assets Liabilities and net worth
AN Non-financial assets 324 AF Liabilities 121
AN.1 Produced assets 243 AF.2 Currency and deposits 381996R2223 — EN — 07.08.2003 — 008.001 — 466
▼B
Assets Liabilities and net worth
AN.11 Fixed assets 231 AF.3 Securities other than shares 0
AN.12 Inventories 2 AF.4 Loans 43AN.13 Valuables 10 AF.5 Shares and other equity 0
AN.2 Non-produced assets 81 AF.6 Insurance technical reserves 5
AN.21 Tangible non-produced assets 81 AF.7 Other accounts payable 35AN.22 Intangible non-produced
assets 0
AF Financial assets 172
AF.2 Currency and deposits 110AF.3 Securities other than shares 25
AF.4 Loans 8
AF.5 Shares and other equity 22AF.6 Insurance technical reserves 4AF.7 Other accounts receivable 3
B.90 Net worth 375
IV.2: Changes in balance sheet
Assets Liabilities and net worth
Total changes in assets Total changes in liabilities
AN Non-financial assets 25 AF Liabilities 28
AN.1 Produced assets 21 AF.2 Currency and deposits 0AN.11 Fixed assets 21 AF.3 Securities other than shares 0
AN.12 Inventories 0 AF.4 Loans 24
AN.13 Valuables 0 AF.5 Shares and other equity 4AN.2 Non-produced assets 4 AF.6 Insurance technical reserves 0AN.21 Tangible non-produced assets 4 AF.7 Other accounts payable 0
AN.22 Intangible non-produced
assets 0
AF Financial assets 33
AF.2 Currency and deposits 12AF.3 Securities other than shares 13AF.4 Loans 01996R2223 — EN — 07.08.2003 — 008.001 — 467
▼B
Assets Liabilities and net worth
AF.5 Shares and other equity 1
AF.6 Insurance technical reserves 0AF.7 Other accounts receivable 8
B.10 Changes in net worth, total
due to: 31
B.10.1 Saving and capital transfers 21
B.10.2 Other changes in volume of
assets 0
B.10.3 Nominal holding gains/losses 10
B.10.31 Neutral holding gains/losses 8
B.10.32 Real holding gains/losses 2
IV.3: Closing balance sheet
Assets Liabilities and net worth
AN Non-financial assets 349 AF Liabilities 149
AN.1 Produced assets 264 AF.2 Currency and deposits 38AN.11 Fixed assets 252 AF.3 Securities other than shares 0AN.12 Inventories 2 AF.4 Loans 67
AN.13 Valuables 10 AF.5 Shares and other equity 4
AN.2 Non-produced assets 85 AF.6 Insurance technical reserves 5AN.21 Tangible non-produced assets 85 AF.7 Other accounts payable 35AN.22 Intangible non-produced
assets 0
AF Financial assets 205
AF.2 Currency and deposits 122
AF.3 Securities other than shares 38
AF.4 Loans 8AF.5 Shares and other equity 23AF.6 Insurance technical reserves 4
AF.7 Other accounts receivable 11
B.90 Net worth 4061996R2223 — EN — 07.08.2003 — 008.001 — 468
▼M5
ANNEX V
DEFINITION OF GOVERNMENT DEFICIT FOR THE
PURPOSE OF THE EXCESSIVE DEFICIT PROCEDURE
For the purpose of the Member States' reports to the Commission under the
excessive deficit procedure laid down in Council Regulation (EC) No 3605/93 (1),
‘Government deficit’ is the balancing item ‘net borrowing/net lending’ of General
Government, including streams of interest payments resulting from swaps
arrangements and forward rate agreements. This balancing item is codified as
EDPB9. For this purpose, interest includes the abovementioned flows and is
codified as EDPD41.1996R2223 — EN — 07.08.2003 — 008.001 — 469
(1) OJ L 332, 31.12.1993, p. 7. Regulation as last amended by Regulation (EC) No 475/2000
(OJ L 58, 3.3.2000, p. 1).
▼B
ANNEX B
TRANSMISSION PROGRAMME OF NATIONAL ACCOUNTS DATA
Overview of the tables
First trans-
missionDelay
t + month
(days where
specified)Transmission
for yearsSubject of the tables Table No
2002 70 days 1995-2001 Main aggregates, annual 1
2002 70 days 1995-2001 Main aggregates, quarterly 1
1999 8 1995-1998 Main aggregates general government 2
2001 3 1997-2000 Main aggregates general government 2'2000 9 1995-1999 Tables by industry 32000 9 1995-1999 Exports and imports by EU/third coun-
tries4
2000 9 1995-1999 Household final consumption expendi-
ture by purpose5
2000 9 1995-1999 Financial accounts by sector (transac-
tions)6
2000 9 1995-1999 Balance sheets for financial assets and
liabilities7
2000 12 1995-1999 Non-financial accounts by sector 8
2000 12 1995-1999 Detailed tax receipts by sector 9
2000 24 1995-1998 Tables by industry and by region, NUTS
II, A1710
2001 12 1995-2000 General government expenditure by
function11
2001 24 1995-1999 Tables by industry and by region, NUTS
III, A312
2001 24 1995-1999 Household accounts by region, NUTS II 13
2001 24 1995-1999 Fixed assets for total economy and by
product (Pi3)14
2002 36 1995-1999 Supply table at basic prices including
transformation into purchasers' prices,
A60 × P6015
2002 36 1995-1999 Use table at purchasers' prices, A60 ×
P6016
2002 36 1995 (*) Symmetric input-output table at basic
prices, P60 × P60, five yearly17
2002 36 1995 (*) Symmetric input-output table for
domestic output at basic prices, P60 ×
P60, five yearly18
2002 36 1995 (*) Symmetric input-output table for
imports at basic prices P60 × P60, five
yearly191996R2223 — EN — 07.08.2003 — 008.001 — 470
▼M8
▼M8
First trans-
missionDelay
t + month
(days where
specified)Transmission
for yearsSubject of the tables Table No
2003 36 2000 Cross classification of fixed assets by
industry and by product, A31 × Pi3, five
yearly20
2003 36 2000 Cross classification of production
account by industry and by sector, A60
× (S11, S12, S13, S14, S15), five yearly21
2003 36 2000 Cross classification of gross fixed
capital formation by industry and by
product, A31 × P60, five yearly22
see table see table see table Backward calculations 23
t: reference period (year or quarter).
(*) The five yearly table for the year 2000 has to be delivered in 2003.
Table 1 — Main aggregates — quarterly and annual exercise
Code List of variablesBreak-
down +Current
pricesConstant
prices
Value added and gross domestic product
B.1g 1. Gross value added at basic prices A6 x x
D.21-D.31 2. Taxes less subsidies on products x x
P.119 3. FISIM x xB.1*g 4. Gross domestic product at market prices x x
Expenditure of the gross domestic product
P.3 5. Total final consumption expenditure x x
P.3 6. (a) Household final consumption expenditure
(domestic concept)xx
P.3 6. (b) Household final consumption expenditure
(national concept)xx
P.3 7. Final consumption expenditure of NPISHs x x
P.3 8. Government final consumption expenditure x x
P.31 (a) Individual consumption expenditure x x
P.32 (b) Collective consumption expenditure x xP.4 9. Actual final consumption of households x xP.41 (a) Actual individual consumption x x
P.5 10. Gross capital formation x x
P.51 (a) Gross fixed capital formation Pi 6 x xP.52 (b) Changes in inventories x xP.53 (c) Acquisitions less disposals of valuables x x
P.6 11. Exports of goods (fob) and services x x1996R2223 — EN — 07.08.2003 — 008.001 — 471
▼M8
Code List of variablesBreak-
down +Current
pricesConstant
prices
P.7 12. Imports of goods (fob) and services x x
Income, saving and net lending
B.5 13. Balance of primary income with the rest of the
worldxx
B.5*g 14. Gross national income at market prices x x
K.1 15. Consumption of fixed capital x x
B.5*n 16. Net national income at market prices x xD.5, D.6,
D.717. Net current transfers with the rest of the world x
B.6n 18. Disposable income, net x x
B.8n 19. National saving, net x
D.9 20. Net capital transfers with the rest of the world x
B.9 21. Net lending or net borrowing of the nation x
Population, employment, compensation of employees
22. Population and employment data
(a) Total population (1 000)
(b) Unemployed persons (1 000)(c) Employment in resident production units
(thousands of persons employed and thou-
sands of hours worked) and employment of
residents (thousands of persons)
Self employed A6 (**)
Employees A6 (**)
D.1 23. Compensation of employees working in resi-
dent production units and compensation of
resident employeesA6 (**) x
D.11 (a) Gross wages and salaries A6 (**) x
+ If no breakdown is indicated that means total economy.
(**) A6 only for self employed and employees in resident production units.
x At real terms.
Table 2 — Main aggregates of general government
Consolidation rules: the transactions D.41, D.7, D.92 and D.99 are consolidated. The other transactions
are not consolidated.
Code List of variables Transmission at t + 3 Transmission at t + 8
P.1 Output X
P.11 + P.12 — Market output and output for own
final useX
P.13 — Other non-market output X
P.131 — Payments for other non-market
outputX1996R2223 — EN — 07.08.2003 — 008.001 — 472
▼M2
▼M2
Code List of variables Transmission at t + 3 Transmission at t + 8
P.132 — Other non-market output, other X
P.11 + P.12 + P.131 X
P.2 Intermediate consumption X X
B.1G Value added, gross X
K.1 Consumption of fixed capital XB.1N Value added, net X
D.1P Compensation of employees, payable X X
D.29P Other taxes on production, payable X X
D.39R Other subsidies on production, recei-
vableXX
B.2N Operating surplus, net X
D.2R Taxes on production and imports,
receivableXX
D.4R Property income, receivable X X
D.3P Subsidies, payable X X
D.4P Property income, payable X X
D.41P — Interest, payable X XD.42P + …D.45P — Other property income, payable X X
B.5N Balance of primary incomes, net X
D.5R Current taxes on income, wealth etc.,
receivableXX
D.61R Social contributions, receivable X X
D.611R — Actual social contributions, recei-
vableXX
D.612 — Imputed social contributions X X
D.7R Other current transfers, receivable X X
D.5P Current taxes on income, wealth etc.,
payableXX
D.62P Social benefits other than social
transfers in kind, payableX
D.6311P +
D.63121P +
D.63131PSocial transfers in kind related to
expenditure on products supplied to
households via market producersX
D.62P + D.6311P
+ D.63121P +
D.63131PX
D.7P Other current transfers, payable X X
B.6N Disposable income, net X1996R2223 — EN — 07.08.2003 — 008.001 — 473
▼M2
Code List of variables Transmission at t + 3 Transmission at t + 8
P.3 Final consumption expenditure X
P.31 — Individual consumption expendi-
tureX
P.32 — Collective consumption expendi-
tureX
D.8 Adjustment for the change in net
equity of households in pension funds
reservesXX
B.8G Saving, gross X X
B.8N Saving, net XD.9R Capital transfers, receivable X X
D.91R — Capital taxes, receivable X X
D.92R + D.99R — Investment grants and other
capital transfers, receivableXX
D.9P Capital transfers, payable X X
P.5 Gross capital formation XP.51 — Gross fixed capital formation X XP.52 + P.53 — Changes in inventories and
acquisitions less disposals of
valuablesX
K.2 Acquisitions less disposals of non-
financial non-produced assetsX
P.5 + K.2 X
B.9 Net lending (+)/Net borrowing (–) X X
TE Total General government expendi-
tureXX
TR Total General government revenue X X
D.995 Capital transfers from general
government to relevant sectors
representing taxes and social contri-
butions assessed but unlikely to be
collected
TE = P.2 + P.5 + D.1P + D.29P + D.3P + D.4P + D.5P + D.62P + D.6311P + D.63121P + D.63131P + D.7P + D.8 +
D.9P + K.2
TR = P.11 + P.12 + P.131 + D.2R + D.39R + D.4R + D.5R + D.61R + D.7R + D.9R1996R2223 — EN — 07.08.2003 — 008.001 — 474
▼M4
▼M2
▼B
Table 3 — Tables by industry — annual exercise
Code List of variablesBreak-
downCurrent
pricesConstant
prices
Value added
P.1 1. Output at basic prices by industry A31 x
P.2 2. Intermediate consumption at purchaser's prices by
industryA31 x
B.1g 3. Gross value added at basic prices by industry A31 x x
K.1 4. Consumption of fixed capital by industry A31 x x
Capital formation
P.5 5. Gross capital formation by industry
P.51 (a) Gross fixed capital formation by industry A31 x x
P.52 (b) Changes in inventories by industry A31 x x
P.53 (c) Acquisitions less disposals of valuables by
industryA31 x x
Employment and compensation of employees, domestic concept
6. Employment by industry (1 000)
(a) self employed by industry A31(b) employees by industry A31(c) hours worked by industry (*) A31
D.1 7. Compensation of employees by industry A31 x
D.11 (a) Wages and salaries by industry A31 x
(*) Until 2003: optional.
Table 4 — Exports and imports by EU/third countries
Code List of variablesBreak-
downCurrent
pricesConstant
prices
P.6 1. Exports of goods and services Total
economyxx
(a) EU countries x x
(b) Third countries x x
P.7 2. Imports of goods and services x x
(a) EU countries x x(b) Third countries x x1996R2223 — EN — 07.08.2003 — 008.001 — 475
▼B
Table 5 — Household final consumption expenditure by purpose
Code List of variablesBreak-
downCurrent
pricesConstant
prices
P.3 Household final consumption expenditure by purpose COICOP
2 digits x x1996R2223 — EN — 07.08.2003 — 008.001 — 476
Table 6 — Financial accounts by sector (transactions), consolidated and non-consolidated
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 477
Table 7 — Balance sheets for financial assets and liabilities, consolidated and non-consolidated
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 478
Table 8 — Non-financial accounts by sector
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 479
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 480
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 481
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 482
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 483
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 484
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 485
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 486
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 487
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 488
▼B1996R2223 — EN — 07.08.2003 — 008.001 — 489
▼B
Table 9 — Detailed tax receipts sector
SNA codeGener-
al
gover-
nmentCentral
gover-
nmentState
gover-
nmentLocal
gover-
nmentSocial
securi-
ty
fundsThe
Institu-
tions
of the
EUTotal
Detailed tax receipts
by sector
D.5 Current taxes on
income, wealth, etc.—
D.51 Taxes on income —
D.51a Taxes on individual or
household income—
…
D.51b Taxes on the income
of corporations—
…—
D.51c Taxes on capital gains —
…—
D.51d Taxes on winnings
from lotteries or
gambling—
…—
D.59 Other current taxes —
D.59.1 Current taxes on
capital—
D.59.1a Current taxes on land
and buildings
…—
D.59.1b Current taxes on net
wealth
…—
D.59.1c Current taxes on other
assets—
…—
D.59.2 Miscellaneous current
taxes—
D.59.2a Poll taxes —
…—
D.59.2b Expenditure taxes —
…—
D.59.2c Payments by house-
holds to obtain certain
licences
…—
D.59.2d Taxes on international
transactions—
…—
D.2 Taxes on production
and imports
D.21 Taxes on products
D.211 Value added type taxes
…
D.212 Taxes and duties on
imports excluding
VAT1996R2223 — EN — 07.08.2003 — 008.001 — 490
▼B
SNA codeGener-
al
gover-
nmentCentral
gover-
nmentState
gover-
nmentLocal
gover-
nmentSocial
securi-
ty
fundsThe
Institu-
tions
of the
EUTotal
D.2121 Import duties
…
D.2122 Taxes on imports,
excluding VAT and
duties
D.2122a General sales or turn-
over taxes
…
D.2122b Excise duties
…
D.2122c Taxes on specific
services
…
D.2122d Profits of import
monopolies
…
D.2122e Taxes resulting from
multiple exchange
rates
…
D.214 Taxes on products,
except VAT and
import taxes
D.214a General sales or turn-
over taxes
…
D.214b Excise duties
…
D.214c Taxes on specific
services
…
D.214d Taxes on financial and
capital transactions
…
D.214e Profits of fiscal mono-
polies
…
D.29 Other taxes on
production
D.29a Taxes on payroll and
workforce
…
D.29b Recurrent taxes on
land, buildings or other
structures
…
D.29c Business and profes-
sional licences
…
D.29d Taxes on the use of
fixed assets or other
activities
…1996R2223 — EN — 07.08.2003 — 008.001 — 491
▼B
SNA codeGener-
al
gover-
nmentCentral
gover-
nmentState
gover-
nmentLocal
gover-
nmentSocial
securi-
ty
fundsThe
Institu-
tions
of the
EUTotal
D.29e Stamp taxes
…
D.29f Taxes on pollution
…
D.29g Taxes on international
transactions
…
D.91 Capital taxes —
D.91a Capital levies —
…—
D.91b Taxes on capital trans-
fers—
…—
Total tax receipts
D.611 Actual social contribu-
tions—
D.6111 — Employers' actual
social contributions—
D.6112 — Employers' social
contributions—
D.6113 Social contributions by
self- and non-
employed persons—
Total receipts from
taxes and social
contributions
D.995 Capital transfers from
general government to
relevant sectors repre-
senting taxes and
social contributions
assessed but unlikely
to be collected
D.99521 Taxes on products
assessed but unlikely
to be collected
D.99529 Other taxes on
production assessed
but unlikely to be
collected
D.99551 Taxes on income
assessed but unlikely
to be collected
D.99559 Other current taxes
assessed but unlikely
to be collected
D.9956111 Employers' actual
social contributions
assessed but unlikely
to be collected
D.9956112 Employees' social
contributions assessed
but unlikely to be
collected1996R2223 — EN — 07.08.2003 — 008.001 — 492
▼M4
▼M4
SNA codeGener-
al
gover-
nmentCentral
gover-
nmentState
gover-
nmentLocal
gover-
nmentSocial
securi-
ty
fundsThe
Institu-
tions
of the
EUTotal
D.9956113 Social contributions by
self- and unemployed
persons assessed but
unlikely to be
collected
D.99591 Capital taxes assessed
but unlikely to be
collected
D.2 + D.5 + D.91 +
D.611 – D.995
Total receipts from
taxes and social
contributions after
deduction of amounts
assessed but unlikely
to be collected
Table 10 — Tables by industry and by region (NUTS II), current prices
Code List of variablesBreak-
downt + month
B1.g 1. Gross value added at basic prices A17 24
B1.g 2. Gross value added at basic prices — 18
D.1 3. Compensation of employees A17 24
P.51 4. Gross fixed capital formation A17 24
5. Employment
— Total A17 24
— Employees A17 241996R2223 — EN — 07.08.2003 — 008.001 — 493
▼B
▼M21996R2223 — EN — 07.08.2003 — 008.001 — 494
▼B
Table 12 — Tables by industry and by region (NUTS III), current prices
Code List of variablesBreak-
downt + month
B1.g 1. Gross value added at basic prices A3 24
2. Employment
— Total A3 18
— Employees A3 18
Table 13 — Households' accounts by regions (NUTS II), current prices
Allocation of primary income account of households
Uses Resources
D.4 Property income B.2/B.3 Operating surplus/Mixed
income
D.1 Compensation of employees
B.5 Primary income D.4 Property income
Secondary distribution of income account of households
Uses Resources
D.5 Current taxes on income,
wealth, etc.B.5 Primary income
D.61 Social contributions D.62 Social benefits other than
social benefits in kind
D.7 Other current transfers D.7 Other current transfers
B.6 Disposable income
Table 14 — Fixed assets for total economy and by product, Pi3
Code List of variables Breakdown
AN.11 Fixed assets Pi31996R2223 — EN — 07.08.2003 — 008.001 — 495
Table 15 — A supply table at basic prices, including a transformation into purchasers' prices
Prices: current and constant
n = 60, m = 60
Industries (NACE)
1234……nΣ(1) Imports cifTotal supply at
basic pricesTrade and trans-
port marginsTaxes less subsi-
dies on productsTotal supply at
purchasers' prices
(1) (2) (3) (4) (5) (6) (7)
Products
(CPA)1
(1) Output by product and by industry at basic
prices(a) Intra EU
(b) Extra EU2
3
4
.
.
.
.
.
m
(Adjustment items)
Σ(1) (2) Total output by industry 0
Total of which:
Market output
(3)For own final use 00
Other non-market output 00▼B1996R2223 — EN — 07.08.2003 — 008.001 — 496
Table 16 — A use table at purchasers' prices
Prices: current and constant
n = 60, m = 60
Industries (NACE)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Intermediate consumption at
purchasers' prices by product and by
industryFinal uses at purchasers' prices:
Final consumption expenditure:
(a) by households
(b) by NPISH (t + 12 together with
(a))
(c) by government
Gross capital formation:
(d) gross fixed capital formation
(e) changes in inventories and valu-
ables
(f) exports
— intra EU
— extra EU2
3
.
.
.
.
.
m
(Adjustment items)
Σ(1) (2) Total intermediate consumption by
industryTotal final uses by type Total use
Compensation of employees
Employers' social welfare contributions (3) Components of value added by
industry Other net taxes on production
Consumption of fixed capitalOperating surplus, net
Σ(3) (4) Value added by industry
Σ(1) + Σ(3) (5) Output at basic prices by industry▼B1996R2223 — EN — 07.08.2003 — 008.001 — 497
Table 17 — A symmetric input-output table at basic prices (product by product)
Prices: current and constant
n=6 0
Product (CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)Intermediate consumption at basic prices
(product by product)Final uses at basic prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation
(e) changes in inventories and valuables
(f) Exports
— intra EU
— extra EU2
3
.
.
.
.
.
.
n
Σ(1) (2) Total intermediate consumption at basic prices
by productFinal use at basic prices by type Total use at basic
prices
Taxes on products
Subsidies on products (−)(3) Net taxes on products by product Net taxes on products by type of final use Total net tax on
products
Σ(1) + (3) (4) Total intermediate consumption at purchasers'
prices by productTotal final uses by type at purchasers' prices Total use at purcha-
sers' price
Compensation of employees
Other net taxes on production
Consumption of fixed capital
Operating surplus, net(5) Components of value added by product
Σ(5) (6) Value added by product
Σ(1) + (3) + Σ(5) (7) Output at basic prices by product
Imports (8) Imports cif by product▼B1996R2223 — EN — 07.08.2003 — 008.001 — 498
Product (CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
(7) + (8) (9) Supply at basic prices by product
Fixed capital formationFixed capital stock
Labour inputs(10)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 499
Table 18 — A symmetric input-output table for domestic output at basic prices (product by product)
Prices: current and constant
n=6 0
Products (CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)For domestic output: Intermediate consumption
at basic prices (product by product)For domestic output:
Final uses at basic prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation
(e) changes in inventories and valuables
(f) Exports
— intra EU
— extra EU2
3
.
.
.
..
.
n
Σ(1) (2) Total intermediate consumption of domestic
output by productFinal use of domestic output Total domestic
output
Use of imported products (3) Total intermediate consumption of imported
products by product, cifFinal use of imported products, cif Total imports
Net taxes on products (4) Net taxes on products for intermediate
consumption by productNet taxes on products for final use Total net taxes on
products
Σ(1) + (3) + (4) (5) Total intermediate consumption at purchaser
prices by productTotal final uses by type at purchaser prices Total use
Compensation of employees
Other net taxes on production
Consumption of fixed capital
Operating surplus, net(6) Components of value added by product
Σ(6) (7) Value added by product
Σ(1) + (3) + (4) + Σ(6) (8) Output at basic prices by product▼B1996R2223 — EN — 07.08.2003 — 008.001 — 500
Products (CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Fixed capital formation
Fixed capital stock
Labour inputs(9)▼B1996R2223 — EN — 07.08.2003 — 008.001 — 501
Table 19 — A symmetric input-output table for imports at basic prices (product by product), cif
Prices: current and constant
n=6 0
Products (CPA)
123……nΣ(1)Final uses
(a) (b) (c) (d) (e) (f)Σ(3) Σ(1) + Σ(3)
(1) (2) (3) (4) (5)
Products
(CPA)1
(1)For imports: Intermediate consumption
at basic prices (product by product)For imports:
Final uses at basic prices:
Final consumption expenditure:
(a) by households
(b) by NPISH
(c) by government
Gross capital formation:
(d) gross fixed capital formation
(e) changes in inventories and valuables
(f) Exports
— intra EU
— extra EU2
3
.
.
.
..
n
Σ(1) (2) Total intermediate consumption of
imports at basic prices by productFinal use of imports at basic prices Total import▼B1996R2223 — EN — 07.08.2003 — 008.001 — 502
▼B
Table 20 — Cross classification of fixed assets by industry and by product
Industries: A31 NACE Rev. 1
Products: Pi3 CPAVariables: Fixed assets, gross
Fixed assets, net
Prices: Current replacement costs
Historic cost valueConstant replacement costs
Table 21 — Cross classification of production account by industry and by sector
Industries: A60 NACE Rev. 1
Sectors: S11
S12
S13
S14S15
Variables: Output
— Market
— Own final use— Other non-market
Intermediate consumptionGross value added
— Compensation of employees
— Other taxes less subsidies on production— Operating surplus, net
— Consumption of fixed capital
Prices: Current
Table 22 — Cross classification of gross fixed capital formation by industry and by product
Industries: A31 NACE Rev. 1
Products: P60 CPA
Variable: Gross fixed-capital formation
Prices: Current and constant1996R2223 — EN — 07.08.2003 — 008.001 — 503
▼B
Table 23 — Backward calculations
Tables, foreseen for recalculationAnnual Quarterly
PeriodsTransmis-
sionPeriodsTransmis-
sion
88—94 April 99 88—94 April 99
Table 1: Main aggregates 70—87 December
9980—87 December
99
Table 2: Main aggregates general government 70—94 December
99
Table 3: Tables by industry 70—94 December
00
Table 5: Household final consumption expen-
diture by purpose80—94 December
00
Table 8: Non-financial accounts by sector 90—94 December
99
80—89 December
00
Table 11: General government expenditure by
function90—94 December
011996R2223 — EN — 07.08.2003 — 008.001 — 504
▼M8
DEROGATIONS CONCERNING THE TABLES TO BE SUPPLIED IN THE
FRAMEWORK OF THE QUESTIONNAIRE ‘ESA-95’ BY COUNTRY
1. AUSTRIA
1.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentDelay: t + 9 months 1999
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1988 to
19942005
3 Tables by industry Delay: t + 12 months 1999
3 Tables by industry Backward calculations:
recalculation only years 1988 to
19942005
5 Household final consumption
expenditure by purposeBackward calculations:
recalculation only years 1988 to
19942005
11 General government expenditure
by functionBackward calculations:
years 1990 to 1994 not to be
recalculated2005
12 Tables by industry and by region,
NUTS III, A3First transmission 2002 2002
13 Household accounts by region,
NUTS IIFirst transmission 2005 2005
15 Supply table at basic prices
including transformation into
purchasers' prices, A60 × P60First transmission 2003 and only
two-yearly2003
16 Use table at purchasers' prices,
A60 × P60First transmission 2003 and only
two-yearly2003
17 Symmetric input-output table at
basic prices, P60 × P60, five-yearlyFirst transmission 2003 2003
18 Symmetric input-output table for
domestic output at basic prices,
P60 × P60, five-yearlyFirst transmission 2003 2003
19 Symmetric input-output table for
imports at basic prices, P60 × P60,
five-yearlyFirst transmission 2003 2003
1.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
1 Main aggregates,
annual and quarterlyEmployment data
according to the unit
hours workedFirst transmission
20052005
3 Tables by industry Consumption of fixed
capital by industry or
sectorFirst transmission
20022002
8 Non-financial
accounts by sector1996R2223 — EN — 07.08.2003 — 008.001 — 505
▼M8
Table No Table Variable/Sector Derogation Until
8 Non-financial
accounts by sectorBreakdown of
corporations by ownerFirst transmission
20052005
8 Non-financial
accounts by sectorBreakdown of private
households by groupsFirst transmission
20052005
16 Use table at purcha-
sers' prices, A60 × P60Consumption of fixed
capital by industryFirst transmission
20032003
18 Symmetric input-
output table for
domestic output at
basic prices,
P60 × P60, five-yearly
2. DENMARK
2.1. Derogations for tables
Table No Table Derogation Until
6 Financial accounts by sectors
(transactions)Delay: t + 13 months 2005
7 Balance sheets for financial assets
and liabilitiesDelay: t + 13 months 2005
20 Cross classification of fixed assets
by industry and by product,
A31 × Pi3, five-yearlyFirst transmission 2005 2005
2.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Wages and salaries by
industryNot to be reported 2005
3 Tables by industry Consumption of fixed
capital by industryDelay: t + 36 months 2005
3 Tables by industry Gross fixed capital
formation by industryDelay: t + 36 months 2005
3 Tables by industry Changes in inventories
by industryDelay: t + 36 months 2005
3 Tables by industry Acquisitions less
disposals of valuables
by industryDelay: t + 36 months 2005
3 Tables by industry Self employed by
industryDelay: t + 36 months 2005
3 Tables by industry Employees by
industryDelay: t + 36 months 2005
3 Tables by industry Hours worked by
industryDelay: t + 36 months 2005
3 Tables by industry Compensation of
employees by industryDelay: t + 36 months 20051996R2223 — EN — 07.08.2003 — 008.001 — 506
▼M8
Table No Table Variable/Sector Derogation Until
9 Detailed tax receipts
by sectorGeneral sales or turn-
over taxes (taxes on
imports)
General sales or turn-
over taxes (taxes on
products)Both variables
together2005
9 Detailed tax receipts
by sectorExcise duties (taxes
on imports)
Excise duties (taxes
on products)Both variables
together2005
9 Detailed tax receipts
by sectorTaxes on specific
services (taxes on
imports)
Taxes on specific
services (taxes on
products)Both variables
together2005
17 Symmetric input-
output table at basic
prices, P60 × P60,
five-yearlyConsumption of fixed
capital, operating
surplus, netBoth variables
together at P602005
18 Symmetric input-
output table for
domestic output at
basic prices,
P60 × P60, five-yearly
19 Symmetric input-
output table for
imports at basic
prices, P60 × P60,
five-yearly
21 Cross classification of
production account by
industry and by sector,
A60 × (S11, S12, S13,
S14, S15), five-yearly
17 Symmetric input-
output table at basic
prices, P60 × P60,
five-yearlyFixed capital forma-
tionOnly P31 2005
18 Symmetric input-
output table for
domestic output at
basic prices,
P60 × P60, five-yearly
19 Symmetric input-
output table for
imports at basic
prices, P60 × P60,
five-yearly
17 Symmetric input-
output table at basicprices, P60 × P60,
five-yearlyFixed capital stock Not to be reported 2005
18 Symmetric input-
output table for
domestic output at
basic prices,P60 × P60, five-yearly
19 Symmetric input-
output table for
imports at basic
prices, P60 × P60,
five-yearly1996R2223 — EN — 07.08.2003 — 008.001 — 507
▼M8
Table No Table Variable/Sector Derogation Until
21 Cross classification of
production account by
industry and by sector,
A60 × (S11, S12, S13,
S14, S15), five-yearlySector private house-
holds
Sector NPISHsBoth sectors together 2005
3. GERMANY
3.1. Derogations for tables
Table No Table Derogation Until
3 Tables by industry t + 9 months only A17, A31 only at
t + 21 months delay2005
5 Household final consumption
expenditure by purposePartly only 1-digit positions 2005
9 Detailed tax receipts by sector No letter positions at the end of the
code2005
10 Tables by industry and by region,
NUTS II, A17Only NUTS I and A6 2005
12 Tables by industry and by region,
NUTS III, A3Delay: t + 30 months, only two-
yearly2005
13 Household accounts by region,
NUTS IIDelay: t + 30 months, only NUTS I 2005
15 Supply table at basic prices incl.
transformation into purchasers'
prices, A60 × P60Only two-yearly 2005
16 Use table at purchasers' prices,
A60 × P60Only two-yearly 2005
3.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Acquisitions less
disposals of valuables
by industry, changes
in inventories by
industryBoth variables
together, not by
industry2005
6 Financial accounts by
sector (transactions)Sector general govern-
mentS.1311/S.1312 and
S.1313 only together2005
7 Balance sheets for
financial assets and
liabilities
10 Tables by industry and
by region, NUTS II,
A17Gross fixed capital
formationDelay: t + 30 months 20051996R2223 — EN — 07.08.2003 — 008.001 — 508
▼M8
4. GREECE
4.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentDelay: t + 9 months 2005
3 Tables by industry Backward calculations:
recalculation only years 1988 to
19942005
5 Household final consumption
expenditure by purposeBackward calculations:
recalculation only years 1988 to
19942005
6 Financial accounts by sector (trans-
actions)First transmission:
(p.m.)2005
6 Financial accounts by sector (trans-
actions)Delay:
(p.m.)2005
7 Balance sheets for financial assets
and liabilitiesFirst transmission 2005 2005
8 Non-financial accounts by sector Backward calculations:
recalculation only years 1988 to
19942005
8 Non-financial accounts by sector Backward calculations:
years 1980 to 1989 not to be
recalculated2005
11 General government expenditure
by functionBackward calculations:
recalculation only years 1988 to
19942005
20 Cross classification of fixed assets
by industry and by product,
A31 × Pi3, five-yearlyFirst transmission 2005 2005
4.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Acquisitions less
disposals of valuablesFirst transmission
20052005
3 Tables by industry Hours worked by
industryFirst transmission
20052005
8 Non-financial
accounts by sectorBreakdown of
corporations by ownerFirst transmission
20052005
8 Non-financial
accounts by sectorBreakdown of private
households by groupsFirst transmission
200520051996R2223 — EN — 07.08.2003 — 008.001 — 509
▼M8
5. SPAIN
5.1. Derogations for tables
Table No Table Derogation Until
11 General government expenditure
by functionDelay: t + 21 months 2005
5.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
1 Main aggregates, quar-
terlyAcquisitions less
disposals of valuablesFirst transmission
20052005
1 Main aggregates, annual Acquisitions less
disposals of valuablesFirst transmission
20052005
3 Tables by industry Consumption of fixed
capital by industryFirst transmission
20052005
3 Tables by industry Acquisitions less
disposals of valuables
by industryFirst transmission
20052005
3 Tables by industry Hours worked by
industryFirst transmission
20052005
8 Non-financial accounts
by sectorAcquisitions less
disposals of valuablesFirst transmission
20052005
9 Detailed tax receipts by
sectorBreakdown of current
taxes on income,
wealth etc., taxes
and duties on imports
excluding VAT and
other taxes on
production for the
subsectors State
government (S1312)
and local government
(S1313)Delay: t + 21 months 2005
16 Use table at purchasers'
prices, A60 × P60Consumption of fixed
capital by industry
(A60)First transmission
20052005
17 Symmetric input-output
table at basic prices,
P60 × P60, five-yearlyConsumption of fixed
capital (P60)First transmission
20052005
18 Symmetric input-output
table for domestic
output at basic prices,
P60 × P60, five-yearly
19 Symmetric input-output
table for imports at
basic prices, P60 ×
P60, five-yearly
17 Symmetric input-output
table at basic prices,
P60 × P60, five-yearlyStocks of fixed assets
(P60)First transmission
20052005
18 Symmetric input-output
table for domestic
output at basic prices,
P60 × P60, five-yearly
19 Symmetric input-output
table for imports at
basic prices, P60 ×
P60, five-yearly1996R2223 — EN — 07.08.2003 — 008.001 — 510
▼M8
6. FRANCE
6.1. Derogations for tables
Table No Table Derogation Until
10 Tables by industry and by region,
NUTS II, A17Delay: t + 36 months 2005
12 Tables by industry and by region,
NUTS III, A3Delay: t + 36 months 2005
13 Household accounts by region,
NUTS IIDelay: t + 42 months 2005
6.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry All variables Breakdown by
branches to be calcu-
lated for homogenous
branches2005
10 Tables by industry and
by region, NUTS II,
A17
12 Tables by industry and
by region, NUTS III,
A3
15 Supply table at basic
prices incl. transfor-
mation into purcha-
sers' prices A60 × P60
16 Use table at purcha-
sers' prices, A60 ×
P60
20 Cross classification of
fixed assets by
industry and by
product, A31 × Pi3,
five-yearly
21 Cross classification of
production account by
industry and by sector,
A60 × (S11, S12, S13,
S14, S15), five-yearly
22 Cross classification of
gross fixed capital
formation by industry
and by product, A31 ×
P6, five-yearly
7. IRELAND
7.1. Derogations for tables
Table No Table Derogation Until
1 Main aggregates, annual and quar-
terlyFirst transmission at t + 90 days
20042004
1 Main aggregates, annual and quar-
terlyFirst transmission at t + 70 days
20082008
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1985 to
199420051996R2223 — EN — 07.08.2003 — 008.001 — 511
▼M8
Table No Table Derogation Until
2' Main aggregates of general govern-
mentTransmission at t + 3 2002
3 Tables by industry First transmission 2005 2005
3 Tables by industry Backward calculations:
years 1970 to 1994 not to be
recalculated2005
5 Household final consumption
expenditure by purposeBackward calculations:
recalculation only years 1985 to
19942005
6 Financial accounts by sector (trans-
actions)First transmission 2005 2005
7 Balance sheets for financial assets
and liabilitiesFirst transmission 2005 2005
8 Non-financial accounts by sector First transmission 2005 2005
8 Non-financial accounts by sector Backward calculations:
years 1990 to 1994 not to be
recalculated2005
8 Non-financial accounts by sector Backward calculations:
years 1980 to 1989 not to be
recalculated2005
15 Supply table at basic prices incl.
transformation into purchasers'
prices, A60 × P60First transmission 2005 2005
16 Use table at purchasers' prices, A60
× P60First transmission 2005 2005
17 Symmetric input-output table at
basic prices, P60 × P60, five-yearlyFirst transmission 2005 2005
18 Symmetric input-output table for
domestic output at basic prices,
P60 × P60, five-yearlyFirst transmission 2005 2005
19 Symmetric input-output table for
imports at basic prices, P60 × P60,
five-yearlyFirst transmission 2005 2005
20 Cross classification of fixed assets
by industry and by product, A31 ×
Pi3, five-yearlyFirst transmission 2005 2005
21 Cross classification of production
account by industry and by sector,
A60 × (S11, S12, S13, S14 + S15),
five-yearlyFirst transmission 2005 2005
22 Cross classification of gross fixed
capital formation by industry and
by product, A31 × P60, five-yearlyFirst transmission 2005 20051996R2223 — EN — 07.08.2003 — 008.001 — 512
▼M8
7.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
1 Main aggregates,
annual and quarterlyFinal consumption
expenditure of
NPISHsNot to be supplied 2005
2 Main aggregates
general governmentP52 + P53 + K2 Not to be supplied 2003
8. ITALY
8.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentBackward calculations:
years 1970 to 1994 not to be
supplied2005
2 Main aggregates general govern-
mentBackward calculations:
years 1980 to 1994 to be supplied
in December 20012001
2 Main aggregates general govern-
mentDelay: t + 9 months 2005
20 Cross classification of fixed assets
by industry and by product, A31 ×
Pi3, five-yearlyNot to be calculated 2005
22 Cross classification of gross fixed
capital formation by industry and
by product, A31 × P60, five-yearlyFirst transmission 2005 2005
8.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
1 Main aggregates,
annual and quarterlyEmployment data
according to the unit
hours workedFirst transmission
20042004
3 Tables by industry Consumption of fixed
capital by industryBreakdown A17, first
transmission 20022002
3 Tables by industry Consumption of fixed
capital by industryBreakdown A31, first
transmission 20052005
3 Tables by industry Acquisitions less
disposals of valuables
by industryTogether with changes
in inventories2005
8 Non-financial
accounts by sectorAcquisitions less
disposals of valuables
by industryTogether with changes
in inventories20051996R2223 — EN — 07.08.2003 — 008.001 — 513
▼M8
9. LUXEMBOURG
9.1. Derogations for tables
Table No Table Derogation Until
1 Main aggregates, annual and quar-
terlyFirst transmission at t + 90 days
20032003
1 Main aggregates, annual and quar-
terlyFirst transmission at t + 70 days
20102010
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1990 to
19942005
3 Tables by industry Backward calculations:
recalculation only years 1980 to
19942005
6 Financial accounts by sector (trans-
actions)First transmission 2005 2005
7 Balance sheets for financial assets
and liabilitiesFirst transmission 2005 2005
8 Non-financial accounts by sector Backward calculations:
years 1990 to 1994 not to be
recalculated2005
8 Non-financial accounts by sector Backward calculations:
years 1980 to 1989 not to be
recalculated2005
10 Tables by industry and by region,
NUTS II, A17Not to be calculated 2005
11 General government expenditure
by functionBackward calculations:
years 1990 to 1994 not to be
recalculated2005
12 Tables by industry and by region,
NUTS III, A3Not to be calculated 2005
13 Household accounts by region,
NUTS IINot to be calculated 2005
9.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Gross fixed capital
formation by industryDelay: t + 36 months 2005
3 Tables by industry Acquisitions less
disposals of valuablesFirst transmission
20052005
8 Non-financial
accounts by sectorS11, S12, S14 + 45,
S211, S212First transmission
20052005
20 Cross classification of
fixed assets by
industry and by sector,
A60 × (S11, S12, S13,
S14, S15), five-yearlyTable at historic cost
valuesFirst transmission
200520051996R2223 — EN — 07.08.2003 — 008.001 — 514
▼M8
10. NETHERLANDS
10.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentBackward calculations:
years 1986 to 1994 to be supplied
in July 20012001
2 Main aggregates general govern-
mentBackward calculations:
years 1970 to 1985 to be supplied
in December 20012001
2' Main aggregates general govern-
menttransmission at t + 3 2003
3 Tables by industry Backward calculations:
years 1986 to 1994 to be supplied
in July 20012001
3 Tables by industry Backward calculations:
years 1970 to 1985 to be supplied
in December 20012001
5 Household final consumption
expenditure by purposeBackward calculations:
years 1986 to 1994 to be supplied
in July 20012001
5 Household final consumption
expenditure by purposeBackward calculations:
years 1980 to 1985 to be supplied
in December 20012001
7 Balance sheets for financial assets
and liabilitiesDelay: t + 19 months 2003
8 Non-financial accounts by sector Backward calculations:
years 1986 to 1994 to be supplied
in July 2001
years 1980 to 1985 to be supplied
in December 20012001
10 Tables by industry and by region,
NUTS II, A17Delay: t + 30 months 2005
13 Household accounts by region,
NUTS IIDelay: t + 36 months 2005
10.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
10 Tables by industry and
by region, NUTS II,
A17Gross fixed capital
formation by regionNot to be calculated 2005
10 Tables by industry and
by region, NUTS II,
A17Total employment by
regionNot to be calculated 2005
12 Tables by industry and
by region, NUTS III,
A31996R2223 — EN — 07.08.2003 — 008.001 — 515
▼M8
11. PORTUGAL
11.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1977 to
1994, to be supplied in December
20002005/2000
3 Tables by industry Backward calculations:
recalculation only years 1977 to
19942005
5 Household final consumption
expenditure by purposeDelay: t + 12 months 2005
5 Household final consumption
expenditure by purposeBackward calculations:
not to be recalculated2005
6 Financial accounts by sector (trans-
actions)Delay: t + 12 months 2005
7 Balance sheets for financial assets
and liabilitiesDelay: t + 12 months 2005
8 Non-financial accounts by sector Backward calculations:
years 1990 to 1994 to be supplied
in December 19991999
11 General government expenditure
by functionBackward calculations:
not to be recalculated2005
11.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
1 Main aggregates,
annual and quarterlyEmployment data
according to the unit
hours workedFirst transmission
20072007
12. FINLAND
12.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1975 to
19942005
3 Tables by industry Backward calculations:
recalculation only years 1975 to
19942005
12.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Acquisitions less
disposals of valuablesNot to be calculated 20051996R2223 — EN — 07.08.2003 — 008.001 — 516
▼M8
Table No Table Variable/Sector Derogation Until
15 Supply table at basic
prices including trans-
formation into purcha-
sers' prices, A60 ×
P60All Breakdown A31 and
P31 Only at current
prices2005
16 Use table at purcha-
sers' prices, A60 ×
P60All
17 Symmetric input-
output table at basic
prices P60 × P60,
five-yearlyAll
18 Symmetric input-
output table for
domestic output at
basic prices, P60 ×
P60, five-yearlyAll
19 Symmetric input-
output table for
imports at basic
prices, P60 × P60,
five-yearlyAll
21 Cross classification of
production account by
industry and by sector,
A60 × (S11, S12, S13,
S14, S15), five-yearlyAll Breakdown A31 2005
13. SWEDEN
13.1. Derogations for tables
Table No Table Derogation Until
2 Main aggregates general govern-
mentBackward calculations:
recalculation only years 1980 to
19942005
3 Tables by industry Delay: t + 12 months 2005
3 Tables by industry Backward calculations:
recalculation only years 1980 to
19942005
6 Financial accounts by sector (trans-
actions)Delay: t + 12 months 2005
7 Balance sheets for financial assets
and liabilitiesDelay: t + 12 months 2005
11 General government expenditure
by functionDelay: t + 16 months 2005
13.2. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
2 Main aggregates
general governmentAcquisitions less
disposals of valuablesFirst transmission
200520051996R2223 — EN — 07.08.2003 — 008.001 — 517
▼M8
Table No Table Variable/Sector Derogation Until
2 Main aggregates
general governmentBreakdown of govern-
ment final consump-
tion expenditure into
individual and collec-
tiveDelay t + 16 months 2005
2 Main aggregates
general governmentActual final consump-
tion of householdsDelay t + 16 months 2005
2 Main aggregates
general governmentActual individual
consumptionDelay t + 16 months 2005
3 Tables by industry Acquisitions less
disposals of valuablesFirst transmission
20052005
3 Tables by industry Breakdown A31 Delay: t + 12 months 2005
8 Non-financial
accounts by sectorAcquisitions less
disposals of valuablesFirst transmission
20052005
8 Non-financial
accounts by sectorBreakdown of govern-
ment final consump-
tion expenditure into
individual and collec-
tiveDelay t + 16 months 2005
8 Non-financial
accounts by sectorActual final consump-
tion of householdsDelay t + 16 months 2005
8 Non-financial
accounts by sectorActual individual
consumptionDelay t + 16 months 2005
14. UNITED KINGDOM
14.1. Derogations for single variables/sectors in the tables
Table No Table Variable/Sector Derogation Until
3 Tables by industry Acquisitions less
disposals of valuablesExclude transactions
by MFIs in gold as a
store of wealth2005
4 Exports and imports
by EU/third countriesExports and imports
by EU/third countriesExclude transactions
by MFIs in gold as a
store of wealth2005
6 Financial accounts by
sector (transactions)Monetary gold and
SDRsInclude transactions
by MFIs in gold as a
store of wealth2005
6 Financial accounts by
sector (transactions)Financial auxiliaries To be included in non-
financial corporations2002
7 Balance sheets for
financial assets and
liabilitiesMonetary gold and
SDRsInclude transactions
by MFIs in gold as a
store of wealth2005
7 Balance sheets for
financial assets and
liabilitiesFinancial auxiliaries To be included in non-
financial corporations2002
8 Non-financial
accounts by sectorAcquisitions less
disposals of valuables
and exports and
imports of goods and
servicesExclude transactions
by MFIs in gold as a
store of wealth20051996R2223 — EN — 07.08.2003 — 008.001 — 518
▼M8
Table No Table Variable/Sector Derogation Until
10 Tables by industry and
by region, NUTS II,
A17GDP For NUTS II
only A1720011996R2223 — EN — 07.08.2003 — 008.001 — 519