# Flow of Funds (FOF) Accounts: Definition, Uses, Data ReportsÂ 

> **Definition**
>
> Flow of funds (FOF) are financial accounts that track the net inflows and outflows of money across various sectors of a national economy.

## What Are Flow of Funds (FOF)?

Flow of funds (FOF) are financial accounts that are used to track the net inflows and outflows of money to and from various sectors of a national economy. Macroeconomic data from flow of funds accounts are collected and analyzed by a country's central bank. In the United States, this data is released by the [Federal Reserve Bank](https://www.investopedia.com/terms/f/federalreservebank.asp) approximately 10 weeks after the end of each quarter.

Note that a different term "[fund flows](https://www.investopedia.com/terms/f/fund-flow.asp)" is used to denote the amount of assets moving in and out of different types of mutual funds, e.g. among equity and fixed income funds.

### Key Takeaways

*   Flow of funds (FOF) are national financial accounts that track the movement of money among industries or sectors of the economy.
*   Figures measuring the scale and scope of flow of funds in a nation's economy are collected and disseminated by the central bank for economic analysis.
*   This FOF analysis can then be used to measure economic activity and predict changes in GDP. They can also be used to help inform fiscal and monetary policy.

## Understanding Flow of Funds Accounts

The FOF accounts are used primarily as an economy-wide performance indicator. The data from the FOF accounts can be compared to prior data to analyze the financial strength of the economy at a certain time and to see where the economy may go in the future. The accounts can also be used by governments to formulate monetary and [fiscal policy](https://www.investopedia.com/terms/f/fiscalpolicy.asp).

The accounts use [double-entry bookkeeping](https://www.investopedia.com/terms/d/double-entry.asp) to track the changes in assets and liabilities in all sectors of the economy: households, nonprofit organizations, corporations, farms, the government (federal, state and local) and the foreign sector. A wide range of financial instruments is accounted for: Treasury assets, American deposits abroad, savings deposits, money market funds, pension funds, corporate equities and bonds, mutual fund shares, mortgages, and consumer credits are just a few examples.

The Fed's annual flow of funds data extends back to 1945, with quarterly data available from the beginning of 1952. The data provide a nuanced picture of how the size and composition of the U.S. economy have changed since World War II. 

## Flow of Funds Data

The Fed issues reports on the financial accounts of the U.S. on a trailing quarterly basis, including data on flow of funds. The release, which the Fed labels Z.1, shows the assets and liabilities of each sector of the economy at the end of the period in question. It also shows how each sector has served as a source and use of funds. It includes a times series of outstanding debt for each sector of the economy, the derivation of net wealth in the country by asset, and the distribution of [gross domestic product (GDP)](https://www.investopedia.com/terms/g/gdp.asp). Detailed statements for each account show how net capital has shifted to or from various sectors, allowing for a granular look at the movement of funds within the economy, as well as into and out of it.

> **Article Sources**
>
> 1.  The Federal Reserve. "[Financial Accounts of the United States—Z.1](https://www.federalreserve.gov/releases/z1/)." Accessed Aug. 16, 2021.
>     
> 2.  The Federal Reserve. "[Meet the Economists](https://www.federalreserve.gov/econres/rsfof-staff.htm)." Accessed Aug. 16, 2021.
>     
> 3.  The Federal Reserve. "[Z.1 Financial Accounts of the United States Historical Data](https://www.federalreserve.gov/releases/z1/20160609/data.htm)." Accessed Aug. 16, 2021.