Workshop on the Implementation and Links between the System of NationalAccounts 2008 and the Government Finance Statistics Manual

20 – 22 November 2013, Istanbul, Turkey

CHANGE OVER TO THE 2008 SNA CHANGE OVER TO THE 2008 SNA METHODOLOGMETHODOLOGY IN THE Y IN THE

UKRANIAN NATIONAL ACCOUNTS UKRANIAN NATIONAL ACCOUNTS

Irina NIKITINA Director of the Macroeconomic Statistics Department

Strategy for the Development of Ukrainian Statistics for the period until 2017

(the Cabinet of Ministers of Ukraine from 20.03.2013 г. № 413) Annual detailed plan of the State Statistical Surveys The relationship between changes in SNA, GFS, PoB,

MAFS

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LEGAL BASIS OF UKRANIAN NATIONAL LEGAL BASIS OF UKRANIAN NATIONAL ACCOUNTS ACCOUNTS

Implementation of the international standard 2008 SNA

State Statistics Committee, Ministry of Finance, Ministry of Economic Development, Treasury, National Bank

Improvement of government finance statistics

The Ministry of Finance, Treasury, State Statistics Committee

Improvement of the external sector statistics

National Bank, the State Statistics Committee

Improvement of monetary and financial statistics

National Bank, the State Statistics Committee, The State Commission for Regulation of Financial Services Markets of Ukraine, National Securities and Stock Market Commission

THE BASIS OF NEW UKRANIAN NATIONAL THE BASIS OF NEW UKRANIAN NATIONAL ACCOUNTS METHODOLODYACCOUNTS METHODOLODY

1)The System of National Accounts, 2008 (2008 SNA);

2)The European System of National and Regional Accounts (ESA-2010).

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FIRST PRIORITY– CHANGES AFFECTING THE FIRST PRIORITY– CHANGES AFFECTING THE SCOPE AND STRUCTURE OF GDPSCOPE AND STRUCTURE OF GDP

• Allocation of FISIM

• Reinsurance

• Research and Development

• Military expenditures

• Goods for processing abroad

• Illegal activities

• Imputed rent

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CALCULATION OF FISIMCALCULATION OF FISIM•Formula:

FISIM = [(rL - rr) x yL] + [(rr - rD) x yD]•The base reference rate:

average on loans and deposits in the interbank market •Data from the National Bank of Ukraine and The State Commission for Regulation of Financial Services Markets of Ukraine:

monthly balances of loans and deposits

interest income on loans/interest expenditures on deposits

FISIM export and import will be included after the adjustment in the BoP •§ 14.16 ЕSА-2010

FISIM for Central Banks is not calculated 5

ALLOCATION OF FISIMALLOCATION OF FISIM

Intermediate consumption• institutional sectors NFC, FC, GG, NPISH, HHs

(in the part of employers and housing loans)

Output• non-market production GG, NPISH

Final consumption (increases GDP)• Institutional sectors GG, NPISH, HHs (in the part

of consumer credit)

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REINSURANCEREINSURANCE

•The calculation scheme of reinsurance services

premiums received from reinsurence

minus incurred claims

minus increase in premium supplements

•Effect of SNS: Increases output and IC, no impact on VA

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RESEARCH AND DEVELOPMENTRESEARCH AND DEVELOPMENT

The following types are included in gross capital formation:

• basic research • applied research• experimental development

The following types remain in intermediate consumption:

• support scientific and technical services (not used repeatedly in the production)

• undertaken without the intention of obtaining benefits• acquired by market producers in activity M 72 “Research

and Development”

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MILITARY EQUIPMENTMILITARY EQUIPMENT

• Expenditures on weapon systems, which can be used more than a year, are transferred from intermediate consumption to gross fixed capital formation (produced assets).

• Single-use items are considered as inventories

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GOODS FOR PROCESSING ABROADGOODS FOR PROCESSING ABROAD

2008 SNA and BPM6 recommend to rerecord export and import on economic ownership basis

1. Import minus the value of imported raw materials

2. Export minus the value of processed goods plus the processing fee

3. Intermediate consumption minus the cost of raw materials

4. Output minus the cost of raw materials

5. The value added remains the same

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ILLEGAL ACTIVITIESILLEGAL ACTIVITIES

Type N2. “Manufacturers, who are not registered deliberately – illegal activity".

EU countries agreed on illegal activities included in the SNA:•production and distribution of drugs (assessment based on World Drug Report UNDOC data)

•prostitution (assessment by CSW International Alliance HIV/AIDS)

•smuggling of alcohol and tobacco (balance method, customs data)

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IMPUTED RENTIMPUTED RENT

• User cost method(Derek Blades. Evaluation of services of owner-occupied

households. Report from the 9th UNECE/Eurostat/OECD meeting on National Accounts 21-24.04.2008)

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IMPACT ON INDUSTRYIMPACT ON INDUSTRY

-5

0

5

10

15

20

25

Изменение ВДС отраслей, %

Ag

ricul

ture

Man

ufac

turin

g

Co

nstr

uctio

n

Tra

de

, tra

nsp

ort

, ho

tels

Co

mm

unic

atio

n an

d

info

rmat

ion,

fin

anci

al,

real

e

stat

e, b

usin

ess

se

rvic

es

Pub

lic a

dm

inis

trat

ion,

e

duc

atio

n an

d

heal

th c

are

Oth

er

serv

ice

s

GDP

13

IMPACT ON FINAL IMPACT ON FINAL CONSUMPTIONCONSUMPTION

-6%

-4%

-2%

0%

2%

4%

6%

Изменение категорий конечного использования

Hou

seho

lds

OSU

NPISH GFCF

Export

Import

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EFFECT ON GDPEFFECT ON GDP

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Changes in nominal GDP,%

FISIM

Rent

Illegal

Science

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FUTURE DIRECTIONS FOR THE FUTURE DIRECTIONS FOR THE DEVELOPMENT OF UKRANIAN NATIONAL DEVELOPMENT OF UKRANIAN NATIONAL

ACCOUNTSACCOUNTS

Changes in the institutional sectors classification Changes in the classification of financial and non-financial

assets

Irina NIKITINA Director of the Macroeconomic Statistics Department

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FUTURE DIRECTIONS FOR THE FUTURE DIRECTIONS FOR THE DEVELOPMENT OF PUBLIC FINANCE DEVELOPMENT OF PUBLIC FINANCE

STATISTICSSTATISTICS

Development and implementation of unified chart of accounts and accounting standards for the public sector with the use of accrual method, currently accounting, which provides the formation of fiscal data, is divided into two components:

- accounting of budgets (cash accounting with accrual elements on individual transactions as debt, obligations of the budgetary funds);

- accounting in the public organizations (modified accrual method). Establishment of common rules for the formation of budget and financial

statements in accordance with international standards, which are developed on the basis of International Financial Reporting Standards for the general government sector

Bringing classifications and budget indicators in accordance with the requirements of the Manual on Government Finance Statistics

- provisions in the accounting standards to collect information on: consumption of fixed capital and imputed employer’s contribution to social insurance.

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FUTURE DIRECTIONS FOR THE FUTURE DIRECTIONS FOR THE DEVELOPMENT OF PUBLIC FINANCE DEVELOPMENT OF PUBLIC FINANCE

STATISTICSSTATISTICS

- Reflection in the classification of transactions in non-financial assets of the transactions related to loans “below the line” i.e. as financing transactions

- Separation of subsidies and current transfers, and bringing them in the line with the requirements of the SNA 2008

- Inclusion of debt arrears in a specific class

- Accounting for Special Drawing Rights (SDRs)

- Accounting for “shares and other equity”

- Detailed breakdown of current expenditure of budget institutions

- Detailing of expenditures on education and R&D

- Reclassification of expenditures on R&D and weapon systems from current to capital expenditures

- Development of new format for presentation of budget data for the needs of national accounts

THANK YOU FOR ATTENTION!THANK YOU FOR ATTENTION!

Irina NIKITINA Director of the Macroeconomic Statistics Department