Compiling the extended accounts for households, Katri Soinne

Compiling the extended accounts for

households

Katri Soinne

Statistics Finland

Content

Household production and households in SNA

Balancing item

Sequence of accounts and household production

Calculation of household production (input method)

Household sector accounts

Extended household sector accounts

IATUR - Workshop on Household Satellite 29 July 2014

Sector accounts of households

vs. household production satellite

vs. extended household accounts


Household sector accounts (SNA)

Other household

activities than SNA

household production

Non-SNA

household

production

SNA

household

production

Extended household sector accounts

Household

production satellite

The Balancing Item

Accounts balance out, either because of the definitions

used or because of the balancing item

Balancing item is calculated based on existing information

and the theory of economics

carries the system forward

is an interesting indicator as such

The balancing item of the previous account is the opening

resource of the next account


Uses

Previous account:

45

10

X

-----------------------

Next account:

20

Y

-----------------------

Resources

Previous account:

50

30

--------------------------

Next account:

X

15

--------------------------


Production account

Value added

Generation of income account

Operating surplus/ mixed income

Allocation of primary income account

Balance of primary incomes

Secondary distribution of income account

Disposable income

The use of disposable income account

Saving

Redistribution of income in kind account

Adjusted disposable income

The use of adjusted disposable income account

Saving

Capital account

Net lending (+) / borrowing (-)

Financial account


Opening

balance

sheet

Net worth

Other

changes in

volume

account

Changes in

volume of

assets

Re-

valuation

account

Nominal

holding

gains and

losses

Closing

balance

sheet

Net worth

Household

production


Household Production

Household production in SNA: calculated as market

production (=> from top down, includes operating surplus/

mixed income)

Non-SNA household production: calculated as non-market

production in the input method (=> from down to top, no

operating surplus/ mixed income)

Includes production account and generation of income

account (=first of distribution and use of income accounts)

Includes intermediate consumption, consumption of fixed

capital, compensation of employees, taxes and subsidies


Example of calculations: Pet care (2006)

Not included in SNA production => calculated total as non-

market production (=operating surplus/ mixed income is 0)

No subsidies on production in Finland

So called “dog tax” is paid in part of the communities in

Finland => included in as a tax on production (7 million

euro)

Compensation of employees = time used for pet care *

value of time (=salary; total 2 484 million euro)

Consumption of fixed capital (pets and pet supplies are

included as gross fixed capital formation: 114 million euro)


Example of calculations: Pet care (cont’)

Intermediate

consumption (pet food

and veterinary services;

409 million euro in

2006)

Summing those figures

together: the total

output of pet care in

Finland in 2006 was

3014 million euro


0

500

1000

1500

2000

2500

3000

3500

Pet care

Value added, net (labour+taxes-subsidies)

Capital consumption

Intermediate consumption

Production account

Value added

Generation of income account

Operating surplus/ mixed income

Allocation of primary income account

Balance of primary incomes

Secondary distribution of income account

Disposable income

The use of disposable income account

Saving

Redistribution of income in kind account

Adjusted disposable income

The use of adjusted disposable income account

Saving

Capital account


Financial account


Opening

balance

sheet

Net worth

Other

changes in

volume

account

Changes in

volume of

assets

Re-

valuation

account

Nominal

holding

gains and

losses

Closing

balance

sheet

Net worth

Extended

household

accounts


The mechanics of accounts


Account

Uses/ liabilities Resources / assets

24 657

676 21

-22

678 (=resources) 678

• There is some information

available both on resources

(/assets) and uses (/liabilities)

from source data, one figure is

missing

• From the theory of

economics we know that

resources = uses

•The difference between

resources (/assets) and uses

(/liabilities) is the balancing

item (=the figure, which we do

not know otherwise)

Sector accounts for households in SNA (aggregated)

Production account (=> B1N) and generation of income

account (=> B.2N + B.3N)

Uses Resources

P.1 / R: Output 28 913

P.2 / K: Intermediate consumption 12 055

B.1G: Value added, gross 16 858

K.1 / K: Consumption of fixed

capital (=CFC) 6 242

B.1N: Value added, net 10 616


D.1 / K: Compensation of

employees 956

D.29 / K : Taxes on production 15

D.39 / R: Subsidies on production -1 647

B.2N: Operating surplus + B.3N:

mixed income, net 11 292


Production and generation of income accounts

Uses Resources

P.1 / R: Output 28 913

P.2 / K: Intermediate

consumption 12 055

B.1G: Value added,

gross 16 858

K.1 / K: Consumption of

fixed capital (=CFC) 6 242




employees 956

D.29 / K : Taxes on

production 15

D.39 / R: Subsidies on

production -1 647

B.2N: Operating

surplus + B.3N: mixed

income, net

11 292

Rest of “current accounts” (=> B.9)

Uses Resources

B.2N: Operating surplus +B.3N: mixed

income, net 11 292

D.1 /R: Compensation of employees 80 981

D.4 / R: Property income 8 935

D.4 / K: Property income 2 363

B.5N: Balance of primary incomes. net 98 845

B.5: Balance of primary incomes, net 98 845

D.5…7 / R: Current transfers 29 357

D.5…7 / K: Current transfers 47 557

B.6: Disposable income 80 645

B.6: Disposable income 80 645

P.31 / K: Individual consumption expenditure 82 160

P.8 / R: Adjustment for the change in pension

entitlements 65

B.8: Saving -1 450

B.8: Saving -1 450

P.9 / R: Capital transfers (receivable) 251

P.9 7 K: Capital transfers (payable) 508

P.51 / K: Gross fixed capital formation) 10 061

K.1 / R: CFC -6 242

P.52 / K: Changes in inventories -31

P.53 / K: Acquisition of valuables 61

NP / K: Acquisition of non-produced assets -41

B9: Net lending/ borrowing -5 515


Extended household accounts

Production account and generation of income account

Uses (HH

total)

Uses (HH

non-SNA)

Uses (HH

SNA)

Resources

(HH SNA)

Resources

(HH non-

SNA)

Resources

(HH total)

P.1 / R: Output 28 913

P.2 / K: Intermediate

consumption 12 055

B.1G: Value added, gross 16 858

K.1 / K: Consumption of fixed

capital (=CFC) 6 242




employees 956

D.29 / K : Taxes on production 15

D.39 / R: Subsidies on

production -1 647

B.2N: Operating surplus +

B.3N: mixed income, net 11 292 0 11 292

-2 584 -937

128 113

63 626 62 670

72 463 61 847

61 847 72 463

10 010 3 768

82 473 65 615

32 527 20 472

86 987 115 000


Current accounts (the rest)

Uses (HH

total)

Uses (HH non-

SNA)

Uses (HH

SNA)

Resources (HH

SNA)

Resources

(HH non-SNA)

Resources

(HH total)

B.2N: Operating surplus +B.3N: mixed income,

net 11 292 0 11 292

D.1 /R: Compensation of employees 80 981 62 670 161 515

D.4 / R: Property income 8 935 2 363

D.4 / K: Property income 2 363 2 363

B.5N: Balance of primary incomes. net 161 515 98 845

B.5: Balance of primary incomes, net 98 845 161 515

D.5…7 / R: Current transfers 29 357 -937 28 420

D.5…7 / K: Current transfers 47 444 -113 47 557

B.6: Disposable income 142 492 80 645

B.6: Disposable income 80 645 142 492

P.31 / K: Individual consumption expenditure 143 021 60 861 82 160

P.8 / R: Adjustment for the change in pension

entitlements 65 65

B.8: Saving -465 -1 450

B.8: Saving -1 450 -465

P.9 / R: Capital transfers (receivable) 251 251

P.9 / K: Capital transfers (payable) 508 508

P.51 / K: Gross fixed capital formation) 14 815 4 753 10 061

K.1 / K: CFC -10 010 -3 768 -6 242

P.52 / K: Changes in inventories -31 -31

P.53 / K: Acquisition of valuables 61 61

NP / K: Acquisition of non-produced assets -41 -41

B9: Net lending/ borrowing -5 515 -5 515


Conclusions

There is not one “perfect way” to calculate household

production/ satellite account, but Finland would prefer

commonly agreed method to get comparable figures

Once the method has been agreed, it is always possible to

make alternative calculations and reconsider the method

Finland suggests the following:

Calculating the whole sequence of accounts

Using principal functions

Calculations based on different household types

Value of labour


Data & Analytics

Compiling the extended accounts for households, Katri Soinne