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8104.0 - Research and Experimental Development, Businesses, Australia, 2010-11 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 11/09/2012   
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QUALITY DECLARATION - SUMMARY

INSTITUTIONAL ENVIRONMENT


Statistics presented in this release have been compiled from data collected by the Australian Bureau of Statistics (ABS) from Australian businesses in the Survey of Research and Experimental Development (R&D), Businesses. The data were collected under the authority of the Census and Statistics Act 1905.

For information about the institutional environment of the ABS, including its legislative obligations, financing and governance arrangements, and mechanisms for scrutiny of ABS operations, please see ABS Institutional Environment.


RELEVANCE

This release presents statistics on R&D undertaken by Australian businesses in respect of the 2010–11 financial year.

R&D statistics produced by the ABS enable the nature and distribution of R&D activity in Australia to be monitored and analysed for policy formulation, allocation of funds and determination of research priorities. The major users of R&D data are Commonwealth and State government organisations, mainly the Department of Industry, Innovation, Science, Research and Tertiary Education (DIISRTE) and the Department of Education, Employment and Workplace Relations (DEEWR). R&D data are also used extensively by the Productivity Commission and for international comparison purposes.

Since the release of the 2008–09 Australian System of National Accounts, R&D has been treated as capital formation. This resulted from the implementation of the new international standards System of National Accounts, 2008 (2008 SNA) and represents a change in treatment of R&D (as intermediate consumption) from SNA 1993.


TIMELINESS

Data are collected from businesses in the Survey of R&D, Businesses on an annual basis, with the reference year being the financial year (i.e. year ended 30 June). Statistics compiled from the data collected are released approximately 15 months after the reference period.


ACCURACY

The Survey of R&D, Businesses is a census of in-scope organisations (refer to the Scope and Coverage section of the Explanatory Notes).

As the survey is a census, the survey estimates are not subject to sampling error. However, other inaccuracies, collectively referred to as non-sampling errors, may affect the data. These errors can result from of a number of factors, including:

  • inadequacies in the collection instrument;
  • treatment of non-response;
  • inaccurate reporting of data by data providers;
  • errors in the application of survey procedures;
  • incorrect recording of answers; and,
  • errors in data capture and processing.

Every effort is made to minimise non-sampling error by careful design and testing of the collection instrument, the use of efficient operating procedures and systems, and the use of appropriate methodologies.

For the Business sector, the reliability and comparability of the estimates may be affected by the following specific non-sampling errors:
  • Many businesses provided estimates due to a lack of separately recorded data on R&D activity.
  • Some businesses may not have reported data as per the definition of R&D used in the survey. This is potentially a result of slight differences in the survey definition of R&D and those used in industry R&D schemes for the allocation of grants, and the AusIndustry administered R&D Tax Concession scheme for tax deductibility for specific R&D activities.
  • Data were self-classified by businesses to Type of activity, Fields of research and Socio-economic objective at the time of reporting. Some businesses may have experienced difficulty in classifying their R&D projects. The ABS makes every effort to ensure correct and consistent interpretation and reporting of these data by applying consistent processing methodologies.
  • The estimation method of R&D related overheads varied across businesses and reference periods.

Revisions to previous cycle data occur on discovery of:
  • errors in reported data, typically a result of the specific non-sampling errors outlined above; and
  • newly identified R&D performers who indicated they had significant levels of R&D in earlier years (details are collected and used to revise previously released estimates).

Revisions are applied up to two cycles prior to the current cycle, but only where the impact on:
  • R&D expenditure is equal to $5 million or more;
  • Human resources devoted to R&D is equal to 25 person years of effort (PYE) or more; or
  • Published level data is of proportional significance.

In processing 2010–11 data, revisions were applied to 2008–09 and 2009–10 estimates. Revisions must be taken into consideration when interpreting results, particularly when comparing estimates over time.

While every effort is made to ensure that all in-scope businesses are included in the survey, complete coverage cannot be guaranteed. The 2010–11 Survey of R&D, Businesses achieved a response rate of 95%.


COHERENCE

There are no other data sources with which ABS R&D data for the Business sector can be directly compared. However, some observations can be made which suggest the survey outputs give a reasonable indication of real world expectations and events. For example, trends in R&D survey data aligning with trends in values claimed, or intending to be claimed, through the R&D Tax Concession Scheme.

While the ABS seeks to maximise consistency and comparability over time by minimising changes to the survey, sound survey practice requires ongoing development to maintain the integrity of the data, its relevance to the changing needs of users and the efficiency of the collection.

In addition to the non-sampling errors outlined in the Accuracy section above, factors which may affect the comparability of 2010–11 estimates with those of previous cycles are described below:
  • Employment size classification groups are defined on data reported in the reference period, and as such businesses may be categorised to different employment size groups across different reference periods.
  • Businesses can also be classified to different industry divisions across survey reference periods as a consequence of structural change. See paragraphs 23 and 24 of the Explanatory Notes for more information.
  • From the 2007–08 cycle, Type of activity, Fields of research and Socio-economic data have been collected and compiled based on the Australian and New Zealand Standard Research Classification (ANZSRC), 2008 (cat. no. 1297.0). Prior to this, these data were based on the Australian Standard Research Classification (ASRC). The implementation of updated classifications in the 1999–2000 and 2007–08 reference periods represent breaks in the relevant time series.


INTERPRETABILITY

R&D, as collected by the ABS, is defined in accordance with the OECD standard as 'creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications'.

The ABS Survey of R&D, Businesses also uses classifications specific to R&D: results presented in this release are based on the ANZSRC 2008.

Data providers report and self-classify R&D survey information based on their interpretation of OECD and ABS definitions and classifications. The ABS makes every effort to ensure correct and consistent interpretation and reporting of these data by applying consistent processing methodologies. See also the Reliability of statistics and Revisions sections of the Technical Note.

Further important contextual information, to be considered when interpreting the results presented in this release, is provided in the Explanatory Notes (including the Technical Note and Glossary).

Additionally, for a more comprehensive interpretation of the definitions and classifications relating to R&D activity, refer to:

ACCESSIBILITY

In addition to main features (which include key findings commentary) resulting from the Survey of R&D, Businesses, a PDF version of the findings and time series data (in spreadsheet format) are included on the ABS website free of charge. See the Downloads page for this issue.

Links to other data releases relating to the ABS Survey of R&D, Businesses can be found on the ABS website, via the Innovation, Science and Technology theme page under Topics @ a Glance/Industry.

If the information you require is not available as a standard product, inquiries can be made by contacting the National Information and Referral Service on 1300 135 070 or Amanda Baile on Perth (08) 9360 5357.

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