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4.14. In presenting balance of payments statistics, ABS publications start with a summary table followed by more detailed tables. Table 4.2 shows the summary table from the quarterly publication (Cat. no. 5302.0). The table illustrates the following points:
- the classifications shown reflect the higher level standard components;
- current and capital account items are shown gross, whereas financial account items are shown net;
- gross and net credit entries are shown without sign, while gross and net debit entries are shown with a negative sign;
- various key balances are recorded, such as the current account balance and the capital and financial account balance, as well as various lower level balances such as the goods and services balance;
- the sum of the current account balance, the capital and financial account balance, and the net errors and omissions item add to zero; and
- data are presented in the form of time series (three years and six quarters).
The concept of a ‘balance’
4.15. In a complete balance of payments statement (including the net errors and omission item), the sum of all credit entries and the sum of all debit entries are necessarily equal, i.e. the sum of credits and debits is zero. The sum of all credit and debit entries may also be referred to as a balance. For any intermediate balance drawn from a selection of items it is possible for credit entries to exceed debit entries, and vice versa. It is common to speak of a balance as a surplus if it is a credit and as a deficit if it is a debit.
4.16. The main balances used in the Australian balance of payments are the balance on current account and the balance on capital and financial account. These balances, and their composition in terms of subsidiary balances and other items, are shown in table 4.3.
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4.2 AUSTRALIA'S BALANCE OF PAYMENTS - SUMMARY | |
| | | | | | Dec Qtr | Mar Qtr | Jun Qtr | Sep Qtr | Dec Qtr | Mar Qtr | |
| | | 1994-95 | 1995-96 | 1996-97 | 1996 | 1997 | 1997 | 1997 | 1997 | 1998 | |
| | | $m | $m | $m | $m | $m | $m | $m | $m | $m | |
| | |
| CURRENT | | | | | | | | | | |
| ACCOUNT | - 28,867 | - 21,824 | - 17,531 | - 4,918 | - 3,163 | - 2,985 | - 5,841 | - 5,599 | - 6,291 | |
| Goods & services | - 9,916 | - 1,891 | 1,777 | - 299 | 1,444 | 2,120 | - 950 | - 247 | - 1,396 | |
| | Credits | 87,509 | 99,004 | 105,318 | 25,906 | 26,042 | 28,643 | 28,487 | 29,273 | 27,321 | |
| | Debits | - 97,425 | - 100,895 | - 103,541 | - 26,205 | - 24,598 | - 26,523 | - 29,437 | - 29,520 | - 28,717 | |
| Goods | - 8,216 | - 1,583 | 1,496 | - 367 | 246 | 2,618 | - 511 | - 32 | - 2,112 | |
| | Credits | 67,101 | 76,146 | 80,934 | 19,836 | 19,111 | 22,964 | 22,162 | 23,151 | 20,414 | |
| | Debits | - 75,317 | - 77,729 | - 79,438 | - 20,203 | - 18,865 | - 20,346 | - 22,673 | - 23,183 | - 22,526 | |
| Services | - 1,700 | - 308 | 281 | 68 | 1,198 | - 498 | - 439 | - 215 | 716 | |
| | Credits | 20,408 | 22,858 | 24,384 | 6,070 | 6,931 | 5,679 | 6,325 | 6,122 | 6,907 | |
| | Debits
| - 22,108 | - 23,166 | - 24,103 | - 6,002 | - 5,733 | - 6,177 | - 6,764 | - 6,337 | - 6,191 | |
| Income | - 18,423 | - 19,907 | - 19,434 | - 4,704 | - 4,593 | - 5,070 | - 4,874 | - 5,402 | - 4,876 | |
| | Credits | 6,954 | 7,162 | 8,319 | 2,233 | 2,071 | 2,099 | 2,250 | 2,331 | 2,545 | |
| | Debits
| - 25,377 | - 27,069 | - 27,753 | - 6,937 | - 6,664 | - 7,169 | - 7,124 | - 7,733 | - 7,421 | |
| Current transfers | - 528 | - 26 | 126 | 85 | - 14 | - 35 | - 17 | 50 | - 19 | |
| | Credits | 3,026 | 3,212 | 3,377 | 835 | 823 | 855 | 886 | 879 | 895 | |
| | Debits
| - 3,554 | - 3,238 | - 3,251 | - 750 | - 837 | - 890 | - 903 | - 829 | - 914 | |
| CAPITAL AND | | | | | | | | | | |
| FINANCIAL ACCOUNT | 28,610 | 21,914 | 18,769 | 5,145 | 3,825 | 3,190 | 5,219 | 6,424 | 5,774 | |
| Capital account | 572 | 1,074 | 1,318 | 324 | 385 | 218 | 338 | 275 | 283 | |
| Capital transfers | 540 | 1,049 | 1,323 | 325 | 377 | 219 | 340 | 268 | 277 | |
| | Credits | 1,383 | 1,956 | 2,200 | 544 | 597 | 485 | 541 | 513 | 523 | |
| | Debits | - 843 | - 907 | - 877 | - 219 | - 220 | - 266 | - 201 | - 245 | - 246 | |
| Net acquisition/ disposal of non- produced, non- financial assets
|
32
|
25
|
- 5
|
- 1
|
8
|
- 1
|
- 2
|
7
|
6
| |
| Financial account | 28,038 | 20,840 | 17,451 | 4,821 | 3,440 | 2,972 | 4,881 | 6,149 | 5,491 | |
| Direct investment | 4,080 | 5,067 | 5,375 | 1,352 | - 115 | 2,297 | 2,017 | 895 | - 480 | |
| | Abroad | - 3,429 | - 7,935 | - 5,908 | - 2,008 | - 1,189 | - 1,502 | - 4,294 | - 895 | - 1,835 | |
| | In Australia | 7,509 | 13,002 | 11,283 | 3,360 | 1,074 | 3,799 | 6,311 | 1,790 | 1,355 | |
| Portfolio investment | 18,378 | 25,661 | 13,378 | 5,856 | 6,665 | - 4,584 | 7,578 | 7,024 | 4,679 | |
| Other investment | 3,609 | - 9,071 | 3,922 | - 2,106 | - 2,519 | 6,645 | - 3,252 | - 441 | - 1,914 | |
| Reserve assets | 1,971 | - 817 | - 5,224 | - 281 | - 591 | - 1,386 | - 1,462 | - 1,329 | 3,206 | |
|
NET ERRORS | | | | | | | | | | |
| AND OMISSIONS | 257 | - 90 | - 1,238 | - 227 | - 662 | - 205 | 622 | - 825 | 517 | |
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Source: Table 1 from Balance of Payments and International Investment Position, Australia, March quarter 1998 (Cat. no. 5302.0). | |
Net errors and omissions item
4.17. The net errors and omissions item is a balancing item, reflecting the underlying double entry accounting system. It is the sum, with sign reversed, of the balance on current account and the balance on capital and financial account. In other words, the sum of the current account balance, the capital and financial account balance and the net errors and omissions item is zero.
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4.3 KEY BALANCES USED IN BALANCE OF PAYMENTS ANALYSIS | |
| Current
account
balance | = | Goods and services balance | = | Goods balance | = | Goods credits | |
| | | | + | Goods debits | |
| | + | Services balance | = | Services credits | |
| | | | | + | Services debits | |
| + | Income balance | = | Income credits | | | |
| | + | Income debits | | | |
| + | Current transfers balance | = | Current transfers credits | | | |
| | + | Current transfers debits | | | |
| | |
| Capital and
financial
account
balance | = | Capital account balance | = | Capital transfers balance | = | Capital transfers credits | |
| | | + | Capital transfers debits | |
| | | + | Net acquisition/disposal of non- produced, non-financial assets | = | credits (disposal) | |
| | | | + | debits (acquisition) | |
| + | Financial account balance | = | Direct investment balance | = | Direct investment abroad | |
| | | | + | Direct investment in Australia | |
| | | + | Portfolio investment balance | = | Portfolio investment assets | |
| | | | | + | Portfolio investment liabilities | |
| | | + | Other investment balance | = | Other investment assets | |
| | | | | + | Other investment liabilities | |
| | | + | Reserve assets | | | |
| | |
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