4.6. The first process in compilation involves the transformation of accounting data into GFS data. This begins with identification of the unit for which data are recorded, verification that the unit qualifies as an enterprise unit (as described in chapter 2) and application of the relevant GFS units classifications to the unit. The second major step is analysis of the source data for the unit, which essentially amounts to linking the accounting records of flows and stocks of the unit to GFS flows and stocks classifications.
APPLICATION OF GFS UNIT CLASSIFICATIONS
4.7. As described in chapter 2, the main GFS unit classifications are Level of government (LOG), Jurisdiction (JUR), Institutional sector (INST), and Industry.
4.8. Unit classifications are first applied at the time a unit comes into the coverage of GFS. This usually happens when a unit is created by a government in Australia, or when an existing unit is split to form more than one unit or is combined with another unit to form a new unit. Once determined, units classifications are reviewed only when major changes occur to the functions of the unit.
4.9. The classification process involves examination of Acts of Parliaments (where applicable) and the unit’s financial statements (i.e. the income and expenditure (profit and loss) statement, balance sheet and cash flow statement). This process is intended to disclose the range of activities in which the unit engages and the legislative background to its creation. Such information is used to determine whether the unit qualifies as an enterprise unit and whether the enterprise falls within the scope of GFS. The information, supplemented where necessary by information obtained directly from the unit, is used to determine the unit classifications applicable to the unit.
APPLICATION OF GFS FLOWS AND STOCKS CLASSIFICATIONS
4.10. As discussed in chapter 2, from an output perspective, the main GFS flows and stocks classifications are the Economic type framework (ETF) and the Government purpose classification (GPC). However, for input processing purposes, the following additional classifications are applied:
- Type of asset classification (TAC) - input items required to derive output items for stocks of non-financial assets in the statement of stocks and flows.
- Source/destination classification (SDC) - a classification that identifies: (i) for each transaction, the institutional sector and level of government (where applicable) of the unit (including non-government units) from which revenues are receivable (the source) or to which expenses are payable (the destination); and (ii) for each financial asset, the institutional sector and level of government of the unit against which the financial claim represented by the asset is held. The codes are used in the consolidation process and for producing output (e.g. grants to public non-financial corporations) that requires identification of the sector of the counterparties to transactions and stocks.
- Taxes classification (TC) - input items required to produce taxation revenue data classified by type.
4.11. For the purpose of applying the classifications, input items are grouped in the following categories:
- Operating statement items - input items required to derive output items in the operating statement.
- Cash flow statement items - input items required to derive output items in the cash flow statement.
- Reconciliation statement items - items required to reconcile items in the operating statement with items in the cash flow statement.
- Supplementary statement items - items of statistical interest that are not within the scope of the cash flow statement (e.g. acquisitions of non-financial assets).
- Intra-unit transfers other than revaluations and accrued transactions - input items identifying flows within a unit (e.g. transfers to reserves, certain provisions) other than revaluations and accrued transactions such as depreciation. Flows within a unit appear in accounting records and must be recorded in the system to ensure that a balance of debits and credits is maintained in the unit’s data. The flows cancel out in output. Revaluations and accrued transactions within units are required in output and are therefore not identified as intra-unit transfers.
- Revaluations and other changes in the volume of assets - input items required to derive revaluations (i.e. changes to asset values arising from price changes, including exchange rate changes) and other changes in the volume of assets in the statement of stocks and flows.
- Balance sheet items - input items required to derive output items for stocks of financial assets, liabilities and equity in the balance sheet and statement of stocks and flows.
The items included in each of the above classification components are listed in appendix 3 and are not discussed in detail here.
4.12. Application of the flows and stocks classifications involves examining flow and stock items recorded in a unit’s accounting records and entering against each item the appropriate classification code(s) from each of the relevant classifications. A single item may have several codes entered against it. For example, an expense item will carry (at least) an ETF code to indicate the type of expense, a source/destination code to indicate the destination code of the expense outflow, and a GPC code to indicate the government purpose of the expense.
4.13. The classification process is applied initially to all flows and stocks of new units and to new flows and stock items of existing units. The process may also be re-applied to existing items that have changed description from the previous period or have changed in value significantly and are suspected to have changed content.
INPUT OF DATA TO GFS PROCESSING SYSTEM
4.14. The next step in the compilation of the statistics is the loading and editing of the analysed data in the GFS processing system. Data is loaded by electronic processes or by manual intervention and is edited directly on the ABS GFS input database. The electronic file supplied by each Treasury contains accounting data for each unit and contains data item descriptions as they appear in source records, the data (values) for each item in each period, and the GFS classifications for each item.
4.15. The purposes of the input data base are to:
- store up-to-date unit-level data;
- serve as the source for the output data base.
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