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Introduction

A1.1 Standard classifications and definitions of statistical units and items are essential elements underlying the compilation and presentation of statistics produced by national statistical offices, such as the Australian Bureau of Statistics. The use of such standards ensures that statistics are comparable across industry and sector boundaries and can be aggregated from various collections, e.g. for national accounts purposes.

A1.2 Furthermore, the ABS has adopted the System of National Accounts 1993 (SNA93) as the standard for the compilation of its national accounts statistics, to help promote the integration of economic and related statistics, as an analytical tool, and in the international reporting of comparable national accounting data.


Sector classification

A1.3 Dividing the economy into sectors provides information about groups of economic units, such as financial corporations or households, that have similar economic functions and institutional characteristics. The main purpose of these classifications is to facilitate analysis of economic activity along sectoral or institutional lines. The Standard Economic Sector Classifications of Australia (SESCA) describes a number of standard classifications used by the ABS in the compilation of statistics that involve dividing the economy into broad economic sectors.

A1.4 A key classification within SESCA is the Standard Institutional Sector Classification of Australia (SISCA). SISCA is based on the SNA93 institutional sector classification. The ASNA bases its sector classification on the international standards set out in SNA93. In the ASNA there are five sectors:

• non-financial corporations (including public non-financial corporations);

• financial corporations;

• households (including unincorporated enterprises);

• general government; and

• rest of the world
  

A1.13 The SNA93 proposes 'functional' classifications to identify the 'functions' - in the sense of 'purposes' or 'objectives' - for which groups of transactors engage in certain transactions.

A1.14 Four functional classifications are included in SNA93. Of these, two are presently used in the ASNA:

• Classification of Individual Consumption by Purpose (COICOP); and

• Classification of the Functions of Government (COFOG).

• food;

• alcoholic beverages and tobacco;

• clothing and footwear;

• housing, water, electricity, gas, and other fuels;

• furnishings and household equipment;

• health;

• transport;

• communications;

• recreation and culture;

• education services;

• hotels, cafes and restaurants; and

• miscellaneous goods and services.

• general public services;

• defence;

• public order and safety;

• education;

• health;

• social security and welfare;

• economic services; and

• all other.

A1.22 The industry classification employed throughout the ASNA is based on the Australian and New Zealand Standard Industrial Classification, 1993 (ANZSIC) (Cat. no. 1292.0). ANZSIC identifies groupings of businesses which carry out similar economic activities. Each such grouping defines an industry, and the similar economic activities which characterise the businesses concerned are referred to as activities primary to that industry.

A1.23 The ANZSIC structure comprises categories at four levels, namely Divisions (the broadest level), Subdivisions, Groups and Classes (the finest level). At the divisional level ANZSIC provides a broad overall picture of the economy, and hence it is suitable for publication in summary tables in official statistics. The subdivision, group and class levels provide increasingly detailed dissections of the broad categories.

A1.24 In the national accounts ANZSIC, is employed with one modification:, ownership of dwellings is treated as a separate industry. Industry detail is generally provided at the Division level. In preparing the accounts it is sometimes necessary to shorten some of the more lengthy ANZSIC Division title descriptions. Where this occurs, no change in industry definition or content is implied.

A1.25 The industry classification used for input-output tables - Input-Output Industrial Classification (IOIC) - is also based on ANZSIC, but in some respects it departs from the usual application of that classification. For input-output tables it is desirable that an industry corresponds as closely as possible to the production of products primary to that industry. This applies especially where establishments classified to an industry produce significant amounts of products primary to another industry which has quite a different pattern of inputs. In these cases, where practical, secondary or subsidiary production is treated as output of the industry to which production is primary; this process is called redefinition of production. The major redefinitions made for the input-output framework can be found in Input-Output Tables, 1994-95 (ABS Cat. no. 5209.0).


Product classification

A1.26 The product classification employed in the ASNA is the Input-Output Product Classification (IOPC). The input-output system describes the production and subsequent use of all goods and services in the economy, hence the input-output product classification is defined in terms of the characteristic products of industry sectors.

A1.27 The structure of the IOPC arises from its industry-of-origin basis. In an industry-of-origin classification, each product item is shown according to the industry in which it is primarily produced. Thus the structure of the IOPC consists of industry of origin headings with detailed product items shown under each heading.

A1.28 The overall principles for the preparation of such an industry-of-origin product classification are:

• homogeneity of inputs - each product or product group should consist of items that have similar input structures or technology of production. This principle is generally applied through the definition of each IOPC item in terms of the ANZSIC industry sector in which it is mainly produced; and

• homogeneity of disposition - each product or product group, having satisfied the first criterion, should consist of items that have similar patterns of disposition or usage. This principle is applied by reference to the description of source data items and information about the transport, distribution and product taxation margins applying to particular products.

A1.31 SNA93 describes three types of assets that should be included in the national accounts:

• Non-financial produced assets;

• Non-financial non-produced assets; and

• Financial assets (and liabilities).

• Fixed assets are defined as produced assets that are themselves used repeatedly, or continuously, in processes of production for greater than one year. The distinguishing feature of a fixed asset is not that it is durable in some physical sense, but that it may be used repeatedly or continuously in production over a long period of time, taken to be more than one year. Some goods, such as coal, may be highly durable physically but cannot be fixed assets because they can be used once only. Fixed assets include not only structures, machinery and equipment, but also cultivated assets such as trees or animals that are used repeatedly or continuously to produce other products such as fruit or dairy products. They also include intangible assets such as software or artistic originals used in production.

• Inventories consist of:

• stocks of outputs that are still held by the units that produced them prior to their being further processed, sold, delivered to other units or used in other ways; and

• stocks of products acquired from other units that are intended to be used for intermediate consumption or for resale without further processing.

Inventories are held either as finished goods, work-in-progress or raw materials.