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EXPLANATORY NOTES


INTRODUCTION

1 The statistics presented in this release have been compiled from data collected from businesses in the Survey of Research and Experimental Development (R&D), Businesses for 2010-11.

2 The survey was conducted by the Australian Bureau of Statistics (ABS) via mail questionnaire and achieved a response rate of 95%.


REFERENCE PERIOD

3 The period covered by the survey is, in general, the 12 months ended 30 June. Where businesses were unable to supply information on this basis, an accounting period for which data could be provided was used. Such businesses make a substantial contribution to some of the estimates presented in this release. As a result, some estimates may reflect economic conditions that existed in periods outside the 12 months ended June in the relevant year.


DEFINITION OF R&D

4 R&D, as collected by the ABS, is defined in accordance with the Organisation for Economic Co-operation and Development (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'.

5 For a more comprehensive interpretation of the definition of R&D, see the Australian and New Zealand Standard Research Classification (ANZSRC), 2008 (cat. no. 1297.0) or refer to the OECD publication The Measurement of Scientific and Technological Activities: Proposed Standard Practice for Surveys of Research and Experimental Development - Frascati Manual 2002.

6 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.


FRAME

7 The source of the frame for the Survey of R&D, Businesses is the ABS Business Register (ABSBR). The ABSBR records information about statistical units and is used to create the frames for most ABS economic collections.


Statistical units defined on the ABSBR

8 Statistical units are those entities from which statistics are collected, or about which statistics are compiled. In ABS economic statistics, the statistical unit is generally the business.

9 The ABS uses an economic statistics units model on the ABSBR to describe the characteristics of businesses, and the structural relationships between related businesses. Within large, complex and diverse businesses, the units model is also used to define reporting units that can provide data to the ABS at suitable levels of detail.

10 The units model allocates businesses to one of two sub-populations. The vast majority of businesses are in what is called the Australian Taxation Office (ATO) Maintained Population (ATOMP), while the remaining businesses are in the ABS Maintained Population (ABSMP). Together these two sub-populations make up the ABSBR population.

11 Most businesses and organisations in Australia need to obtain an Australian Business Number (ABN) and are then included on the whole-of-government register of businesses, the Australian Business Register (ABR), which is maintained by the ATO. Most of these businesses have simple structures; therefore, the unit registered for an ABN will satisfy ABS statistical requirements. For these businesses, the ABS has aligned its statistical units structure with the ABN unit. The businesses with simple structures constitute the ATOMP, and the ABN unit is used as the statistical unit for ABS economic collections.

12 For the population of businesses where the ABN is not suitable for ABS statistical requirements, the ABS maintains its own units structure through direct contact with each business. These businesses constitute the ABSMP. This population consists typically of large, complex and diverse businesses. For businesses in the ABSMP, statistical units comprise the Enterprise Group, the Enterprise and the Type of Activity Unit (TAU). The range of activities across the Enterprise Group can be very diverse. The TAU represents a grouping of one or more business entities within the Enterprise that cover all of the operations within an industry subdivision and for which a basic set of financial production and employment data can be reported.

13 The current economic statistics units model was introduced into the ABS in mid 2002, to better use the information available as a result of The New Tax System (TNTS). For more information please refer to the Information Paper: Improvements in ABS Economic Statistics [Arising from The New Tax System], 2002 (cat.no.1372.0).

14 Statistical units for the Survey of R&D, Businesses consist of ABN units for the ATOMP and TAUs from the ABSMP, except for a small number of cases where unit splitting occurs.


Unit splitting

15 In cases where a TAU is deemed to have significant activities applying to more than one industry subdivision, the TAU is split for statistical purposes and the 'TAU splits' become the statistical units. TAU splits were implemented in the R&D survey for the first time in the 2005-06 cycle, and were applied for previous cycles according to the revision rules outlined in the Technical Note.


SCOPE AND COVERAGE

16 The Survey of R&D, Businesses aims to be a complete enumeration of businesses within the Australian business sector (i.e. all businesses and the private non-profit institutions mainly serving them) with intramural expenditure on R&D of $100,000 or more during the reference period.

17 Intramural expenditure is defined as expenditure for R&D performed by the statistical unit regardless of the source of funds. Expenditures made outside the statistical unit but in support of intramural R&D are included; for example, payments for analytical work, engineering or specialised services which form part of an R&D project performed by the statistical unit. R&D funded by the statistical unit but performed wholly by another on their behalf (extramural R&D) is excluded. R&D performed overseas by Australian businesses is included. For further information, refer to the OECD Frascati Manual 2002.

18 The ABS identifies businesses for inclusion in the survey if the business:

• reported expenditure on R&D in previous surveys;
• applied for an AusIndustry administered R&D Tax Concession and/or grant for industry R&D;
• indicated expenditure on R&D of $100,000 or more in the reference year, via a coverage questionnaire; or
• were identified through other sources such as newspapers, journals, research compendia, etc. as likely to have expenditure on R&D.

• include businesses classified to Division A (Agriculture, forestry and fishing) of the Australian and New Zealand Standard Industrial Classification (ANZSIC); and
• exclude businesses with expenditure on R&D of less than $100,000 in the reference period (i.e. introduction of an expenditure based scope cut-off).

GROSS DOMESTIC PRODUCT, current prices
	2006-07	2007-08	2008-09	2009-10	2010-11
	$m	$m	$m	$m	$m
Gross Domestic Product	1 083 060	1 175 949	1 252 218	1 293 380	1 399 070
Source: Australian National Accounts: National Income, Expenditure and Product, March 2012 (cat. no. 5206.0), released 6 June 2012.

GROSS STATE PRODUCT, current prices
	NSW	Vic.	Qld	SA	WA	Tas.	NT	ACT
	$m	$m	$m	$m	$m	$m	$m	$m
2010-11	438 456	317 152	266 585	90 172	216 586	24 809	17 082	30 327
2009-10	410 774	298 123	251 144	84 269	180 821	23 561	16 021	28 666
Source: Australian National Accounts: State Accounts, 2010-11 (cat. no. 5220.0), released 23 September, 2011.

Research and Experimental Development, Government and Private Non-Profit Organisations, Australia, 2011-12 (cat. no. 8109.0), scheduled for release in July 2013.

Australian and New Zealand Standard Research Classification (ANZSRC), 2008 (cat. no. 1297.0)
Innovation in Australian Business, 2010-11 (cat. no. 8158.0)
Microdata: Business Longitudinal Database, CURF, Australia, 2004-05 to 2009-10 (cat. no. 8168.0.55.001)
Research and Experimental Development, Government and Private Non-Profit Organisations, Australia, 2008-09 (cat. no. 8109.0)
Research and Experimental Development, Higher Education Organisations, Australia, 2010 (cat. no. 8111.0)
Selected Characteristics of Australian Business, 2009-10 (cat. no. 8167.0)
Summary of IT Use and Innovation in Australian Business, 2010-11 (cat. no. 8166.0)

Main Science and Technology Indicators 2012/1
The Measurement of Scientific and Technological Activities: Proposed Standard Practice for Surveys of Research and Experimental Development - Frascati Manual 2002