Australian National Accounts: Non-Profit Institutions Satellite Account methodology

The International Classification of Non-Profit Organisations (ICNPO) is the recommended classification for non-profit organisations in the Handbook on Non-Profit Institutions in the Systems of National Accounts. It is fundamentally an activity classification system, although some purpose criteria have been included where activities are similar.

The complete ICNPO is described in the following paragraphs. For the purpose of the 2006-07 and 2012-13 NPI Satellite Accounts, the following adjustments were made to the ICNPO:

• Groups 5-9 have been merged to form one Group - 'Environment, Development and Housing, Law, Advocacy, Philanthropic, International'.
• Hospitals have been removed from Group 3: Health to form a separate Group - 'Hospitals'.
• Group 12 Not elsewhere classified is referred to as 'Other'.
   

1 100 Culture and arts

• Media and communications - Production and dissemination of information and communication; includes radio and TV stations; publishing of books, journals, newspapers and newsletters; film production; and libraries.
• Visual arts, architecture, ceramic art - Production, dissemination and display of visual arts and architecture; includes sculpture, photographic societies, painting, drawing, design centres and architectural associations.
• Performing arts - Performing arts centres, companies and associations; includes theatre, dance, ballet, opera, orchestras, choirs and music ensembles.
• Historical, literary and humanistic societies - Promotion and appreciation of the humanities, preservation of historical and cultural artifacts and commemoration of historical events; includes historical societies, poetry and literary societies, language associations, reading promotion, war memorials and commemorative funds and associations.
• Museums - General and specialised museums covering art, history, sciences, technology and culture.
• Zoos and aquariums.
   

1 200 Sports

• Provision of amateur sport, training, physical fitness and sport competition services and events; includes fitness and wellness centres.
   

1 300 Other recreation and social clubs

• Recreation and social clubs - Provision of recreational facilities and services to individuals and communities; includes playground associations, country clubs, men's and women's clubs, touring clubs and leisure clubs.
• Service clubs - Membership organisations providing services to members and local communities, for example, Lions, Rotary Club.
   

2 100 Primary and secondary education

• Elementary, primary and secondary education - Education at elementary, primary and secondary levels; includes pre-school organisations other than day care.
   

2 200 Higher education

• Higher education - Higher learning, providing academic degrees; includes universities, business management schools, law schools and medical schools.
   

2 300 Other education

• Vocational/technical schools - Technical and vocational training specifically geared towards gaining employment; includes trade schools, paralegal training and secretarial schools.
• Adult/continuing education - Institutions engaged in providing education and training in addition to the formal educational system; includes schools of continuing studies, correspondence schools, night schools and sponsored literacy and reading programs.
   

2 400 Research

• Medical research - Research in the medical field; includes research on specific diseases, disorders or medical disciplines.
• Science and technology - Research in the physical and life sciences and engineering and technology.
• Social sciences, policy studies - Research and analysis in the social sciences and policy area. 
   

​3 100 Hospitals and rehabilitation

• Hospitals - Primarily inpatient medical care and treatment.
• Rehabilitation - Inpatient health care and rehabilitative therapy to individuals suffering from physical impairments due to injury, genetic defect or disease and requiring extensive physiotherapy or similar forms of care.
   

3 200 Nursing homes

• Nursing homes - Inpatient convalescent care and residential care, as well as primary health care services; includes homes for the frail elderly and nursing homes for the severely handicapped.
   

3 300 Mental health and crisis intervention

• Psychiatric hospitals - Inpatient care and treatment for the mentally ill.
• Mental health treatment - Outpatient treatment for mentally ill patients; includes community mental health centres and halfway homes.
• Crisis intervention - Outpatient services and counsel in acute mental health situations; includes suicide prevention and support to victims of assault and abuse.
   

3 400 Other health services

• Public health and wellness education - Public health promotion and health education; includes sanitation screening for potential health hazards, first aid training and services and family planning services.
• Health treatment, primarily outpatient - Organisations that provide primarily outpatient health services, e.g., health clinics and vaccination centres.
• Rehabilitative medical services - Outpatient therapeutic care; includes nature cure centres, yoga clinics and physical therapy centres.
• Emergency medical services - Services to persons in need of immediate care; includes ambulatory services and paramedical emergency care, shock/trauma programs, lifeline programs and ambulance services.
   

4 100 Social services

• Child welfare, child services and day care - Services to children, adoption services, child development centres, foster care; includes infant care centres and nurseries.
• Youth services and youth welfare - Services to youth; includes delinquency prevention services, teen pregnancy prevention, drop-out prevention, youth centres and clubs and job programs for youth; includes YMCA, YWCA, Boy Scouts, Girl Scouts and Big Brothers/Big Sisters.
• Family services - Services to families; includes family life/parent education, single parent agencies and services and family violence shelters and services.
• Services for the handicapped - Services for the handicapped; includes homes, other than nursing homes, transport facilities, recreation and other specialised services.
• Services for the elderly - Organisations providing geriatric care; includes in-home services, homemaker services, transport facilities, recreation, meal programs and other services geared towards senior citizens (does not include residential nursing homes).
• Self-help and other personal social services - Programs and services for self-help and personal development; includes support groups, personal counselling and credit counselling/money management services.
   

4 200 Emergency and relief

• Disaster/emergency prevention and control - Organisations that work to prevent, predict, control and alleviate the effects of disasters, to educate or otherwise prepare individuals to cope with the effects of disasters, or to provide relief to disaster victims; includes volunteer fire departments, life boat services etc.
• Temporary shelters - Organisations providing temporary shelters to the homeless; includes travellers' aid and temporary housing.
• Refugee assistance - Organisations providing food, clothing, shelter and services to refugees and immigrants.
   

4 300 Income support and maintenance

• Income support and maintenance - Organisations providing cash assistance and other forms of direct services to persons unable to maintain a livelihood.
• Material assistance - Organisations providing food, clothing, transport and other forms of assistance; includes food banks and clothing distribution centres.
   

5 100 Environment

• Pollution abatement and control - Organisations that promote clean air, clean water, reducing and preventing noise pollution, radiation control, treatment of hazardous wastes and toxic substances, solid waste management and recycling programs.
• Natural resources conservation and protection - Conservation and preservation of natural resources, including land, water, energy and plant resources for the general use and enjoyment of the public.
• Environmental beautification and open spaces - Botanical gardens, arboreta, horticultural programs and landscape services; Organisations promoting anti-litter campaigns; programs to preserve the parks, green spaces and open spaces in urban or rural areas; and city and highway beautification programs.
   

5 200 Animal protection

• Animal protection and welfare - Animal protection and welfare services; includes animal shelters and humane societies.
• Wildlife preservation and protection - Wildlife preservation and protection; includes sanctuaries and refuges.
• Veterinary services - Animal hospitals and services providing care to farm and household animals and pets.
   

6 100 Economic, social and community development

• Community and neighbourhood organisations - Organisations working towards improving the quality of life within communities or neighbourhoods, e.g., squatters' associations, local development organisations and poor people's cooperatives.
• Economic development - Programs and services to improve economic infrastructure and capacity; includes building of infrastructure, such as roads, and financial services, such as credit and savings associations, entrepreneurial programs, technical and managerial consulting and rural development assistance.
• Social development - Organisations working towards improving the institutional infrastructure and capacity to alleviate social problems and to improve general public well-being.
   

6 200 Housing

• Housing associations - Development, construction, management, leasing, financing and rehabilitation of housing.
• Housing assistance - Organisations providing housing search, legal services and related assistance.
   

6 300 Employment and training

• Job training programs - Organisations providing and supporting apprenticeship programs, internships, on-the-job training and other training programs.
• Vocational counselling and guidance - Vocational training and guidance, career counselling, testing and related services.
• Vocational rehabilitation and sheltered workshops - Organisations that promote self-sufficiency and income generation through job training and employment.
   

7 100 Civic and advocacy organisations

• Advocacy organisations - Organisations that protect the rights and promote the interests of specific groups of people, e.g., the physically handicapped, the elderly, children and women.
• Civil rights associations - Organisations that work to protect or preserve individual civil liberties and human rights.
• Ethnic associations - Organisations that promote the interests of or provide services to members belonging to a specific ethnic heritage.
• Civic associations - Programs and services to encourage and spread civic mindedness.
   

7 200 Law and legal services

• Legal services - Legal services, advice and assistance in dispute resolution and court-related matters.
• Crime prevention and public policy - Crime prevention to promote safety and precautionary measures among citizens.
• Rehabilitation of offenders - Programs and services to reintegrate offenders; includes halfway houses, probation and parole programs, prison alternatives.
• Victim support - Services, counsel and advice to victims of crime.
• Consumer protection associations - Protection of consumer rights and the improvement of product control and quality.
   

7 300 Political organisations

• Political parties and organisations - Activities and services to support the placing of particular candidates into political office; includes dissemination of information, public relations and political fundraising.
   

8 100 Grant-making foundations

• Grant-making foundations - Private foundations; including corporate foundations, community foundations and independent public law foundations.
   

8 200 Other philanthropic intermediaries and voluntarism promotion

• Volunteerism promotion and support - Organisations that recruit, train and place volunteers and promote volunteering.
• Fundraising organisations - Federated, collective fundraising organisations; includes lotteries.
   

9 100 International activities

• Exchange/friendship/cultural programs - Programs and services designed to encourage mutual respect and friendship internationally.
• Development assistance associations - Programs and projects that promote social and economic development abroad.
• International disaster and relief organisations - Organisations that collect, channel and provide aid to other countries during times of disaster or emergency.
• International human rights and peace organisations - Organisations which promote and monitor human rights and peace internationally.
   

10 100 Religious congregations and associations

• Congregations - Churches, synagogues, temples, mosques, shrines, monasteries, seminaries and similar organisations promoting religious beliefs and administering religious services and rituals.
• Associations of congregations - Associations and auxiliaries of religious congregations and organisations supporting and promoting religious beliefs, services and rituals.
   

11 100 Business associations

• Business associations - Organisations that work to promote, regulate and safeguard the interests of special branches of business, e.g. manufacturers’ association, farmers’ association and bankers’ associations
   

11 200 Professional associations

• Professional associations - Organisations promoting, regulating and protecting professional interests, e.g., bar associations and medical associations.
   

11 300 Labour unions

• Labour unions - Organisations that promote, protect and regulate the rights and interests of employees.
   

12 100 Not elsewhere classified

• All other NPIs.
   

The following table shows the concordance between the Voluntary Work survey type of organisation categories and ICNPO

The national accounts are a comprehensive set of economic data which are fully consistent and complete within the boundary of the economic activities they cover. Gross domestic product (GDP) is perhaps the most recognisable and important economic statistic from the core national accounts. Satellite accounts allow an expansion of the national accounts for selected areas of interest while maintaining the concepts and structures of the core national accounts. Satellite accounts present specific details on a particular topic in an account which is separate from, but linked to, the core accounts. An NPI satellite account highlights NPIs within the national accounting framework.

Implicitly, the data in respect of NPIs is included in the national accounts. The value of NPIs sales and transfers, compensation of employees and other items of income and expenditure are all part of the economic activity measured in the Australian national accounts. However, while all the production of NPIs is embedded in the accounts for industries such as health and community services and education, they are not separately identified.

An NPI satellite account provides a means by which the economic aspects of NPIs can be drawn out and analysed separately within the structure of the main accounts. One of the major features of an NPI satellite account is that it is set within the context of the whole economy, so that NPIs contribution to major national accounting aggregates can be determined. The NPI satellite account has two dimensions. The first is referred to as measurement on a national accounts basis. This is equivalent to production and other economic aggregates as defined in the national accounts. The second dimension is referred to as measurement on an NPI satellite account basis. This dimension extends the boundary of national accounts to include values for the non-market output of market producers and NPI services provided by volunteers. Measurement on an NPI satellite account basis provides a more complete picture of the value of NPIs to society than is evident in estimates included in the national accounts.

The international standard for national accounting is the System of National Accounts, 2008 (2008 SNA). It makes recommendations about the scope, concepts and classifications to be used in compiling national accounts estimates. Australia's national accounts, like those of most other countries, are compiled according to these recommendations.

The concepts and methods used in the Australian NPI satellite account are based on the Handbook on Non-Profit Institutions in the System of National Accounts (the Handbook). The Handbook was endorsed by the United Nations Statistical Commission in 2002.

2008 SNA identifies five institutional sectors which are the core building blocks of the national accounts. These are:

• Non-financial corporations
• Financial corporations
• Government units, including social security funds
• Non-profit institutions serving households (NPISH)
• Households
   

Each of these institutional sectors is made up of individual units capable of engaging in economic activities and transactions with other units, including non-residents. The allocation of NPIs depends on the nature of their operations. Those mainly engaged in market production are allocated to the relevant corporate sector. Those mainly engaged in non-market production are allocated to the general government sector if they are controlled by government, otherwise they are allocated to the NPISH sector. The SNA recommends the separate identification of NPISH. While separate estimates are being developed, NPISH are currently included with the household sector in Australia's national accounts.

Figure 4.1 shows the allocation of types of institutional units to institutional sectors in the Australian System of National Accounts (ASNA).
 

Source: Australian System of National Accounts: concepts, sources and methods, 2013

According to the Standard Economic Sector Classifications of Australia (SESCA), 2008 (Version 1.1) (cat. no. 1218.0):

'Market operators are units which respond to market forces. Market operators make decisions about what to produce and how much to produce in response to expected levels of demand and expected costs of supply and are exposed to the risks associated with this production. Market operators adjust supply either with the goal of making a profit in the long run or, at a minimum, covering capital and other costs.' Examples of market NPIs include business and professional associations.

'Non-market operators are not likely to respond to changes in economic conditions in the same way as market operators. Their economic behaviour is influenced by the receipt of material financial support in the form of transfers such as grants and donations.' Examples of non-market NPIs include churches and most welfare organisations.

NPIs are typically thought of as charities or community service organisations, but they are more than this. NPIs cover a wide range of activities and may be engaged in either market production or non-market production, or a combination of both. 2008 SNA defines NPIs as 'legal or social entities created for the purpose of producing goods or services, whose status does not permit them to be a source of income, profit or other financial gain for the units that establish, control or finance them.' (2008 SNA, paragraph 4.83)

Non-profit in the title does not mean that such institutions do not, or are not capable of making a profit in the generally accepted sense. 'In practice, their productive activities are bound to generate either surpluses or deficits but any surpluses they happen to make cannot be appropriated by other institutional units. The articles of association by which they are established are drawn up in such a way that the institutional units that control or manage them are not entitled to a share in any profits or other income they receive. For this reason, they are frequently exempted from various kinds of taxes.' (2008 SNA, paragraph 4.83)

2008 SNA (paragraph 4.85) describes the characteristics that distinguish NPIs from other institutional units. In summary, these include:

• 'Most NPIs are legal entities created by process of law whose existence is recognised independently of the persons, corporations or government units that establish, finance, control or manage them.
• Many NPIs are controlled by associations whose members have equal rights, including equal votes on all decisions affecting the affairs of the NPI.
• There are no shareholders with a claim on the profits or equity of the NPI.
• The direction of an NPI is usually vested in a group of officers, executive committee or similar body elected by a simple majority vote of all the members.
• The term 'non-profit institution' derives from the fact that the members of the association controlling the NPI are not permitted to gain financially from its operations and cannot appropriate any surplus which it may make.'
   

The Handbook provides a 'structural-operational' definition of NPIs as entities that are:

• organisations;
• do not exist primarily to generate profits and are non-profit distributing where they do make a profit;
• institutionally separate from government;
• self governing; and
• non compulsory - 'means that membership and contributions of time and money are not required or enforced by law or otherwise made a condition of citizenship' (Handbook, 2.19).
   

These characteristics are consistent with the 2008 SNA description of NPIs and are the primary basis for the identification of NPI units on the ABS Business Register of organisations.

The first dimension of the NPI satellite account provides estimates of production consistent with the production boundary of the national accounts. For the purposes of the satellite account publication, this is referred to as measurement on a national accounts basis. The second dimension extends the boundary beyond that defined for national accounts to include values for the non-market output of market producers and volunteer services. This extended dimension is referred to as measurement on an NPI satellite account basis.

For market NPIs, valuation of the output of NPIs on a national accounts basis is consistent with the valuation method for incorporated and unincorporated enterprises more generally in the national accounts. It is the sum of:

• the total value of goods and services sold. In this context, the notion of income from service provision includes income received from governments on a volume basis (e.g. per student, per patient, per bed funding in hospitals or nursing homes, per service (travel, meals, cleaning) provided by organisations assisting the disabled or elderly) rent, leasing and hiring income, membership fees and sponsorships;
• the total value of goods and services bartered or used as payments in kind, including to employees;
• the total value of own-account capital formation; and
• the total value of changes in inventories of finished goods and work in progress goods intended for one or other of the above uses.
   

The absence of a market price for non-market services means that the output of non-market NPIs is valued as the costs of production. These costs exclude interest payments and other transfers. Output for non-market units is the sum of:

• purchases (including for own-account capital formation) or intermediate consumption of goods and services;
• labour costs;
• depreciation;
• taxes less subsidies on production, e.g. land tax and payroll tax; and
• the total value of the change in inventories of raw materials, fuels etc.
   

This valuation of non-market NPIs is consistent with the convention adopted for the valuation of General Government sector output, the other non-market sector in the national accounts.

Although non-market NPIs receive most of their income from sources such as transfers from government and donations, they may also receive revenue from sales of goods and services. If this were also included in the measure of output the value would be distorted by double counting. Once an NPI is defined as a non-market producer because it provides most of its output free or at prices which are not economically significant, all output is then valued at cost.

NPI gross value added and NPI GDP are the major economic aggregates derived in this satellite account.

Gross value added shows the value which a producer adds to the raw material goods and services it purchases in the process of producing its own output. NPI gross value added is measured as the value of the output of NPI goods and services less the value of the intermediate consumption inputs used in its production. As non-market NPI output is valued at cost, gross value added for non-market NPIs is also equivalent to the sum of labour costs, depreciation and other taxes less subsidies on production, e.g. land tax and payroll tax. Output and value added is measured at basic prices, that is before any net taxes (taxes paid less subsidies received) on products are added.

NPI GDP measures the value added of NPIs at purchasers prices. It therefore includes taxes paid less subsidies received on NPI goods and services, as these are reflected in the prices consumers actually pay.

NPIs receive income from market sales of goods and services, from governments, private sponsorships and donations and from other sources such as interest and dividends received on investments in financial assets. The satellite account makes a distinction between what is termed 'transfer income' and 'sales of goods and services'. Transfers are transactions in which one unit receives resources from another unit without providing a good or service in return. Receipts of donations, bequests, membership fees paid to non-market NPIs, government funding which is not provided on a volume basis and income received from related or affiliated organisations are classified as transfers received. Sales of goods and services on the other hand are transactions where payment is received in return for a benefit provided. Sales income includes rent, leasing and hiring income, sponsorships, membership fees paid to market NPIs and government funding which is provided on a volume basis (e.g. per student, per patient).

The NPI satellite account extends the SNA production boundary beyond that which is usually measured in the national accounts. One extension to the production boundary is the inclusion of a value for the non-market output of market producers.

The non-market output of market producers measures that component of the output of market NPIs which is not captured when output of market units is valued under the standard SNA convention of valuation by sales. The Handbook argues that if such an adjustment is not made to value any non-market output produced by market units, then the value of the output of market NPIs is understated as such units can produce significant amounts of output which are supported by charitable contributions or other transfers that is not evident in sales revenue.

The non-market output of market producers is valued as the difference between the output of market units when calculated by the standard SNA valuation method for non-market units of cost summation, and output as calculated by the standard SNA method for market units of valuation by sales. Where output on a cost valuation basis exceeds output on a sales valuation basis, the difference is taken to be the non-market output of market producers. Where output on a sales basis exceeds output on a cost basis, non-market output of market producers is assumed to equal zero.

The second extension to the SNA production boundary which is seen in the NPI satellite account is the inclusion of a value for the services provided to NPIs by volunteers. 2008 SNA excludes all unpaid labour, including the value of volunteering.

The Handbook recognises that as volunteer labour is critical to the output of NPIs and their ability to produce a level and quality of service, it is important to capture and value this activity in the NPI satellite account. The Handbook proposes three methods by which volunteer services can be valued. Each method involves assigning a wage rate to the total number of hours worked by volunteers.

The first such valuation method mentioned in the Handbook is referred to as the "opportunity cost" approach. The notion behind this approach is that each hour of volunteer time should be valued at what the time is worth to the volunteer in some alternative pursuit. The applicable wage rate at which an hour of volunteer time is valued in this instance is therefore the wage rate associated with the usual occupation of the volunteer. The Handbook recognises that while theoretically desirable for some analytical purposes, this valuation approach is not often used. The ABS has considerable reservations as to the appropriateness of this valuation method, as it assumes that paid work is foregone in order to undertake voluntary work. Most workers, however, have limited choices in the hours they work and are more likely to be giving up leisure time for voluntary work. This being the case, the opportunity cost should not be based on the wage they receive in the market but on the value they place on leisure. Valuation of goods and services at market prices is fundamental to national accounting. In this context, two volunteers involved in identical unpaid activity should be valued at the same hourly rate irrespective of what they could each earn in their paid occupations. Additionally, this method raises the issue as to which is the appropriate wage rate to apply to those volunteers who do not have a usual occupation, for example those who are retired or unemployed or otherwise not in the labour force.

The second valuation method proposed in the Handbook is the "replacement cost" or "market cost" approach. This approach recommends that each hour of volunteer time be valued at what it would cost the organisation to replace the volunteer with paid labour. The applicable wage rate at which an hour of volunteer time is valued in this instance relates to the particular activity being undertaken by the volunteer. While this method is preferred over the opportunity cost approach, the value of volunteer services may be under or over estimated using this approach depending on variations in the productivity of volunteers compared with labour provided to the market sector. The estimate of volunteer services included in this satellite account is based on this approach.

The Handbook recognises that both the opportunity and replacement cost methods require more information on the activities in which volunteers engage than is likely to be available in most countries. Where detailed data on volunteering are not available, the Handbook recommends a fallback option which values each hour of volunteer time at the average gross wage for the community, welfare and social service occupation category. The Handbook argues that the work of volunteers is most likely to resemble this occupation category, and that the associated wage rate is conservative and typically towards the low end of the income scale but not at the very bottom.

The classification system used in this satellite account is a reduced version of the classification that is recommended in the Handbook, the ICNPO. Although ICNPO does include some purpose criteria, it is fundamentally an activity classification. ICNPO permits a fuller specification of the components of the non-profit sector than the industry classification used in Australia, the Australian and New Zealand Standard Industrial Classification (ANZSIC). In some instances the detailed ANZSIC codes cut across several ICNPO groups and sub groups. In keeping with the current availability of data, a number of the broad level ICNPO groups have been combined in this publication and estimates have not been produced for classifications below the group level. A full version of ICNPO and the concordance between ICNPO and the ANZSIC classification are shown in Appendix 1 and Appendix 2 of this publication.

The 2012-13 data on voluntary work was collected using an activity classification which is similar to ICNPO, at least at the Group level. Appendix 3 contains a concordance between the voluntary work data type of organisation and ICNPO.

The principles detailed in the Standard Economic Sector Classifications of Australia (cat. no. 1218.0) have been applied to determine the market/non-market classification of NPI data.

The Australian NPI satellite account does not attempt to measure the universe of entities that could be defined as NPIs. This is partly for practical and partly for conceptual reasons. Decisions made around scope can significantly affect the size of the NPI sector, particularly with regard to units such as universities and public hospitals and the correct or theoretically desirable classification of units is far from clear cut in some instances.

The Handbook on Non-Profit Institutions in the System of National Accounts (the Handbook) defines non-profit organisations in paragraphs 2.15 to 2.19 as:

• Organisations; which are
  • not-for-profit and non-profit-distributing;
  • institutionally separate from government;
  • self-governing; and
  • non-compulsory.
     

This definition forms the basis of what is included within the scope of the NPI satellite account. Each criterion and its conceptual and practical implications is discussed below.

The first criterion noted in the Handbook refers to organisational existence. This means that in order to meet the definition of an NPI, an entity must have some institutional reality and a meaningful organisational boundary separate and distinct from its members.

For the purposes of the satellite account, a practical means to identify that an entity meets this criterion is the existence of an ABN. Without an ABN, an entity cannot have employees or accept tax deductible donations. There are many non-profit groups in Australia who do not have an ABN, some of which if examined closely could be argued to have a separate organisational existence. However, if such groups are unable to employ or accept tax deductible donations then the economic significance of such units is likely to be negligible.

The next criterion discussed in the Handbook is that in order to meet the definition of an NPI, an entity must be both not-for-profit and non-profit-distributing. This means that the organisation does not exist primarily to make a profit, and any surplus it accumulates must not be distributed to owners or members.

For the purposes of the satellite account, this meant that a number of units were excluded from the scope of the account on the basis that they are able to distribute surpluses to members, either on an ongoing basis or on liquidation. The Handbook mentions that to the extent that they are able to distribute profits to members, cooperatives and mutual societies are excluded from the NPI sector. Also excluded from the satellite account on this basis are strata titles, credit unions and building societies. According to ABN counts, there are currently approximately 120,900 strata titles in Australia, and according to the Australian Prudential Regulation Authority (APRA), as at June 2013 there were 88 credit unions and 9 building societies in Australia. Credit unions and building societies received net interest income of $1,052m and $475m respectively in the year ended December 2013.

Consistent with the previous NPI satellite account, any units classified to either finance or insurance were also excluded from the scope of the satellite account. There are a number of religious charitable development funds operating in Australia which are classifiable to the Financial corporations sector. According to APRA, there are currently 57 of these funds in Australia.

The third criterion discussed in the Handbook is that in order to meet the definition of an NPI, an entity must be institutionally separate from government. This means that the organisation must have sufficient discretion with regard to both its production and use of funds, and that its operating and financing activities cannot be fully integrated with government finances.

For the purposes of the satellite account, this meant that any unit which was classified to the General government sector was excluded on the basis that if the unit is sufficiently controlled by government to be included in the General government sector, its finances are integrated with those of the government and the unit is not sufficiently separate from government to satisfy this criterion.

The fourth criterion discussed in the Handbook is that in order to meet the definition of an NPI, an organisation must be self-governing. This means that the organisation must be able to control its own activities and is not under the effective control of any other entity.

The final criterion mentioned in the Handbook is that in order to meet the definition of an NPI, an organisation must be non-compulsory. This means that membership or contributions of time and money cannot be required or enforced by law or otherwise made a condition of citizenship. However, a unit is still considered an NPI if membership is a necessary condition in order to practice a particular profession. For the purposes of the satellite account, this meant that professional associations are within scope.

When all of the above criteria have been considered, the overall scope of the NPI satellite account is:

• all organisations registered for an ABN;
• which are not-for-profit and non-profit-distributing;
• institutionally separate from government;
• self-governing; and
• non-compulsory.
   

These criteria limit the scope of the NPI satellite account to all non-profit organisations registered for an ABN which are classified to either the Non-financial corporations sector or the Non-profit institutions serving households (NPISH) sector.

The NPI satellite account has been compiled from a variety of data sources, including ABS economic and social collections. The sources used to compile the various data contained in the satellite account are outlined below.

The bulk of the data contained in the NPI satellite account are monetary aggregates. This includes data about income, use of income, capital expenditure and asset stocks, as well as the national accounting measures of output of goods and services and gross value added. The data used to compile this information were collected in the annual Economic Activity Survey (EAS), which for 2006-07 and 2012-13 covered all employing and significant non employing non-profit organisations. A range of information from a sample of these organisations, including detailed information about their financial performance over the reporting period was collected. Information from the ABS Business Register of organisations was used to compile data about the number of non-profit organisations.

Micro non employing non-profit organisations with turnover below a set threshold were excluded from the scope of the survey. Information for these organisations was taken from Business Activity Statement (BAS) data as collected by the ATO. Data available from BAS records included in the satellite account relate to sales and service income, labour costs (wages, salaries and superannuation), non capitalised purchases and capital expenditure. Data for other survey questionnaire items, including transfers and donations paid and received, were not available from BAS records, nor was a suitable imputation method apparent for these items.

Data in respect of permanent full time, permanent part time and casual paid employees of NPIs were also collected as part of the EAS. Given the nature of the administrative arrangements for deducting tax with respect to paid employees, the ABN based survey frame should cover all employing NPIs.

The 2006-07 EAS also collected information as to the number of volunteers that each organisation surveyed reported had worked for their organisation during the reporting period. However, as more detailed information on volunteering was available from the ABS publication, Voluntary Work, Australia 2006 (cat. no. 4441.0), those estimates were used. For this reason, the 2012-13 EAS did not collect information about volunteers.

Estimates on the number of volunteers were sourced from unpublished data from the ABS General Social Survey which released its results in June 2015. The ABS has compiled the number and contribution of volunteers to non-profit organisations for 2012-13. These data are included in this reissued publication.

The compilation of data about the value of volunteer services involves taking information on the annual hours volunteered from the 2014 General Social Survey and assigning a wage rate derived from unpublished data taken from the ABS 2012 Employee Earnings and Hours Survey. As detailed in the conceptual framework appendix, the Handbook on Non-Profit Institutions in the System of National Accounts (the Handbook) recommends three alternative methods for estimating the value of volunteer services. The compilation of each of these methods for 2012-13 and the different results generated are outlined below.

The first valuation method described in the Handbook is the opportunity cost approach. Under this method, the appropriate wage rate to apply to each volunteer hour is what the volunteer could earn in their usual occupation. Data on the number of hours volunteered, classified by the usual occupation of the volunteer, was obtained from General Social Survey 2014. Occupation categories are based on the Australian and New Zealand Standard Classification of Occupations, First edition (cat. no. 1220.0). The number of hours volunteered for each occupation category was then multiplied by the relevant wage rate for that occupation category. For each valuation method described, calculations were done separately for males and females and the average ordinary time hourly rate for non managerial employees was used. Where the volunteer did not nominate a usual occupation, for example they were retired or not in the labour force, the average wage rate for all occupation categories was applied. The opportunity cost approach valued total volunteer services at $18.1b. In addition, the total number of volunteer hours are able to be converted to full time equivalents by dividing hours volunteered by the average ordinary time hours worked in full time occupations associated with each occupation category. Full time equivalents will therefore vary with each valuation method, depending on the occupation categories used. Full time equivalents under the opportunity cost approach were 254,300 persons.

The second valuation method noted in the Handbook is the replacement cost approach. Under this method, the appropriate wage rate to apply to each volunteer hour is that associated with the activity being undertaken by the volunteer. The 2014 General Social Survey does not contain information about the number of hours volunteered by each type of activity, so a single wage rate was applied to each volunteer hour under this method. This wage rate was calculated in a two step process. Firstly, volunteer activities were matched to occupation categories to determine a wage rate for each activity. For some volunteer activities, more than one occupation category was matched to the activity and in these instances an average of the relevant occupations was used. The second step was to weight the results for each activity to calculate a single weighted average wage rate. This weighted average wage for all activities was then applied to each volunteer hour to calculate the value of volunteer services. Weights for each activity were based on the actual number of volunteer involvements associated with the activity compared with the average number of involvements for all activities. The value of volunteer services calculated using the replacement cost method have been included in the satellite account for 2012-13 as this valuation method was considered the most appropriate. As seen in the above table, volunteer services under this method were $17.3b and full time equivalents were 265,600 persons.

The Handbook recognises that data necessary to populate the opportunity or replacement cost approaches will not be available in all countries. Where detailed data on volunteering is not available, the Handbook recommends a fallback option which values each hour of volunteer time at the average gross wage for the community, welfare and social service occupation category. Under this approach, volunteer services were valued at $16.4b and full time equivalents were 266,400 persons. The number of full time equivalents differ under each approach as the average weekly hours worked in the relevant occupation categories are different.

There is a range of information in various forms available with respect to NPIs. The extent to which this information is comparable is dependent on a range of factors, most notably the scope of what is included in the data, data collection or compilation methods and the definitions or metadata associated with the data. The following discussion provides information about the comparability of the NPI satellite account with a range of other ABS publications.

While the Not-for-profit Organisations, Australia, 2006-07 (cat. no. 8106.0) publication was the principal data source used to compile the 2006-07 NPI satellite account, there are notable differences between the two publications of which users must be mindful when making comparisons.

The NPI satellite account presents data for the non-profit sector which were compiled from a variety of existing economic and social collections conducted by the ABS. Not-for-profit Organisations Australia, 2006-07 presents information from a survey of economically significant non-profit organisations and supplements the NPI satellite account statistics with a detailed examination of the structure and performance of non-profit organisations for the reference year of the survey.

Micro non employing NPIs with turnover below a set threshold were out of scope of Not-for-profit Organisations Australia, 2006-07. Data for these organisations for available data items was sourced from BAS information collected by the ATO for inclusion in the satellite account. The inclusion of these units in the satellite account had a significant impact on the identified number of non-profit organisations.

Not-for-profit Organisations Australia, 2006-07 contains information about the number of volunteers who volunteered for non-profit organisations during the reporting period. The information regarding numbers of volunteers and the annual hours volunteered for non-profit organisations contained in the satellite account was sourced from the ABS publication Voluntary Work, Australia, 2006. Further information about the different collection methodologies for Not-for-profit Organisations Australia, 2006-07 and Voluntary Work Australia, 2006 is presented in Appendix 6: Data Sources and Compilation Methods.

A survey of NPIs was the principal data source for the 2012-13 satellite account. Like the 2006-07 survey micro non employing NPIs were out of scope but are included in the satellite account using BAS information. All data which are able to be released from the 2012-13 survey are included in the satellite account.

Detailed information about volunteering and the characteristics of volunteers is presented in the ABS publication General Social Survey:Summary Results, Australia, 2014 (cat. no. 4159.0). Unpublished data from this publication was the principal data source for the number of volunteers and annual volunteer hours included in the 2012-13 satellite account estimates. Differences between the totals presented in General Social Survey: Summary Results, Australia, 2014 (cat. no. 4159.0) and the satellite account are due to the exclusion of volunteering for government and for profit organisations and volunteers under 18 years of age in the satellite account data.

Information relating to private hospitals, including the number of private hospitals and data about income and expense flows, is available in the ABS publication Private Hospitals, Australia (cat. no. 4390.0). This publication presents separate information in respect of for profit and not for profit private hospitals.

To some degree, the data relating to not for profit private hospitals presented in Private Hospitals Australia is comparable with data presented in the satellite account for ICNPO 13: Hospitals. However, important differences in scope, definitions and collection methods should be noted and any such comparisons should be undertaken with caution.

The scope of organisations included in ICNPO 13 of the satellite account is any non-profit organisation classified to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 (Revision 2.0) (ANZSIC06) classes 8401 (Hospitals) and 8402 (Psychiatric hospitals). The basis of this classification is the predominant activity of the particular organisation, and data in the satellite account are based on a sample of organisations which represents the entire population. By contrast, the scope of Private Hospitals Australia includes all private acute and psychiatric hospitals licensed by state and territory health authorities and all free-standing day hospital facilities approved by the Australian Government Department of Health for the purpose of health insurance benefits, including those registered with their respective state health authority, and which operate for all or any part of the financial year. This includes sub-acute hospitals, rehabilitation hospitals and privately contracted public hospitals. As all private health establishments are included, this results in 100% coverage. Hence, Private Hospitals Australia is a census of private health facilities in Australia and information is collected from the entire population in scope.

Variances between data presented in Private Hospitals Australia and ICNPO 13 of the satellite account are further attributable to differences in the identification of non-profit organisations. For the purposes of the satellite account, non-profit organisations are identified on the ABS Business Register of organisations using a combination of indicators including a number of characteristics based on taxation data, or by individual profiling of the organisation by the ABS. For the Private Hospitals Australia publication, non-profit organisations are self-identified in response to a question about whether or not they qualify as a non-profit organisation with either the ATO or the Australian Securities and Investments Commission (ASIC).

The satellite account estimates for ICNPO 13 include private non-profit organisations, whose predominant activity is to provide hospital facilities and services, but whose income and expenditure accounts cover a number of establishments (and which may include both public and private hospitals), while Private Hospitals Australia does not cover privately contracted public hospitals. In addition, because the purpose of the underlying surveys is different certain data items may be included in, or excluded from, the statistics. One such example is state and territory government payments which are excluded from income in Private Hospitals Australia but are included in income in the satellite account.

The ABS has previously published NPI satellite accounts in respect of 2006-07 and 1999-2000. While the three satellite accounts are generally based on the same underlying conceptual framework and have been produced in accordance with Handbook on Non-Profit Institutions in the System of National Accounts recommendations, there are significant differences in the 1999-2000 compilation methods and classifications which should be noted in undertaking any comparisons between the accounts.

Unlike the 2012-13 and 2006-07 satellite accounts, the 1999-2000 satellite account was not compiled from a survey of NPIs. For compilation of the 1999-2000 satellite account, existing social and economic data from a range of sources was analysed and the NPIs component of each data set was identified. Given the limited data available, the 1999-2000 satellite account contains information about a smaller number of ICNPO categories and less detailed data about the income and expense flows of non-profit organisations than is presented in the 2012-13 and 2006-07 satellite accounts.

Following feedback received after the 1999-2000 satellite account, it became apparent that there was a need to implement on the ABS Business Register of organisations a consistent means of identifying non-profit organisations for the purposes of compiling all ABS economic data. A substantial body of work was undertaken by the ABS in this regard to improve and standardise the identification of non-profit organisations. This improvement has resulted in coverage differences between the 1999-2000 satellite account and the later accounts.

Since the 1999-2000 satellite account, there has been an updated version produced of the underlying industry classification used across all ABS business collections, namely the ANZSIC06. The 2012-13 and 2006-07 satellite accounts are based on this updated industry classification.

The 1999-2000 and the original release of the 2006-07 satellite account were compiled in accordance with SNA93. The 2012-13 satellite account (and the revised 2006-07 estimates included in this publication) are compiled according to the 2008 SNA resulting in further incomparability with the 1999-2000 satellite account. The 2006-07 results include additional revisions, see Changes in this issue in the Topic page of this release.

The tables below provide some analysis of gross value added, income and expenses data published in the three satellite accounts.

The article Spotlight on the National Accounts: Unpaid Work and the Australian Economy includes volunteer work estimates for calendar year 2006. The value of these estimates is $34b which is significantly higher than the volunteer services estimates in this publication for 2006-07. The main reason for the difference is the scope of the unpaid work estimates is broader and not limited to the voluntary work done for NPIs. There are also differences in timing, methodology and source data.

Advertising expenses are the costs incurred by an organisation for promotional and publicity campaigns aimed at bringing the activities of the organisation to the attention of consumers for the purpose of increasing sales. Marketing expenses are the costs incurred in the long-range promotion of an organisation and its goods or services. Promotional expenses are those costs associated with generating good relations of an organisation and/or its services with the general public, e.g. promotional brochures. Sponsorship expenses are excluded.

This refers to items with future economic benefits, for example providing future costs savings or generating future revenue. Includes cash and deposits, investments held with fund managers, property, plant and equipment and other items.

This item represents any organisation domiciled in Australia. Australian branches and Australian subsidiaries of foreign organisations are regarded as Australian residents.

Transactions in which the ownership of an asset (other than cash and inventories) is transferred from one institutional unit to an another, in which cash is transferred to enable the recipient to acquire another asset or in which the funds realised by the disposal of another asset are transferred. Examples include general government capital transfers to private schools for the construction of science blocks or libraries and transfers to charitable organisations for the construction of homes for the aged.

This item refers to employees who are not entitled to take paid leave.

This item refers to regularly recurring financial charges made in the accounts to reflect that part of the value of the asset which may be regarded as having been used up in producing revenue in a particular accounting period. Depreciation generally refers to physical (tangible) non current assets, and amortisation generally refers to intangible non current assets.

This item refers to transactions for which the donor receives no material benefit other than a tax deduction (if eligible). Donations can be financial or in-kind.

This item represents all permanent, temporary and casual employees on the payroll of the organisation for the last pay period ending in June. Employees absent on paid or prepaid leave are included. Consultants, contractors, people paid by commission only and volunteers are excluded.

This item is calculated by taking the annual hours of voluntary work divided by average annual hours worked in full time jobs for each occupation category.

This item refers to project or program payments made by federal, state/territory or local government in the form of funds for ongoing (current) operations and capital funds to purchase or improve equipment or property. It includes:

• volume based funding, which refers to funding provided subject to an agreement or contract specifying the volume of services to be delivered, and paid in proportion to the volume of services delivered (e.g. per student funding to schools, per bed funding to residential aged care facilities)
• non volume based funding, which refers to general purpose grants or to funding which may be provided under a funding agreement for a specific purpose, but which is not dependent on the delivery of a specified volume of services
• funding for specific capital items, which refers to one-off funds to make capital improvements or to purchase equipment or property (e.g. motor vehicles, buildings, etc.).
   

This item represents the total market value of goods and services produced in Australia within a given period after deducting the cost of goods and services used up in the process of production, inclusive of net product taxes but before deducting allowances for the consumption of fixed capital.

This item refers to the total expenditure on acquiring fixed tangible and intangible assets, before deduction of trade-in allowances, and including expenses (except capitalised interest) incurred during the year in acquiring such assets. Fixed tangible assets include dwellings, other buildings and structures, plant, machinery and equipment (including motor vehicles). Intangible assets include patents and licences. This item also includes capitalised work done by own employees (own-account capital formation).

This item represents the total market value of goods and services produced in Australia within a given period after deducting the cost of goods and services used up in the process of production. See also real gross value added.

The Handbook on Non-Profit Institutions in the System of National Accounts which provides recommendations, standards and guidelines for the development of statistical data for non-profit institutions within the SNA framework.

A related or affiliated organisation is one which has a legal relationship with the receiving organisation, or which is part of the same group of organisations (e.g. a state equivalent of an Australian organisation, or an Australian chapter of an international organisation). This item includes grants, distributions, allocations and affiliation fees received, but excludes government funding, membership fees, donations and sponsorships income received.

This item refers to income received from the sale of services. It includes income from services provided for nominal consideration, contract, subcontract and commission income, management fees/charges from related and unrelated organisations, delivery charges separately invoiced to customers and takings from gambling activities, (net of pay-outs and rebates to players, but inclusive of specific gambling taxes and/or levies). This item excludes government funding and subsidies for service delivery, income from sponsorships and other fundraising activities, and income from investments, royalties, membership fees and rent, leasing and hiring.

An institutional unit is an economic entity that is capable, in its own right, of owning assets, incurring liabilities, engaging in economic activities and engaging in transactions with other entities.

Includes such assets as computer software, entertainment and literary or artistic originals intended to be used for more than a year.

This item refers to outflows of funds related to the cost of borrowing money.

Consists of the value of the goods and services used as inputs by a process of production, excluding compensation of employees and the consumption of fixed capital.

This item includes three components:

• interest income - the income earned through the lending out of funds owned by the organisation or interest earned on bank deposits
• dividend income - the dividends received during the financial period that are recognised as income in that period
• other investment income - includes earnings on discounted bills and distributions from trusts and managed funds.
   

This item includes the following components:

• Wages and salaries;
• Employer contributions to superannuation funds;
• Salary sacrificed earnings paid on behalf of employees;
• Workers compensation premiums/ costs;
• Fringe benefits tax;
• Payroll tax; and
• Employee share based payments and stock options paid by the NPI to remunerate employees.
   

Liabilities are the future sacrifices of service potential or economic benefits that the entity is presently obliged to make to other entities as a result of past transactions or other past events.

This item refers to payments received from an individual or another organisation for the purpose of securing membership. Market NPIs, typically grant some form of benefit or right, (e.g. discounts, use of facilities, voting rights), to the individual or organisation paying the fee. For non-market NPIs income from membership fees is treated as transfers as any income received is intended to cover the cost of non-market production and does not include any reciprocal benefit or right.

This item refers to payments made to another organisation for the purposes of securing membership, which typically grants some form of benefit or right, (e.g. discounts, use of facilities, voting rights), in return for payment of the fee.

Refers to estimates which have been produced in accordance with standard national accounting valuation methods as prescribed in the System of National Accounts, 2008. Estimates produced on a national accounts basis are directly comparable with estimates in the Australian System of National Accounts, as published in ABS catalogue number 5204.0.

In the NPI balance sheet, net worth represents the difference between the stock of assets (both financial and non-financial) and the stock of liabilities (including shares and other equity). Because it is derived residually, it can be negative.

Is an imputation recommended by the Handbook to measure the output of NPIs engaged in market production that is not measured when output is valued through sales. It is calculated at the unit level for market NPIs as:

• the value of output, using the prescribed valuation method for non-market units of cost summation, minus
• the value of output, using the prescribed method for market units of valuation by sales.
   

For market units where output on a cost valuation basis exceeds output on a sales valuation basis, the difference is included in the aggregate value of non-market output of market producers. For units where output on a sales basis exceeds output on a cost basis, their non-market output of market producers is assumed to equal zero.

Non-profit institutions are legal or social entities, formed for the purpose of producing goods or services, and whose status does not permit them to be a source of income, profit or financial gain for the individuals or organisations that establish, control or finance them.

Refers to any organisation domiciled overseas. Foreign branches and foreign subsidiaries of Australian organisations are regarded as non-resident organisations.

NPIs which receive income from sales sufficient to cover the majority of their costs of production. Sales in this context includes income received from government provided on a volume basis, rent, leasing and hiring income, sponsorship income and membership fees.

NPIs which rely principally on funds other than receipts from sales to cover their costs of production or other activities.

Refers to estimates which extend the boundary of production as described in the System of National Accounts to include imputations for the value of the non-market output of market producers and the value of volunteer services.

The goods and services that are produced within an establishment that become available for use outside that establishment, plus any goods and services produced for own final use.

Compensation of employees and other costs (including purchases of materials) paid by organisations in producing capital goods for use by the organisation.

This item refers to payments made to other businesses or organisations, such as employment agencies, for the supply or recruitment of staff.

This item refers to employees who work 35 hours or more per week and are entitled to paid leave.

This item refers to employees who work less than 35 hours per week and are entitled to paid leave.

Philanthropic trusts/foundations are non-profit organisations which hold money in trust for the public benefit and which make grants of money for charitable or socially useful purposes.

An activity carried out under the responsibility, control and management of an institutional unit, that uses inputs of labour, capital and goods and services to produce output of goods and services.

As defined in the System of National Accounts, the production boundary includes:

• the production of all individual or collective goods and services that are supplied to units other than the producers, or intended to be supplied, including the production of goods and services used up in the process of producing such goods and services
• the own-account production of all goods that are retained by their producers for their own final consumption or gross capital formation
• the own-account production of housing services by owner-occupiers.
   

The cost of goods and services used in the production of the final output of a business. This item is further comprised of materials and goods for use by the reporting organisation and finished goods for resale.

Gross value added which has been adjusted for inflation using the final consumption implicit price deflator from Australian National Accounts: National Income, Expenditure and Product (cat. no. 5206.0).

This item refers to revenue derived from the renting, leasing or hiring of assets such as land, buildings, vehicles, machinery or equipment to other businesses/organisations or individuals.

This item refers to income earned from the sale of goods, whether or not produced by the organisation. It includes export sales, sales or transfers to related organisations or to overseas branches of the organisation, sales made for nominal consideration and delivery charges not separately invoiced to customers. This item excludes excise and duties received on behalf of the government, sales of assets, delivery charges separately invoiced to customers and income from investment, royalties and rent, leasing and hiring.

This item is derived as total revenue less total current expenses. Revenue includes funding from government of a capital nature. Current expenses do not include expenditure of a capital nature.

This item refers to transactions made which result in advertising and/or other benefits to the sponsoring business/organisation. Donations of a financial or in-kind nature are excluded.

The System of National Accounts is a framework of a coherent, consistent and integrated set of macroeconomic accounts, balance sheets and tables based on a set of internationally agreed concepts, definitions, classifications and accounting rules.

When one institutional unit provides a good, service or cash to another unit without receiving from the latter anything of economic value in return. See also capital transfers and donations.

Volunteers are people who willingly give unpaid help, in the form of time, service or skills, to an organisation or group. Included in this category are the volunteer component of boards of management, fundraising committee members and auxiliary members.

This item represents the imputed value of volunteer work. This is calculated by assigning a wage rate to each volunteer hour.

For information on the institutional environment of the Australian Bureau of Statistics (ABS), including the legislative obligations of the ABS, financing and governance arrangements, and mechanisms for scrutiny of ABS operations, please see ABS Institutional Environment.

The main purpose of the non-profit institutions (NPI) satellite account is to measure the size, structure and contribution to the economy of the non-profit sector in Australia during the 2012-13 financial year. The non-profit institutions satellite account draws on information from a variety of sources, including a survey of the Australian non-profit sector conducted by the ABS and the General Social Survey 2014. Valuation methods used in the satellite account are broadly consistent with those employed throughout the national accounts, and the estimates of gross value added and gross domestic product produced in the satellite account are comparable with those produced for the whole economy. The information contained in the satellite account may be used by government policy makers to assist in policy formulation and review in relation to the non-profit sector, particularly in the context of NPIs engaging in the delivery of government resources to beneficiaries, as well as by private sector analysts.

The ABS aims to publish estimates from its business survey program within twelve months of the end of the reference period. Data contained in this publication are based on a survey of non-profit organisations conducted by the ABS For the purposes of this survey, questionnaires were mailed to a sample of 4,264 non-profit organisations in mid-August 2013. The Non-profit Institutions Satellite Account, 2012-13 (cat. no. 5256.0) was released in June 2014.

A reissued Non-profit Institutions Satellite Account, 2012-13 (cat. no. 5256.0) that incorporates the volunteering services component to complete the NPI satellite account was released in August 2015. Estimates of volunteering services were sourced from unpublished data from the ABS General Social Survey 2014 (cat. no. 4159.0) released on 29 June 2015.

The main data input to the non-profit institutions satellite account is the annual Economic Activity Survey (EAS) 2012-13. The ABS aims to produce high quality data from its industry collections while minimising the reporting burden on businesses/organisations. To achieve this, extensive effort is put into collection and questionnaire, sample design, collection procedures and processing. Over 4000 NPIs were surveyed in the 2012-13 EAS, almost double the number of NPIs that were included in the 2006-07 survey.

The identification of non-profit organisations on the ABS Business Register provides the opportunity for improved non-profit estimates from ABS business surveys. The ability to identify all non-profit organisations in the population, rather than relying on self-identification in the sample, allows the ABS to use alternative estimation techniques to improve the quality of its statistics for the non-profit sector.

Most ABS business surveys use the ABS Business Register of employing and non-employing businesses/organisations to draw a sample frame. The ABS Business Register includes only those businesses/organisations registered with the Australian Taxation Office (ATO) for an Australian Business Number (ABN). There are many small informal groups in Australia that do not have an ABN. These groups were out of scope on the grounds that such groups do not meet the "organisational existence" criterion set out in the United Nations Handbook on Non-Profit Institutions in the System of National Accounts (the Handbook). Further information about the Handbook criteria can be found in the Explanatory Notes.

Two types of error can occur in estimates that are based on a sample survey: non-sampling error and sampling error.

Non-sampling error arises from inaccuracies in collecting, recording and processing the data. Every effort is made to minimise reporting error by careful design of questionnaires, intensive training of collection analysts and efficient data processing procedures. A significant effort to improve identification of NPIs using tax information was also made to ensure an accurate population from which to draw the survey sample.

Non-sampling error also occurs when information cannot be obtained from all organisations selected in the survey. The survey of non-profit organisations achieved a response rate of 89.3%. Data were imputed for the remaining 10.7% of operating organisations.

Sampling error occurs because a sample, rather than the entire population, is surveyed. It reflects the difference between estimates based on a sample and those that would have been obtained had a census been conducted.

The non-profit institutions satellite account was produced largely in accordance with international recommendations as prescribed in the Handbook. By their nature some data contained in the non-profit institutions satellite account are not directly observable and are necessarily modelled estimates. The Handbook provides guidance as to the measurement of such estimates.

Overall the ABS considers that the estimates are of good quality, particularly at the most aggregated level, such as total income and total gross value added. However, some care should be exercised in the use of the finer level components, as sampling error associated with survey data used to compile detailed estimates is generally higher than for the total.

The ABS has previously published NPI satellite accounts in respect of 2006-07 and 1999-2000. While the three satellite accounts are generally based on the same underlying conceptual framework and have been produced in accordance with the Handbook recommendations, there are significant differences in the 1999-2000 compilation methods and classifications which should be noted in undertaking any comparisons between the accounts.

Unlike the 2012-13 and 2006-07 satellite accounts, the 1999-2000 satellite account was not compiled from a survey of NPIs. For compilation of the 1999-2000 satellite account, existing social and economic data from a range of sources was analysed and the NPIs component of each data set was identified. Given the limited data available, the 1999-2000 satellite account contains information about a smaller number of ICNPO categories and less detailed data about the income and expense flows of non-profit organisations than is presented in the 2012-13 and 2006-07 satellite accounts.

A survey of NPIs was the principal data source for both the 2006-07 and 2012-13 satellite accounts. Micro non employing NPIs were out of scope for the surveys but are included in the NPI satellite accounts using Business Activity Statement information collected by the ATO.

Not-for-profit Organisations Australia, 2006-07 (cat. no. 8106.0) presents information from a survey of economically significant non-profit organisations and supplements the 2006-07 non-profit institutions satellite account statistics with a detailed examination of the structure and performance of non-profit organisations for the reference year of the survey. There are important differences between the 2006-07 statistics published in the non-profit institutions satellite account and Not-for-profit Organisations Australia, 2006-07 (cat. no. 8106.0) and users should exercise caution when making comparisons between the two sets of estimates.

The 2012-13 NPI satellite account includes conceptual and methodological improvements which have resulted in revisions to the 2006-07 NPI satellite account. Revised statistics for 2006-07 are included in tables 1-3 of the 2012-13 NPI satellite account and in the accompanying 2006-07 datacube. An explanation of the improvements can be found in Changes in this issue.

Although financial estimates in this publication relate to the full twelve months of 2012-13 financial year, employment estimates relate to the last pay period ending in June 2013. As such, estimates of values per person employed can be affected by any fluctuations in employment during the reference period. Organisation counts reflect only those organisations operating at 30 June 2013.

Further information on terminology and other technical aspects associated with statistics from the non-profit institutions satellite account can be found in the Explanatory Notes, Glossary, Abbreviations and relevant classifications and concordances. Other aids to interpretation may be accessed at the ABS website and include the Australian System of National Accounts: Concepts, Sources and Methods (cat. no. 5216.0) for information on national accounting terminology and conventions. The Handbook provides information about how national accounting concepts apply to NPIs.

Data from the 2012-13 non-profit institutions satellite account are available in the following formats free of charge on the ABS website:

• which includes the main items of interest in the key results and an analysis of each of the broad data item categories, for example NPI gross value added and NPI employment
• two datacubes, one which contains additional satellite account data for 2012-13 and the other which contains revised satellite account data for 2006-07.
   

Inquiries about these statistics can be made by contacting the National Information and Referral Service on 1300 135 070.