Annual Accounts by Institutional Sector

Institutional sector accounts represent a coherent overview of all economic processes and the roles of different sectors in the economy. This publication presents the first two non-financial accounts by Institutional Sectors for the years 2013 - 2015 in accordance with the European System of Accounts (ESA2010). Sector accounts show interactions between different sectors of the economy, including national economy as a whole and the rest of the world. The process of producing non-financial accounts by institutional sector relies on integrating a whole set of data that includes surveys or censuses, administrative data, extrapolations and models. Concepts, definitions and classifications are based on the European System of Accounts (ESA 2010). The basic statistical unit is the institutional unit. Institutional units are classified into five institutional sectors, Non-Financial Sector (S.11), Financial Sector (S.12), Government Sector (S.13), Household Sector (S.14) and Non profit institutions serving household Sector (S.15). These five sectors together form the total economy (S.1). Non-financial accounts are consistent with annual GDP publications.

Every economic process is described in a separate account. Accounts record economic transactions into resources, uses, and a balancing item for each account. This balancing item passes from one account to the other creating a link between them.

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Production Account

Production account expresses transactions related to the production process. Output is recorded as a resource, Intermediate Consumption as an use. The balancing item for each sector is Gross Value Added at basic prices (B.1g). The total economy production account (S.1) is the sum of individual sectors production accounts, together with transactions for which a sectoral distribution is not possible (Taxes and Subsidies on Products). The balancing item of Production Account for the total economy is Gross Domestic Product, at market prices (B.1*g).

Generation of Income Account

This account represents the transactions through which the Gross Domestic Product at market prices is distributed to labour: (compensation of employees), taxes (tax differentiation and subsidies on production) and "gross operating surplus (B.2g) /gross mixed income (B.3g)", which is also the balancing item of this account.

The institutional unit is an economic entity characterized by autonomy in decision-making. The resident unit is considered as an integral part of the institutional unit in the economic territory where it has its main economic interest center, if it has decision-making autonomy and whether it holds a full set of accounts or is able to compile a full set of accounts. For purposes of the system of accounts, based on the type of producers and their main activities and functions that indicate a certain economic behavior, the institutional units are grouped together in five institutional sectors comprised of: Non-Financial Corporations, Financial Corporations, General Government, Household Sector and Non-profit institutions serving households. These five sectors together form the total economy and each sector can be divided into subsectors.
S.11 The non-financial sector consists of institutional units which are independent legal entities and market producers and whose main activity is the production of non-financial goods and services.
S.12 The financial sector consists of institutional units which are independent legal entities and market producers, whose main activity is the production of financial services.
S.13 The general government sector consists of institutional units that are non-market producers, whose production is directed at individual and collective consumption, and mainly financed by compulsory payments made by units belonging to other sectors and institutional units engaged mainly in the redistribution of national income and assets.

S.14 The household sector consists of individuals and groups of individuals as consumers and entrepreneurs, who produce commercial goods and financial and nonfinancial services (market producers) only if the production of goods and services is not made by specific entities treated as quasi-corporations . It also includes individuals or groups of individuals as producers of non-financial goods and services for final consumer consumption.

S.15 The Non-Profit Institutions serving households (NPISH) sector consists of non-profit institutions that are separate legal entities that serve households and are private market producers. Their main sources are derived from voluntary contributions in cash or in kind from family to their quality as consumers, from payments made by public administration and from property income.

 

 

 

Definition of variables

Production: An activity exercised under the control and responsibility of an institutional unit that combines resources in labor, capital and products and services to produce products or services. Clear natural processes without human intervention or control are not part of the production. There are three types of production: market production; production for own final use and other non-market output.

Intermediate consumption: Value of products or services transformed or fully consumed during the production process. The use of fixed assets put into operation is not taken into account; it is evidenced in the consumption of fixed capital.

Gross value added: Gross value added represents the contribution of different activities to GDP and is calculated as the difference between output and intermediate consumption

Taxes on products and imports: Taxes on products are the taxes payable per unit of some goods and services such as: Value Added Tax (VAT), excise duty and customs duty on imports.

Subsidies on products and imports: Subsidies on products are non-refundable payments that public administration units make to enterprises as a fixed amount of money per unit of a good or service.

Subsidies on imports consist of subsidizing goods or services that become payable when goods cross the border of economic territory or when services are transferred to resident institutional units.

Compensation of employees is defined as the total compensation in cash or in kind that the employer pays to the employee in exchange for the work done by him during the accounting period. Compensation of employees includes employer’s wages and social contributions.

Gross Operating Surplus/ Mixed Income (B.2g / B.3g)
The Gross Operating Surplus (B.2g) is the difference that remains after the deduction from the added value (at basic prices) of compensation of employees and other taxes and subsidies on production. The operating surplus of the self-employed is called “Mixed Income (B.3g)" because it also includes compensation for the work of self-employed persons and their family members.