# 83

The national accounting is a diagrammatic and quantified representation economic activity of a country. It consists of a measurement of the monetary Flux representative of the economy of a country for a given period, in theory, a year. The national accounting takes into account of many macroeconomic indicators, of which most important is the GDP (Gross domestic product), which corresponds to the full value of the internal production of goods and services in a country given during one year. The national accounting takes into account the many information, contained in the documents accountant S of the companies on the one hand, but also in the reports/ratios of the administrative institutions. The national accounting classifies the various economic agents thus of categories, the institutional sectors, in order to as well as possible count the various relative informations with the economy.

The first systems of national accounting date from the Second world war, first of all with the British economist Keynes which develops as of 1941 measuring instruments of the economy, then with Jan Tinbergen and Wassily Leontief, considered as the true inventors of the national accounting. The national accounting then developed in the majority of the developed Pays. Thus, within the framework of the European Monetary System (EMS), the systems of national accounts were harmonized around Norme S communes, and the State S Européen S use same the countable Cadre: the SEC (European System of accountancy).

## History

The first system of national accounting was created by John Maynard Keynes (which then directed the British delegation charged to write the Accords of Bretton Woods) in 1941 following the request for the Parlement of Great Britain. The collaborators of Keynes worked out a series of tables illustrating the produced resources and them Utilization in the form of Consommation, Public expenditure, Subvention S and Investissement S. Moreover, the work undertaken by American Wassily Leontief (“Nobel Prize” of economy in 1973) and Dutch Jan Tinbergen, “Nobel Prize” of economy in 1969 made it possible to develop analyzes closer to those which we know today.

The national accounting was born from the will of the State to intervene in regulations of the economic situation of the economy. Work of Richard Stone and Simon Kuznets is at the origin of what one baptized a " standardized model of accountancy nationale". In France, they are economists like François Perroux (also author of the theory of the " poles of croissance") who have the first bench of the models of national accounting. With regard to the tables of synthesis, in particular the table input/output (YOUR) the precursor was the Russian economist Wassily Leontief.

## Objectives

The national accounting has two principal vocations: to model and study the economic activity of a country given for one length of time specify (most of the time a year) on the one hand, and to envisage the evolution of an economic situation on the other hand. The national accounting can thus be a tool of forecast to help a government to find solutions, or to start again consumption for example. The national accounts are published per quarter or year.

The national accounting is ex-post, it is carried out the past Année once. It measures with Current price S (i.e. it does not take account of the Inflation).

The most known Information used by the national accounting is GDP (Gross domestic product). The GDP is a macroeconomic indicator named Agrégat, i.e. a total size which measures the economic activity. It is possible to propose three approaches of the GDP, however, one considers it most of the time as the sum of the added-values produced by the whole of the units resident, i.e. the economic agents indeed present on the territory during at least 183 days over one year.

The GDP has thus optical triple based on the great principles of the national accounting:

• production: PIB=somme of the VAB+IP-SUBV. The approach by the production, thus connects the sum of the rough added-values, the tax on the production as well as different the subsidies.

• formation of income: PIB=RS+EBE+RMB-SUBV+IP, with RS EBB, compensation of employees the rough Surplus of exploitation, RMB rough mixed incomes, SUBV subsidies and IP taxes on the production (related on the production and the imports).

• the request: PIB=CF+FBCF+ (X-M), with CF final consumption, GFCF gross fixed capital formation, X exports, and M imports.

The GDP (Produced interior gross) should not be confused with the GNP (produced national gross) which is the sum of the primary education incomes received indeed by the economic agents of the same nationality, that they are located on the territory or not. There is thus the relation GNP = GDP + returned of the factors coming from the outside - incomes of the factors poured outside. Thanks to these indicators, the national accounting is thus analyzed by the Investisseur S foreigners which hesitate to invest to them Capital in a given country.

## Institutional units and sectors

Different the Economic agents is gathered in various baptized units institutional units. They constitute the basic units of the national accounting.

A institutional Unité is an autonomous decision-making center which can be a nobody (or several) physical, the economist S say whereas it is about a Ménage, or a Moral person, i.e. a Entreprise, a Public administration or a association. They are likely to have themselves of the active , to subscribe of engagements, to engage in economic activities and to carry out operations with other units.

These institutional units must exert economic operations during at least one year on the national territory to be entered in the institutional sectors. This territory is, if one take the example of the France, the metropolis and the overseas departments, the French territorial enclaves out of the territory, the airspace, territorial water and spaces which gather resources belonging to France. On the other hand the foreign enclaves with the image of consulates and embassies which are in France are not regarded as units resident.

The institutional Units having the same principal activity and the same primary source of Revenu are gathered into five institutional sectors .

One distinguishes five institutional sectors resident :

• the households,
• the companies not - financial (SNF)
• the finance companies (SF)
• the non-profit-making institutions with the service of the households (ISBLSM)

The whole of the units non-residents , insofar as they maintain the economic relations with units resident, are gathered in a category called rest of the world, sometimes baptized " category; plus-un".

### The Household S

The principal function of the Ménage S is the Consommation starting from principal resources obtained in two manners:

• On the one hand by the Remuneration of the factors of production, namely the work, the Ground, the Capital.

• In addition, by the transfers carried out by other institutional sectors bound for the Household S.

Within the households " purs" one can distinguish:

• the household " ordinaire" , namely a unit of people living in a housing.

• the household " collectif" who is consisted the populations of the old people's homes, workers' home, etc

One also finds in this sector the individual Entreprise S which are economic units whose principal function is the production of goods and services for their own final use. One thus finds in this category the Agriculteur S, the Artisan S, the Liberal professions, the small shopkeepers, etc

### The Companies not - financial

Companies not - financial (SNF) gather the whole of the company S and quasi-corporate enterprises having the legal status of Entreprise whose principal function is Produire Biens and commercial services whose selling price is consisted of the Manufacturing costs and of a profit Marge with a lucrative aim.

The Resources of the companies and quasi-corporate enterprises not - financial are the result of the Production and possible the Subvention S poured by the Public administrations (local government agencies…).

### The Finance companies

The finance companies (or SF) are consisted the whole of the companies and quasi-corporate enterprises whose principal function is to offer services of financial intermediation and/or to carry on auxiliary financial activities. Their resources are funds coming from financial liabilities. Five institutional under-sectors constitute the institutional sector of the finance companies:

1. the central banks

2. other monetary financial institutions (national compatibility excludes there by convention the companies from Assurance and the Pension funds)
3. financial intermediaries
4. financial auxiliaries
5. companies of Assurance and the Pension funds

The public administrations are gathered under the initials APU. The principal function of these institutional Unités is to produce noncommercial Services and/or to carry out operations of redistribution of the Revenu S or national Patrimoine. They draw the major part of their Ressources from obligatory contributions (taxes).

In France, the Public administrations (APU) gather in three under-sectors:

1. the APU power stations (APUC): composed of the State and organizations various APUC (ODAC); the University S, CNRS, the ANPE…
2. the APU local (APUL): area S, department S, common S + OAL (governed municipal transport, chamber of commerce…)
3. the ESA (Social security administration): units which distribute social security Benefits starting from obligatory National insurance contributions + ODASS; the resources come from the Social Security (ex: public hospitals)

### The non-profit-making Institutions with the service of the households

The non-profit-making Institutions with the service of the households (ISBLSM) gather various structures of which some association S (ex: Consumers' association, Political party, Trade union, Church, organization of charity, etc). Their common points are that, on the one hand, they Produisent services for the Ménage S, on the other hand, they are Financée S by voluntary contributions and sometimes by the Vente of goods and services.

From an economic point of view and because of way in which the national accounting takes them into account, the ISBLSM post a negligible role; it results that in the total Statistiques, them Consommation is added to that of the Ménage S. the majority of the non-profit making companies, which gather the whole of the Entreprise S of the social economy, is however not gathered in this category of the ISBLSM, which contributes to undervalue their importance. The various undertaken studies locate the importance of the whole of the nonlucrative sector (ISBLSM and social economy) at approximately 10% of the Emploi S in France.

### The rest of the world

It is not an institutional sector and for this reason it is qualified sometimes false sector, insofar as the operations are not broken up while distinguishing from the categories of agents: there are no household account or SNF of the rest of the world. This sector " more un" thus gather the units nonresident which carry out operations with the nation's economy.

## Operations

### Operations on goods and services

It is about the whole of the operations which relate to the creation and the use of the goods and the services.

Among them one distinguishes:

• the Production, which evolved/moved in time; the companies play an important role there, but the households as well as the administrations are them also regarded as producers.
• the Consumption,
• the Gross fixed capital formation - GFCF - (i.e. the Investment),
• operations with outside (i.e. the Importation S and the Export S of goods and services). These operations are gathered in the TRE (table of the resources and employment).

### Operations of distribution

It is the operations by which the Added-value created by the Production is distributed between the Salarié S, the owners of Entreprise S and the Public administrations, then redistributed because of action of the public administrations (payments of Allocation S financed by taking away…)

To simplify one can regard here the Added-value (GOES) as the whole of the richnesses created. = P GOES - CI: Production - Intermediate consumptions

An Indicating , the Rate of margin, summarizes essentially the distribution of the Richesse S created between the Salarié S and the owners of companies. It measures the share of the profits of the companies (EBB, rough surplus of exploitation) in GOES: rate of margin = EBB/GOES X 100. As the Added-value is distributed mainly between Salaire S and Profit S, to a rise of the rate of margin corresponds a fall on behalf of the richnesses created which returns to the Salarié S, and a rise of that which is allocated to the owners of the means of production (Capital). These operations are gathered in the TCEI (table of the integrated economic accounts).

### Financial transactions

The financial transactions represent the commitments entered into by the economic agents the ones towards the others, n the other hand of currency or products. For example the loans made by some represent loans for the others. The national accounting recalls these operations between the principal institutional sectors within the framework of the TOF " table of the operations financières".

## Integrated accounts

(This part of the article makes the list of the principal accounts. It is an outline to be supplemented because each one of them remains to present)

### Accounts of current operations

#### The account of production

$P-CI=VA$ The account of production describes flows which compose the production process to knowing the intermediate consumptions which are operations on goods and services: its balance is the value added or the richness created.

#### The operating statement

$VAB+Subv. - \left(54+IP+SP\right) =EBE$ The uses of the operating statement describe the distribution of the added-value which takes place at the time of the production process between the factor work (compensation of employees), the State (taxes on the production and the imports) and the capital factor (rough surplus of exploitation). The rough surplus of exploitation (EBB), balance of the account, thus measures the gross income which remains with the producers once paid the intermediate consumptions, the taxation of the production and work. It is also usually called " stroke brute" and one calculates the rates of margin by submitting the EBE/valeur report/ratio added rough. This last perhaps interpreted like a rate of profit withdrawn gross from the productive activity, and for this reason like an indicator of profitability of the productive activity.

#### The appropriation account of the primary education incomes

EBE+Revenus of the property reçus+revenus salariés+impôts on the production and of the subsidy-incomes of the property versés=SBRP This account is interested in the resources of the sectors it is the distribution of income directly related to the production process (returned primary education). In employment one has the property incomes which the sectors pour.

#### The secondary account of distribution of the income

Srp + Income taxes received + Tax S on the inheritance received + social security Benefits receipts + Other received current transfers + Contributions received - versed income taxes - taxes on the versed inheritance - social security benefits versed - national insurance contributions versed - other versed current transfers = RDB This account of secondary distribution of income describes flows between the various sectors which are the Ménage S and the Public administrations. In resource of account the taxes and national insurance contributions are versed with the public administrations. The Ménage S receive social security benefits. The other current transfers are versed with the whole of the sectors. In employment there are the Impôt S versed and received by the whole of the institutional Secteurs. The national insurance contributions are poured by the Ménage S and the Entreprise S. the balance obtained is the income available gross.

#### The account of use of the income available

$RDB-CF=EB$ This account makes it possible to distinguish the share from the income available (RDB=revenu available gross) which will be devoted to the consumption of final goods (CF=consommation finale) of that which will be reserved for the saving (EB= saves rough). This account constitutes in fact the hinge between the income statements (those which represent Flux) on the one hand and the accounts of accumulation (sometimes called patrimonial accounts and which represent stocks). Indeed it is at the beginning of the saving that are constituted the capital intensive masses.

### Accounts of accumulation

#### The stock-account

Employment: + GFCF (P51) + CCF + VS (P52) + OV (acquired P53 - yielded) + AF (NP1 + acquired NP2 - yielded)

Resources: + EB (B8) preceding + TC (received D9 - versed D9)

BALANCE : Capacity/Financing need (B9A)

#### The financial account

the financial account measures the variation of the credit and the financial liability of the institutional sector and the rest of the world.

## Tables of synthesis

### The overall economic table (TEE)

The national accounting uses the “overall economic table” (TEE) which gathers the origin and the use of the resources of each sector (companies not - financial, institutes of credit, companies of insurance, public administrations, private administrations, households and rest of the world). It is built in value on the one hand, in vrut, cvs (corrected seasonal variations) and cjo-cvs (corrected effect of the business days and seasonal variations) on the other hand. Like for YOUR, the accounts of the TEE are not published. the TEE breaks up into a succession of lines and columns which end each one in measurement of a corresponding balance. Each account is separate in employment (credit) and resources (liability). Except in the account of production, the balances of the various accounts are evaluated in the quarterly accounts quite simply by balance.

### The table input-outputs (YOUR)

The national accounting uses the “table input-outputs” (YOUR) which describes the balance of the operations on goods and services for all the branches of the economy. One understands by branch the whole of the production units which manufacture same a produced. Thus YOUR allows it for each branch and the whole of the economy, to emphasize a balance between the Emploi S and the resources of the branch. Its structure rests on a division by branches and products. It constitutes a tool useful for the national accountants. From the point of view keynésienne, taking as a starting point the economic table of Quesnay, it YOUR was highlighted by the Analyze input-output of Wassily Leontief to represent the whole of the operations of the Economic agents during a given period. One thus first of all will point out the basic equality, then to see the structure of YOUR, and finally his utility.

#### Recall of the basic equality

$Ressources = Production \left(P\right) + Importation \left(M\right)$ Employment = Intermediate consumption (CI) + final Consumption (CF) + GFCF + Exports (X) + Variation of stocks (VS)

YOUR present balance employment/resources: P + M = CI + CF + GFCF + X + VS

This balance is always checked in the accounts in T.

#### The structure of YOUR

On line: distribution of the produced S between the branches i.e. the volume of products used by each branch. In column: volumes of the products necessary to each branch for its production. The total of the Ressource S of each branch is equal on the whole uses of the corresponding products.

#### Utility of YOUR

YOUR a coherent representation of the national production gives and makes it possible to represent the branches which contribute more to the national production. It makes it possible to reveal the degree of independence of the branches by making calculation:

(Total of the intermediate consumptions of branch/Production of the branch) *100

Thus, any modification of the Production in a branch involves reflected in the other branches. YOUR is also an economic instrument of forecast. One can calculate technical coefficients: (Intermediate consumption produces of it X/Production branch there) *100

The whole of the technical coefficients gives a matrix on which one can base relatively reliable forecasts in the short run. It is in particular possible to envisage:

• the domino effect of a branch on the others
• consequences on the branches of a total increase of the Production, Export S, Consumption of the Household S…
• consequences of the interdependence of the branches (bottlenecks).

One can of course criticize the difficulty of construction of such a table for an nation's economy, as well as the errors of measurement of the economic sizes which it contains.

Abbreviations:

### The table of financial transactions (TOF)

The TOF joins together the whole of the financial statistics relating to the institutional sectors (SI) and makes it possible to analyze face them financial economy. In spite of their size and mass of information which they contain, these tables are of a very simple structure and their reading is rather easy.

## Examples of national book

• national Accounts of France
• Balance of payments of France in 2002
• Assessments of the Bank of Belgium
• economic Accounts and financier of Canada
• economic Accounts of Quebec

## National auditing of accounts

Specialized companies are charged to audit the national accounts: the Course of the accounts. In France, the Organic law concerning with the finance laws (LOLF), promulgated in August 2001 and implemented since January 1st 2006, modifies in-depth the Public finances. .

The national accounting is subjugated with a principle of sincerity.

The report/ratio of the Court of Auditors of June 2006 gives a report on lacks of precise details in the system of French national accounting:

“II does not include/understand the passive S implicit; he is unaware of good active number of S having a social Utilité, but which is not developed fault of a commercial value of reference; few Intangible assets is listed; finally, it is based on a concept of active restrictive, excluding most of the immaterial Capital - education, Recherche, Santé”.

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