TERMS AND DEFINITIONS by sofiaie

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									TERMS AND DEFINITIONS

Industry Classification and Descriptions
                                 National
                                 Accounts
                                 Industry                        Description of the Type of Economic
   NZSNA Industry Groups         Reference          NZSIC                      Activity
Market Industries
1 Agriculture
Sheep, beef and mixed livestock 1.1          1112, 1113, 11141 Raising of sheep, beef and mixed
                                                               livestock.
Dairy                           1.2          1111              Dairy farming.
Horticulture                    1.3          1115 & 1117       Growing of horticultural crops and fruit.
Other farming                   1.4          1114, 1116, 1119 Raising of other animals, cropping and
                                             [excl. 11141]     other farming.
Services to agriculture         1.5          112               Agricultural services such as fencing,
                                                               shearing, top dressing etc.
2 Fishing and Hunting
Fishing and hunting             2.0          113, 131,132,      Hunting, trapping and noxious animal
                                             133                control; all commercial fishing activity.
3 Forestry
Forestry and logging            3.0          12                 Ownership and management of forests;
                                                                forestry (planting, thinning etc); logging
                                                                (felling trees and hauling logs - carried
                                                                out in the bush separate from the
                                                                sawmill); and consultancy services.
4 Mining and Quarrying
Oil and gas exploration and     4.1          2201, 2202         Exploration and drilling for crude
extraction                                                      petroleum and natural gas; extraction of
                                                                crude petroleum and natural gas. Includes
                                                                the operation of oil and gas undertakings
                                                                up to the point of shipment from the
                                                                producing area, both on and off shore .
Other mining and quarrying      4.2          21, 23, 29         Mining including extraction, crushing and
                                                                purifying of coal, metal ore, stone, clay,
                                                                fertilisers, salt etc; and mining
                                                                consultancy.
5 Food, Beverages and Tobacco
Meat and meat products       5.1             3111               Slaughtering and processing of meat.
Dairy products               5.2             3112               Production and packaging of milk, cream,
                                                                ice cream and other dairy products.
Other food manufacture          5.3          3113-3122          Processing of fruit, vegetables, fish and
                                                                shell fish; grain milling, baking, sugar
                                                                and confectionery manufacture; animal
                                                                feed manufacture.
Beverage manufacture            5.4          313                Production of beverages.
Tobacco manufacture             5.5          314                Manufacture of tobacco products.
6 Textiles, Clothing and Footwear
Textile and apparel manufacture 6.0          321 - 324          Scouring of yarn, spinning and weaving
                                                                of textiles; dyeing and printing of
                                                                materials; manufacture of carpet, rope,
                                                                canvas etc; manufacture of clothing,
                                                                tanning, tailoring and garment
                                                                production; manufacture of footwear.
                                 National
                                 Accounts
                                 Industry                     Description of the Type of Economic
  NZSNA Industry Groups          Reference         NZSIC                    Activity
7 Wood and Wood Products
Wood and wood products         7.0           33              Sawmilling, planing, preserving, chipping
manufacture                                                  etc of timber; manufacture of
                                                             prefabricated and pre-cut buildings,
                                                             plywood, carpentry, and joinery;
                                                             caneware, cork products, and wooden
                                                             containers; wooden furniture and fixtures
                                                             (including car upholstery and mattress
                                                             making).
8 Pulp and Paper Products, Printing and Publishing
Paper and paper product       8.1          3411, 3412,       Production of pulp, paper and
manufacture                                3419              paperboard; manufacture of paper bags
                                                             and paperboard containers etc;
                                                             wallpaper and other pulp, paper and
                                                             paperboard articles.
Printing and publishing        8.2           342             Printing and publishing (including
                                                             newspapers, periodicals and books) and
                                                             allied industries.
9 Petroleum, Chemical, Plastics and Rubber Products
Petroleum, coal and basic      9.1         351, 353, 354     Production of basic industrial chemicals
chemical manufacture                                         (including fertiliser and pesticide
                                                             production; manufacture of synthetic
                                                             resins, plastic materials and man-made
                                                             fibres except glass); petroleum refining;
                                                             production of miscellaneous products of
                                                             petroleum and coal.
Rubber, plastic and other      9.2           352, 355, 356   Manufacture of paints, varnishes,
chemical products                                            lacquers, drugs and medicines, soap,
                                                             cleaning products, perfumes and
                                                             cosmetics; manufacture of tyres and tubes
                                                             including retreading and vulcanising, and
                                                             other rubber products; plastic products
                                                             not elsewhere classified.
10 Non-metallic Mineral Products
Non-metallic minerals        10.0            36              Manufacture of concrete, clay, glass,
manufacture                                                  plaster, masonry, asbestos, lime and
                                                             related mineral products.
11 Basic Metal Products
Basic metal industries         11.0          37              Manufacture of ferrous and non-ferrous
                                                             metal from the smelting stage through to
                                                             rough forging and casting.
12 Fabricated Metal Products, Machinery and Equipment
Fabricated metal products     12.1        381                Manufacture of almost all fabricated
manufacture                                                  metal products including: household and
                                                             kitchen utensils, and hardware; metal
                                                             furniture and fittings; structural metal
                                                             products; and wirework, nails and
                                                             fasteners.
Transport equipment manufacture 12.2         384             Transport equipment including ship
                                                             building and repair, railroad equipment,
                                                             motor vehicles, motorcycles, bicycles and
                                                             aircraft.
                               National
                               Accounts
                               Industry                   Description of the Type of Economic
  NZSNA Industry Groups       Reference       NZSIC                       Activity
Machinery and equipment      12.3       382, 383, 385   Production of: engines including
manufacture                                             reconditioning; office computing and
                                                        accounting machinery;
                                                        agricultural machinery and equipment;
                                                        tool, die and jig making, and metal and
                                                        woodworking machinery; electrical
                                                        industrial machinery and apparatus, radio,
                                                        television and communications
                                                        equipment, domestic electrical appliances
                                                        and other electrical apparatus and
                                                        supplies; professional and scientific
                                                        measuring and controlling equipment,
                                                        and photographic and optical goods.
13 Other Manufacturing
Other manufacturing          13.0        39             Manufacture of jewellery, musical
                                                        instruments, sporting and athletic goods,
                                                        and sundry items such as brushes,
                                                        brooms, toys, souvenirs etc.
14 Electricity Gas and Water
Electricity supply           14.1        4101           Electricity generation and distribution.
Gas supply                   14.2        4102           Gas treatment and distribution.
Water supply                 14.3        4200           Water works and supply including the
                                                        collection, purification and distribution of
                                                        water.
15 Construction
Construction                 15.0        51, 52, 53     Construction, alteration, renovation,
                                                        repair and maintenance of buildings
                                                        including ancillary building and
                                                        construction services such as brick and
                                                        block laying, carpentry, painting,
                                                        plastering, glazing, roofing, electrical and
                                                        plumbing work, installation of heating,
                                                        air conditioning, floor covering, and
                                                        insulation and other building and
                                                        construction services; construction and
                                                        project management for work other than
                                                        building, including work on structures
                                                        such as dams, roads, pipelines, tunnels,
                                                        bridges, power transmission lines and
                                                        flood and drainage facilities. Also
                                                        includes the construction of any building
                                                        by a person, or enterprise, who
                                                        undertakes construction work for their
                                                        own use whether or not the owner
                                                        physically does any building work.
                            National
                            Accounts
                            Industry                    Description of the Type of Economic
  NZSNA Industry Groups     Reference          NZSIC                  Activity
16 Distribution
Wholesale trade            16.1         61             Distribution and sale (without
                                                       transformation) of large quantities of all
                                                       types of new or used goods for resale
                                                       (including petroleum and the activities of
                                                       producer boards). Includes assembly,
                                                       sorting, breaking down of bulk goods and
                                                       repackaging activity.
Retail trade               16.2         62             Sale of goods without transformation,
                                                       predominantly to final consumers.
Accommodation, cafes and   16.3         63             Operation of restaurants including
restaurants                                            tearooms, takeaway food stores, cafes, etc
                                                       and catering; the provision of
                                                       accommodation including the operation
                                                       of hotels, motels, hostels, motor camps
                                                       etc.
17 Transport and Storage
Rail transport             17.1         7111           Transportation of freight and passengers
                                                       by rail. Excludes railways workshop
                                                       activity, intermediary activity by firms
                                                       arranging rail freight, and the
                                                       construction and maintenance of track.
Road transport             17.2         7112, 7113,    Transportation of passengers on
                                        7114           scheduled and chartered bus services
                                                       including the operation of bus terminals
                                                       and railways bus services; the provision
                                                       of cars with drivers for hire by the public
                                                       excluding taxi communication services;
                                                       the operation of school bus contractors;
                                                       freight transport by road including
                                                       logging, stock and refrigerated haulage,
                                                       furniture removal and general freight
                                                       carriage.
Water transport            17.3         712            Ocean, coastal and inland water transport
                                                       of passengers and freight including rail
                                                       ferry operation; supporting services to
                                                       water transport such as harbour
                                                       operations, maritime safety, stevedoring
                                                       etc.
Air transport              17.4         713            Transport by air of passengers and
                                                       freight; aero club, aircraft rental, and
                                                       airport operations activity.
Services to transport      17.5         7116-7, 719    Vehicle parking, metering and toll
                                                       operations; car and truck rental services;
                                                       other services allied to transport
                                                       including travel operators and agents,
                                                       storage and warehousing, freight agents,
                                                       aircraft and shipping brokers, freight
                                                       packing and crating services, and
                                                       container rental services.
                                 National
                                 Accounts
                                 Industry                     Description of the Type of Economic
  NZSNA Industry Groups          Reference        NZSIC                     Activity
18 Communication
Communication services          18.0         72002, 72003    Transmission of sound, images or other
                                                             information via cable; answering and
                                                             radio communications services; postal
                                                             activities and courier services.
19 Finance, Insurance, Real Estate and Business Services
Finance                         19.1         811, 812,       Operation of the central bank, trading
                                             81330           banks and of recognised savings banks;
                                                             other financial activities including the
                                                             acceptance of deposits from the public
                                                             and businesses; loan and credit
                                                             operations; and enterprises that are
                                                             engaged in investing money on their own
                                                             account.
Insurance                       19.2         821, 822        Provision of life insurance and life
                                                             re-insurance including mortgage
                                                             repayment insurance; superannuation and
                                                             mutual fund operation not separately
                                                             administered; provision of fire and other
                                                             accident insurance; provision of medical,
                                                             hospital and dental insurance; employee
                                                             benefit funds, welfare societies and
                                                             friendly societies; operation of separately
                                                             administered superannuation and pension
                                                             funds. Excludes funds managed on a fee
                                                             or contract basis.
Services to finance and         19.3         81310, 814      Trustee operations including the
insurance                                    [excl 81492],   redistribution of income from assets
                                             823             under administration on behalf of estates
                                                             and other investors; other services to
                                                             finance and investment including broking,
                                                             dealing and underwriting stocks, shares
                                                             and securities services, mortgage and
                                                             finance broking etc; insurance broking
                                                             and agency services, adjustment,
                                                             assessing and consultant services and the
                                                             management of pension and
                                                             superannuation funds on a commission or
                                                             fee basis; and the activities of
                                                             self-employed insurance commission
                                                             agents.
Real estate                     19.4         831             Activities of real estate agents, valuers,
                                             excl 83122      appraisers and property management on a
                                                             fee or contract basis; ownership of
                                                             property for leasing and rental including
                                                             activity of property developers.
Business services               19.5         832, 833        Business services such as legal,
                                                             accounting, data processing, engineering,
                                                             architectural and advertising services;
                                                             machinery and equipment rental and
                                                             leasing excluding the rental of transport
                                                             vehicles.
                              National
                              Accounts
                              Industry                          Description of the Type of Economic
  NZSNA Industry Groups      Reference          NZSIC                         Activity
20 Ownership of Owner - Occupied Dwellings

Ownership of owner-occupied        20.0    83122              Households which own their own homes
dwellings                                                     and notionally rent them back to
                                                              themselves.
21 Community, Social and Personal Services
Education services           21.1          93101 - 93104,     Except where provided as a government
                                           93109, 9320        service by a central or local government
                                                              organisation, otherwise incudes
                                                              kindergartens and play centres but
                                                              excluding day nurseries and creches;
                                                              primary and secondary education;
                                                              universities, technical institutes,
                                                              polytechnics etc; private tertiary and
                                                              vocationally orientated education
                                                              including private handicapped and
                                                              disabled education; activities of research
                                                              and scientific institutes.
Health and community services      21.2    933 excl 9333,     Except where provided as a government
                                           9340               service by a central or local government
                                                              organisation, otherwise incudes medical,
                                                              dental and related health services; old
                                                              peoples’ licensed rest homes, day care
                                                              centre, creches and other welfare
                                                              institutions.
Cultural and recreation services   21.3    94                 Except where provided as a government
                                                              service by a central or local government
                                                              organisation, otherwise incudes
                                                              recreational and cultural services such as
                                                              motion picture production and projection,
                                                              racing, radio and television broadcasting
                                                              etc.
Personal and other services        21.4    92, 9333, 9350, 95 Except where provided as a government
                                           excl 953           service by a central or local government
                                                              organisation, otherwise incudes sanitary,
                                                              cleaning and pest control services;
                                                              business, professional and labour
                                                              associations; veterinary services; and
                                                              personal and household services such as
                                                              repair services, photography,
                                                              hairdressing, dry cleaning, funeral
                                                              direction and health studio services.
                                 National
                                 Accounts
                                 Industry                          Description of the Type of Economic
   NZSNA Industry Groups         Reference         NZSIC                         Activity
Non-market Industries
22 Central Government Services
Central government services    22.0          9101 plus any        Central government administration,
                                             other economic       defence, and fire services etc including
                                             activity from        the administration of health, education
                                             NZSIC 111 to 959     and welfare services.
                                             which is provided
                                             as a 'government
                                             service' by a
                                             central
                                             government
                                             organisation
23 Local Government Services
Local government services    23.0           9102 plus any         Local government administration and
                                            other economic        regulation and the operation of
                                            activity from         recreational and cultural facilities,
                                            NZSIC 111 to 959      sewerage and drainage, refuse collection,
                                            which is provided     river maintenance etc.
                                            as a 'government
                                            service' by a local
                                            government
                                            organisation
24 Private Non-Profit Services to Households
Private non-profit services to  24.0        93101 - 93104,        Education, health, and welfare services;
households                                  93109, 932 - 935,     business, professional and labour
                                            939, 941 - 945        associations; religious, cultural,
                                            (excl 9415, 943,      amusement, recreation, social and
                                            94401), 95 excl       community services.
                                            953
25 Domestic Services of households
Domestic Services of Households 25.0        953                   Gardeners, housekeepers, home
                                                                  companions, baby sitters etc.
                                                                                             1
New Zealand Institutional Sector Classification 1990
1.00 Producer Enterprises
     1.10 Private
          1.11 Corporate
          1.12 Non-corporate

     1.20 Producer Boards

     1.30 Government Enterprises
          1.31 Central Government
          1.32 Local Government

2.00 Financial Intermediaries
     2.10 Central Bank

    2.20 Financial Institutions providing current account facilities operated by
cheque
         2.21 Central Government
         2.29 Private

     2.30 Other Financial Intermediaries except insurance and pension funds
          2.31 Central Government
          2.32 Local Government
          2.39 Private

     2.40 Insurance and Pension Funds
          2.41 Central Government
          2.42 Local Government
          2.49 Private

3.00 General Government
     3.10 Central Government
          3.11 Central Government (excluding Funded Social Security Schemes)
          3.12 Funded Social Security Schemes

     3.20 Local Government
          3.21 Regional Authorities
          3.29 Other Local Authorities

     3.30 Runanga Iwi

4.00 Private Non-Profit Organisations Serving Households

5.00 Households


1
  This classification was revised in 1996 to take effect in Statistic New Zealand’s Business Frame from
December 1997. It will be implemented in the department’s major economic statistics series from
February 1998.
6.00 Rest Of World
Institutional Sector and Sector of Ownership
It is important to distinguish between the previously published sector of ownership
classification and the institutional sector classification outlined above.

The sector of ownership classification groups accounting units into three sectors:

   private
   central government, and
   local government.

The objective of the classification is to provide ownership detail within an industry
framework. Each accounting unit is allocated to the sector which owns more than
50 percent of that entity.

The institutional sector classification has an entirely different focus. Within this
classification enterprises are grouped according to their economic roles. Industry
affiliation is irrelevant, the economic role played by the enterprise is crucial. A
secondary breakdown of ownership is available within this framework. The sectors
and sub-sectors of the classification bring together transactors which play similar roles
in the economic process of the nation and which can be expected to have similar
reactions to market, fiscal and monetary policy stimuli.
Glossary of Transactions
Principal totals

Gross Domestic Product (GDP)
The total market value of goods and services produced in New Zealand after
deducting the cost of goods and services utilised in the process of production, but
before deducting allowances for the consumption of fixed capital.

Gross National Expenditure
The total final expenditure within a given period on goods and services by New
Zealand residents (ie excluding goods and services used up during the process of
production).

Gross National Product (GNP)
The income accruing within a given period to New Zealand residents from their
services in supplying factors of production in New Zealand and overseas, plus net
indirect taxes, and before the deduction of allowances for the consumption of fixed
capital. In the 1993 SNA this is, more correctly, renamed Gross National Income.

National Income
This aggregate is equivalent to gross national product after the deduction of
allowances for consumption of fixed capital. It is a measure of income accruing to
New Zealanders from supplying factors of production in New Zealand and overseas,
plus net indirect taxes. In the 1993 SNA this is, more correctly, renamed Net
National Income.

National Disposable Income
The total income of New Zealand residents from all sources available for final
consumption or savings. In the 1993 SNA this is, more correctly, renamed Net
National Disposable Income.

The main NZSNA totals, using 1993 SNA terminology, are therefore linked as
follows:
       Gross National Expenditure
plus Exports of goods and services
less Imports of goods and services
equals Gross Domestic Product
plus Net factor receipts from the rest of the world
equals Gross National Income (Gross National Product)
plus Net other current transfers from the rest of the world
equals Gross National Disposable Income
less Consumption of fixed capital
equals Net National Disposable Income
less Final consumption expenditure
equals Savings
Other transactions

Capital Transfers From The Rest Of The World, Net
The excess of capital transfers by non-residents to New Zealand residents over the
value of similar transfers by residents to non-residents. Capital transfers are
unrequited transfers in cash or in kind which are not considered by the recipient as
adding to current income, nor by the donor as reducing current income. Examples
are unilateral transfers of capital goods, legacies, investment grants, and transfers of
migrants' funds. In the NZSNA it has only been possible to separately identify some
of these flows since 1984/85, otherwise they have been included in current transfers
to/from the rest of the world.

Compensation Of Employees
Payments of salaries and wages whether in cash or in kind (such as fringe benefits) to
employees. Includes contributions paid on employees' behalf to superannuation
funds, private pension schemes, the Accident Compensation Corporation, casualty and
life insurance schemes, etc.

Compensation Of Employees To/From The Rest Of The World
In principle, these items cover the compensation residents of one country earn from
employment in another where, because their stay is for a period of less than 12
months, they are classed as non-resident. In practice, data available does not permit
estimates of these items.

Compulsory Fees
These are payments made to either central or local government by households for
regulatory services, eg passport fees and dog licence fees. The payments are
obligatory and unavoidable, and their value bears no relation to the cost of providing
the service.

Consumption Of Fixed Capital
The value of depreciation at ordinary rates allowed for taxation purposes, plus an
estimate of the normal rate of accidental damage. No estimates are at present
calculated for general government services (production groups 22 and 23) since,
historically, the source data has been in the form of cash accounts. For the household
sector, consumption of fixed capital represents depreciation on owner-occupied
dwellings.

Current Transfers From The Rest Of The World, Net
See other current transfers to/from the rest of the world.

Dividends
See property income.

Entrepreneurial Income
The net current income of unincorporated businesses, plus salaries and wages paid to
working proprietors of private companies. In the case of the latter, these payments
are regarded to be more in the nature of a proprietorial withdrawal than a wage
payment. The unincorporated businesses are those owned and operated by households,
either as sole proprietorships or as partnerships.

Exports Of Goods And Services
All goods and services produced by New Zealand residents and purchased by the rest
of the world. Exports of merchandise are valued free-on-board (f.o.b.).

Final Consumption Expenditure:
1. Private Households - All outlays on consumer goods and services, including
   expenditure on durables such as motor vehicles and furniture, payments made by
   the government on behalf of households, and the imputed rent of owner-occupied
   dwellings. Households consist of New Zealand resident individuals and families
   and consumption expenditure relates to their outlays both within New Zealand and
   overseas.
2. General (Central and Local) Government Services and Private Non-Profit Services
   to Households - Total current expenditure by these producers less the value of any
   sales or own account capital formation (that is, the total net current costs incurred
   in providing the services).

Gross Fixed Capital Formation
The outlays of producers on durable real assets, such as buildings, motor vehicles,
plant and machinery, hydro-electric construction, roading, and improvements to land.
In measuring the outlays, sales of similar goods are deducted. Land is excluded from
gross fixed capital formation. Included is the value of construction work done by a
firm's own employees. The term "gross" indicates that consumption of fixed capital
has not been deducted from the value of the outlays. For the household sector gross
fixed capital formation consists solely of net capital expenditure on owner-occupied
dwellings.

Gross Output At Producer's Values:
1. Market Production Groups - The total market value including commodity taxes of
   all goods and services produced during the year, including stocks of
   work-in-progress. Included is the production of goods and services for sale in the
   market, and for capital formation on own account.
2. Non-market Production Groups - These producers may sell a proportion of their
   output in the market, and such receipts are included in total output. Most of the
   services produced, however, represent unmarketed output and are valued at cost
   price. This assumption is necessary because there is no other basis for valuation.

In both cases, an adjustment has been made to gross output for goods and services that
have been provided to employees free of charge, or at a markedly reduced cost.
These goods and services (or fringe benefits) have been revalued at the cost of
production and are included in gross output. A similar amount is included in
compensation of employees.

GST On Production
The Goods and Services Tax (GST) was introduced on 1 October 1986 and is
imposed on all goods and services supplied in New Zealand, other than exempt
supply. Registered suppliers of taxable goods and services pay GST on their
intermediate purchases but credit may be claimed for this tax. As a result of this
credit-offset mechanism, the final expense of GST levied on the supplies of registered
producers is, in general, borne by the domestic consumer. GST is not a cost to
businesses unless the business deals in or purchases exempt goods and services,
provides employee fringe benefits, or does not register. The NZSNA reflects these
valuations. The transactions of registered producers are recorded excluding GST
while those of final consumers (including producers of exempt goods and services)
are recorded at actual market prices. The potential imbalance between the value of
goods and services produced and the value ultimately consumed is removed by
including the item "GST on production" in the GDP account. This item produces a
measure of the amount of GST included in the valuation of the final demand
categories.

Import Duties And Other Unallocated Indirect Taxes
These indirect taxes are levied on the purchaser of the taxed commodity and not on
the seller so they are not recorded in the production accounts as a charge against the
value of output. Consequently when GDP is derived by consolidating production
accounts, the indirect taxes excluded must be added on. Import duties also appear as
part of intermediate and final consumption, and stamp duty on purchases of land and
buildings forms part of gross fixed capital formation.

Imports Of Goods And Services
All goods and services produced by the rest of the world and purchased by New
Zealand residents. Imports of merchandise are valued at cost, including insurance
and freight (c.i.f.).

Imputed interest
See property income.

Income Tax
In the Household Income and Outlay Account (Table 4.1), this item relates to income
tax paid by resident households. It is the cash amount received by the Inland
Revenue Department during that year. No adjustments have been made to allow for
timing differences with other items in the account.

Increase In Stocks
In the tables, this transaction is termed ‘Value of the Physical Increase in Stocks’ to
distinguish it from the book value changes recorded in most business accounting
records. It is equivalent to the book value change less a stock valuation adjustment
which removes the capital gains and losses that may arise through holding stocks
purchased at prices either higher or lower than those ruling during the period of
account. The value of the physical increase in stocks effectively values the change in
stocks at the average prices for the period.

Indirect Taxes
Taxes which are assessed on producers in respect of the production, sale, purchase and
use of goods and services, and which add to the market prices of those goods and
services. Includes sales tax, local authority rates, import and excise duties, fringe
benefits tax, and also registration fees such as motor vehicle registration, which are
paid by producers. In the consolidated accounts of the nation this figure includes
goods and services tax.

Interest received/paid
See property income.

Intermediate Consumption
The value of non-durable goods and services used in production. Valuation is at
purchaser's values.

Net Acquisition Of Foreign Financial Assets
The change in actual claims by New Zealanders on non-residents. It relates to the
purchase, less the sale, of financial claims, such as those described below for the net
incurrence of foreign liabilities. It also includes changes in New Zealand's holdings
of special drawing rights in its reserve position at the International Monetary Fund,
and in the assets of the New Zealand banking system.

Net Incurrence Of Foreign Liabilities
The change in actual indebtedness of New Zealanders to non-residents. It relates to
the issue, less the redemption, of financial claims, such as currency and transferable
deposits, bonds, corporate equities, loans, and long-term trade credits. Changes in
the holdings of paid-up capital of companies, and changes in inter-company
indebtedness are also included.

Net Capital Taxes (Household sector only)
This measures death duties paid on deceased persons' estates.

Net Capital Transfers Received (Household sector only)
This includes migrants' transfers which have been allocated to households. The value
for all other capital transfers received is equal to the claims paid by the Earthquake
and War Damages Commission.

Net Lending (Household sector only)
This represents the excess of households' net acquisition of financial assets over their
net incurrence of liabilities.

Net Lending To The Rest Of The World
The excess of New Zealand's net acquisition of financial assets over its net incurrence
of liabilities, recorded in the National Capital Finance Account (Table 1.3).

Net Purchases Of Land (Household sector only)
This measures purchases of undeveloped (vacant) land less sales.

Nominal Industry (Bank Service Charge)
A large proportion of the income of banks and financial institutions consists of an
excess of interest and other property income over payments rather than from direct
charges for services. As NZSNA records this income in the income and outlay
accounts rather than as an item of gross output in the production account, operating
surplus would be negative. To overcome this a service charge is imputed, equal to
net interest and other property income. Conceptual problems of how to allocate the
charge to the users of services provided by financial institutions, (such as whether to
allocate on the basis of the number or value of loan transactions), are overcome by
creating a nominal industry which pays the total charge. The nominal industry has no
gross output and makes a negative contribution to GDP. Its negative operating surplus
counteracts the increased operating surplus of all other industries which are not
recorded as paying any of the imputed bank service charge.

Operating Surplus
This is a residual item, being gross output at producer's values less the sum of
intermediate consumption, compensation of employees, consumption of fixed capital,
and indirect taxes net of subsidies. It is approximately equal to accounting profit
before the deduction of direct taxes, dividends, interest paid and bad debts, and before
the addition of interest and dividends received. For Owner-Occupied Dwellings, the
item represents the surplus, inclusive of interest paid, from the notional activity of the
operation of owner-occupied dwellings.

Other Current Transfers
These include all transfers of income not specifically included in other categories of
the household income and outlay account. The transfers are made from current
income of households and add to the current income of recipients for such purposes as
consumption or production expenditure, eg gifts, net casualty insurance premiums and
insurance claims.

Other Current Transfers To/From The Rest Of The World
Conceptually, these items cover all current transfers other than property and
entrepreneurial income. However, in practice, it has not been possible to identify all
these transfers separately, and the figures are deficient in two respects. First, not all
current transfers can be identified. Prior to 1989, those associated with insurance
transactions were omitted, since all insurance flows are recorded as either exports or
imports of services. Second, it has proved difficult to distinguish between current
and capital transfers to the rest of the world, and in the NZSNA some of these
transactions are treated as current.

Producer's Value
The equivalent of purchaser’s values (see below) reduced by the trade and transport
margins for delivering the items from the producers to the purchasers. This
effectively gives the market sales value for the producer at the factory door, farm gate,
mine head, etc. For services, the producer’s value is the same as the purchaser’s
value since services are produced and consumed at the same time.

Production Groups
Accounting units of production grouped on the basis of their predominant activity.
There are four main categories. Industries (groups 1 to 21) dispose of most of their
output in the market. The other three categories do not sell all of their output on the
market. They are classified as producers of government services (groups 22, 23),
producers of private non-profit services to households (group 24) and domestic
services of households (group 25).
Property Income
 - as income
  Property income refers to transfers of income accruing to the owners of financial
  assets, intangible assets such as patents, copyrights and concessions, and mineral
  rights. This income is mainly in the form of interest, dividends and royalties. In
  the household income and outlay account, interest received is split between
  "actual" and "imputed". Imputed interest consists of the earnings of life insurance
  and pension funds which are imputed to households who, following the UNSNA
  guidelines, are considered to be the owners of the fund's assets. This imputed
  interest flow is then reinvested, via savings, in householders' financial assets,
  namely "net equity in life insurance reserves and pension funds".
 - as outlays
  Outlays of property income include interest, dividends and royalties paid. In the
  Household Income and Outlay Account, interest paid is split between consumer
  debt interest and other interest. Consumer debt interest consists of interest paid on
  hire purchase, credit advances, etc. Other interest relates to interest paid through
  home ownership, such as mortgage interest, and includes the value of interest
  concessions.

Property And Entrepreneurial Income To/From The Rest Of The World
The property income component of these items is defined above (excluding any
imputed interest which is entirely a resident-to-resident flow). The entrepreneurial
income refers to the actual withdrawals of income from enterprises operating
overseas, such as overseas branches of New Zealand companies. Retained earnings
are excluded from these flows.

Purchase Of Intangible Assets From The Rest Of The World, Net
The value of purchases by residents from non-residents of intangible assets, less sales
of such assets by residents to non-residents. Examples of these types of assets are
mineral rights, fishing quotas, patents, copyrights, and trademarks. In the NZSNA,
flows associated with this item are not distinguishable in the source data and
consequently are included in exports/imports of goods and services.

Purchaser's Value
The costs in the market of goods and services on the delivery to the purchaser. For
services, the purchaser’s value is the same as the producer’s value since services are
produced and consumed at the same time.

Savings
The residual item in both the national and household income and outlay accounts after
all current receipts and disbursements have been accounted for. Note, however, that
savings in the National Income and Outlay Account is net of consumption of fixed
capital, whereas because operating surplus from the ownership of owner-occupied
homes is measured gross in the Household Income and Outlay Account, savings in
this account is gross of consumption of fixed capital.

Sector Of Ownership
Ownership of production in the New Zealand economy is classified to central
government, local government or private (including overseas). As a general rule,
fifty percent or more of the share holding or control is necessary.

Social Assistance Grants
Includes all monetary benefits paid to individuals and households by public
authorities, private non-profit organisations and private enterprises, eg
unemployment benefits, national superannuation and education scholarships. Also
includes grants paid directly to providers of services on behalf of households, eg
pharmaceutical benefits and free medical care for under-six year-olds.

Social Security Benefits And Contributions
These consist of receipts from, and contributions to, the Accident Compensation
Corporation (ACC) which is classified as a social security fund.

Statistical Discrepancy
In the NZSNA, the items making up GDP and Expenditure on GDP are estimated
independently, using diverse data sources. The combination of survey and other
measurement and timing errors in the various components results in a difference
between the estimates, known as the statistical discrepancy. In the past the statistical
discrepancy has been included on the expenditure side of the consolidated GDP
account (Table 1.2). This practice was the result of convention and did not imply that
one side of this account was more accurate than the other.

The presentation of the statistical discrepancy has been reorganised to more clearly
illustrate the independence of the two estimates of GDP and the difference that exists
between them. Expenditure on GDP is now calculated as the sum of expenditure
components. The discrepancy is now outside the GDP and expenditure on GDP
calculations. This format more clearly illustrates the true nature of the relationship
between the two estimates. It also has the advantage of removing any distortion
associated with the previous practice of including the discrepancy within the
expenditure on GDP series.

The statistical discrepancy has a counter entry in the National Capital Finance
Account (Table 1.4).

Subsidies
Grants made by Government to market-oriented producers who regard the transfers as
an addition to income from current production. These grants include payments to
ensure a guaranteed price, or to enable market prices of goods and services to be held
below the cost of production. Transfers made by local authorities out of rates
receipts to finance the losses of their trading departments, and deliberately incurred
losses of government trading organisations are also included.

Surplus Of The Nation On Current Transactions
The excess in the External Transactions Account of current receipts over current
disbursements.

Taxes On The Use Of Goods
These are levies, designed primarily to raise revenue, made by Government on the
possession or use of goods by households. They include motor vehicle registration
and licence fees.

Type Of Capital Good
Major groupings of fixed assets, eg residential buildings, transport equipment, etc, as
defined in the department's manual, Capital Formation: Definition and Classification
in Integrated Economic Statistics of New Zealand (December 1980).

Value Added
The amount added to goods and services by the contributions of capital and labour (ie
the value of output after the cost of bought-in materials and services has been
deducted).

								
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