GLOSSARY
Accrual basis of recording
A recording method in which revenues, expenses, lending and borrowing are recorded as they are earned, accrued or incurred regardless of when payment is made or received.
Cash Flow Statement
The GFS financial statement that records cash flows from operating, investing and financing activities.
Consolidation
The process of elimination of all within-sector asset-liability positions, and all transactions between two units of the same sectors. Consolidation can be applied to the statistics of any group of units of analytical interest.
Net lending/borrowing
The financing requirement of government, calculated either as the GFS net operating balance less the net acquisition of non-financial assets. A positive result reflects a net lending position and a negative result reflects a net borrowing position.
Net Operating Balance (NOB)
This is calculated as GFS revenue minus GFS expenses. It is equivalent to the change in net worth arising from transactions.
Operating Statement
The operating statement presents details of transactions in GFS revenues, GFS expenses and the net acquisition of non-financial assets for an accounting period. GFS revenues are broadly defined as transactions that increase net worth and GFS expenses as transactions that decrease net worth. Net acquisition of non-financial assets equals gross fixed capital formation, less depreciation, plus changes in inventories plus other transactions in non-financial assets. Two key GFS analytical balances in the operating statement are GFS Net Operating Balance (NOB) and GFS Net Lending(+)/Borrowing(-).
Surplus/deficit
Supplementary balance in the GFS cash flow statement that is derived as net cash flows from operating activities plus net cash from investments in non-financial assets less distributions paid less value of assets acquired under finance leases.
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