Part G - Gross and net recording of flows and stocks

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Australian System of Government Finance Statistics: Concepts, Sources and Methods
Reference period


In GFS, flows and stock positions may be presented on a gross or a net basis. Paragraph 3.143 of the IMF GFSM 2014 states that the presentation of flows and stock positions on the gross basis means that the data is presented as the total sum of a flow or stock. The presentation of flows and stocks on the net basis means that the flow or stock is shown as the sum of one set of flows or stock positions minus the sum of a second set of a similar kind. An example of the gross and net basis of recording of flow and stock positions can be shown through the presentation of total tax revenue. When presented on a gross basis, the total tax revenue is the total amount of all taxes accrued. When presented on a net basis, the total tax revenue is the gross amount minus tax refunds and non-payable tax credits.


The use of the terms 'gross' and 'net' are used in a very limited manner for GFS purposes. Apart from a few cases, the GFS classifications employ the word 'gross' and 'net' to indicate the value of variables before or after the deduction of depreciation. Paragraphs 3.143 to 3.151 of the IMF GFSM 2014 examine the gross and net presentations of flows and stocks as used in the GFS framework. Some of this information has reproduced in the points below:

  • Revenues are presented gross of expense categories for the same or related category and likewise for expense categories. in particular, interest revenue and interest expense are presented gross rather than as net interest expense, or net interest revenue. Similarly, grant revenue and expense, and rent revenue from natural resources and expenses are presented as gross. Also, sales of goods and services are presented as gross of the expenses incurred in their production;
  • Revenues are also presented net of refunds of revenues, and expense categories are presented net of inflows of expenses arising from erroneous or unauthorised transactions. For example, refunds of income taxes may be paid when the amount of taxes withheld or otherwise paid in advance of the final determination exceeds the actual tax due. Such refunds are recorded as negative tax revenues. Similarly, if monetary transfers paid in error to households are recovered, then such recoveries are recorded as negative expenses;
  • Acquisitions and disposals of non-financial assets (other than inventories) are presented on a gross basis. For example, acquisitions of land are presented separately from disposals of land;
  • Changes in inventories are presented on a net basis. That is, the change in inventories is presented as the value of additions less withdrawals. Acquisitions and disposals of financial assets are also presented on a net basis. For example, only the net change in the holding of cash is presented, not gross receipts and disbursements of cash. Similarly, liquidation of liabilities is netted against incurrence of liabilities;
  • Holding gains and losses (also known as revaluations) are presented on a net basis. That is, the net holding gain for each asset and liability is presented, not the gross holding gain and the gross holding loss;
  • Stocks of non-financial assets are presented net of depreciation, revaluations, depletion, and other changes since their acquisition;
  • Stocks of financial assets and liabilities are presented net of revaluations and other changes since their acquisition; and
  • Stocks of the same type of financial instrument held both as a financial asset and a liability are presented on a gross basis. For example, a unit’s holding of bonds as assets is presented separately from its liability for bonds.
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