The I-O approach to compiling the National Accounts
22.84 The 2008 SNA recommends use of the I-O framework for compiling basic data, integration of the I-O tables within the national accounts, and compilation of I-O tables at constant prices as well as at current prices. Currently S-U tables are compiled in both current and constant prices, whereas the I-O tables are compiled only in current prices.
22.85 The 2008 SNA also recommends that commodity flows data (by-products of the goods and services account) should be compiled at least annually, and that these data should be fully consistent with other parts of the national accounts.
22.86 Chapter 14 of the 2008 SNA provides a description of the full I-O framework for compiling a set of national accounts. A distinction is drawn between S-U tables and analytical, or symmetric, I-O tables. The process of benchmarking the GDP account to balanced S-U tables is referred to as the I-O approach, and, since 1994-95, the GDP account has been compiled using this approach.
22.87 The GDP account provides three approaches to measuring gross domestic product: (a) summing the incomes generated by production; (b) summing final expenditures on commodities produced; and (c) summing the value added at each stage of production. I-O tables are a further disaggregation of the same three approaches and are compiled as the second stage of this process, when the S-U tables for a particular year are deemed to be final. Intermediate consumption is netted out from the GDP account; however, I-O tables bring these inter-industry flows of commodities back into focus, providing a more developed articulation of the process of economic production, structure and interrelationships of industries. An important feature of the I-O tables is that they are fully balanced matrices, which allow for data confrontation and the resolution of differences at a detailed level.
22.88 The S-U tables for each year are compiled three times: first preliminary tables; second preliminary tables; and final tables. The GDP account is benchmarked at each of these three stages. The benchmarked GDP account is published first in the September quarter issues of the ASNA. This strategy means that the quarterly accounts will never be projected more than eight quarters from a balanced set of annual accounts.
22.89 Up to and including the 2009-10 table, the Input-Output tables were based upon the second preliminary S-U tables, and released about 40 months after the reference period. Starting with the 2012-13 release the tables are based on the first preliminary tables S-U and released about 24 months after the reference year. This approach ensures the measures of current price annual GDP and its components are consistent between the S-U tables, the I-O tables and the GDP accounts published in Australian System of National Accounts at the time that the I-O tables are compiled.
22.90 As previously stated, I-O tables are not revised once they have been finalised, whereas the S-U tables and the GDP accounts may be revised for all periods whenever an historical revision is undertaken, and are therefore a consistent time series. This difference allows more flexibility to incorporate changes in the I-O tables which are not produced as time series while structural changes in S-U tables can only be incorporated during historical revisions.
22.91 Changes made in the I-O tables resulting from the balancing process are incorporated in the rest of the national accounts via the S-U framework. The S-U tables incorporate changes resulting from the I-O balancing process either during the compilation phase prior to the finalisation of the S-U tables or during a historical revision.