Concepts and definitions

Adjustment for seasonal variation

Seasonal adjustment means the estimation of seasonal variation and the elimination of its impact from a time series. The obtained result is a seasonally adjusted time series. The trend of a time series is obtained when both seasonal variation and irregular random variation are eliminated from a time series. Trading or working day adjusted series are in turn obtained when the factors caused by the variation in the number of trading days or weekdays is eliminated from the observation of the original time series. The Tramo/Seats method is used for the seasonal adjustment of time series at Statistics Finland. In the Tramo/Seats method, preadjustment is based on a regression model (which allows for outlying observations, public holidays and the weekday structure) and the seasonal adjustment proper on an ARIMA model constructed for the time series.

Capital taxes

Capital taxes (D.91) consist of taxes levied at irregular and very infrequent intervals on the values of the assets or net worth owned by institutional units or on the values of assets transferred between institutional units as a result of legacies, gifts between individuals or other transfers (e.g. inheritance tax, death duty and gift tax).

Capital transfers

Capital transfers are different from current transfers in that they involve the acquisition or disposal of an asset, or assets, by at least one of the parties to the transaction. Regardless of whether the capital transfers are made in cash or in kind, they result in a commensurate change in the financial, or non-financial, assets shown in the balance sheets of one or both parties to the transaction.

Capital transfers consist of capital taxes, investment subsidies and other cap-ital transfers.

Compensation of employees

Compensation of employees (D.1) is defined as the total remuneration, in cash or in kind, payable by an employer to an employee in return for work done by the latter during the accounting period.

Compensation of employees is broken down into:

a) wages and salaries (D.11): wages and salaries in cash; wages and salaries in kind;

b) employers’ social contributions (D.12): employers’ actual social contributions (D.121); employers’ imputed social contributions (D.122).

Consumption of fixed capital

Consumption of fixed capital (P.51C) represents the amount of fixed assets used up, during the period under consideration. Consumption is the result of normal wear and tear and foreseeable obsolescence, including a provision for losses of fixed assets as a result of accidental damage which can be insured against.

Consumption of fixed capital should be distinguished from the depreciation shown in business accounts. It refers to the amount of fixed assets used up, during the period under consideration. It should be estimated on the basis of the stock of fixed assets and the probable average economic life of the different categories of those goods.

Employers' actual social contributions

Employers' actual social contributions (D611). Employers pay employers' ac-tual social contributions to social security funds and pension funds that maintain the social security system in order to ensure social benefits for their employees. For example, employer's unemployment insurance contributions, employer's employment pension insurance contributions, employer's social contributions.

Gross fixed capital formation

Gross fixed capital formation consists of resident producers' acquisitions, less disposals, of fixed assets. Fixed assets are tangible or intangible assets produced as outputs from processes of production that are themselves used repeatedly, or continuously, in processes of production for more than one year.

Intermediate consumption

Intermediate consumption consists of the value of the goods and services consumed as inputs by a process of production, excluding fixed assets whose consumption is recorded as consumption of fixed capital. The goods and services may be either transformed or used up by the production process.

Products used for intermediate consumption should be recorded and valued at the time they enter the process of production. They are to be valued at the purchasers’ prices for similar goods or services at that time.

Net lending/net borrowing

Net lending/borrowing is a balancing item in the capital account and the fi-nancial account.

Net lending/borrowing corresponds to the amount available to a unit or sec-tor for financing, directly or indirectly, other units or sectors, or the amount which a unit or sector is obliged to borrow from other units or sectors.

The corresponding concept to net lending/borrowing in financial accounts is financial transactions, net. It is the difference between net acquisition of fi-nancial assets and liabilities. If a sector acquires financial assets in excess of the amount of new debt incurred during the period it is a net lender.

Output at basic prices

Output at basic prices consists of the products which have been produced in the accounting period. Three categories of output are distinguished: market output, output for own final use, and other non-market output. Output is to be recorded and valued when it is generated by the production process.

Property expenditure and income

Property expenditure and income (D.4) are generated when the owners of financial assets or natural resources give such assets to other institutional units for use. Income generated from the use of financial assets is called in-vestment income while the income from the use of natural resources is rent. Property income is the total sum of investment income and rents. Property income is classified as follows:

a) Interest (D.41);

b) Distributed income of corporations (D.42):

1) Dividends (D.421);

2) Withdrawals from income of quasi-corporations (D.422);

c) Reinvested earnings on direct foreign investment (D.43);

d) Other investment income (D.44):

1) Investment income attributable to policyholders in insurance (D.441);

2) Investment income based on pension entitlements (D.442);

3) Investment income from collective mutual funds belonging to sharehold-ers (D.443);

e) Land and natural resource rents (D.45).


Saving is the balancing item in the use of income accounts. It is the positive or negative amount resulting from current transactions which establishes the link with accumulation. If saving is positive, non-spent income is used for the acquisition of assets or for paying off liabilities. If saving is negative, certain assets are liquidated or certain liabilities increase.

Social benefits other than social transfers in kind

Social benefits other than social transfers in kind (D.62) include:

a) Social security benefits in cash are payable to households by social security funds and are provided under social security schemes. E.g. pensions, unemployment benefits.

b) Social assistance benefits in cash are payable to households by government units to meet the same needs as social insurance benefits but are not made under a social insurance scheme incorporating social contributions and social insurance benefits. E.g. living allowances paid by municipalities, child maintenance allowances.

Social security contributions

Social security contributions (OECD Classification of Taxes heading 2000) covers all compulsory payments that confer an entitlement to receive a (contingent) future social benefit. These include a) employers' social security contributions, e.g. unemployment insurance and old-age insurance premia paid by employers, b) employees' social security contributions, e.g. unemployment insurance and old-age insurance premia paid by employees, employees' contributions to the National Pension Insurance scheme and to the National Health Insurance scheme, c) social security contributions paid by independent entrepreneurs and non-employed persons, e.g. old-age insurance premia paid by entrepreneurs.

The OECD Classification of Taxes heading "Social security contributions" covers only statutory social security contributions, and does not include voluntary social security (a sub-heading under D.611 "Actual social contributions" in the national accounts).

Social transfers in kind

Social transfers in kind consist of individual goods and services provided as transfers in kind to individual households by government units and non-profit institutions serving households (NPISHs), whether purchased on the market or produced as non-market output by government units or NPISHs.


Subsidies (D.3) are current unrequited payments which general government or the institutions of the European Union make to resident producers, with the objective of influencing their levels of production, their prices or the remuneration of the factors of production. Other non-market producers can receive other subsidies on production only if those payments depend on general regulations applicable to market and non-market producers as well.

Subsidies granted by the Institutions of the European Union cover only current transfers made directly by them to resident producer units.

Subsidies are classified into:

a) subsidies on products (D.31)

(1) import subsidies (D.311)

(2) other subsidies on products (D.319)

b) other subsidies on production (D.39).

Taxes on production and imports

Taxes on production and imports (D.2) consist of compulsory, unrequited payments, in cash or in kind which are levied by general government, or by the Institutions of the European Union, in respect of the production and importation of goods and services, the employment of labour, the ownership or use of land, buildings or other assets used in production. These taxes are payable whether or not profits are made.

Taxes on production and imports are divided into:

a) taxes on products (D.21)

(1) value added type taxes (VAT) (D.211)

(2) taxes and duties on imports excluding VAT (D.212)

– import duties (D.2121)

– taxes on imports excluding VAT and import duties (D.2122)

(3) taxes on products, except VAT and import taxes (D.214)

b) other taxes on production (D.29).


Trend describes the long-term development in a time series. A trend series has been adjusted for seasonal and random variations, so that the effects of e.g. weather conditions or short-term labour disputes do not show in it. By contrast, permanent changes, such as growth in demand due to changed taxation, will show in a trend. The direction indicated by the end of a trend should be interpreted with caution. The latter part of a trend indicator may change once it has been updated with data for subsequent months.

Value-added tax

Value-added tax (D.211) is a tax on goods or services collected in stages by enterprises and which is ultimately charged in full to the final purchasers. Value-added tax (VAT) comprises the value added tax which is collected by the General government and which is applied to national and imported products.

For the total economy account, VAT is equal to the difference between total invoiced VAT and total deductible VAT.

In the national accounts, taxes are recorded on an accrual basis. The accrual-basis method of recording differs from the cash-basis method of recording in certain respects. Tax amounts recorded on cash basis express the amount accrued on the cash account. Tax amounts recorded on an accrual basis show the amount of tax accruing from the transaction over the period of time when the tax liability was incurred.

Referencing instructions:

Official Statistics of Finland (OSF): General government revenue and expenditure by quarter [e-publication].
ISSN=1797-9382. Helsinki: Statistics Finland [referred: 25.6.2019].
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