IMF--Dissemination Standards Bulletin Board--:(Summary Methodology)

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(THE SUMMARY METHODOLOGY STATEMENT HAS BEEN PROVIDED BY LUXEMBOURG, WHICH IS SOLELY RESPONSIBLE FOR ITS ACCURACY AND COMPLETENESS. AT THE TIME OF POSTING, THE STATEMENT WAS REVIEWED BY THE IMF FOR CONSISTENCY WITH THE METADATA BASE PAGE DESCRIBING DISSEMINATION PRACTICES. SUBSCRIBERS ARE REQUIRED TO PROVIDE UPDATES TO THE STATEMENT, AS NEEDED, AND ARE EXPECTED TO MAKE OTHER IMPROVEMENTS, AS WARRANTED, TO ENHANCE TRANSPARENCY)

Luxembourg
Summary Methodology
National accounts

Last Posted:	Oct-6-2009
Last Certified:	Dec-29-2008
Last Updated:	Jul-4-2006

Contact Person(s)		Printer Friendly Page
	Mr. John Haas, Division C "Comptabilité Nationale et statistiques d'entreprise", Statec, Service central de la statistique et des études économiques, 13, rue Erasme, B.P. 304, Luxembourg L-2013
	Phone :	352 247-84232
	Fax :	352 26 20 37 26
	Email :	john.haas@statec.etat.lu

I. Analytical Framework, Concepts, Definitions, and Classifications
2.1.1 Concepts and definitions

Analytical framework: Defined and classified according to the European System of Accounts 1995 (ESA95).

Definition: GDP measures the market value of the goods and services produced in Luxembourg, before deduction of provisions for consumption of fixed capital.
2.3.1 Classification/sectorization

Classification systems: The classifications used are those of the NACE Rev.1.1 and ESA95.

II. Scope of the data
2.2.1 Scope

Scope of the data

Transaction coverage: The production boundary is in accordance with the European System of Accounts 1995. Estimates for consumption from own agricultural production are also included.

Geographic coverage: Nation-wide.
Unrecorded activity

The Luxembourg national accounts cover all transactions, except illegal activities per se, to be included in the estimation of the GDP. Estimates are made for certain types of under-reporting, such as tax evasion and other informal activities.

III. Accounting Conventions
2.4.1 Valuation

Valuation: At market prices. Output of government and NPISHs are recorded at cost; value of gross fixed capital formation includes installation costs.
2.4.2 Recording basis

Time of recording: In principle all transactions are recorded on a accrual basis (ESA95). Government tax income and social security contributions are recorded on an time adjusted cash basis. Imports and export are recorded at the time goods are released by customs (for flows with countries outside the European Union) or on the basis of change in ownership (for flows with countries inside the European Union).

Recording period: Calendar quarters and years.

IV. Nature of the Basic Data Sources
3.1.1 Source data collection programs

Data sources: For the yearly accounts the main sources are:

Production approach: The production side of the annual accounts is based on exhaustive administrative data and business survey data. Specific assumptions are made by industry on informal activities. The exhaustivity and the coherence of the estimations are ensured by means of the supply and use table (270 products).

Expenditure approach: For the expenditure approach of the yearly accounts, the sources are:

Household final consumption expenditure: A households budget survey every 5 years and VAT turnover for retail trade, hotels and restaurants and other services.

Final consumption expenditure of NPISHs: Estimation on basis of employment, wages and salaries from Social Security data.

Final consumption expenditure of general government: The budget statements.

Gross fixed capital formation: Investment survey data, yearly accounts of enterprises and budget statements (for general government).

Changes in inventories: Business surveys and yearly accounts of enterprises.

Exports and imports of goods and services: Customs statistics, Intrastat data and balance of payments data, adjusted to the national accounts concepts.
3.1.2 Source data definitions, scope, classifications, valuation, and time of recording

To the extent possible, the choice of the quarterly indicators is closely aligned to the data sources and methodology used for the annual accounts.

Production approach

Value added is estimated for 135 branches of activity, but these are aggregated into six main branches for publication. The indicators used are as follows:

Industrial production indices for industry (manufacturing, construction and energy);
VAT records for most market services and some industries;
Quarterly business accounts for financial services;
Monthly budget statements for general government;
Quarterly statements for social security funds.

Expenditure Approach

Household final consumption expenditure:

VAT turnover for retail trade, hotels and restaurant services;
Final consumption expenditure of NPISHs: Employment and salary data are used as indicator.

Final consumption expenditure of general government:

The estimates for central government are based on the monthly budget statement and the estimates for social security on quarterly statistics.
The quarterly final consumption expenditure of local government is interpolated with employment and salary data starting from a yearly extrapolation.

Gross fixed capital formation:

Fixed gross capital formation of companies is based on short term investment surveys as well as on imports and production of investment goods.
Fixed gross capital formation on housing is based on VAT turnover (real estate construction).
Fixed gross capital formation for public administration comes from the monthly budget statement.

Changes in inventories:

Derived as a residual by subtracting the sum of the other expenditure components from total GDP as measured from the production approach.

Exports and imports of goods and services:

The customs statistics and Intrastat statistics for goods and balance of payments data (adjusted to the national accounts concepts) for services.

V. Compilation Practices
3.3.1 Source data statistical techniques

General estimation method

As the main sources of annual data are not available in time to allow the annual methodology to be transposed to the quarterly level, the method used for the Luxembourg quarterly accounts is indirect, i.e., the absence of quarterly data necessitates recourse to a "proxy" variable.

Each statistical series of the annual accounts is coupled with a quarterly series which is available by the time the accounts are compiled and whose behaviour is similar to that of the accounting item. This series is called the "quarterly indicator". The quarterly indicator generally differs in annual value from the accounting datum, for reasons of definition and scope. It is therefore necessary to "calibrate" the quarterly indicator to the annual accounting datum.

This operation consists in searching for the econometric adjustment which best explains the movement of the annual accounts on the basis of the quarterly value of the indicator in the past. The statistical link arrived at by this regression method, on an annual basis, between the accounting item and its indicator makes it possible to estimate the account in the current quarters on the basis of the quarterly value of the indicator.
3.3.2 Other statistical procedures

Quarterly compilation techniques: The econometric method used is based on a model which by its construction ensures perfect coherence with the annual series and provides optimal extrapolations for the current year. Among the several benchmarking methods available in the literature Luxembourg has chosen the proportional Denton method. The coherence of the estimations is ensured by means of the supply and use table (270 products).

Current and constant prices: Volume measures are calculated by deflating value indicators by adequate price indices as follows: production approach – producer price and consumer price indices are used to derive volume estimates; expenditure approach – a) household final consumption expenditure: the consumer price index is used to deflate the VAT turnover for retail trade, hotels and restaurant services; b) gross fixed capital formation: the producer prices index and the price index of imports are used to deflate all the items of gross fixed capital formation; c) exports and imports of goods and services: external trade price indices are used as deflators.

Seasonal adjustment: Seasonal adjustments are made by the program X12-Arima in the interface Demetra.

Base year and reference year: Volume measures are calculated using the prices of the previous year and are published at the reference period of 2000.
3.4.3 Assessment of discrepancies and other problems in statistical outputs

Reconciliation of the production and expenditure approach: The reconciliation of the production and expenditure side is obtained within quarterly supply and use tables (about 270 products).

The changes in inventories are obtained as a residual.

VI. Other Aspects

Footnotes

Last posted: Date IMF staff last posted an update to these metadata on the DSBB.
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Footnotes
Last posted: Date IMF staff last posted an update to these metadata on the DSBB.
Last certified: Date subscriber last officially certified the accuracy of these metadata.
Last updated: Date subscriber last submitted an update of these metadata to the IMF.