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Quarterly National Accounts Course
Joint Vienna Institute
August 5 - 16, 2013
L-1: Scope and Role of QNA
Reproductions of this material or any parts of it should refer to the IMF Statistics Department as the source
Lecture Outline
What is QNA? What is QNA?
Scope of QNA
Role and uses of QNA
Time-series oriented data
Timeliness vs. Reliability
f The Need for Revisions
IMF Statistics Department JVI/QNA/L1 : 2
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What is Quarterly National Accounts?
System of integrated quarterly time series System of integrated quarterly time series
coordinated through a consistent accounting
framework (SNA)
In principle cover the entire sequence of accounts and
balance sheets in the 1993 SNA
Adopt the same principles, definitions and structure as
th l ti l t (ANA) the annual national accounts (ANA)
Usually less complete than ANA because of data
availability, time, and resource constraints
Provided on a timely basis (SDDS requirement: 3-month)
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Scope of QNA
Basic compilation Basic compilation
At current prices and in volume terms:
• GDP by the production approach
• GDP by the expenditure approach
At current prices:
• GDP by the income approach • GDP by the income approach
• Gross National Income (GNI)
• Gross Saving
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Scope of QNA
Advanced compilation Advanced compilation
Seasonally adjusted GDP, in addition to the original
data very valuable for users
Full sequence of quarterly accounts by institutional
sector
Balance sheets
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Role of QNA
Provide a picture of the current economic Provide a picture of the current economic
development that is
More timely than ANA,
More comprehensive than short-term statistics
To meet this purpose, QNA should be
Timely e y
Accurate/Reliable
Comprehensive
Consistent
Detailed
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Role of Quarterly National Accounts
Monitoring Business Cycles - Quarterly versus Annual Data
Annual data mask short term economic developments
5800
6000
6200
6400
6600
1450
1500
1550
1600
1650
5200
5400
5600
1300
1350
1400
1990 1991 1992 1993 1994
quarterly GDP (left hand scale) annual GDP (right hand scale)
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Uses of QNA
QNA are used for: QNA are used for:
Early identification of changes in trends
Timely implementation of economic policies
Macro-economic forecasts, including early estimates of
annual accounts
Framework for business cycle analysis
Econometric modeling, including studies of seasonal
patterns
Price and volume decomposition of nominal growth
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Time-series oriented data
Definition: a set of measurements on a given Definition: a set of measurements on a given
phenomenon over consecutive, equally spaced
periods of time, which facilitates:
identification of underlying trend and turning points
allows different periods to be compared (growth rates)
Requirements q
Consistency over time of concepts and measurement
Ordered observations dependent through time
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Time-series oriented data
Discrete periods such as months and quarters Discrete periods such as months and quarters
January, February, March,… ; Q1, Q2, Q3, Q4
Cumulative data do not constitute time series
January, January—February, January—March
e.g. they do not allow April’s performance to be
compared with January’s
Should cover a sufficient number of years
minimum 5 years for time series procedures (e.g.
seasonal adjustment)
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Time-series oriented data
Should facilitate analysis of the development over Should facilitate analysis of the development over
time in a flexible manner
The change from the same period in the previous year
(with s number of seasons in a year):
1 100
t
t s
I
I ÷
| |
÷ ·
|
\ .
The change from the previous period (period-to-period
growth rate):
1
1 100
t
t
I
I ÷
| |
÷ ·
|
\ .
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Time-series oriented data
Decomposition of time series Decomposition of time series
TC
t
long-term trend and cyclical movements
S
t
seasonal effects
t t t t
Y TC S I = + +
t
I
t
irregular component
Most QNA users are interested in seasonally adjusted series,
i.e. series from which the seasonal component
has been appropriately removed
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Seasonality in QNA
Identification of Turning Points Identification of Turning Points
“Unadjusted” QNA series
106.0
110.0
114.0
94.0
98.0
102.0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
JVI/QNA/L1 : 13 IMF Statistics Department
Seasonality in QNA
Identification of Turning Points Identification of Turning Points
Seasonally adjusted QNA series
106.0
110.0
114.0
94.0
98.0
102.0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
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Seasonality in QNA
Identification of Turning Points Identification of Turning Points
Seasonally adjusted series
106.0
110.0
114.0
94.0
98.0
102.0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
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Timeliness vs Reliability: the Need for
Revisions
Data collection takes time Data collection takes time
Data compilation takes time
Collection of comprehensive and reliable data is
costly
Trade-off between timeliness, comprehensiveness
and reliability and reliability
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Timeliness vs Reliability: the Need for
Revisions
A well-balanced solution A well balanced solution
Annual accounts
• Preliminary version (after few months)
• Revised and final versions (after several years)
• More accurate, detailed and comprehensive .. but not timely
Quarterly accounts
• More timely but less accurate detailed and comprehensive • More timely … but less accurate, detailed and comprehensive
• Flash estimates
Coordinated revision of annual and quarterly estimates
Clear and transparent revision policy required
(GDDS/SDDS requirement)
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