Changes from the GFSM 2001 and GFSM 1986 267
between consumption of fi xed capital and deprecia-
tion as used in government fi nancial records is also
explained (see paragraph 6.54). Th e calculation of
consumption of fi xed capital is described in Box 6.1.
Furthermore, the treatment of costs of ownership
transfer as a component of consumption of fi xed capi-
tal is explained in paragraphs 6.60 and 8.42.
A1.78 Th e description of interest (24) is clarifi ed to
show the relationship between interest as recorded in
the 2008 SNA and interest as recorded in the GFSM
2014. It is suggested to identify the counterpart for
interest transactions to allow for consolidation (see
paragraph 6.62). A discussion on recording interest,
when using a cash basis of recording, is introduced
in paragraph 6.65. Recording interest in the case of
grace periods and step-up interest arrangements is
explained in paragraphs 6.69–6.70. Th e recording of
interest related to index-linked securities is explained
in paragraphs 6.75–6.78. Furthermore, clarifi cation is
provided on the treatment of interest on debt securi-
ties with embedded derivatives, nonperforming loans,
and arrears (see paragraphs 6.79–6.82).
A1.79 Recording subsidies (25) is clarifi ed. Th e
treatment of subsidies in cases when an institutional
unit acts on behalf of another unit to redistribute the
subsidies is explained in paragraph 6.84. It is also clar-
ifi ed that subsidies are receivable by all resident and
nonresident producers, and that units such as gen-
eral government units, nonprofi ts institutions serving
households, and households can receive subsidies in
their capacity as producers (see paragraph 6.86). Th e
coverage of subsidies is extended to include the im-
plicit subsidy that results from the central bank impos-
ing a rate of interest other than the market rates (see
paragraphs 5.70 and 6.89, Box 6.2). Th e discussion
on subsidies also introduced the distinction between
subsidies on products and subsidies on production to
better align with this distinction in the 2008 SNA (see
paragraphs 6.89–6.90).
A1.80 To further delineate subsidies, a list of items
that do not constitute subsidies is included (see para-
graph 6.91), and Box 6.3 elaborates on transactions
with public corporations with specifi c reference to
the classifi cation of “capital injections” into public
corporations.
A1.81 Th e defi nition of grants (26) is revised to no
longer refer to grants as noncompulsory transfers. Th is
change accommodates cases where compulsory rev-
enue sharing occurs between government units. Th e
defi nition is also expanded to indicate that grants are
transfers that do not meet the defi nition of a tax, sub-
sidy, or social contribution (see paragraph 6.92).
A1.82 Th e treatment of grants in kind is elaborated
on, specifi cally describing the distinction between
current and capital grants, and the time of recording
in, respectively, an accrual and cash basis of recording
(see paragraph 6.93–6.95).
A1.83 Th e circumstances under which social as-
sistance benefi ts (272) become payable are clarifi ed
to include contributions payable to social insurance
schemes on behalf of households who cannot oth-
erwise aff ord to participate in the scheme (see para-
graph 6.102).
A1.84 Th e distinction between imputations for
employment-related nonpension social benefi ts and
employment-related pensions and other retirement
benefi ts is clarifi ed in paragraph 6.105.
A1.85 Th e time of recording dividends (2811)
when using an accrual basis of recording is clarifi ed
to be when the equity or shares go ex-dividend (see
paragraphs 3.87, 5.112, and 6.109). Th e treatment of
disproportionately large dividends is clarifi ed (see
paragraphs 5.116 and 6.110).
A1.86 Th e coverage of property expense for invest-
ment income disbursements (2813) is expanded to
include distributions to holders of investment fund
shares or units (see paragraph 6.113).
A1.87 It is clarifi ed that rent (2814) includes
amounts payable under resource leases on land, sub-
soil resources, and on other natural resources. Th e
measurement of such amounts payable is clarifi ed in
the context of the corresponding revenue item (see
paragraph 6.120).
A1.88 Th e GFSM 2014 assumes the 2008 SNA and
BPM6 treatment of reinvested earnings on foreign di-
rect investment (2815) (see paragraph 6.121).
A1.89 Th e GFSM 2001 expense categories for mis-
cellaneous other expense (282) are subsumed in two
new categories in the GFSM 2014—namely, transfers
not elsewhere classifi ed (282) and premiums, fees, and
claims payable related to nonlife insurance and stan-
dardized guarantee schemes (283) (see paragraphs
6.122 and 6.125, respectively). Th e transfers are