276 Government Finance Statistics Manual 2014
if supplementary information is available on policy
lending, both the overall balance and policy lending
can be calculated from GFS source data, as a fi scal in-
dicator (see annex to Chapter 4, Table 4A.2).Balancing Items
A1.182 Several new balancing items are intro-
duced in the GFS framework, a consequence of the
view that fi scal analysis must include a variety of con-
siderations and that no single measure is suffi cient for
all purposes. In the GFSM 1986, the analytic frame-
work is focused on a single balancing item, the overall
defi cit/surplus, although provision is made for other
balancing items.
A1.183 Th e analytic framework of the integrated
GFS features several balancing items. Th e Statement
of Operations includes the following:- Th e net operating balance, which is defi ned as
revenue minus expense and represents the change
in net worth resulting from transactions - Net lending/net borrowing, which is defi ned as
the net acquisition of fi nancial assets minus the
net incurrence of liabilities, or, alternatively, as
the net operating balance minus the net invest-
ment in nonfi nancial assets; it is also equal to the
gross operating balance minus gross investment
in nonfi nancial assets.
A1.184 Th e Statement of Sources and Uses of Cash
includes the cash surplus/defi cit to indicate the bal-
ance of cash fl ows from government operations and
the gross investment in nonfi nancial assets. It is similar
to the overall defi cit/surplus of the GFSM 1986 except
that net cash outfl ows from policy lending (lending
minus repayment of policy-related transactions in fi -
nancial assets or liabilities) are not subtracted.
A1.185 Another balancing item in the GFS frame-
work is the overall balance, defi ned as net lending/
net borrowing adjusted through the rearrangement of
transactions in assets and liabilities that are deemed to
be for public policy purposes. Notably, policy lending
is added to expense while privatization proceeds (in-
cluding fi xed asset sales) are included as transactions
in fi nancial items in calculating the overall fi scal bal-
ance. It is the equivalent of the overall defi cit/surplus
in the GFSM 1986, but determined using the accrual
basis of recording.
A1.186 Other balancing items in the GFS frame-
work include net worth, net fi nancial worth, the
change in net worth, the change in net fi nancial worth
(all related to the balance sheet), the change in net
worth from other economic fl ows, the primary bal-
ance, and savings. Th ere are no similar balancing
items in the GFSM 1986.Harmonization with Other Statistical Systems
A1.187 Th e GFS framework is harmonized with
other international macroeconomic statistical sys-
tems. Th at is, the basic concepts, defi nitions, and con-
ventions are the same to the extent possible, given the
objective of the GFS framework to provide data that
support fi scal analysis. Th e other statistical manuals
with which the GFS framework has been harmonized
are the 2008 SNA, the sixth edition of the IMF’s Bal-
ance of Payments and International Investment Posi-
tion Manual, and the IMF’s Monetary and Financial
Statistics Manual (in the process of being updated). In
contrast, the GFSM 1986 follows the 1968 version of
the SNA where possible, but the degree of harmoniza-
tion is much less, primarily because of the use of the
cash basis of recording in the GFSM 1986. Appendix 7
of this Manual provides additional information on
linkages of the GFS framework with other macroeco-
nomic statistics.