Government Finance Statistics Manual 2014

186 Government Finance Statistics Manual 2014

7.82 Work in progress inventories are valued on

the basis of the cost of production at current prices

as of the balance sheet date. Th e value of standing

timber and other cultivated crops may be estimated

by discounting the future proceeds of selling the fi nal

product at current prices and the expenses of bringing

the product to maturity.

Finished goods (61223)

7.83 Finished goods (61223) consist of goods that

are the output of a production process, are still held by

their producer, and are not expected to be processed

further by the producer before being supplied to other

units. Finished goods may be held only by the units

that produce them. General government units will

have fi nished goods only if they produce goods for

sale or transfer to other units. Inventories of fi nished

goods are valued at their current sales value (before

adding any taxes, transport, or distribution charges)

or at the cost to produce them currently (i.e., their

current replacement prices).

Goods for resale (61224)

7.84 Goods for resale (61224) are goods acquired

for the purpose of reselling or transferring to other

units without being further processed. Goods for

resale may be transported, stored, graded, sorted,

washed, or packaged by their owners to present them

for resale in ways that are attractive to their custom-

ers or benefi ciaries, but they are not otherwise trans-

formed. Any general government unit that sells goods

for economically signifi cant prices, such as a museum

gift shop, is likely to possess an inventory of goods for

resale. Th is category also includes goods purchased by

general government units for provision free of charge

or at prices that are not economically signifi cant to

other units. Goods acquired by government for distri-

bution as social transfers in kind but that have not yet

been so delivered are also included in goods for resale.

7.85 Inventories of goods intended for resale are

valued at their current replacement prices.

Military inventories (61225)

7.86 Military inventories (61225) consist of sin-

gle-use items, such as ammunition, missiles, rockets,

bombs, etc., delivered by weapons or weapons sys-

tems. As noted in paragraph 7.74, in the discussion of

weapons systems as fi xed assets, most single-use items

are treated as inventories, but some types of missiles

with highly destructive capability may be treated as

fi xed assets. Military inventories are valued at their

current replacement prices.

Valuables (613)

7.87 Valuables (613) are produced assets of consid-

erable value that are not used primarily for purposes

of production or consumption but are held as stores

of value over time. Th ey are expected to appreciate, or

at least not to decline, in real value, and they do not

deteriorate over time under normal conditions.

7.88 Included in valuables are:

• Nonmonetary gold and other precious stones and
  metals that are not intended to be used as materi-
  als and supplies in the processes of production


• Paintings, sculptures, and other objects recog-
  nized as works of art or antiques held primarily
  as stores of value over time


• Jewelry of signifi cant value fashioned out of pre-
  cious stones and metals, collections, and miscel-
  laneous other valuables.
  Many items fi tting the description of a valuable
  that are owned by general government units will be
  classifi ed as machinery and equipment not elsewhere
  classifi ed (611222) because they are not held primar-
  ily as stores of value but used in production, such as
  by being displayed in government museums. (See also
  paragraph 7.57.)
  7.89 To the extent that there are well-organized
  markets for valuables, they can be valued at current
  market prices, including any costs of ownership trans-
  fer, such as agents’ fees or commissions. Otherwise,
  the amounts for which they are insured against fi re,
  theft , and other risks may be appropriate.

Nonproduced assets (614)

7.90 Nonproduced assets consist of tangible, nat-

urally occurring assets—natural resources—over

which ownership rights are enforced, and intangible

nonproduced assets (6144) that are constructs of soci-

ety. Natural resources comprise land (6141), mineral

and energy resources (6142), and other naturally occur-

ring assets (6143). If ownership rights have not or can-

not be enforced over naturally occurring resources,

then they are not economic assets.