Concepts and definitions

Consolidated financial balance/flows

Financial assets and liabilities can be presented in consolidated form, i.e., after elimination of intra-sectorial transactions within sub-sectors (e.g. debts between municipalities) and between sub-sectors (including municipalities' debts to the state, employment pension corporations and other social security institutions within the general government sector). Consolidated data only show the relative positions of the sectors.

Debt securities

Debt securities comprise all marketable debt instruments, such as Treasury bills, securities issued by municipalities, bank certificates of deposit, commercial papers, bonds and convertible bonds.

ESA 2010

ESA 2010 = European System of Accounts 2010, the EU's revised Regulation that steers the compilation of economic statistics.

Financial accounts

The system of financial accounts (i.e. the financial accounting system) shows the financial assets and liabilities of the different sectors of the economy, as well as financial transactions that have an impact on these financial assets and liabilities. The financial accounts consist of 1) the financial balance at the end of the year, and 2) a record of the financial transactions involving financial assets and liabilities during the year. The financial accounts are part of the national accounts.

The financial accounts are statistical tables which are based on other financial statistics as well as e.g. sector statistics containing data on balances and flows.

Financial assets

Financial assets are economic assets, comprising means of payment, financial claims and economic assets which are close to financial claims in nature.

Financial claims entitle their owners, the creditors, to receive a payment or series of payments without any counter-performance from other institutional units, the debtors, who have incurred the counterpart liabilities.

Financial assets are divided into eight sub-categories: Monetary gold and special drawing rights (AF1), Currency and deposits (AF2), Debt securities (AF3), Loans (AF4), Equity and investment fund shares or units (AF5), In-surance, pension and standardised guarantee schemes (AF6), Derivatives and employee stock options (AF7), and Other assets and liabilities (F8).

Financial assets category

The financial assets category includes all financial instruments that are described in the financial accounts.

The main classification criteria are the asset's liquidity and the laws that regulate its use. The asset must correspond to an unconditional liability; contingent assets are included only if they have a market value or can be offset against other liabilities.

Financial liabilities

Financial liabilities are economic liabilities that are categorised in the same manner as financial assets. Liabilities represent the counterpart of assets, i.e., an asset of one sector is always recorded as a liability of another sector.

Financial transactions

Financial transactions are transactions in financial assets and liabilities be-tween institutional units, and between them and the rest of the world.

The item shows which sectors are net lenders and which sectors are net bor-rowers, the form of the financial asset or liability and the amount .

Financial transactions are classified into eight main categories, which are subdivided into subcategories. The classification is consistent with the classi-fication of the balance sheet totals of financial assets and liabilities.

Financial transactions, net

Finansiella nettotransaktioner utgör differensen mellan nettoanskaffningen av finansiella tillgångar och nettoanskaffningen av finansiella skulder. En sektor är nettoutlånare under perioden, om sektorns finansiella tillgångar ökar mer än dess finansiella skulder. Begreppet motsvarar begreppet netto-utlåning/-upplåning i nationalräkenskaperna.

Holding gain and loss

Holding gains and losses result from changes in the prices of assets. They occur on all kinds of financial and non-financial assets, and on liabilities. Holding gains and losses accrue to the owners of assets and liabilities purely as a result of holding the assets or liabilities over time, without transforming them in any way.

Holding gains and losses measured on the basis of current market prices are called nominal holding gains and losses. These may be decomposed into neutral holding gains and losses, reflecting changes in the general price level, and real holding gains and losses, reflecting changes in the relative prices of assets.

Households' indebtedness ratio

Households' indebtedness ratio is calculated as the ratio of their loan debts at end of a quarter to their total disposable income during the preceding four quarters

Net acquisition of debt

Net amount of debt incurred during a specific period of time.

Net acquisition of financial assets

Net amount of financial assets acquired during a specific period of time.

Net lending/net borrowing

Net lending/borrowing is a balancing item in the capital account and the fi-nancial account.

Net lending/borrowing corresponds to the amount available to a unit or sec-tor for financing, directly or indirectly, other units or sectors, or the amount which a unit or sector is obliged to borrow from other units or sectors.

The corresponding concept to net lending/borrowing in financial accounts is financial transactions, net. It is the difference between net acquisition of fi-nancial assets and liabilities. If a sector acquires financial assets in excess of the amount of new debt incurred during the period it is a net lender.

Non-consolidated financial balance/flows

Financial assets and liabilities can be presented in non-consolidated form, i.e. all transactions are shown in full, including intra-sectorial and intra-sub-sectorial transactions. Intra-sectorial transactions in sectors consisting of a single institutional unit are nevertheless eliminated (e.g. borrowing within the central government sector). Intra-sectorial transactions do not have any impact on the sector's net worth or net lending.

Statistical discrepancy

Statistical discrepancy is the difference between demand and supply in na-tional accounts. Even though by definition the items should be equal in the national economy, they usually deviate from one another due to deviation in statistical sources and they are not forced to be equal in the Finnish system of accounts.

In financial accounts, the statistical discrepancy describes the difference be-tween net lending in financial accounts and non-financial national accounts.

Referencing instructions:

Official Statistics of Finland (OSF): Financial accounts [e-publication].
ISSN=1458-8145. Helsinki: Statistics Finland [referred: 22.10.2017].
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