Notes
FINANCIAL ACCOUNTS OF LITHUANIA
Financial accounts present data on financial assets and
liabilities amounts outstanding of institutional sectors at the end of period,
and changes in financial assets and liabilities (transactions, revaluation and
other volume changes) between the institutional sectors. They are an integral
part of the System of national accounts. The methodology, main concepts and
accounting rules are based on Council Regulation (EC) No 2223/96 of 25 June 1996
on the European system of national and regional accounts in the Community (ESA
95)1 Annex A2.
Under ESA 95 the institutional unit is an economic
unit, which is entitled to own goods or assets in its own right and incurs
liabilities on its own behalf and which is able to exchange the ownership of
goods or assets in transactions with other institutional units. Institutional
units are grouped into institutional sectors and subsectors on the basis
of the type of their principal activity and function.
INSTITUTIONAL SECTORS AND SUBSECTORS
Non-financial corporations S.11
- Public corporations S.11001
- National private corporations S.11002
- Foreign controlled corporations S.11003
Financial corporations S.12
- Central bank S.121
- Other monetary financial institutions S.122
- Other financial intermediaries, except insurance
corporation and pension funds S.123
- Financial auxiliaries S.124
- Insurance corporations and pension funds S.125
General government S.13
- Central government S.1311
- State government S.1312
- Local government S.1313
- Social security funds S.1314
Households S.14
Non-profit institutions serving households S.15
Rest of the world S.2
- The European Union S.21
- The member countries of the EU S.211
- The institutions of the EU S.212
- Third countries and international organisations S.22
Institutional units of Lithuania are grouped into
institutional sectors and subsectors according to ESA 95 requirements.
S.11 Non-financial corporations
S.11 in Lithuania is not broken down to subsectors. It covers
private and public institutional units, which are market producers of goods and
non-financial services. When deciding on sector of the institutional unit its
legal status and activity are taken into account. This sector includes closed
stock companies, joint stock companies, state and municipal enterprises,
non-profit institutions, which cover the larger part of their activity costs by
income from goods and services. This sector does not include personal
enterprises (sole-proprietorships), even though they are market producers. These
institutional units in Lithuania are included into households sector.
S.12 Financial corporations
S.12 in Lithuania includes private and public institutional
units that are engaged in financial intermediation and financial auxiliary
activity.
Subsector S.121 Central bank includes the Bank of Lithuania.
Subsector S.122 Other monetary financial institutions covers
commercial banks, foreign banks branches, central credit union, credit unions
and money market funds.
Subsector S.123 Other financial intermediaries, except
insurance corporation and pension funds includes open-end and closed-end
collective investment undertakings (CIU), security dealers on own accounts,
financial leasing companies, factoring companies, venture capital companies,
companies that finance persons and business, investment holding companies.
Subsector S.124 Financial auxiliaries covers category
securities brokers and investment advisers, managers of pension funds and mutual
funds, insurance brokers and agents, guarantees companies, supervisory
authorities (Securities Commission, Insurance Supervision Commission), Vilnius
Securities Exchange, Central Securities Depository of Lithuania, state company
Deposit Insurance Fund, non-profit institutions serving financial corporations.
Subsector S.125 Insurance corporations and pension funds
covers life and non-life insurance corporations and autonomous pensions funds.
S.13 General government
S.13 in Lithuania consists of central government, local
government and social security funds subsectors. Administration of counties is
an area of activity of the central government in Lithuania.
Subsector S.1311 Central government in Lithuania includes all
state administrative institutions and central agencies, the competence of which
covers all economic area, except for administration of social security funds.
This subsector also includes 6 extra budgetary funds: Privatisation Fund,
Savings Restitution Fund, Blockade 1990 Fund, Guarantee Fund, Reserve
Stabilization Fund, Fund for Decommissioning of Ignalina Nuclear Power Plant.
Subsector S.1313 Local government consists of public
administration that covers local part of economic area, except for
administration of social security funds.
Subsector S.1314 Social security funds consists
Social Insurance Fund (SODRA) and its local units,
the Health insurance Fund and its local units, Lithuanian
Labour exchange and its local units, Employment fund.
S.14 Households
Households sector in Lithuania covers individuals or groups
of individuals as consumers and encompasses farmers, own-account workers and
personal enterprises (sole-proprietorships) as market producers.
S.15 Non-profit institutions serving households
S.15 consists of trade unions, various societies, consumer
associations, political parties, churches and religious societies,
multiapartment house owners’ societies, as well as social, cultural, leisure and
entertainment and sports clubs, charity and aid organisations.
ACCOUNTING RULES OF FINANCIAL ACCOUNTS
Accounting rules of financial transactions
Financial transactions are transactions in financial assets
and liabilities between institutional units, and between them and rest of the
word.
Financial assets are economic assets, comprising means of
payment, financial claims and economic assets, which are close to financial
claims in nature.
ESA 95 distinguishes seven categories of financial assets.
The classification of financial transactions corresponds to the classification
of financial assets and liabilities. In the system, each financial asset has a
counterpart liability, with the exception of those financial assets classified
in the category monetary gold and special drawing rights (AF.1). Six categories
of liabilities are distinguished corresponding to the categories of the
counterpart financial assets.
Seven financial instruments groups are distinguished:
|
Financial instrument |
Code |
|
Monetary gold and special drawing rights |
AF/F.1 |
|
Monetary gold |
AF/F.11 |
|
Special drawing rights |
AF/F.12 |
|
Currency and deposits |
AF/F.2 |
|
Currency |
AF/F.21 |
|
Transferable deposits |
AF/F.22 |
|
Other deposits |
AF/F.23 |
|
Securities other than shares |
AF/F.3 |
|
Securities other than shares, excluding financial
derivatives |
AF/F.33 |
|
Short-term |
AF/F.331 |
|
Long-term |
AF/F.332 |
|
Financial derivatives |
AF/F.34 |
|
Loans |
AF/F.4 |
|
Short-term |
AF/F.41 |
|
Long-term |
AF/F.42 |
|
Shares and other equity |
AF/F.5 |
|
Shares and other equity, excluding mutual funds shares |
AF/F.51 |
|
Quoted shares |
AF/F.511 |
|
Unquoted shares |
AF/F.512 |
|
Other equity |
AF/F.513 |
|
Mutual fund shares |
AF/F.52 |
|
Insurance technical reserves |
AF/F.6 |
|
Net equity of households in life insurance reserves and
in pension funds reserves |
AF/F.61 |
|
Net equity of households in life insurance reserves |
AF/F.611 |
|
Net equity of households in pension funds |
AF/F.612 |
|
Prepayments of insurance premiums and reserves for
outstanding claims |
AF/F.62 |
|
Other accounts receivable/payable |
AF/F.7 |
|
Trade credits and advances |
AF/F.71 |
|
Other |
AF/F.79 |
Financial transactions result in changes in balance sheets.
However, the changes between the opening balance sheet and the closing balance
sheet may also include other flows. The other flows are broken down into
revaluations in financial assets and liabilities due to changes in price and
fluctuations in the exchange rate that are recorded in revaluation account, and
changes in the volume of financial assets and liabilities that are recorded in
the account of other changes in volume. Relation of opening balance sheet,
closing balance sheet and financial transactions can be illustrated by this
equation:
Opening balance sheet + Financial transactions + Revaluations
+ Other changes in volume = Closing balance sheet
In Lithuania financial transactions are calculated indirectly
in most cases, i.e., as a difference between opening and closing quarterly
financial balance sheets minus revaluations, minus other changes in volume.
Consolidated and non-consolidated financial accounts
Financial accounts may be consolidated and non-consolidated.
The non-consolidated financial accounts of a sector show all financial
transactions in which institutional units classified in the sector or subsectors
are involved. In the consolidated financial accounts financial transactions
between institutional units classified in the sector and subsector are
eliminated. For consolidation purposes all transactions and positions are broken
down to:
- “intra” transactions and positions (reciprocal financial
assets/liabilities) that relate to a subsector
- “inter” transactions and positions that relate to the
sector as a whole whereas each of its subsectors is considered as a single
entity.
On this basis consolidated data at the level of one subsector
means that the “intra” transactions and positions have been eliminated.
Consolidated data at the level of the sector means that the
“intra subsectors” and the “inter subsectors” transactions and positions have
been eliminated in the data.
Non-consolidated data at the level of the subsector mean that
all “intra” transactions and positions are included in the data.
Non-consolidated data at the level of the sector means that
the “intra subsectors” and the “inter subsectors” transactions and positions are
included in the data; this is obtained by summing the subsectors.
Valuation at market price
Market prices are ESA 95 basic reference for valuation.
Therefore, financial assets and liabilities have to be valuated at market price.
This rule does not apply for financial assets and liabilities that do not have a
secondary market. These are deposits, loans, and other accounts payable/receivable.
Accrual principle
The ESA 95 requires to record flows on an accrual basis; that
is, when transaction takes place, not when the corresponding payment is made.
In financial accounts accrual principle is applied for:
- Interest receivable/payable that are recorded as
reinvested financial assets.
- Trade credits when time of delivery of goods and
services does not coincide with a corresponding payment.
- Other accounts payable/receivable, which arise from
timing differences between accrued transactions and the corresponding
payments made in respect of taxes, social contributions, wages and
salaries, rents, etc.
___________________
1OJ L 310 of 30.11.1996, p. 1; Regulation as last amended by Regulation (EC) No 1267/2003 of the European Parliament and of the Council of 16 June 2003 (OJ L 180, 18.7.2003, p. 1).
2(http://forum.europa.eu.int/irc/dsis/nfaccount/info/data/esa95/en/titelen.htm).
