## BPM7 Chapter 3/2025 SNA Chapter 4. Flows, Stocks, and Accounting Rules: Annotated Outline ## Source details **Canonical URL:** [BPM7 Chapter 3/2025 SNA Chapter 4. Flows, Stocks, and Accounting Rules: Annotated Outline](https://www.imf.org/-/media/files/data/statistics/bmp7/final-annotated-outlines/bpm7-chapter-32025-sna-chapter-4-flows-stocks-and-accounting-rules-annotated-outline.pdf) ## Other formats - [Markdown version](/-/media/files/data/statistics/bmp7/final-annotated-outlines/bpm7-chapter-32025-sna-chapter-4-flows-stocks-and-accounting-rules-annotated-outline.pdf.md) - [Structured JSON version](/-/media/files/data/statistics/bmp7/final-annotated-outlines/bpm7-chapter-32025-sna-chapter-4-flows-stocks-and-accounting-rules-annotated-outline.pdf.json) --- ### Introduction - Scope: chapter discusses flows, stocks, and accounting rules covering both national and international accounts, following the 2008 SNA Chapter 3 structure with targeted additions from BPM6 and guidance notes. - Organization: five main sections—B Flows; C Stocks; D Balancing Items; E Accounting Rules; F Symmetry of Reporting in International Accounts. - Balancing items: a sub-section will include balancing items relevant for international accounts. ### Flows - Transactions - Coverage: monetary transactions (exchanges or transfers, rearrangement, rerouting, and partitioning), non-monetary transactions (barter, remuneration in kind, transfers in kind, and internal transactions), and externalities and illegal actions. - Additions from BPM6 paragraph 3.18: examples to be added for rerouting include: - retained earnings of investment funds - government has a nonresident entity to undertake fiscal functions related government borrowing - implicit taxes or subsidies associated with multiple exchange rate regime - Partitioning/portioning of assets: text to include examples based on emission trading permits (GN WS.7), potential split asset approach for natural resources (GNs WS.6, WS.10, and WS.11), and dual use of assets for consumption and production purposes (e.g., household car used for taxi services and personal use). - Unbundling of travel-package services: inclusion following GN C.7 (after paragraph 3.68). - Terminology change: monetary transactions by “units facilitating a transaction on behalf of others” (paragraphs 3.69–74) will be called “reassigning transactions”, consistent with GFSM 2014; reassignment records the transaction as taking place directly by the two principal parties. - Other Flows - Coverage: other changes in the volume of assets and holding gains and losses (as in 2008 SNA). - Crypto assets: potential inclusion depending on outcome of GN F.18. - Change of residence of individuals: changes in status of existing financial claims/liabilities arising from change in residence treated as other changes in the volume of assets (see BPM6, paragraph 3.21). ### Stocks - Structure: sub-sections on benefits; ownership; definition of an asset; financial assets and liabilities; nonfinancial assets; the asset boundary; entry and exit of assets from the balance sheet; exclusions from the asset boundary. - Nonfinancial assets: separate sub-section to be included prior to asset boundary; reference to 2025 SNA Chapter 11 “Capital Account”. - Ownership - Clarification on economic ownership of (non-renewable) natural resources, biological resources, and renewable energy resources (dependent on outcomes of GNs WS.6, WS.8, and WS.11). - Economic ownership of intellectual property products (IPPs): brief guidance following GN G.5; economic ownership for previously produced IPP depends on underlying arrangement and recommends using decision tree from the UNECE Guide to Measuring Global Production (GMGP) to determine economic owners of IPP across an MNE group; special purpose entities (SPEs) can be economic owners of IPP assets. Cross-reference to BPM7 Chapter 15/2025 SNA Chapter 23 Globalization. - Financial assets and liabilities: clarify that the international investment position covers financial assets and liabilities that have an international character (based on BPM6, paragraph 3.25). - Asset boundary: further clarification on provisions (financial-asset-related, nonfinancial-asset-related, and unrelated to asset ownership) following recommendation of GN WS.9; updated reference to 2025 SNA Chapter 14 “Balance Sheet” (updated Table 13.1 of 2008 SNA). ### Balancing Items - Flow and stock accounts: discussion of balancing items in flow accounts and balancing items in stock accounts, as in 2008 SNA. - International accounts: inclusion of balancing items specific to international accounts drawn from BPM6, paragraphs 3.126–129. ### Accounting Rules - Types of Accounting System - Coverage: vertical double-entry bookkeeping, horizontal double-entry bookkeeping, and quadruple-entry bookkeeping; applications to national and international accounts. - Additions from BPM6 (paragraphs 3.26–29): - Vertical double-entry bookkeeping: international accounts for an economy are to be compiled on a vertical double-entry bookkeeping basis from the perspective of the residents of that economy. - Horizontal double-entry bookkeeping: example on dividends payable to illustrate that at the worldwide level, dividends payable by all economies should be equal to dividends receivable by all economies. - Quadruple-entry bookkeeping: definitions, classifications, and accounting principles in international accounts derived from conceptual symmetry and symmetric reporting; quadruple approach needed for bilateral comparisons and global integrated data. - Conventions and terminologies for recording flows to be discussed (BPM6, paragraphs 3.30–31). - Valuation - Coverage: valuation of transactions; valuation of partitioned flows; special valuation concerning products; valuation of other flows; valuation of positions of financial assets and liabilities. - Additions and clarifications: - Definition of market prices from BPM6 (paragraph 3.67) to be added. - Concessional pricing (paragraph 3.134): never record a transfer element for concessional lending in the “central framework” of national accounts and external sector statistics, except for concessional loans provided by employers to employees (as per GN F.15); references to relevant BPM7/2025 SNA chapters for details. - Valuation of imports and exports of goods (paragraph 3.149): current standard using free on board (FOB) retained; observed transaction value conceptually preferred and, subject to further testing, may be introduced as the standard in the next version of the manuals (following GN G.1); see BPM7 Chapter 10 “Goods Account” for details. - Valuation of positions of financial assets and liabilities: - Include relevant parts of BPM6 text in paragraphs 3.84–87 and 3.90. - Following GN F.8, explicit guidance to compile stock of debt securities at nominal value as a supplement to existing market valuation will be emphasized (references to relevant BPM7/2025 SNA chapters). - Following GN D.2, updated guidance on valuation of unlisted equity will be briefly mentioned (references to relevant BPM7/2025 SNA chapters). - GN AI.1 (still under discussion) may have implications for valuation language; no impact on main principles envisaged at this stage. - Time of Recording - Coverage: items as in 2008 SNA with specific additions. - Redistributive transactions (paragraph 3.171): (i) do not record fine/penalty transactions until the unit issuing the fine has an “unconditional claim to the funds”; if a judgment or ruling is subject to further appeal, an unconditional claim exists “when the appeal is resolved” (specifically for balance of payments), following GN C.8; and (ii) guidance on time recording of deferred or waived rental payments (IMF Special Series Note on Recording of Deferred or Waived Rental Payments). - Financial assets and liabilities: add details on time of recording of employee stock options and one of (nonstandardized guarantees) from BPM6, paragraphs 3.58–59. - Nonproduced nonfinancial assets: add time of recording of transactions (based on BPM6, paragraph 3.53). - Timing adjustments for international transactions: include additional details from BPM6 paragraphs 3.61–66. - Unit of Account and Currency Conversion - Coverage: unit of account; domestic versus foreign currency; currency of denomination and currency of settlement; currency conversion principles (BPM6, paragraphs 3.92–108). - Aggregation, Netting, Consolidation - Coverage: principles of aggregation, netting, and consolidation as in 2008 SNA. - Additions from BPM6: - Aggregation: details relevant for international accounts from BPM6, paragraphs 3.109–113. - Netting: details for international accounts from BPM6, paragraphs 3.114–121. ### Symmetry of Reporting in International Accounts - Based on Section G, Chapter 3, BPM6: discussion of conceptual symmetry and symmetric reporting by partner economies to support bilateral and global data consistency. ### Schematic Overview (chapter structure) - A Introduction - 1. Stocks and Flows - 2. Balancing Items - 3. Grouping Stocks and Flows into Accounts - 4. Accounting Rules - B Flows - 1. Transactions - 2. Other Flows - C Stocks - 1. Benefits - 2. Ownership - 3. The Definition of an Asset - 4. Financial Assets and Liabilities - 5. Nonfinancial Assets - 6. The Asset Boundary - 7. Entry and Exit of Assets from the Balance Sheet - 8. Exclusions from the Asset Boundary - D Balancing Items - E Accounting Rules - 1. Types of Accounting System - 2. Valuation - 3. Time of Recording - 4. Unit of Account and Currency Conversion - 5. Aggregation, Netting, Consolidation - F Symmetry of Reporting in International Accounts --- _Source: https://www.imf.org/-/media/files/data/statistics/bmp7/final-annotated-outlines/bpm7-chapter-32025-sna-chapter-4-flows-stocks-and-accounting-rules-annotated-outline.pdf_