The Measurement of Reinvested Earnings in the Balance of Payments

Author/Editor:

Jack Bame

Publication Date:

September 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper notes that, for the first time, the concept and treatment of reinvested earnings in the Fund’s Balance of Payments Manual and the 1993 System of National Accounts are fully harmonized. The paper presents the conceptual basis for the measurement of reinvested earnings and illustrative examples as to recording, from the Fund’s Balance of Payments Compilation Guide and Balance of Payments Textbook. Highlighted are the recommended time of recording of reinvested earnings, the calculation of earnings on a current operating basis, and the calculation of depreciation at replacement cost, notwithstanding possible practical difficulties in implementation.

Series:

Working Paper No. 1995/094

Subject:

Foreign direct investment Income National accounts Stocks Wages

English

Publication Date:

September 1, 1995

ISBN/ISSN:

9781451950724/1018-5941

Stock No:

WPIEA0941995

Pages:

20

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