The Integrated Approach to Economic Statistics “The Canadian Approach” Friends of the Chair Group on Integrated Economic Statistics Marie Brodeur, Michel

The Integrated Approach toThe Integrated Approach toEconomic StatisticsEconomic Statistics

“The Canadian Approach” “The Canadian Approach” Friends of the Chair Group on Integrated Economic Friends of the Chair Group on Integrated Economic StatisticsStatistics

Marie Brodeur, Michel GirardMarie Brodeur, Michel GirardBern, SwitzerlandBern, Switzerland

June, 2007June, 2007

Statistics CanadaStatistique Canada

Overview of the presentation

1. Historical Context

2. UES Background

3. Integrated Approach Principles

4. Survey Characteristics

4. Business Register

6. Sampling

7. Enterprise Financial Program

8. Use of Tax Data/Chart of Accounts

9. Data Processing

10. Management of the UES

11. Future Directions


1. Historical Context

Before 1986, various production accounts were not synchronized and developed independently of IE accounts

1986: From 3 GDP measures to a unique one Beginning of the reconciliation period

1997 Historical Revision Further integration of concepts + SNA 1993 Implementation of NAICS/Harmonization of

classificationsMake uniform definition public sectorFirst real step towards integration

Program to Improve Provincial Economic Statistics (PIPES)Fiscal programs


Fiscal Programmes

Tendency to use SNA statistics because of their coherence From survey data and government statistics –

Financial Management System to,To production accounts, IE accounts

Higher quality and coherence of regional statisticsHST allocationEqualization Eventually First Nation Sales Tax

Coherence (structure) - consistency (frequency)


2. UES Background

Major project to improve provincial statistics (1996)

Occasion to improve consistency, coherence, breadth and depth of business survey data

More detailed Industry & Commodity data

Creation of Enterprise Statistics Division (ESD)

Gradual Expansion of Surveys; Covers 65% of GDP


3. Integrated Approach Principles

Use of Single, Unduplicated Frame -- the BR

Common Sample Design Methodology

Maximum Use of Tax Data

Reduction of Response Burden

Integrated Questionnaire simple language; harmonized concepts / common variables


3. Integrated Approach Principles (continued)

Centralized Data Collection

Enterprise Portfolio Managers

Common Generic Processing Systems and Methods

Centralized Warehouse for processing and analytical purposes


4. Survey Characteristics

Separate Enterprise & Establishment Surveys 64 Establishment Surveys Over 55,000 collection entities representing about

68,000 establishments (17K replaced by tax for RY 2007)

Centralized Collection -- $3.5 million budget Smallest businesses estimated through tax data


5. Business Register (BR)

BR covers all sectorsAll economic units producing goods and

services in Canada Incorporated and unincorporated businesses Complex and simple enterprises Structure for Reference Year 2007

LegalOperational

Updated with Administrative Data


Types of Administrative (Tax) Data

From the Canadian Revenue Agency (CRA)

Agreement between CRA and STC T1 (unincorporated businesses) T2 (incorporated businesses) T4 (pay slips) GST (goods and service tax) PD7 (payroll deduction accounts)


BR Structure

Business Accounting

Investment centreProfit centreCost centreRevenue centre

Statistical Structure

EnterpriseCompanyEstablishmentLocation


Deliniation of the statistical units

Statistical structure: Conversion of operating structure Pros:

Creates standardized structures that support sampling Provides the basis for complete and unduplicated reporting

Cons: Creates many units that are identical to the units recorded in the

operating structure Creates units and structures that do not correspond to the real world

organizational components Do not treat each enterprise the same way Add complexity to the data collection process Coherence analysis is more difficult to perform

Use the operating structure instead of the statistical structure starting with RY 2007

Recommandations


ABCLtd

Profit centre

Profit centre

Investment centre

Using the operating structure

Cost Centre

ABCLtd

Profit centre

Profit centre

Profit centre

Profit centre

Using the operating structure

Cost Centre

Cost Centre

5. Sampling

Stratified Random Sample

Industry (NAICS 4) Province Size

1 Take-all stratum2 Take-some strata (50% of units replaced by

tax)Take-none strata (under thresholds)

6. Sampling


Stratification in One Look

Take-some 2

Cell

Must takeunits

Exclusion Thresholds:

To reduce response burden on small enterprises

Sam

plin

g re

venu

e

Take-all

Take-some 1

Take-none

T2

T1 Take-None:

Sample of e-filers

T2 Take-None:

Census of General Index of Financial Information (GIFI)

ROYCE-MARANDA THRESHOLDS

Main sample to be surveyed

Not eligible for tax : questionnaire

Tax replaced

Characteristic survey (some Services surveys) or

questionnaire (all other divisions)

T1

Main sample to be surveyed

RY2007 Methodology: Tax Replacement

Monitor the size, the financial structure and position of the corporate sector

Business Register Survey of complex enterprises over $250 millions in

revenues or assets Consolidated Balance Sheets and Income

Statements, corporate taxation Use of Tax data

7. Enterprise Financial Program


Enterprise Content

QFSS: Quarterly Survey of Financial StatementsBS, income statements, change in financial

position, financing position, rate of return and other financial ratios

Corporate profits and CCASector accounts

AFTS: Annual Financial and Taxation SurveyQSFS + Public Accounts (GBE) + Tax Data


8. Use of Tax data

Objective is to substitute 50% of simple establishments.

Direct Data Replacement for annual surveys usingT1(unincorporated)T2 (incorporated)

Facilitated by the Chart of Accounts (COA). Result

Almost 65% of units replaced by tax data Impact of 27% in the total estimate


DISSEMINATION

COLLECTION

Chart of Accounts

SalesOperatingrevenue Cost of

sales

Grossprofit Expenses

EBIT

OutputsInputs

Valueadded

Shipments OperatingSurplus

GDP

LINK, BRIDGE, CONCORDANCE

Expected Benefits of a Chart of Accounts

Standardization in business data collection Higher survey response Increase in quality of data Comparison of data from various sources Increase efficiency in using administrative data


Links to Chart of Accounts

CHART OF

ACCOUNTEstablishment

Legal entity

Enterprise

UES: Use of Tax Data

Validation (comparison)Verify dubious collected data against the

equivalent tax data record Imputation

One of the methods used for non-response Estimation

Below take-noneDirect Data Replacement Some annual surveys 100% tax (Taxi &

Limousines, Survey of Mapping) Update Business Register Allocation of survey data (use tax revenues, salaries and

expenses)


Develop centralized systems Move away from stand-alone Single point of access for security

Integrated Questionnaire Metadata System Edit and imputation Allocation and Estimation Data Warehouse

9. Centralized Processing Systems and Databases


Centralized CollectionCentralized Collection

Mailout(38K CEs)

Pre-Contact(17K Businesses)

Edit / Verification(BLAISE)

Receipt(75% target)

Delinquent Follow-Up

Capture / Imaging

“Clean” Records

Score Function

Enterprise Portfolio Managers

Top 350 enterprises in Canada Status

Platinum, Gold, Silver, Bronze Personal visits Enterprise Profiling Coordination of mail-out and collection Enterprise/ Establishment coherence Holistic Response Management

Strategic Response UnitEscalation Process / Statistics Act


Post-Collection ProcessingPost-Collection Processing

Pre-Grooming

Allocation / Estimation

Edit & Imputation

“Clean” Records

Central Data Store

Subject Matter Review & Correction

Tool

Tax Data

USTART

10. Management of the UES

ESD provides functional support and coordination A series of committees is charged with process

clarification & decision making

Project Management Team

Operations Management Committee

FrameOperations

SamplingTax Data

OperationsContent /Collection

ProcessingOperations

11. Future Directions

Business Register Redesign for RY2007

North American Product classification System

Service inputs

Data Integration Project

Make a more efficient use of tax data

“Holistic Response Management” strategy

Welcome new surveys


Documents

The Integrated Approach to Economic Statistics “The Canadian Approach” Friends of the Chair Group on Integrated Economic Statistics Marie Brodeur, Michel