1. ESSnet on profiling: a project centered on «culture» and process ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

2. ESSnet on « profiling large and complex MNEs »
Objectives and main features of profiling slide 3
The “cultural” changes slides to 9
« Process » changes incoming slide
Consultation, dissemination and future work slide
Annex slides to 15
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

3. => “enterprises” linked between countries through the EGR
ESSnet on « profiling large and complex MNEs » the main objectives of the ESSnet Profiling project
As it is presently not possible “to see the whole elephant”, the ESSnet has been assigned to:
> describe consistently the same MultiNational Enterprises (MNEs) in all the EU countries
=> “enterprises” linked between countries through the EGR
> support efficient data collection in SBS, FATS, FDI & if possible in STS
=> a system of statistical units for all business statistics
> for direct dissemination and for indirect use (National accounts etc)
=> most statistical productions concerned
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

4. Profiling is a method: legal – operational and – accounting
ESSnet on « profiling large and complex MNEs » «Cultural» changes in the approach (1): operational & accounts analysis analysis of structure replaces use of pre-existent units found in admin or legal background; the SUs must have collection capabilities
Profiling is a method:
> to analyse the
legal – operational and – accounting
> structure of an enterprise group
> in order to
- establish the statistical units within that group and
- their links and
- the most efficient structures
> for the collection of statistical data
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

5. > uses the MNEs information system for accounting consolidation
ESSnet on « profiling large and complex MNEs » «Cultural » changes in the approach (2): negociation with MNEs delineation, list, names of “enterprises” built with & agreed by the MNEs.
Profiling :
> uses the MNEs information system for accounting consolidation
> takes the (organisational or management) operating segment as a starting point for delineation of economic “enterprises” (IFRS8), but can differ at the end
> with the result that an enterprise is (can be):
- a single legal unit (if independant)
- an enterprise group (i.e a set of legal unit under common control)
- a part of an enterprise group.
> as “enterprises” are organisational units, their autonomy (in decision making for allocation of their current resources) is an essential characteristic.
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

6. ESSnet on « profiling large and complex MNEs » «Cultural » changes in the approach (3): ESS cooperation to list the SUs from bottom-up/national to top-down/global analysis
Profiling :
> drops the previous “smallest combination of legal units” which is usually: - national
- bottom-up
- usualy non autonomous
as basis of the enterprise;
> uses “a part of an enterprise group” called “global enterprise (GEN)” which is usually:
- top-down
- multinational
- compulsarily autonomous
> and complement it by “truncated enterprises” as national parts of GENs.
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

7. > For most EU statisticians, a large change to the usual way:
ESSnet on « profiling large and complex MNEs » «Cultural » changes in the approach (4):testing ability Is the « enterprise » able to produce structural statistical data ?
> For most EU statisticians, a large change to the usual way:
- from surveying SUs (statistical units), predetermined in the BR,
- to a dialog with MNEs,
- using their common language: the standardised business accounting
> Leads to necessary pre-checkings, from BR staff:
- are the priority variables we need available in the MNE information system at the level of the “enterprises”?
- if yes, are they economically significant?
> The checkings are to be made uppermost at EU level
(then at national level):
- are there theoretically consistent data all over the EU?
- will we be able to gather them consistently from the truncated national parts of the “enterprises”?
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

8. => priority to components of value added
ESSnet on « profiling large and complex MNEs » «Cultural » changes in the approach (4) (continued) : Is the « enterprise » able to produce structural statistical data ?
> What are the priority variables to check, (statisticians view)?
- the usual BR variables (to identify, assess the continuity and link different kind of units, split the populations and stratify);
- the SBS variables; as such and as SBS are main providers of NA;
the NA themselves;
- special attention to outward-FATS statistics, that operate at the MNE level on “enterprises”
> How can the MNEs work on checkings (the business view)?
- they ask for a priority list;
- they want this list to be common to all European countries;
- they ask for common questionnaires for priority variables;
- they know better accounting data than any other.
=> priority to components of value added
(in an accounting shape), the “core variables”
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

9. => priority to components of value added
ESSnet on « profiling large and complex MNEs » «Cultural » changes in the approach (5): the language talking the business only common language: the « IFRS »
> What are the priority variables to check, (statisticians view)?
- the usual BR variables (to identify, assess the continuity and link different kind of units, split the populations and stratify);
- the SBS variables; as such and as SBS are main providers of NA;
the NA themselves;
- special attention to outward-FATS statistics, that operate at the MNE level on “enterprises”
> How can the MNEs work on checkings (the business view)?
- they ask for a priority list;
- they want this list to be common to all European countries;
- they ask for common questionnaires for priority variables;
- they know better accounting data than any other.
=> priority to components of value added
(in an accounting shape), the “core variables”
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

10. > Each NSI plays alternatively the 2 roles
ESSnet on « profiling large and complex MNEs » « Process » changes incoming: networking and platforming « networking » the global and national statistical units
> For the NSI of the UCI country of a MNE, the tasks are:
No more registering SUs (statistical units), from admin or legal world, but:
- check the global perimeter of the MNE ,
- visit the MNE,
- propose GENs (global enterprises in agreement with the MNE) and TENs,
- link the GENs with legal units (can be “m to n” links),
- test at world level the ability to produce adequate statistics,
- send the resulting TENs to partnering NSIs and discuss with them,
> For the partnering NSIs:
- receive proposed TENs (and links with legal units) from the leader NSI
- validate them (existence, ability, agreement from the national managers)
- accept or re-discuss them with the leader NSI
> Each NSI plays alternatively the 2 roles
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

11. Thank you for your attention
ESSnet on « profiling large and complex MNEs » consultation, dissemination and future work
Our project lasts until the end of 2013, now mainly on testing
We try to be in constant coordination with:
- the EGR ESSnet on methodological studies
- the ESSnet project on Consistency
- the EU studies on globalisation (e.g on value chains) and on MNEs
- the Eurostat groups on BR, SBS, FATS, NA etc
- other interested countries (US, Canada, China …)
- international bodies such as OECD, UNECE, etc
We will appreciate your comments:
Thank you for your attention
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

12. ESSnet Workshop in Köln
ESSnet on « profiling large and complex MNEs » Annex Core variables: the highest priority to test ability for SBS & NA:
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

13. ESSnet Workshop in Köln
ESSnet on « profiling large and complex MNEs » Annex Core variables: reconciliation with the P&L
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

14. ESSnet Workshop in Köln
ESSnet on « profiling large and complex MNEs » Annex Core variables: where to find the right variables in the financial statement?
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007

15. ESSnet Workshop in Köln
ESSnet on « profiling large and complex MNEs » Annex Core variables: what if a complete balance-sheet for the enterprise?
ESSnet Workshop in Köln
27-28/10/2011
Division communication externe 2007