1. Patrick O’Hagan, Statistics Canada
Measurement error and balancing in the SNA Capital and Financial Account
OECD Working Party on Financial Statistics/ Working Party on National Accounts
October 2008
Patrick O’Hagan, Statistics Canada

2. Background ● Measurement error in the SNA
● Measurement error in the Financial Account
- Instrument discrepancies
- OECD financial databases
● Measurement error in the Capital and Financial Account
- Sector discrepancies
- Capital Account discrepancies

3. Capital and Financial Account / Flow of Funds Account

4. Measurement error information in the Capital and Financial Account
● Instrument measurement error
● Sector measurement error
● Interdependence of types of measurement errors
● Link to the Balance Sheet Account
Balancing methodology in Canada
General comments
- Summary process

5. Balancing methodology in Canada
DATA SOURCES AND ISSUES FOR CFA
● Saving-investment estimates
● Government sector
● Non-resident sector
● Corporate sector
Non-financial corporations
Financial corporations
● Household sector

6. Balancing methodology in Canada
PROCEDURES
● 3 blocks of inter-related data used in the analysis — funds raised, matrix of sectors, matrix of categories
● CFA matrix closed in sequence, leveraging the higher quality data
● Remaining items can be difficult to close off in some quarters
● Seasonally-adjusted data

7. Closing remarks
● Quarterly production of Capital and Financial Account a complex undertaking
- Matrix dimensions; uneven data quality; need for integration with SNA; evolution of economic and financial activity
● Canada leverages the integrated SNA in the process; and links to quarterly BSA
● Securities databases and counterpart data will continue to be essential
● Finding staff with the required background to work in this domain continues to be a challenge