Government Finance Statistics (GFS)
The accrual Government Finance Statistics (GFS) reporting framework is a financial measurement and reporting system designed to support economic analysis of the public sector. It focuses on the size of the public sector; its contribution to aggregate demand, investment, and saving and provides for cross-country comparison. The principles are formalised and promulgated by the International Monetary Fund (IMF) in consultation with practitioners. The Heads of Treasury and the Australian Bureau of Statistics (ABS) oversee Australian practical application.
Although the initial GFS standard (documented in the IMF’s GFS Manual 1986) was cash-based, GFS moved to accrual-based reporting with the current publication of the IMF’s GFS Manual 2001. The ABS has also published an Australian version of this framework. The Australian Accounting Standards Board’s AASB1049 Whole of Government and General Government Sector Financial Reporting [362 KB] harmonises IMF GFS Manual 2001 and Generally Accepted Accounting Principles and is used to present Australian Government financial reports.
The IMF has commenced a review of the GFS Manual 2001, with a revised GFS Manual expected for release by mid‑2012. Finance has provided comments on the likely areas of change.
Based on the GFS framework, the AASB1049 major fiscal aggregates presented in budget documents include:
- Fiscal balance – is an accrual measure that shows whether the Government has to borrow from financial markets to cover its activities
- Underlying cash balance – is a cash measure that shows whether the Government has to borrow from financial markets to cover its activities
- Net debt – a common measure of the strength of the Government’s financial position and comprises selected financial assets and liabilities
- Net worth – is equal to assets minus liabilities and is a measure of the strength of the Government’s financial position. It is a broader measure than net debt
- Net financial worth – is equal to financial assets minus liabilities and is a measure of the strength of the Government’s financial position but avoids valuation issues with non‑financial assets in measuring net worth