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Accuracy and reliability

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National Accounts, Economic Statistics
Bo Siemsen
+45 3917 3069

bsm@dst.dk

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Annual National Accounts, Total Economy (Discontinued)

The inaccuracy of the national accounts figures relates to the inaccuracy of the various sources which are used. However, the conceptual consistency and, over time, the uniform adaptation of the sources contribute to reducing the inaccuracy of the national accounts figures. In particular, the combination of the primary sources into a coherent system in many cases gives rise to errors, which therefore are not reflected in the final national accounts.

Overall accuracy

The national accounts cover all economic activities based in Denmark and are therefore based on many different source statistics. Some of them are based on collected information from companies or households, whereas others are based on data from different registries. The uncertainty in the national accounts figures reflect the uncertainty in the source statistics and the calculation methods used. However, since the national accounts system is an integrated system that contains many routines for balancing and data verification, there is reason to assume that these reduce some of the uncertainties in the sources and calculations. Error sources and uncertainties related to individual sources are usually described in the statistics documentation for each of the individual source statistics.

Sampling error

Not relevant for this statistics.

Non-sampling error

Some parts of the national accounts can be calculated more accurately than others because there are better source data within these areas. For example, within the industrial area, data are fairly accurate, while for Danish-based companies, which live from buying and reselling goods abroad, less precise data are available. Finally, there are also areas where source data does not exist, including for example, owner-occupied dwellings and undeclared work. In these areas, the national accounts are almost entirely based on calculations and estimates, so the uncertainty here can be significant.

Another condition that affects the uncertainty and reliability of the national accounts is that the national accounts' many source statistics can be corrected after the final version of the national accounts has been prepared. These corrections cannot be included in the national accounts before a major revision is made, which usually takes place every 5-10 years. This contributes to increasing the uncertainty of the national accounts. However, in the long run, the accuracy and reliability of the national accounts are reestablished because all corrections in the source statistics are included in the major revisions. Recently, there has been a tendency for upward revisions of investments. This means that one should expect a somewhat greater uncertainty about the investment calculation than for other variables in the national accounts.

Real growth in general government production and government consumption expenditure is subject to particular uncertainty as real growth is mainly based on volume indicators. Both data sources and methods are continuously developed.

Globalization, which causes Danish companies to increasingly organize production internationally, affects Danish national accounts and Danish GDP. See, for example (in Danish only):

Detailed data collection and confronting and checking consistency of data for the large enterprise groups are resource-intensive. Therefore, there is greater uncertainty about the early issues of foreign trade and balance of payments, which also causes revisions in the national accounts.

Quality management

Statistics Denmark follows the recommendations on organisation and management of quality given in the Code of Practice for European Statistics (CoP) and the implementation guidelines given in the Quality Assurance Framework of the European Statistical System (QAF). A Working Group on Quality and a central quality assurance function have been established to continuously carry through control of products and processes.

Quality assurance

Statistics Denmark follows the principles in the Code of Practice for European Statistics (CoP) and uses the Quality Assurance Framework of the European Statistical System (QAF) for the implementation of the principles. This involves continuous decentralized and central control of products and processes based on documentation following international standards. The central quality assurance function reports to the Working Group on Quality. Reports include suggestions for improvement that are assessed, decided and subsequently implemented.

Quality assessment

The ESA 2010 regulation requires Eurostat to undertake quality assessments of reported data in accordance with the ESA transmission program. The starting point of this is in the individual member state’s own quality reports, which are not published by Eurostat. These reports are prepared annually. Read the quality assessment of the Danish national accounts here:

Data revision - policy

Statistics Denmark revises published figures in accordance with the Revision Policy for Statistics Denmark. The common procedures and principles of the Revision Policy are for some statistics supplemented by a specific revision practice.

Data revision practice

Preliminary annual national accounts are published four times a year: end of February, end of March, end of June and early November. Final annual national accounts are published once a year at the beginning of November 3 years after the reference year.

The first versions of the national accounts are fairly summary, while the final version is more detailed. This reflects both the access to more detailed source data as well as a longer production time. This means that the national accounts, as time passes, becomes more and more accurate - it applies both to current year’s prices and to chained values. At the same time, figures can be more and more detailed because more source data becomes available in a more detailed form.

Every 5-10 years, major revisions are conducted in which long time series of final national accounts are corrected. This improves the accuracy and reliability of the national accounts because all corrections in the source statistics and calculation errors are included.

Since the main purpose of the national accounts is to provide a basis for an overall assessment of the structural and economic development of the economy, continuity in time series is given high importance, and consequently level errors are usually first addressed during the major revisions.