Accuracy and reliability

Overall accuracy

The accuracy of the estimation of Household final consumption expenditure depends on the quality and coverage of the underlying data sources. Since household consumption is calculated as a residual in the national accounts, it is indirectly affected by uncertainties in both output and supply statistics. The main sources used for the distribution of consumption by goods and services include the Household Budget Survey (FU) and the retail trade–based turnover statistics (DOI). However, the Household Budget Survey is subject to considerable sampling uncertainty and underreporting, and the data are grossed up to represent the full population. In addition, certain consumption components—such as undeclared work and imputed rent for owner-occupied dwellings, are based on estimates and assumptions, which further reduces the accuracy of these areas. The first versions of household consumption for a given year are compiled before all data sources are available. The starting point is the most recent final national accounts, which are extrapolated using relevant indicators of private demand, including short-term statistics and developments in VAT revenue. As new and more comprehensive sources become available, they are incorporated continuously, improving the accuracy in later versions. Accuracy may also be affected by revisions made to the underlying source statistics after a period has been published as final. Such revisions are only incorporated during major revisions of the national accounts, when long time series are updated as a whole.

Sampling error

Not relevant.

Non-sampling error

The main sources used for the distribution of consumption by goods and services (COICOP18) are the Household budget survey (FU), retail trade statistics, and VAT data. The Household budget survey is associated with considerable sampling uncertainty, as it covers a relatively limited number of households and therefore requires extensive grossing up to the full population. In addition, there is a risk of underreporting certain types of expenditures, particularly cash purchases and frequently purchased goods, which may lead to biases in the consumption structure.

To ensure consistency between the level of total household consumption and the rest of the national accounts, VAT totals are used as a benchmark for the overall level of consumption. The overall development of household consumption is therefore also assessed in relation to developments in VAT revenue and other indicators of private demand.

Uncertainty is greatest in the earliest versions of the national accounts, where detailed sources are not yet available. At this stage, calculations are mainly based on indicators from short-term statistics and the retail trade index, and the COICOP-level distribution of consumption is extrapolated from the latest final year. As new and more detailed sources are incorporated, the uncertainty in both the total level and the distribution is reduced, but since consumption is calculated as a residual, it will always be indirectly determined and thus sensitive to changes in other components of use.

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

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.

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

Household final consumption is revised according to the same principles as the national accounts as a whole. Ongoing revisions may occur when new or updated sources become available. In the quarterly and annual accounts, changes from the sources are incorporated as more complete data become available, which may lead to minor adjustments of previously published figures.

Indirect revisions may also occur when changes in the sources affect the accounting of the economy’s total supply and use, for example in the financial statements. Such changes can impact the overall product balances and, consequently, the functional distribution, including household consumption.

Comprehensive revisions are carried out as part of the national accounts’ five-year revision cycle. During these revisions, longer time series for household consumption are updated to ensure consistency with the other components of the national accounts and to incorporate any changes in methodology, classifications, or source coverage. Larger revisions may also occur in connection with the implementation of new international standards, such as ESA, where the entire time series back to 1966 is re-estimated