Types of representation and balance of payments

When publishing the balance of payments can be submitted in a "neutral" or "analytical" form. In a "neutral" form of goods, services and current transfers combined current account and capital transfers, direct investment, portfolio investment, financial derivatives, other investment and reserve assets - in the capital account and financial instruments. To ensure equality between the accounts, adding a balancing item "net errors and omissions" and displays the total zero balance.

"Neutral" presentation of a number of disadvantages, in particular, it vanishes the combined effect of economic and other residents of the country's communication with the outside world, but it is impossible to determine whether the figures of independent significance or whether they are derivatives of wires included there for the sake of principle double entry.

In this regard, along with "neutral representation of the IMF recommends to be an alternate version of the balance of payments, which is based on a reclassification and regrouping of the available information so that possible to separate primary, autonomous operation of the secondary, balancing accounts. This variant (analytical presentation) already involves removal of active or passive balance of payments, which should be defined as the total result of independent, autonomous operations, current and capital nature, independently conducted by residents and nonresidents in their relations with each other, and thus indicates the direction of foreign economic activity of the country. All other operations, in particular with the official authorities are regarded as balancing funding operations or the use of surplus, indicating the methods and sources of its settlement.

Balance by major object is called balance of payments and, when it is positive, speak of "a strong balance of payments, when it is negative - about the" weak balance of payments.

Historically, there are several approaches to what exactly the operation to provide a "balancing". According to the recommendations of the IMF, the balancing items include: operation of official monetary authority in foreign exchange reserves (gold, foreign currency reserve position in IMF and SDR), modify the obligations of official foreign exchange authorities to foreign official institutions, including international organizations, allocation of SDRs.

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