A. Sector Coverage

6. The mission in cooperation with the authorities supplemented the institutional table to identify the entities covered by different source data used to compile GFS. The table presents an overview on which central government budgetary and extrabudgetary units, local governments, social security units, and public corporations are included in the following source data: CBS’ accounting report (accounts 31,32,34,35, and 63); CEBUMA¹ data; State Budget; and MFS report on other depository corporations. The table also provides information, by unit, on the existence of own revenues alongside the budgetary resources, and indicates which units have accounts in commercial banks. To finalize the institutional table, more work is required. However, the exercise was extremely useful in clarifying which institutions are covered by the main and supplementary sources, as well as which units are covered above and below the line. The table is presented in Appendix IV.

7. The expanded institutional table proved the existence of large inconsistencies among the source data and incompleteness of the GFS reporting. The table demonstrates that individual reports and sources used to compile above and below-the-line transactions cover different selections of entities, in some cases including units belonging to different subsectors. It is still not clear which the so called ‘budgetary’ and ‘extrabudgetary’ units are included within the reporting of the relating ministries. On the other hand, it is clear that neither above-the-line, nor below-the-line data (nor MFS) cover all central government entities and all government operations. The latter relates to the off-budget accounts belonging to numerous units (accounts in commercial banks and CBS accounts 34,35,63) which are not reflected in revenues and expenditures and only partially reflected in the below-the-line data.

8. Further work should focus on identifying those entities which are not institutional units and should be consolidated with the underlying ministries. According to the GFSM 2014, the public entities which fully or to large extent depend on the parent government unit and do not meet the criteria of institutional units², are considered to be part of the parent unit. The analysis of the institutional table indicated that there are some ‘budgetary’, ‘extrabudgetary’, and possible other public entities in Suriname which do not appear to be institutional units and whose operations are currently not fully covered within the ministries. These entities should be identified and included in the reporting of the central budgetary organizations to achieve comprehensive sector coverage. An updated institutional table should also be shared among the source data providers and statistics compilers to harmonize the reporting in GFS, MFS, BoP, and IIP.

B. Compilation of Above-the-Line Transactions

9. The mission assisted MFP compilers in the compilation of the above-the-line data for January, February, and March 2022. The compilation was based on the template produced during the previous mission in December 2021. The template was reviewed and updated as a result of a more in-depth analysis of individual adjustment items based on discussions with the relevant MFP’s staff, Tax office, and the CBS’s compiler of the below-the-line data. The amended file links the adjustments with the underlying source data and would serve as a good basis for further GFS compilation by the MFP. This will enable the MFP to crosscheck the consistency of above-the-line data with the below-the-line operations compiled by the CBS and identify potential sources of discrepancies. This would also serve as an analytical source presenting the ‘off-budget’ government operations. The aggregated result is presented in Table 2 and the comprehensive table reconciling the source data with the GFSM 2014 based revenues and expenditures and showing all adjustments is presented in Appendix II. The justifications for individual adjustments were described in the December 2021 TA report.

^{Table 2.}

Adjustments Made to the Above-the-Line Operations, January-March 2022

(in million SRD)

Source: IMF staff, MFP. CBS.

^{Table 2.}

Adjustments Made to the Above-the-Line Operations, January-March 2022

(in million SRD)

		Jan-22	Feb-22	Mar-22
REVENUE	GFS (CB source + adjustments)	1,283.2	1,293.8	1,552.6
	CB source	1,015.8	818.6	1,223.1
	Adjustments	267.4	475.2	329.5
EXPENDITURE	GFS (CB source + adjustments)	1,138.3	1,374.9	2,007.8
	CB source	889.8	1,011.4	1,477.3
	Adjustments	248.5	346.6	530.5
Net lending/Net borrowing		144.9	-81.1	-455.2
	CBS source	126.0	(192.8)	(254.2)
	Adjustments	18.9	128.6	(201.0)
Net financing		147.7	-70.5	n.a
Discrepancy between above and below the line data		(2.79)	(10.59)	n.a.

Source: IMF staff, MFP. CBS.

View Table

^{Table 2.}

Adjustments Made to the Above-the-Line Operations, January-March 2022

(in million SRD)

		Jan-22	Feb-22	Mar-22
REVENUE	GFS (CB source + adjustments)	1,283.2	1,293.8	1,552.6
	CB source	1,015.8	818.6	1,223.1
	Adjustments	267.4	475.2	329.5
EXPENDITURE	GFS (CB source + adjustments)	1,138.3	1,374.9	2,007.8
	CB source	889.8	1,011.4	1,477.3
	Adjustments	248.5	346.6	530.5
Net lending/Net borrowing		144.9	-81.1	-455.2
	CBS source	126.0	(192.8)	(254.2)
	Adjustments	18.9	128.6	(201.0)
Net financing		147.7	-70.5	n.a
Discrepancy between above and below the line data		(2.79)	(10.59)	n.a.

Source: IMF staff, MFP. CBS.

10. Several outstanding issues remain:

• a. Data on interest payable are not comprehensive. No data on the interest payable through the suspense account in the CBS were available during the mission. It was also not clear if any interest payments to be imputed as a result of a non-cash settlement with other government operations. Finally, the amount of interest in arrears was not possible to compile due to the gaps in the source data.

• b. Insufficient data on expenditure payable through direct payments to suppliers. It was impossible to distinguish between the capital expenditure and acquisition of goods and services. Importantly, data supply delays constantly.

• c. Unavailable data on operations made through off-budget accounts in commercial banks. No data on revenues and expenditure passing through commercial banks exist. The only available source is the stock of accounts that is reflected below-the-line. As a proxy, the change in stocks in the accounts was used to impute the missing revenue/expenditure in January-March 2022. The adjustment was allocated to non-tax revenue.

• d. Late data on taxes by type and other selected operations. Based on the discussion with the Tax Office authorities, the mission found out that timely submission of data by individual tax categories could hardly be achieved under the current tax collection and tax administration system. Since most taxpayers do not indicate the tax code when paying taxes, the Tax Office staff needs to investigate all the undefined transactions. The process is manual and very time consuming, extending the processing time up to six months. Among other data that are supplied with a large delay are mainly non-tax revenues from royalties and other Finabank data.

C. Compilation of Below-the-Line Transactions and Debt Data

11. The compilers from the Statistics Department of the CBS started the compilation of the financial balance sheet of the Central Government, to assure the integration of the flows (financing and other economic flows) with the stocks of financial assets and liabilities. However, some outstanding issues remain regarding the consistency among set of macroeconomics statistics, GFS, MFS, External Sector Statistics (ESS) and Public Sector Debt Statistics (PSDS).

12. The main differences between the GFS figures and the external sector statistics are the amount of interest payments and the stock of public securities issued abroad. In the ESS, the public securities issued abroad are recorded as a debt with nonresidents only for the amount that it is not held by the domestic sector, and it is included in the IIP at market value including the interest in arrears. On the other hand, in SDMO debt stock, all public securities issued abroad are included in external debt at face value, without considering the interest in arrears as a part of the outstanding debt³. Therefore, the interest in arrears (the portion considered by the external sector) is included in the BOP each time when the interest payment is due. In GFS the interest in arrears was not considered above-the-line at the due date. Neither the ESS nor SDMO are calculating the accrued interest monthly, the interest is calculated only when it is due, each three months in the case of the public securities issued abroad.

13. Regarding the cross checking between GFS and MFS, the work started in the CBS, but is still ongoing. The main source of the differences is the sectorization of the institutions in GFS and in MFS and the accrued interest in the MFS data. GFS uses data from SDMO which does not calculate accrued interest. The interaction between the CBS’ statistics department and SDMO have been very positive, and the debt data is more comprehensive.

14. The cross checking of the stock and flow data between the sectors compiling GFS below-the-line, PSDS, ESS and MFS need to be part of the regular procedures to enhance the quality of the macroeconomic statistics. There is a clear advantage for the CBS to lead this task because except for the debt statistics all the other areas are in the CBS supervised by the same director. During the TA mission, CBS acknowledged and accepted this task and committed itself to devote appropriate resources to continue the consistency control between the set of macroeconomic statistics.

15. The mission provided hands-on training for the CBS team compiling below-the-line transactions The file that the mission recommended to prepare has three sheets with the following monthly data. A model of the file is in Appendix III, please note that the data is still being revised:

• a. Stock of financial assets and liabilities by instrument and creditor when the creditor can be identified. The stocks in foreign currency will be expressed in SRD using the ER at the end of each month.

• b. Transactions in financial assets and liabilities. The value of the transactions in foreign currency will depend on the availability of data:

  • i. Transactions in CG accounts in foreign currency will be expressed in SRD using the ER of the day of the transactions. When those transactions are disbursements or amortizations of liabilities based on SDMO data, the compiler should check the differences between the data from SDMO and the data from the CBS accounts, and should double check with SDMO

  • ii. Transactions (disbursements, amortization, interest paid, and interest in arrears) in debt instruments in SDMO file, that were not conducted through the CG accounts in CBS in foreign currency should be converted into SRD using the average ER of the month.

  • iii. The rest of the transactions in foreign currency will be estimated by the differences, in original currency, of the stocks at the end of the month minus the end of the previous month and will be converted in SRD by the average ER of the month.

16. SDMO updated the data of the debt instruments in its system. This was the main reason for the revision of the outstanding debt data in December 2020 and in December 2021. SDMO started the usual monthly provision of debt data since January 2022, the last month available during the TA mission was March 2022. The data of stocks and flows is presented in original currency and converted into SRD using the ER at the end of the month. The mission recommended the following to convert the foreign currency debt into SRD:

• Stocks: Stocks in original currency converted into SRD using the ER at the end of each month. SDMO publishes online annual debt data since December 2000⁴.

• Transactions in SRD: Disbursements, amortization, and the increase/decrease of interest in arrears accumulated in the month in original currency converted into SRD using the average ER of the month. SDMO shares the data with GFS compilers in CBS and MOF in a monthly basis.

• Other Economic Flows in SRD: Change in stocks expressed in SRD minus the transactions expressed in SRD calculated before.

17. The mission run some quality checks in SDMO data in original currency and found out some instruments that are not consistent over the time. The files with the quality checks were shared with SDMO director via email and with the compilers from CBS. The quality check to ensure the integration of stocks and flows in original currency is:

Stock_t-1 + Disbursment_t + (Int.arrears acc_t - Int.arrears acc_t-1) − Amortization_t − Stock_t = 0

where Int.arrears acc_t = interest in arrears accumulated in month t; and

Stock includes the accumulated interest due until t but not yet paid at t

18. Data on domestic debt in arrears with suppliers. During the mission, due to different reasons argued, the Paymaster Department of the MFP was not available, therefor it was impossible to follow up on the recording of the net flows of the other accounts payable including the arrears.

19. The role of CBS in the GFS compilation should be formalized and intensified. Currently, the CBS compilers produce below-the-line on an informal basis. Based on the mission recommendation, the CBS will establish a formal procedure to include in their responsibilities the compilation of the stocks and flows of financial assets and liabilities and the consistency of the data in GFS, MFS and BOP and IIP (compiled in CBS) and Central Government debt stock (compiled by SDMO).

20. The process of GFS compilation will benefit from a formalized and more intensive involvement of CBS. It is recommended that the CBS not only be responsible for the complimentary activity of the compilation of the financing and the integration of flows and stocks of the financial assets and liabilities, but also, in cooperation with the MFP, in the cross checking of the classification of all transactions (including above– the-line) passing through the CG accounts in CBS.

21. Currently there are issues with the classification of the transactions recorded in the CG accounts in CBS. In order to enhance the classification, it was recommended to work in coordination with the CBS’ Accounting Department on the revision of the coding system. The codes should be revised by GFS compilers in MFP and CBS. However, they need to be enforced by the MFP, to require that all the transactions that go through CBS accounts include a comprehensive description and the corresponding code. The issue with the existing codes relates to the lack of guidelines on the description of the transactions that does not allow the accounting officials in CBS to understand which code to be used.