Statistical processing

Source data

The statistics are compiled based on several surveys, statistics, and administrative data. The most important sources are summarized below: - Statistics on International Trade in Goods, including supplementary information on the nature of individual transactions. - Statistics on International Trade in Services. - Supplementary information about businesses collected in the International Trade in Services survey: Trade in goods not crossing the Danish border. Price adjustment of goods that have crossed the Danish border. - Unilateral transfers to and from abroad. Trade in non-produced non-financial assets with foreign countries (e.g., trademarks and football players' licenses to play club football). - Insurance premiums and claims to and from abroad. - Nationalbankens compilation of Danish residents' investment income to and from abroad. - Information about public administration and service. - Information about Danish residents' wages and transfers from abroad and foreign residents' wages and transfers from Denmark. - Information on the import of illegal goods. - Survey of foreign embassies and international organizations' consumption in Denmark

Frequency of data collection

Most of the balance of payments sources are available monthly, while some are delivered quarterly and annually. Data available only quarterly and annually are extrapolated for the months when data is not available.

Data collection

Data for the balance of payments current account is retrieved from existing statistics and internal deliveries in Statistics Denmark

Data validation

When data is delivered for the compilation of the balance of payments, the system shows which sources have been received and the most recent period for a given source. The sources not extrapolated must be loaded before the balance of payments can be published. When data is received from the various sources, validation has already been performed by the source provider as these data are included in other statistics. However, a check is conducted to ensure data contains valid countries and codes. Any invalid countries or codes are examined in collaboration with the source provider and corrected either at the source or in the balance of payments validation model. The value of data included in the statistics is validated at the macro level by examining developments in the main items: Goods, Services, Investment Income, and Current Transfers. If there is a relatively or absolutely large increase or decrease, the item is further examined, and the source provider is contacted to confirm the development. In addition to the validation already conducted for the sources by the providers, cross-source validation is performed in the balance of payments. Each month, data reported for foreign trade in goods and the foreign trade in services survey is validated at the enterprise level for consistency in processing and construction activities.

Data compilation

In the balance of payments production system, all sources are converted to the balance of payments concepts and methodology. For the International Trade in Goods statistics (ITGS), a correction is made in the balance of payments from a border-crossing principle, where transactions are counted when a good crosses the Danish border, to an ownership change principle, where transactions are counted when there is a change of ownership between a Danish and a foreign resident. Furthermore, the value of imports in the balance of payments is calculated as the value at the sender’s border (the so-called FOB value), whereas in the ITGS it is calculated as the value at the Danish border (the so-called CIF value). The difference between the actual paid price (invoice value) and the value at the Danish border (FOB) is considered freight services and is allocated to transport services and insurance services for both imports and exports. In the transition from the border-crossing principle to the ownership change principle, especially information about the transaction type collected in the foreign trade in goods survey is used. This information indicates whether there was a change of ownership in the border crossing. Examples of border crossing without ownership change include when goods cross the border for processing. Here, the ownership of the processed goods remains with the owner of the goods while they are processed in another country. Another example is goods that are returned, where both the returned goods and the originally sent/received goods are not counted in the ownership change principle. Furthermore, corrections are made for trade in goods that are part of construction and civil engineering activities with a foreign counterpart, as the value of goods included in construction and civil engineering projects is considered part of the construction service in the balance of payments. Any value impairments and price adjustments on goods that have already crossed the border are also corrected in the balance of payments. Besides the ITGS, trade in goods with non-residents that do not cross the Danish border is also included in the balance of payments goods concept. This includes goods bought or sold in connection with processing abroad, goods bought and sold abroad without crossing the Danish border (merchanting), and provisioning and fuel purchases by vessels abroad (e.g., ships buying fuel in a foreign port). The transition from ITGS to the balance of payments goods concept is carried out at a macro level for statistical years 2005 to 2021, but from 2022, a method change has been introduced so that the transition is now carried out at the micro-level, meaning corrections are made at the enterprise and commodity code level. This means that detailed trade in goods can now be calculated according to both an ownership change principle and a border-crossing principle. For the treatment of returned goods, a method change has also been introduced so that now returns are offset in the previous periods and not just in the current period.

The International Trade in Services statistics (ITSS) are directly included in the balance of payments compilation of services without further corrections. In calculating wage income, the primary source is an internal delivery of Danish residents’ wages from abroad and foreign residents’ wages from Denmark. Information about foreign residents’ wages from Denmark comes from the E-income register, and Danish residents’ wages from abroad are based on tax information. These data are supplemented with information on wages for employees at embassies and international organizations in Denmark and abroad. In calculating investment income, data received from Danmarks Nationalbank is corrected for the part of the interest payments considered a service contribution (the so-called FISIM calculation). A calculated income from the technical wealth in pension, insurance, and investment funds (the technical wealth can, for example, be the accumulated premium payments made to an insurance company) is also added. Other income mainly consists of product and import taxes and subsidies, which in practice all relate to amounts settled under the EU's common agricultural policy. This group also includes rents for natural resources, such as fishing rights. In calculating current transfers, the primary source is the delivery of public administration and service, covering, among other things, Denmark's contributions to the EU, Greenland, and the Faroe Islands, and other international institutions, but also transfers to Denmark, such as EU agricultural subsidies. Supplementing this source are businesses' paid premiums/contributions and insurance/pension payouts reported to the international trade in services survey and the calculated property income from the technical wealth in pension and insurance considered as paid premiums/contributions. The international trade in services survey also includes businesses' transfers to or from abroad without a quid pro quo, which can, for example, cover private aid or EU funds. Furthermore, information about payments to pensions and similar and income tax comes from the source on Danes' wages from abroad and foreigners' wages from Denmark. A tax on dividend payments for foreigners is calculated based on information about dividend payments from Danmarks Nationalbank, and this tax is reduced with information about refunds of dividend tax from public administration and service. Information about private transfers to abroad and foreigners' transfers to private individuals in Denmark is calculated by extrapolating the most recent known estimate for this activity with an index for price developments. The capital account consists partly of information from the foreign trade in services survey about businesses' purchases and sales of non-produced non-financial assets (such as trademarks and football player licenses) and partly of information from public administration and service about investment grants, etc.

Data not received monthly is distributed either based on a variable available monthly or divided by three or 12 for quarterly or annual data, respectively. When the balance of payments is published, the calculated data is archived at the most detailed level. Groupings for items and countries are calculated based on so-called masters that indicate the relationship between the detailed items/countries and the relevant groupings for a given period.

Data sources delivered aggregated on either a quarterly or annual basis are extrapolated for the months when the quarter or year is not yet complete (e.g., the second quarter is not ready in May) or if the delivery is not received in time to be included in the statistics. Extrapolations are either based on a monthly variable (e.g., a price index) or by using a previous report (the latest report or the latest identical quarter). The vast majority of the value from sources for the balance of payments current account is delivered as monthly data, but some sources also use extrapolations for missing data or, for example, annual reports. Read more in the statistical documentation for International Trade in Services and International Trade in Goods.

Adjustment

The main items of the current account (goods, services, income, and current transfers) are adjusted for normal seasonal fluctuations. All items are divided into income and expenses, as well as EU and non-EU. Thus, 16 series are seasonally adjusted directly. Other levels are calculated based on these (indirect seasonal adjustment). Data is seasonally adjusted using X-12-ARIMA with fixed model selection, which is reviewed once a year. Adjustments are made for Easter, trading days, and leap years if these effects are significant. Annual reconciliation is not performed, so there may be minor differences between the actual and seasonally adjusted figures on an annual basis