HomeSNAISWGNAKnowledge BaseDataTechnical CooperationPublications
You are here:   ISWGNA >> Updating the SNA >> Towards the 2008 SNA >> 1993 SNA Update Information >> List of Issues

1993 SNA Update Information - Country comments for issue:
Land

Issue description
Issue description in [English] | [French] | [Russian] | [Spanish]
The 1993 SNA records improvements to land as gross fixed capital formation, but in the balance sheet such improvements are included with land itself – a non-produced asset. Should land be split into two, with one part recorded as a fixed asset and the other part recorded as a non-produced asset? If so, how should the separation be made? One option is to distinguish between land that is in, or nearly in, its natural state as a non-produced asset and the remainder as a fixed asset. Another option is to separate land from the improvements made to it, and record the former as a non-produced asset and the latter as a fixed asset.
Country comments
Number of country comments for selected issue:79
  Date postedSourceComment
 10/10/2006SwedenAgreement with proposal
 15/09/2006United KingdomWe agree with all the recommendations made by the AEG.
 15/09/2006LatviaAfter deep discussions and expert consultations we basically support the 1993 SNA Update Issues.
 18/08/2006ItalyWe are in favour of the recommendations.
 31/07/2006MongoliaRecently in Mongolia, the land improvements are not and not treated. The expenditure for elaborating land such as fertilizer and seed are not seen as land improvement and it is treated in intermediate consumption.
We agree with the proposal that land improvements and land should be treated similarly to the gross fixed capital formation of other assets and result in a produced asset appearing separately on the balance sheet.
 28/07/2006LithuaniaIn general we support the recommendations.
 27/07/2006EgyptImprovements of lands should be split from land to form a new asset and the land itself to be recorded as non-produced asset. The cost of improvement represents the new assets. Dams and irrigation systems are to be considered as construction and capital formation and not treated as part of the land.
 23/02/2006South African Reserve Bank We agree with all the recommendations made by the AEG.
 27/01/2006Central Bank of El SalvadorEstamos de acuerdo con la precisión dentro de la FBKF. Sería importante distinguir respecto a las tierras el porcentaje que corresponde a activos no producidos y lo que equivale a un activo fijo diferente (mejoras). No obstante, en términos prácticos se requerirá de una mayor apertura en la información básica.
 22/12/2005Serbia and MontenegroWe agree with the suggested changes.
 19/12/2005KenyaAgreed
 14/12/2005FranceL'INSEE soutient la recommandation consistant à distinguer dans la valeur des terrains qui ne sont pas restes dans leur état purement naturel la valeur des travaux d'amélioration, qui constituent une formation de capital fixe et sont sujet à une consommation de capital fixe. Toutefois, I'INSEE remarque qu'en France, en pratique, le calcul de la valeur du terrain hors améliorations ne peut être qu'indirect.
 13/12/2005CanadaCanada’s current balance sheet and capital formation data is virtually in line with what is being proposed here. Dams, dykes and irrigation systems are being treated as engineering structures on capital formation and not treated as part of the land valuation.
 12/12/2005Bank of KoreaWe agree to all the recommendations.
 09/12/2005RussiaRosstat largely supports the recommendations on the updating 1993 SNA, made at the July 2005 meeting of the Advisory Expert Group on National Accounts.
 05/12/2005DenmarkAgreement
 02/12/2005NetherlandsWe agree with the recommendations of the AEG. We would like to remark, however, that in The Netherlands - and may be in other countries as well – we would not be able to distinguish between land improvements on the one hand and structures on the other hand.
 02/12/2005AustraliaAustralia agrees with the AEG recommendations.
 02/12/2005TurkeyWe agree with the recommendations made at the July 2005 meeting of the Advisory Expert Group on National Accounts.
 01/12/2005GermanyWe welcome the more differentiated approach of the new recommendation.
 01/12/2005NorwayWe agree with the AEG's recommendations.
 01/12/2005IranThe terms “ land improvement “ and “ unimproved land “ are very suitable. We perform in national accounts as follows:
We treat unimproved land as fixed assets, but do not include it in GFCF.
The expenditures on land improvement are considered as GFCF and are classified under "Other" in GFCF.
Cost of ownership transfer of land is also regarded as GFCF and is classified under "Other" in GFCF.
Accordingly, we agree on conclusions of the AEG; however, it would be better to distinguish clearly structure from land improvement.
 01/12/2005IsraelWe agree with all the recommendations of the AEG on this issue.
 01/12/2005United KingdomWe agree with the AEG decisions.
 30/11/2005Slovak RepublicSO SR agree with AEG recommendations.
 30/11/2005FinlandStatistics Finland supports the recommendations of the AEG.
 30/11/2005ItalyIstat fully agrees with the recommendations made at the July 2005 meeting of the Advisory Expert Group on National Accounts.
 30/11/2005State Bank of PakistanWe have gone through recommendations made by Advisory Expert Group (AEG) and fully agree with them.
 30/11/2005State Bank of VietnamWe agree that GFCF of land improvement should be treated like other GFCF and result in a produced asset appearing separately in the balance sheet and non- produced component of should be valued at its present unimproved value but in practice our country and other countries are unable to obtain estimate of the total value of land and they can only estimate land improvement.
 29/11/2005TadjikistanМы согласны с тем, что затраты на улучшение земли (как запасы) должны отражаться в балансе активов и пассивов как вид основных фондов, то есть отдельно от земли, что соответствует трактовке затрат на улучшение земли (как операций) как валового накопления основного капитала. Это требует проведения различия между арендными платежами за пользование землей, которые должны отражаться как рента, и за пользование сооружениями, создаваемыми в результате затрат на улучшение земли, которые должны отражаться как платежи за услуги; последнее может привести к некоторому увеличению ВВП.
 29/11/2005CambodiaWe wish to agree that land improvements should be treated as Other Gross Fixed Capital Formation. The cost of land improvements should be separated from the cost of land (original cost) in temporary account such as Work in Process when the land improvement is unfinished. However, land improvement is very difficult in practice on how to estimate the value of improvements and its consumption of fixed capital when the land is sold. For Cambodia, this issue is every insufficient in gathering information and data to implement the national accounts of Cambodia. So far, SNA should clarify the methodology for estimating the output of land improvement and its consumption of fixed capital when non-produced asset is sold.
 29/11/2005People's Bank of ChinaI agree with your improvements and have no other suggestions.
 21/11/2005USAWe agree with the proposed clarification of the classification of land improvements.
 30/06/2005Slovak RepublicWe support AEG recommendations in this issue. Especially we point out the necessity of checking boundary between land improvements and structures, since some (mainly ground water and reclamation) alterations of land have the nature of structure and according this they are recorded. We also agree with proposal to clarify terms “Land Improvements” and “Unimproved Land”.
 30/06/2005MexicoWe agree with the proposal that land improvements should be treated as gross fixed capital formation. However, this proposal implies to do the required actions for introducing the specific questions in the questionnaire of the enterprises in order to compile the necessary information for doing this measure.
 30/06/2005Serbia and MontenegroWe agree with the recommendations made at the December 2004 meeting of the AEG.
 22/06/2005Bank of GhanaThe SNA currently records improvements to land as gross fixed capital formation, but in the balance sheet, such improvements are included with land itself – a non-produced asset. This however raises the following questions: Should land be split into two, with one part recorded as a fixed asset and the other part recorded as a non-produced asset? If so, how should the separation be made? One option is to distinguish between land that is in, or nearly in, its natural state as a non-produced asset and the remainder as a fixed asset. Another option is to separate land from the improvements made to it, and record the former as a non-produced asset and the latter as a fixed asset. In general, we agree with the AEG that gross fixed capital formation (GFCF) of land improvements should be treated like other GFCF and result in a produced asset appearing separately in the balance sheet. Moreover, the non-produced component of land should be valued at its present unimproved value. Also, the costs of ownership transfer on land should be recorded as fixed assets and included with land improvements etc. However, more work needs to be done in this area by the Canberra II Group.
 03/06/2005Central Bank of VenezuelaWe agree with the treatment of land improvements as gross fixed capital formation under produced fixed assets, since this allows for maintaining consistency within the system for all transactions .
With respect to the recommendation to value land at the present value of the unimproved land, there are statistical difficulties in performing such valuation, so that in practice, we propose booking the value furnished by the informant.
We accept that when there is no distinction between the combined value of the unimproved land and the improvements to the land, it must be estimated. However, we believe that the principle described in paragraph 13.57 of the SNA93 should prevail, to the effect that when there is sufficient data, the disaggregation should be imputed, but when the value of the unimproved land cannot be separated from the improvements, the combined asset should be classified under the category that represents the greatest percentage of the value.
We agree that rent imputable to the land improvements should be treated as purchases of services, and that the ownership transfer costs for the land is considered in the same fashion as these costs in the case for other assets. Therefore, they should be booked as a fixed asset on the balance sheet. We propose that they all be imputed to land improvements and that the value to be booked should be provided by the informant.
 27/05/2005PakistanCost of ownership transfer of land should not be included with land improvement.
 19/05/2005Bank of IndonesiaBI agrees with the AEG recommendation. Land improvements has been already measured currently.
 18/05/2005Central Bank of ChileWe agree with the proposal that land improvements and land should be treated similarly to the gross fixed capital formation of other assets and result in a produced asset appearing separately on the balance sheet. However, developing an estimate of the value of the land is difficult because of a lack of data.
In Chile, land improvements are not identified for lack of data and records. However, an estimate of the irrigation of arid zones by construction of dykes, ditches, or irrigation channels could be developed based on Comisión Nacional de Riego (Chilean Irrigation Commission) (CONAF) data and Base Year 2003 data. When new lands are incorporated by removing forests, rock formations, etc. to facilitate first-time use, the type of data available would have to be defined and based on the data available, the feasibility of developing an estimate could be determined.
As with improvements, no transfer costs are calculated. However, these costs could be estimated based on property transfer data for domestic taxes and related data, such as commission percentages, etc.
 16/05/2005JordanDOS agree with all AEG recommendations regarding this issue except in classifying it as separate item, DOS prefer to classify it under other structures.
 16/05/2005Eastern Caribbean Central BankWe agree with the AEG recommendations of treating GFCF of land improvement like other GFCF and result in a produced asset appearing separately in the balance sheet. Also, that, the non-produced component of land should be valued at its present unimproved value.
 13/05/2005State Bank of PakistanThe cost of ownership transfer on land should not be included with land improvement.
 12/05/2005European Central BankThe ECB supports all decisions related to land improvements, particularly on the treatment of gross fixed capital formation ( GFCF) of land improvements like other GFCF .
 11/05/2005India India agrees with the AEG recommendations.
The expenditures on land improvements are already classified as fixed capital formation. However, the appreciation of land due to land improvement or other reasons should be recorded in “other changes in volume of accounts”
 10/05/2005USAThe U.S. Bureau of Economic Analysis endorses the recommendations made by the AEG.
 09/05/2005AustraliaAustralia agrees with the AEG recommendations
 09/05/2005MaldivesWe wish to agree with the AEG that land improvement be treated as capital formation. The separation of the cost of land improvement to the value of the land in balance sheet should be followed in international accounting standards. It would be difficult to implement the concepts if data sources do not follow the concept. Moreover, when the improved land is sold, the transaction is recorded only as value of land, which would often include the land improvement. As such there would be consistency in the balance sheet of the seller and buyer institution.
 09/05/2005United KingdomWe agree with all recommendations made under this item. In particular, that land improvements that are of a capital nature should be regarded as fixed capital formation and recorded separately in the balance sheet. Also, that the non - produced land be valued at its unimproved value.
 09/05/2005Central Bank of IranWe agree with the AEG recommendation of treating land improvements and cost of ownership transfer of land as produced assets. Our problem is the methodology of computing or estimating consumption of fixed capital for different forms of land improvement. (Is “the clearance of forests, rocks that enable land to be used in production for the first time” subject to CFC?
 09/05/2005ItalyWe agree with the recommendations of the AEG.
 06/05/2005TurkeyWe agree with the recommendations made by the Advisory Expert Group on National Accounts at its second meeting in December 2004.
 06/05/2005Commonwealth of Independent States We agree that land improvement (as stocks) should be shown in the balance sheet as kind of fixed assets, that is separately from land which is in line with treatment of land improvement (as transactions) as gross fixed capital formation. It requires drawing a distinction between rental payments for use of land, which should be treated as rent, and for use of structures resulting from land improvement, which should be treated as payment for services; the latter can lead to some increase in GDP.
 06/05/2005FinlandStatistics Finland supports the recommendations of the AEG.
 06/05/2005Macao, SAR ChinaCurrently, all land is treated as non-produced asset. The acquisition of land is not included into the GFCF, so it is not necessary to identify which part of land is the result of reclamation.
Considering the situation of Macao, a majority of land comes from reclamation and it will be treated as produced asset. However, to distinguish “land from improvements (reclamation)” from land is not feasible in practice.
 06/05/2005VietnamWe agree that GFCF of land improvement should be treated like other GFCF and result in a produced asset appearing separately in the balance sheet and non- produced component of should be valued at its present unimproved value but inpractice our country and other countries are unable to obtain estimate of the total value of land and they can only estimate land improvement.
 05/05/2005SwedenThe recommendations are fully acceptable and also supported by Sweden. But we would like that a list is added, pointing out what kind of activities should be regarded as land improvement. The ideas could be numerous, whether GFCF-definitions could be applied or not. And we would not wish to worsen the risk for disagreements and incomparability between the states NA.
 04/05/2005DenmarkDenmark agrees with the AEG-recommendations.
 29/04/2005NorwayStatistics Norway agrees with the proposals.
 28/04/2005Trinidad and TobagoWe agree with the recommendations of the AEG.
 25/04/2005Bank of Sierra LeoneWith reference to the above subject we agree with the recommendations of the Expert Group on National Accounts (AEG) especially where there is harmonization of definitions and other concepts between the Balance of Payments (BOP) and system of National Accounts (SNA).
 14/04/2005Bank of FranceLa Banque approuve les recommandations du Groupe consultatif.
 13/04/2005Bank of KoreaWe support the treatments of land improvements and cost of ownership transfer of land as produced assets like other GFCF separate from unimproved land.
 12/04/2005GreeceWe agree with the recommendations of the AEG on the issues for which a decision has been taken, at the December 2004 meeting of the group.
 12/04/2005Central Bank of HondurasLas ventajas prácticas y conceptuales propuestas en Canberra II respecto al tratamiento de las mejoras a la tierra y el tratamiento propuesto no implican un esfuerzo mayor para la compilación. El tratamiento recomendado para los costos de transferencia de propiedad de la tierra es consistente con el de las mejoras a la misma y en conjunto su impacto en el Producto Interno Bruto.
 11/04/2005Central Bank of KuwaitKuwait agreed that:
(a) GFCF of land improvements should be treated like other GFCF and result in a produced asset appearing separately in the balance sheet.
(b) The non-produced component of land should be valued at its present unimproved value.
(c) Where the value of land cannot be partitioned into an improved and unimproved part adopt recommendations for land and associated structures as in para 13.57 for balance sheets and para 7.131 for rent and rentals.
(d) Costs of ownership transfer on land should be recorded as fixed assets and included with land improvements.
 11/04/2005Bank of Tanzania/National Bureau of StatisticsWe concur with AEG recommendation.
 11/04/2005Hong Kong, ChinaWe agree with the AEG recommendation of treating expenditure on land improvements as gross fixed capital formation, which is in line with the treatment of other produced assets.
 11/04/2005IranThe terms “unimproved land” and “land improvement” are very appropriate.
In national accounts we observe the followings:
• Unimproved land can be regarded as fixed asset and it is not classified under GFCF.
• Land improvement expenditure is considered as GFCF and is classified under other GFCF.
• Cost of ownership transfer on land is regarded as GFCF and classified under other GFCF.
Accordingly, we agree on the cases decided by the AEG. However it is preferable to draw a line between the structure and land improvement.
 11/04/2005Germany m2(c)de20;
 11/04/2005MalawiI fully endorse the recommendations of the Expert Group on National Accounts.
 11/04/2005Philippines -In the SNA, land is treated as separate item compared with land Improvement built within the land. Land is a non-produced asset which is recorded in the balance sheet. While the improvements on land like dike, fence or structure are treated as gross fixed capital formation and should be capitalized. There was mention of two categories of fixed assets pertaining to land improvements, i.e. land improvements and structures? What will be covered by land improvements vs. structures?
In the Philippines, the main problem inherent in the present data system is that both land and land improvements are lumped as one item and is difficult to separate considering that these data are mostly available from financial statements of big corporations. Another issue may arise from the estimate of depreciation of these fixed assets. Land improvements take on different forms and maybe complex to estimate depreciation for each form of improvement.
 11/04/2005Russian FederationWe agree with the recommendations made by the AEG on National Accounts.
 11/04/2005South African Reserve Bank We agree with the recommendations of the AEG.
 11/04/2005South AfricaSouth Africa agrees with the recommendations.
 11/04/2005The NetherlandsWe agree with the recommendations made at the December 2004 meeting of the Advisory Expert Group on National Accounts.
 01/04/2005PolandIn the scope of treatment of land and land improvements we do not support proposition regarding separation of the improved land form the not improved and treating it adequately as produced and non-produced assets.
 18/03/2005Palestinian Central Bureau of StatisticsPCBS supports that GFCF of land improvements should be treated like other GFCF and result in a produce appearing separately in the balance sheet.
Navigation Options
*Back to Issues
*See all issues/subissues with country comments
*See all AEG recommendations for this issue
*See all expert comments for this issue

About  |  Sitemap  |  Contact Us
Copyright © United Nations, 2014