Explanatory Notes on Main Statistical Indicators
Industry refers to the material production
sector which is engaged in the extraction of natural resources and processing
and reprocessing of minerals and agricultural products, including (1)
extraction of natural resources, such as mining, salt production (but not
including hunting and fishing); (2) processing and reprocessing of farm and
sideline produces, such as rice husking, flour milling, wine making, oil pressing,
silk reeling, spinning and weaving, and leather making; (3) manufacture of
industrial products, such as steel making, iron smelting, chemicals
manufacturing, petroleum processing, machine building, timber processing; water
and gas production and electricity generation and supply; (4)repairing of
industrial products such as the repairing of machinery and means of transport
(including cars).
In
industrial statistics surveys, the units of enquiry are corporate industrial
enterprises with independent accounting systems.
Corporate
industrial enterprises with independent accounting systems refer to enterprises
engaging in industrial production activities, which meet the following
requirements: (1) They are established legally, having their own names, organizations,
location and able to take civil liability; (2) They possess and use their
assets independently, assume liabilities and are entitled to sign contracts
with other units; (3) They are financially independent and compile their own
balance sheets.
Enterprises
covered in the industrial statistics in the Yearbook include the following
categories by their registration:
State-owned and State-holding
Enterprises refer to state-owned enterprises plus State-holding enterprises.
State-owned enterprises (originally known as State-run enterprises with
ownership by the whole society) are non-corporate economic entities registered
in accordance with the Regulation of the People’s Republic of
Collective-owned Enterprises refer to economic
entities registered in accordance with the Regulation of the People’s Republic
of
Cooperative Enterprises refer to economic units set up on a
cooperative basis, with funding partly from employees of the enterprise and
partly from outside investment, where the operation and management is decided
by all the members who also participate in the production, and the distribution
of income is based both on work (labour input) and on
shares (capital input).
Joint Ownership Enterprises refer to economic units that
are established by joint investment by two or more corporate enterprises or
institutions of the same or different types of ownership on voluntary, equal
and mutual-beneficial basis. They include:
a)
State-owned joint-operation enterprises (joint operation between State-owned
enterprises);
b)
Collective joint-operation enterprises (joint operation between collective
enterprises; and
c)
State-collective joint-operation enterprises (joint operation between state and
collective enterprises).
Limited Liability Corporations refer to economic units
registered in accordance with the Regulation of the People’s Republic of China
on the Management of Registration of Corporations, with capital from 2 to 49
investors, each investor bears limited liability to the corporation depending
on his/her holding of shares, and the corporation bears liability to its debt
to the maximum of its total assets.
Limited
liability corporations include state sole funded corporations and other limited
liability corporations.
Share-holding Corporations Ltd. refer to economic units
registered in accordance with the Regulation of the People’s Republic of China
on the Management of Registration of Corporate Enterprises, with total
registered capital divided into equal shares and raised through issuing stocks.
Each investor bears limited liability to the corporation depending on the
holding of shares, and the corporation bears liability to its debt to the
maximum of its total assets.
Private Enterprises refer to economic units
invested or controlled (by holding the majority of the shares) by natural
persons who hire labours for profit-making
activities. Included in this category are private limited liability
corporations, private share-holding corporations Ltd., private partnership enterprises
and private sole investment enterprises registered in accordance with the
Corporation Law, Partnership Enterprise Law and Tentative Regulation on Private
Enterprises.
Enterprises with Funds from Hong
Kong, Macao and Taiwan refers to all industrial enterprises registered as the
joint-venture, cooperative, sole (exclusive) investment industrial enterprises
and limited liability corporations with funds from
Foreign Funded Enterprises refer to all industrial
enterprises registered as the joint-venture, cooperative, sole (exclusive)
investment industrial enterprises and limited liability corporations with
foreign funds.
Light Industry refers to the industry that
produces consumer goods and hand tools. It consists of two categories,
depending on the materials used:
(1)
Industries using farm products as raw materials. These are the branches of
light industry which directly or indirectly use farm products as basic raw
materials, including the manufacture of food and beverages, tobacco processing,
textile, clothing, fur and leather manufacturing, paper making, printing, etc.
(2)
Industries using non-farm products as raw materials. These are the branches of
light industry which use manufactured goods as raw materials, including the
manufacture of cultural, educational articles and sports goods, chemicals,
synthetic fibre, chemical products for daily use,
glass products for daily use, metal products for daily use, hand tools, medical
apparatus and instruments, and the manufacture of cultural and office
machinery.
Heavy Industry refers to the industry which
produces capital goods, and provides various sectors of the national economy
with necessary material and technical basis for production. It consists of the
following three branches according to the purpose of production or the use of
products:
(1)
Mining, quarrying and logging industry, which refers to the industry that
extracts natural resources, including extraction of petroleum, coal, metal and
non-metal ores.
(2)
Raw materials industry refers to the industry that provides various sectors of
the national economy with raw materials, fuels and power. It includes smelting
and processing of metals, coking and coke chemistry, chemical materials and
building materials such as cement, plywood, and power, petroleum refining and
coal dressing.
(3)
Manufacturing industry which refers to the industry that processes raw
materials. It includes machine-building industries which equip sectors of the
national economy; industries producing metal structure and cement products; and
industries producing means of agricultural production, such as chemical
fertilizers and pesticides.
In
accordance with the above principles of classification, the repairing trades,
which are engaged primarily in repairing products of heavy industry, are
classified as heavy industry while those which are engaged in repairing
products of light industry are classified as light industry.
Gross Industrial Output Value
(1)
Definition: Gross industrial output value is the total volume of final
industrial products produced and industrial services
provided during a given period. It reflects the total achievements and overall
scale of industrial production during a given period.
(2) Principles for calculation:
Statistics
on industrial production follow the principle that all products produced by the
enterprises and accepted through quality check during the reference period are
to be included no matter whether they are sold or not during the reference
period.
Determination
of final products follows the principle that all products that are included in
the calculation of gross industrial output value are the final products of the
enterprise which have been accepted through quality check and require no
further processing. If an enterprise has intermediate (semi-finished) products
to sell, these intermediate products are considered as the final products of
the enterprise.
Gross
industrial output value is calculated following the principle of factory
approach, i.e. industrial enterprise is used as the basic accounting unit in
calculating the gross industrial output value. By this approach, value of the
same product is not to be double-counted, and the output value of different
workshops (branch factories) within the enterprise should not be added.
However, this approach allows the possibility of double counting between
enterprises.
(3) Content and method of calculation:
The old definition of gross industrial output value was modified during the
1995 National Industrial Census. The revised (new) definition of gross
industrial output value consists of 3 components: value of the finished
products during the reference period, income from processing for external
parties, and value of change in semi-finished products between the end and the
beginning of the reference period.
Value
of finished products during the reference period: refers to the value of all
finished (semi-finished) industrial products that are produced during the
reference period without the need for further processing, checked for
acceptance, packed and put into the warehouse of the enterprise, including the
value of own-produced equipment and the value of products provided to the
projects under construction of the enterprise, and to other non-industrial or
welfare units. Value of finished products during the reference period is
calculated by the quantity of products produced using own materials multiplied
by the average unit prices at which products are sold (excluding value-added
tax). Own-produced equipment and products produced for own use
are valued at cost prices as in the case of enterprise accounting. Value
of finished products does not include the value of finished products
(semi-finished products) that are produced using the materials from the clients
who place the orders.
Income
from external processing: refers to income from contracted external processing
of industrial products (including processing of industrial products using
materials from the clients), and the income from industrial repairing work
provided to other parties. Income from external processing is calculated using
information from the item “products sales income” in the enterprise accounting
at the prices with value-added tax excluded.
For
income from services such as processing, repairing and installation of
equipment provided to non-industrial units within the enterprise, if the
accounting work of the enterprise is good enough to separate it from other
records, and the share of such services is significant, it should also be
included in the income from external processing.
Value
of change in semi-finished products between the end and the beginning of the
reference period: refers to the value of change in semi-finished products
between the end and the beginning of the reference period, which generally can
be obtained from accounting records of enterprises. If the enterprise
accounting excludes the cost of semi-finished products, then it should not be
included in the gross industrial output value, and the reverse if otherwise.
(4) Changes in the scope and method of
calculation of the gross industrial output value
Prior
to 1984, the value of rural industry run by villages was classified into
agriculture instead of industry. Since 1984, it has been included in the gross
industrial output value. Method of calculation for the gross industrial output value
was modified in the industrial census in 1995. The difference in the new method
as compared with the old one is outlined below:
Principle
in using full value vs. processing fee: The new method stipulates that all
products produced using own materials are to be calculated with full value in
reporting the gross industrial output value irrespective of the complexity of
production, and for external processing, it allows calculation using processing
fee. In the old method, however, the use of full value or processing fee was
determined by the degree of complexity of production in different branches of
industries.
Principle
in determining the value of change in semi-finished products: The new method
requires that value of change in semi-finished products should be included in
the gross industrial output value if it is included in the accounting record of
the enterprise, otherwise it should not be included. In the old method, it is
determined by the type of enterprises in terms of production cycle. If the production
cycle is over 6 months, the value of change in semi-finished products is
included in the gross industrial output value, otherwise it is not.
Difference
in prices: The new method uses prices excluding value-added tax in the
calculation of gross industrial output value, while the old method used prices
including value-added tax.
Value-added of Industry refers to the final results of
industrial production of industrial enterprises in money terms during the
reference period.
Industrial
value-added can be calculated by two approaches: the production approach, i.e.
gross industrial output value minus intermediate input plus value-added tax,
and the income approach, i.e. income for various factors used in the course of
production, including depreciation of fixed assets, remuneration of labourers, net of production tax, and operating surplus.
Value-added of industry in the Yearbook is calculated by the production
approach as follows:
Value-added
of industry = gross industrial output - industrial intermediate input +
value-added tax
(1) Gross industrial output: refers to
the total achievements of industrial production activities during a given
period. Gross industrial output includes value of finished products, income
from external processing, and value of change in semi-finished products between
the end and the beginning of the reference period. Since 1995, the gross
industrial output value obtained by the new method is used in the calculation.
(2) Industrial intermediate input: refers
to purchased goods and paid services consumed during the industrial production
of enterprises. Fees paid for services include fees paid for the services
provided by material production sectors (industry, agriculture, wholesale and
retail trade, construction, transport, post and telecommunications) and by
non-material production sectors (insurance, banking, culture, education,
scientific research, health and medical care, public administration, etc.). The
determination of industrial intermediate input follows the principle that the
goods and services must be purchased from outside and included in the gross
industrial output, and that the goods and services are inputted into production
and consumed (include low-value consumables) during the reference period.
Industrial
intermediate input includes 5 components, namely direct consumption of
materials, industrial intermediate input in manufacturing cost, industrial
intermediate input in management cost, industrial intermediate input in
marketing cost and expenditure on interest.
Total Assets refer to all economic
resources, in monetary term, these are owned or controlled by enterprises,
including properties, creditor’s equity and other economic rights of all forms.
Classified by the degree of liquidity, total assets include working capitals,
long-term investment, fixed assets, intangible assets, deferred assets and
other assets. Data on this indicator can be obtained by the year-end figures of
total assets in the Assets and Liability Table of accounting records of
enterprises.
Working Capital refers to capital that an
enterprise can cash or use during one year or one production cycle that may
exceed one year, including cash and savings deposits of various forms,
short-term investment, money receivable and prepaid money, inventories, etc.
Annual Average Value of Working Capital refers to the average value of
all working capital of the enterprise during the reference period.
Original Value of Fixed Assets refers to the total value, in
monetary terms, that an enterprise spent on fixed assets, through construction,
purchase, installation, transformation, expansion or technical upgrading.
Generally, it covers cost of purchase, packing, transportation and
installation, etc.
Annual Average of Net Value of Fixed Assets refers to the average of the net
value of fixed assets during the reference period, calculated with the
following formula:
Information
on this indicator can be obtained from the beginning and ending figures of the
original value of fixed assets and cumulative depreciation from the Assets and
Liability Table of enterprises.
Net
value of fixed assets refers to the original value of fixed assets minus
depreciation over the years, i.e.:
Net
value of fixed assets = original value of fixed assets - cumulative
depreciation
Total Liabilities refer to payable liabilities of
enterprises that have to be repaid in terms of money, assets or labour services. In terms of payment, it can be divided
into liquid liabilities and long-term liabilities. Data on this item is
obtained from the ending figures on total liabilities from the Assets and
Liability Table from the enterprises.
Owner’s Equity refers to the ownership of net
assets of enterprise by its investors. Net assets equal total assets minus total liabilities of
the enterprise, including the actual assets invested into the enterprise by
investors, accumulation of capital and operating surplus and non-distributed
profits. The enterprise’s assets are less than its liabilities if the sum of
owner’s equity is smaller than zero.
Revenue from Principal Business refers to the annual
accumulation of the corresponding item in the “profit table” of the accountant.
For enterprises that do not follow the 2001 Enterprise Accounting Standards,
the year-end accumulation of revenue from the sales of products is used as a
substitute.
Cost of Principal Business refers to the annual
accumulation of the corresponding item in the “profit table” of the accountant.
For enterprises that do not follow the 2001 Enterprise Accounting Standards,
the year-end accumulation of cost for the sales of products is used as a
substitute.
Tax and Extra Charges from Principal Business refer to the annual accumulation
of the corresponding item in the “profit table” of the accountant. For
enterprises that do not follow the 2001 Enterprise Accounting Standards, the
year-end accumulation of tax and extra charges from the sales of products is
used as a substitute.
Total Profits refer to the final achievement
of production and operation activities of the enterprises, represented by total
profits after deducting losses (loss is expressed by the negative figure). It
is the sum of profits from operation, income from subsidies, investment
earnings, net income from activities other than operation, and adjustment of
profits and losses of previous years.
Value-added Tax Payable in the
Current Year refers to the amount of the
value-added tax which should be paid by the enterprises during the reference
period. It is the sum of tax on sales, export rebate, and transferred tax on
purchases of the current year, minus the tax on purchases of the current year.
Value-added tax payable of small-size enterprises is determined by the taxable
sales of the year multiplied by the tax rate.
Average Annual Number of Employed
Persons Employed persons refer to all
those who are employed in enterprises and receive remunerations there from,
including currently working employees, retirees who are re-employed, teachers
of local-run schools, as well as foreigners, staff from Hong Kong, Macao and
Taiwan, part-time employees and persons with second job who are employed by the
enterprise, and employees of other units temporarily working in the enterprises,
but excluding former employees who left the enterprise with their employment
records still being kept by the enterprises.
Average
number of employed persons refers to the number of employee everyday during the
reference period, calculated with the following formula:
Ratio of Profits, Taxes and Interests
to Average Assets reflects the profit-making
capability of all assets of the enterprise and is a key indicator manifesting
the performance and management and evaluating the profit-making potential of
the enterprise. It is calculated as follows:
In
the above formula, total taxes is the sum of tax and extra charges on the sales
of products and value-added tax payable; and average
assets is the arithmetic mean of the sum of beginning assets and ending assets.
Ratio of Debts to Assets
reflects both the operation risk and the capability of the enterprise
in making use of the capital from the creditors. It is calculated as follows:
Both
assets and debts are figures at the end of the reference period.
Turnover of Working Capital refers to the number of times of
turnover of working capital in a given period of time, which reflects the speed
of the turnover of working capital of industrial enterprises, and is calculated
as follows:
In
the above formula, average balance of total working capital refers to the
arithmetic mean of the sum of working capital at the beginning and at the end
of the reference period.
Ratio of Profits to Total Industrial Costs refers to the ratio of profits
realized in a given period to the total costs in the same period, which
reflects the economic efficiency of input cost and is calculated as follows:
Total
costs in the above formula are the sum of cost of products sold, marketing
cost, management cost and financial cost.
Sales Ratio of Products is an indicator reflecting
the actual sale of industrial products, analyzing the production-selling and
supply-demand relations. It is calculated as:
