Accuracy and reliability

Overall accuracy

The transition to new statistical sources and methods from January 2005 has unavoidably incurred some transitional problems. Accordingly, in a transitional period, the uncertainty of the figures was higher than usually for a couple of years. The uncertainty has particularly been linked to the service item, where the most significant changes occurred. In September 2014, the balance of payments transitioned to new international guidelines (BPM6). In connection with the implementation of the new guidelines, the questionnaire on International Trade in Services was expanded to include, among other things, the sale of goods abroad after processing abroad. This opened the possibility for a more direct comparison with information reported to other statistics. Based on this, Statistics Denmark conducted a systematic mapping of the foreign activities of selected larger Danish enterprises. The investigation revealed a need to revise the Balance of Payments Statistics. Therefore, a revision of the period 2005-2014 was conducted in October 2016. The most important sources for the balance of payments are based on monthly data, so sudden changes in activity, such as due to the Covid-19 situation in the spring of 2020, are captured in these sources. For some selected sources, special adjustments have been made in trade with air transport and travel to capture the expected decline due to the Covid-19 situation.

Sampling error

The balance of payments inherits the sampling errors present in the sources included in the statistics. See more about sampling error in the statistical documentation for International Trade in Services and International Trade in Goods, which are the largest expected contributors to sampling error for the balance of payments.

Non-sampling error

The balance of payments is compiled according to the double-entry principle. This is, every transaction gives rise to two entries: one on the income side and one on the expenditure side. The use of this principle means that the balance of payments, i.e., all three main accounts (current account, financial account, and capital account) as a whole, will always balance in the sense that the sum of income equals the sum of expenditure, excluding inaccuracies in the statistical compilation, the so-called errors and omissions. Since the balance of payments is based on other statistics, the uncertainties, including sampling error, associated with these statistics will also apply to the balance of payments. In addition, some smaller sources have insufficient coverage due to missing sources, particularly for personal transfers to and from abroad. For the International Trade in Services statistics, the basis for the population is updated every five years, which means that there is increased uncertainty, especially towards the end of the five-year period, regarding whether the population is accurately defined. From the survey year 2019, the method for updating the population for International Trade in Services has been changed to a rolling annual update, which is expected to increase the precision of the population. The increasing globalization, including the international splitting of value chains by production companies, has shown to lead to missing coverage, particularly for the largest companies' production abroad. For this reason, a unit has been established that specifically looks at the coherence between the largest Danish companies and their reporting across different statistics and surveys. This work often extends over a long period and can therefore lead to significant revisions in data back in time. Furthermore, the balance of payments inherits the coverage errors that may exist in the sources, particularly relevant for the major sources like the statistics on International Trade in Goods and International Trade in Services. See the statistical documentation for International Trade in Services and International Trade in Goods.

Quality management

Statistics Denmark follows the recommendations on organisation and management of quality given in the Code of Practice for European Statistics (CoP) and the implementation guidelines given in the Quality Assurance Framework of the European Statistical System (QAF). A Working Group on Quality and a central quality assurance function have been established to continuously carry through control of products and processes.

Quality assurance

Statistics Denmark follows the principles in the Code of Practice for European Statistics (CoP) and uses the Quality Assurance Framework of the European Statistical System (QAF) for the implementation of the principles. This involves continuous decentralized and central control of products and processes based on documentation following international standards. The central quality assurance function reports to the Working Group on Quality. Reports include suggestions for improvement that are assessed, decided and subsequently implemented.

Quality assessment

Compared to the balance of payments in other countries comparable in size and development, the Danish balance of payments is considered to be of good quality. The EU's annual quality assessment concludes that the quality of the statistics meets the EU requirements.

Data revision - policy

Statistics Denmark revises published figures in accordance with the Revision Policy for Statistics Denmark. The common procedures and principles of the Revision Policy are for some statistics supplemented by a specific revision practice.

Data revision practice

After the first publication of the balance of payments, it is continuously adjusted, as supplementary or adjusted statistical material becomes available. Property income from direct investments' preliminary estimates are replaced by reported data up to 22 months after the end of the reference period and are thus associated with greater uncertainty than the other data. Data is published in September the year after the end of the reference period. It is standard practice to lock the months of the previous year in early June. At the same time, the months of the year before this are revised and locked again. This latter year is internally revised in June to be included in the final calculations of the national accounts. This year thus becomes final in the balance of payments the following June. Historically, there have been particularly large revisions in international trade in services due to the updating of the population basis in 2009, 2014, and 2019. From the survey year 2019, the transition from a five-year to an annual update begins. The new method limits the revisions resulting from uncertainty about the population. At the publication on February 8, 2021, the distribution of the commodity type in the balance of payments goods item was exceptionally adjusted for the period 2010 to 2019. This did not result in changes in the total import and export of goods, but only in the distribution by commodity types.