Current cost accounting has ramifications that permeate the
entire SNA."> OECD Glossary of Statistical Terms - Current cost accounting Definition
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CURRENT COST ACCOUNTING

Statistics Directorate    
French Equivalent: Comptabilité au coût actuel

Definition:
Current cost accounting is a valuation method whereby assets and goods used in production are valued at their actual or estimated current market prices at the time the production takes place (it is sometimes described as “replacement cost accounting")

Current cost accounting has ramifications that permeate the
entire SNA. It affects all the accounts and balance sheets
and their balancing items. A fundamental principle
underlying the measurement of gross value added, and
hence GDP, is that output and intermediate consumption
must be valued at the prices current at the time the
production takes place. This implies that goods withdrawn
from inventories must be valued at the prices prevailing at
the times the goods are withdrawn and not at the prices at
which they entered inventories.

Context:
A method of accounting for the use of assets in which the cost of using the assets in production is calculated at the current price of those assets rather than using the historic cost (that is the price at which the assets were originally purchased).

ILO, IMF, OECD, Eurostat, UNECE, World Bank, 2004, Producer Price Index Manual: Theory and Practice, International Monetary Fund, Washington DC

http://www.imf.org/external/np/sta/tegppi/index.htm.

Source Publication:
SNA 1.60
System of National Accounts (SNA), 2008, 1.67.

Hyperlink:
http://unstats.un.org/unsd/nationalaccount/docs/SNA2008.pdf

Statistical Theme: National accounts

Created on Tuesday, September 25, 2001

Last updated on Tuesday, April 23, 2013