10.4225/03/59fab3a7ab60e Fausten, Dietrich K Dietrich K Fausten Pickett, Brett Brett Pickett "Errors & Omissions" in the Reporting of Australia's Cross-Border Transactions Monash University 2017 Errors and omissions balancing item balance of payments accounts 2002 1959.1/2230 monash:2230 2017-11-02 05:56:52 Journal contribution https://bridges.monash.edu/articles/journal_contribution/_Errors_Omissions_in_the_Reporting_of_Australia_s_Cross-Border_Transactions/5562247 Large and variable errors & omissions imply that reported data constitute erroneous and potentially unreliable information for policy formation. To the extent that successive data revisions involve substantial alterations in the reported statistics, the study of policy conduct and of policy effectiveness is susceptible to distortion. These considerations d m attention to the nature and extent to which economic processes are misreported. Accordingly, the present study explores two specific issues in the statistical reporting of Australia's cross-border transactions: convergence of reported transactions over successive revisions, and the potential source or prominent driver/-s of the balancing item. The major positive findings are that there is only limited evidence of convergence of measured to true magnitudes of cross-border transactions; that there is robust evidence of structural instability of the balancing item; and that financial sector transactions appear increasingly to constitute the major source of misreporting of balance of payments outcomes.