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
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.
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:
