Creating Flow of Funds Accounts
Flow of Funds Accounts (FFA) are a set of integrated national financial accounts that show uses and sources of funds in key economic sectors by various financial instruments. They are a way of thinking about transactions and links among sectors and sets of entities within a country and with the rest of the world.
This CFSP Concept Note provides a basic introduction to FFA and their construction and uses, with an emphasis on developing countries. While we will use the U.S. FFA as an example, the focus is on the methodology. The methodology can be applied to different countries, as well as to different types of aggregates (for instance, to a region within a country or even, hypothetically, all the way down to the city or village level). We will also provide insights into how the basic methodology might need to be adapted or modified to better suit developing countries.