The layout of the generation of income account by institutional sector is as shown in the Table 8.3:

Table 8.3 Account II.1.1: Generation of income account

8.16 The generation of income account is also presented by industries, in the columns of the supply and uses tables (see Table 9.6).

8.17 The generation of income account presents the sectors, sub-sectors and industries which are the source, rather than the destination, of primary income.

8.18 It analyses the extent to which value added can cover compensation of employees and other taxes less subsidies on production. It measures the operating surplus, which is the surplus (or deficit) on production activities before account has been taken of the interest, rents or charges which the production unit:

1. must pay on financial assets or on tangible non-produced assets which it has borrowed or rented;
2. must receive on financial assets or on tangible non-produced assets of which it is the owner.

The operating surplus corresponds to the income which the units obtain from their own use of their production facilities. It is the last balancing item which can be calculated for both the industries and the institutional sectors and sub-sectors.

8.19 In the case of unincorporated enterprises in the households sector, the balancing item of the generation of income account implicitly contains an element corresponding to remuneration for work carried out by the owner or members of his family which cannot be distinguished from his profits as entrepreneur. This is referred to as 'mixed income’.

8.20 In the case of own account production of accommodation services by owner-occupier households, the balancing item of the generation of income account is an operating surplus.