India - Service Sector: NSS 63rd Round, Schedule 2.345, July 2006 - June 2007

Item 401: Lodging charges, rent receivable for hiring out rooms and halls for functions, conferences and receipts
from services provided like transport / travel arrangements, laundry services, gym, spa, hair dressing, swimming
pool, entertainment, etc.: Charges receivable for hiring out rooms, rent for conference halls, charges receivable
from services like transport, travel arrangements, laundry, gym, hair dressing, swimming pool, entertainment etc.
will be recorded against this item. If lodging charges include the breakfast or meal charges, the combined value
may be recorded here.

Item 402: Receipts from sale of prepared food, refreshment and drinks: The receipts from sale of prepared food,
refreshments and drinks will be considered against this item when they are separately charged. If the hotels and
lodging places sell prepared food to outsiders, the receipts will be noted here.

Items 403 and 404: Receipts from trading of purchased food, refreshment, drinks, etc. / receipts from catering
services outside: Receipts from trading of purchased food like ice creams, pastries, patties, drinks, etc. will be
recorded against item 403. This is the receipt part of traded goods. Drinks will mean soft drinks as well as hard
drinks. If the enterprise does any catering business and serves to other concerns or individuals, the receipt will
be noted against item 404.

Items 405 and 406: earnings from passenger traffic and earnings from goods traffic: These two items will record
the earnings from transport activity, from passenger traffic and from goods traffic, respectively. Charges received
from the customers for contract/chartered service will also be noted as earning from passenger traffic (item 405).
If the same vehicle is used for passenger as well as goods transport, the total earning may be recorded against
the predominant activity, if separate accounts are not maintained. Charges received by enterprises providing
services incidental to transport (operation of bridges, loading / unloading of vessels, travel agency, maintenance
of docks, etc.) will, however, be recorded in item 441 of block 4.1.

Item 407: Earnings of commissions for booking agents: The earning from booking charges is to be given in this
item.
Items 414 and 415: Tuition fees and other fees (including transport fees, laboratory fees, examination fees, fines,
library fee etc.): Tuition fees receivable from the students will be entered in item 414. Other fees such as library
fee, laboratory fee, examinations fee, games fee, medical fee, bus fee, etc. will be recorded against item 415.
This will not include hostel fee. Item 415 will also exclude fees collected on behalf of other authorities such as
secondary board, university etc. This will also exclude refundable deposits such as library deposit, laboratory
caution money, etc. collected from students. The developmental fee realised from students will be shown against
this item. Receipts from sale of books, school uniform etc. will also be shown against item 415.

Item 416: donations/ grants from individuals and institutions: Please refer to paragraph 3.0.7.

Item 417: consultation fees and charges for medicines: This includes consultation fee for services rendered
by doctors. The amount receivable will be inclusive of charges of medicines, if supplied by the doctor. The
medicines provided to the patients by the nursing homes may also be recorded here.

Item 418: charges for operation theatre and other special procedures: This includes operation theatre charges
and charges for other special procedures.

Item 421: charges for ward, cabin, pathological, radiological and other diagnostic tests, diet, nursing,
physiotherapy and rehabilitation, etc.: Self-explanatory.

Item 422: fees for training (nurses, paraprofessionals, etc.): In this item, fee receivable for training of the nurses,
para-professionals, etc. is to be recorded. Charges received by training programmes, counselling, etc. by social
work organisations will also be recorded here.

Item 423: Donations / grants from individuals and institutions: Kindly refer to paragraph 3.0.7.

Item 429: total (total of item 401 to 423): Total of all the items of block 4 will be recorded here. Care may be taken,
particularly at the scrutiny stage, to see that entries in constituent items are present whenever there is entry in
item 429.

Item 431: Receipts from sale of goods manufactured or incidental to manufacturing: If the unit is engaged
in manufacturing activity then the receipts from the sale of manufactured items and goods incidental to
manufacturing will be reported here for the given reference period. If the value for the sale of goods incidental to
manufacturing is not available for the reference period then it should be properly apportioned for the reference
period. Care should be taken to keep the consistency with the entry in item 362.

Item 432: Receipts from sale of goods traded: This item will include sale value of those items which are bought
for the purpose of sale without any transformation. Bottled cold drinks, ice-cream, etc. sold by restaurants is one
such item.

Item 433 and 434: Closing and opening stock of trading goods: In any trading, generally some goods are left in
stock at any point of time. Items 433 and 434 will record the closing and opening value of such stock at purchase
price. The value of stock should include the credit purchases also. It is not easy to get the stock figures for the
commodities traded. As a proxy measure, capital locked up in stock may be collected.

Item 435: Change in stock of trading goods: The estimates of the stock figures, for trading activities will be noted
for the beginning and for the end of the reference period. The difference (item 433 - item 434) will be noted with
proper sign against item 435, which will refer to the change in stock of trading goods.

Item 439, ‘total (item 431 + item 432 + item 435)’ will generally be more than entry in item 363.

Item 441: Receipts from services provided to others including commission charges: This is the main item of
this block. Service provided to other concerns will mean work done for other concerns whether such services
are rendered inside or outside the premises of the reporting enterprise. In rendering services, the materials for
processing or repairing are generally supplied by the reporting enterprise. In such cases, service charge should
not include the material cost. Even if the payment is not yet received, the amount receivable for job done during
the reference period will be recorded here. If materials are purchased for the customer, who will reimburse the
amount subsequently, price of the materials will be excluded while recording the service charges. If charges
received for work done are already taken care of in block 4 (e.g., cost of materials reported in block 3 and cost
of materials and charges received for making the products together reported in block 4), duplication should be
avoided. Service charges received in kind are to be imputed.
If this is the only item of receipt of an enterprise (like a road-side barber) care may be taken to first record the
entry here, instead of recording it only in item 449 or item 451 (total receipts). These occurrences should be rechecked
before despatch of the schedule.

Item 442: value of own construction of building, furniture and fixtures: This is the receipt item corresponding to the
item 343 in block 3.1. In addition to the expenses reported in item 343, value of own and hired labour charges
will be added to arrive at the figure for this item. Non-hired labour charges may be imputed at the prevailing local
market rates.

Item 443: value of consumption of goods/ services produced or traded for own use of the owner or employees
(at owner’s cost): Value of goods and/or services produced by the enterprises for sale but ultimately consumed
by the entrepreneur or by the employees of the enterprise will be noted here. Any part of the finished products
that were supplied to sister concerns will also be included. Grocery items consumed in household, manufactured
cloth worn by the owner, restaurants providing food to the employees are some of the items of this kind. The
goods/services provided should be evaluated at cost of producing them. However, if goods obtained free of cost
are consumed, no imputation is required. Item 709 should be inclusive of this item (item 443).

Item 444: Rent receivable on fixed assets (other than land and building): If a unit hires out its assets, except land
and building, the receipts from these may be recorded against this item, since value added by this marginal
activity will otherwise be missed.

Item 445: Funding/ donations
Item 446: Govt. grants
Item 447: production subsidy / interest subsidy
Item 448: Other receipts (excluding royalty receipts on land and subsoil assets like minerals etc.): This item will
include royalties received the enterprise but excluding royalties received on land and any subsoil assets like
mineral.
The valuation of trading goods sold will be done at sale price. Sale price will include excise duties and other
incidental charges associated with sale. But this will be net of discount, rebate or allowances, which are given by
the suppliers to the traders, or by the traders to the customers. However, the stock figures will always be at the
purchase price.
Other receipts will exclude all receipts to be recorded in block 5, e.g., interest and dividend receipts. Similarly, in
blocks 3 and 3.1 will exclude all expenditures and appropriations to be recorded in block 5.
item 501: interest payments: An enterprise pays interest on loans contracted by it. It may also have to pay
interest on default of some payment, for failing to supply some goods or services as per schedule, etc. These
payments will be recorded here. In some cases, interest payment and other bank charges, like service charges
for preparation of drafts, etc. are reported together. In such cases, interest component is only to be reported
here. Interest paid to partners of an enterprise on capital deployed by the partners will also be reported here.
item 502: dividend payments: An enterprise pays dividend to its shareholders, on capital deployed by the
shareholders. Dividend payments (including any dividend distribution tax) reported in the books of accounts will
be recorded here. However, some enterprises first show its profit after tax and depreciation in the profit and loss
account, and later show the dividend payments (or provisions for the same) in the balance sheet. If the profit
after tax and depreciation is already recorded in any of the items 513 or 514, then this may not be duplicated
here.
Total of items 501 and 502 will be equal to total interest/dividend reported in item 1019.

item 503: rent payments on land and building: Rent payments only on land and building will be recorded here.
Other rentals like rent payments on machinery, etc. will not appear here.

item 504: royalties payments on land and subsoil assets like minerals, etc.: This type of royalties payments are
more prevalent in the activities of mining and quarrying. As this is not a part of intermediate consumption, this
item has been separately provided here.

item505: donations, puja expenses, etc.: Please see paragraph 3.0.7.
Some enterprises may have to spend some amounts on various local funds for smooth running of its activities.
These will be recorded here. Expenditure on first aid, medical check-up, teacher’s day, annual day celebration,
etc. done by schools, etc. will not be treated as transfers as these are integral part of its operation. Those will be
recorded in item 322.
item 506: loss on exchange: Some enterprises deal in foreign currencies. Due to different rates prevailing at
the time of its purchase and sale/use, the enterprises may incur certain losses. These losses will be reported
here. Note that the enterprise may also gain due to holding of foreign exchange. In such cases, the gain will be
reported in item 538 (and not item 506).
item 507: loss due to sale of investments (both physical and financial): An enterprise may sell fixed assets like
car, computer, etc. It can also sell some financial assets like share certificates, units of mutual funds, etc. If the
actual value realised by the enterprise is less than the net book value of the assets at the time of sale, then
the enterprise incurs a loss on this sale. This loss will be recorded here. If the enterprise gains due to such a
transaction, the gain will be reported in item 541 (and not item 507). Item 507 will be same as item 923. (for
investment please see 3.0.16)
item 508: taxes on production: Please refer to paragraph 3.0.8.
Items 511 to 514 and 553 are available in the books of accounts after computation of ‘gross profit before
depreciation and taxation’. In some books of accounts, the distribution of ‘gross profit before depreciation
and taxation’ or ‘profit after depreciation’ or ‘profit after depreciation and taxation’ is shown under the heading
‘appropriation of profit’. Items 512 to 514 are for recording the amounts shown under ‘profit after depreciation
and taxation’. Some enterprises, like schools, hospitals, etc. (which are non-profit institutions) may not show any
‘gross profit’. They will show transfer of the ‘excess of income over expenditure’ to the balance sheet through
some of these items. Entries related to distribution of profit or distribution of income over expenditure will not be
recorded under any of the earnings recorded through items 531 to 544.
Item 511: provisions for income tax: Amount booked by the enterprise for income tax payment for the year will be
recorded here.
Item 512: written off and provisions for bad and doubtful debts: The entries in the books of accounts against this
item may carry various types of descriptions, like ‘bad debts’, ‘provisions for bad debts’, ‘bad debts-written off’
etc. All such items will be considered here. (please see paragraph 3.0.15 also)
Item 513: transfer to reserve: After adjusting for the income tax, bad and doubtful debts, a part or whole of the
remaining amount of profit is distributed among the owners/shareholders. After this distribution, a part of the
remaining amount is transferred to the balance sheet (on the liability side) as reserve and surplus (also written as
reserve fund). In the balance sheet, the reserve fund or ‘reserve and surplus’ may already contain some value,
which has arisen due to similar transactions made in earlier years. Hence, the amount added in the reserve and
surplus for the reference year will be recorded in item 513. (Please see paragraph 3.0.13)
Item 514: transfer to balance sheet: After making adjustments through distribution of dividends, addition in the
reserve and surplus, remaining part of profit is transferred to balance sheet as a liability to the owners of the
enterprise. Some enterprises may show the entire amount of profit after depreciation and taxation as ‘transfer
to balance sheet’ and then show the distribution of dividends, etc. In such cases, the entire amount may be
recorded in item 514 without any duplication.
Entries like ‘net profit transferred to balance sheet’, ‘excess of income over expenditure transferred to balance
sheet’ will be recorded in item 514 (and not in items of earnings under items 531 to 544).
In case of oral enquiry from small OAEs, it may be difficult to get direct entries against items 511 to 514. However,
the enterprise may be asked the various provisions made by it. Provisions for replacement of old assets will
be recorded in item 553, provisions for bad debts will be recorded in item 512. Amounts kept for expansion
of business in future years or some future contingencies will be considered as transfers to reserve and lastly,
amount obtained from this enterprise to run his household expenditures and savings (i.e., mixed income for
OAEs) will be recorded in item 514.
National Sample Survey, 2006-2007 (63rd round) - Schedule 2.345 - Service Sector Enterprises - Variables Description
Item 519: total: This will be total of items 501 to 514 without any duplication.
Item 521: transfer of capital expenditure: Any transfer payments made by the enterprise to govt/institution/other
enterprise /individual will be recorded here. Please see paragraph 3.0.14.
531 to 541 appear as items of income in the profit and loss account. Items 542 to 544 also appear in the
profit and loss account. However, some enterprises may show it under income, while others may show it as
adjustments under appropriations of gross profit.
Item 531: interest receipts: Interests received by the enterprise from fixed deposits, bank savings accounts, from
suppliers due to late supply, from other enterprises on loans given to them, etc. will be recorded here.
Item 532: dividend receipts: Dividends received by the enterprise for holding shares, units of mutual funds, etc.
will be recorded here.
Item 533: rent receipts from land and building (for NIC division 70, i.e., real estate and renting activities, this
will not be recorded): As rent receipts from land and building is a part of the output of enterprises engaged in
real estate and renting activities covered under NIC division 70, this will not be recorded in this item for such
enterprises. For other enterprises, this item will be recorded.
Item 534: royalty receipts from land and subsoil assets like minerals, etc.: This is similar to item 504.
Item 535: insurance claims: As insurance claims received by the enterprise after loss due to fire, theft, etc. is not
a part of its output. Such claims will be recorded here.
Item 536: refund of income tax: Some refund on excess income tax payments made during earlier years will be
recorded here.
Item 537: donation, puja etc.: Please see paragraph 3.0.7.
Item 538: gain on exchange: Similar to item 506.
Item 541: income due to sale of investments (both fixed and financial assets): Similar to item 507. It will equal
item 922.
Item 542: excess provision written back: Excess provisions made during earlier years for the doubtful debts are
written back in the current year. Such adjustments made while computing the appropriations will be recorded
here.
Item 543: transfer from reserves: Current losses are made good by transferring some amount from the reserve
and surplus fund kept with the enterprise. If such transfers are made, it will be recorded here. (please see
paragraph 3.0.13)
Item 544: balance brought forward from last account: This entry is another way of making adjustments in book
profit/loss. If it appears in the profit and loss account, it will be recorded, as it does not pertain to current year.
Item 549: total: This is total of items 531 to 544. These incomes of the non-financial enterprises either do not form
a part of its output, or do not arise as a part of its activity in the current year.
Item 551 and 552: transfer of capital receipts from govt. / others: Govt. grants given for the purpose of capital
formation (eg. building fund or buying some expensive equipment for laboratory) would come under item 551
whereas capital transfer from any other national/international institution, individual or enterprise will come under
item 552. (please see 3.0.14 also)
Item 553: provisions for depreciation: Entire provisions made for depreciation will be recorded here. Please see
3.5.14.3 for instructions on oral enquiry with respect to this item.
Item 601: interest payments: Interest payments made by the enterprise to its depositors as also interest payments
on loans contracted by it will be recorded here. Interest paid to partners of a financial enterprise on capital
deployed by the partners (which often appear as ‘interest to partners’, ‘interest a/c of partners’, etc.) will not be
reported here.
Suppose an enterprise deducted Rs.1000 as tax on a total interest payment of Rs.10000, i.e., it actually paid
Rs.9000 to the persons and deposited the remaining Rs.1000 to government account, then the entire amount of
Rs.10000 will be reported in item 601. The tax amount of Rs.1000 will not be added in either of the items 607 or
622

Item 602: rent payments (excluding land and building): Rent payments on land and building will not be recorded
here. Other rentals like rent payments on machinery, etc. will appear here.
Item 603: commission and brokerage: Commissions/ brokerages paid to agents selling the financial instruments
will be recorded here. Note that these agents will not be counted as workers of the enterprise. If the enterprise pays some amount to its workers for similar services, these will be a part of compensation to the workers and will not be reported here. Commission and brokerage will include items like ‘National Stock Exchange (NSE)/Bombay Stock Exchange (BSE) transaction charges’, ‘funds placement charges’, ‘NSDL charges’, ‘commission and procurement charges’, ‘NSE/BSE listing fees’, etc.

Item 604: bank charges: Charges paid to banks for making drafts, etc. will be recorded here.
Item 605: DEMAT charges: For transaction of shares there is a special type of account called DEMAT account.
Charges to be paid for getting service through this account are DEMAT charges. This item may be copied from balance sheet. For oral enquiry this item may be ignored unless the informant give it without any pretext.
Item 606: repair and maintenance (building, transport equipment, office equipment, etc.): All minor repair and maintenance expenses will be reported here. This item is equivalent to items 344 to 348 of block 3.1.
Item 607: taxes on products: Please see paragraph 3.0.8.

Item 608: insurance: Insurance premiums given by the enterprise will be reported here.
Item 611: advertisement: Expenses on advertisement will be reported here.
Many companies (e.g., mutual funds) incur a huge expenditure while issuing new shares or bonds to public
on advertisement, etc. Instead of accounting for the entire expenditure on this account, the companies are
allowed to adjust these expenses over a few years (generally five years). This is often written under a heading
‘amortisation of expenses’ in the profit and loss account. For such expenses (e.g., debt issue expenses,
commercial paper issue expenses, syndicated loan issue expenses, etc.), it may not be possible to get bifurcated
figures on advertisement, service charges, etc. Then the entire ‘amortisation expenses’ may be recorded against
one of the items 611 or 612 based on major head of books of a/c under which this expenditure was incurred.
Item 612: service charge for work done by other concerns: This is similar to item 352 of block 3.1. Service
charges will include ‘rating fees’, ‘leasing and paying agent’s fees’, ‘process agency fees’, ‘sitting fees’, etc.
Item 613: others: All other items of intermediate consumption, like expenses on electricity, communication like
telephone, fax, VSAT charges, travelling, printing, stationary, etc. will be recorded here. If the enterprise was
pursuing mixed activity during the reference period, all the expenses incurred for these minor activities will be
recorded here.

Item 619: total: Total of items 601 to 613 will be recorded in item 619.
Items 621 to 624 are not a part of intermediate consumption of an enterprise. Hence, these items will not be
deducted from the receipts for computing the gross value added.
Item 621: donations, puja expenses
Item 622: taxes on production
Item 623: written off and provisions for bad and doubtful debts: Instructions is same as item 512.
Item 624: other provisions: Provisions for taxation and depreciation will not be included here. This will include
provisions for diminution in value of investments.
Item 631: interest receipts: Interests received by the enterprise from investments made by them, from loans given
to individuals and enterprises, etc., fixed deposits, bank savings accounts, from suppliers due to late supply, etc.
will be recorded here. Note that for a financial enterprise, be it a SHG/ moneylender, co-operative credit society
or a firm or company, this is one of the principal sources of receipt.
Item 632: dividend receipts: Dividends received by the enterprise for holding shares, units of mutual funds, etc.
will be recorded here.

Item 633: net profit in share dealing: Many financial enterprises buy and sell shares and gain (or loose) due
to change in value of shares. This gain will be reported here. If the enterprise incurs a net loss, the figure will
be reported with a negative sign. This will include net capital gain on investments, profit on sale of assets/
investments, etc.
Item 634: net earnings from hire purchase finance: Financial companies finance purchases made by other
enterprises. Net earnings of the financial company from such dealings will be recorded here.
Item 635: lease income: This is the income earned from financial leasing.
Item 636: brokerage and commission: The term has been already explained in item 603.
Item 637: bill discounting: Net income earned from bill discounting activity, income from bills purchased, will be
recorded here.
Item 638: merchant banking/under writing: Merchant banking is not a banking activity. Income earned from such
activities will be recorded here.
Item 641: income earned on chit funds: Net earnings from dealings with chit funds, if any, will be recorded here.
Item 642: rent receipts (excluding land and building): Similar to item 444.
Item 643: others: This will include all the other receipts like receipts from consultancy activities, advisory services,
finance charges earned, etc. This will also include entire receipts from non-financial activities, if any, of the
enterprise during the reference period.
Item 644: Govt. grant (excluding capital transfers like building fund, etc.)
Item 645: production subsidy / interest subsidy.
Item 649: total: This is total of items 631 to 645.
Item 659: gross value added: This will be item 649-item 619.
Item 661: excess provision written back: The instruction for this item is similar to that of item 542.