Attachment 1 - Outreach letter

June 24, 2011

Dear :
The Bureau of Economic Analysis (BEA) is in the process of designing the 2012 Benchmark
Survey of Foreign Direct Investment in the United States (BE-12). Because of your interest and
expertise in foreign direct investment and multinational companies, I want to let you know about
our plans for the benchmark survey. We welcome any input you may wish to offer.
Benchmark surveys are conducted every five years; the prior survey covered 2007. The
benchmark survey covers the universe of foreign direct investment in the United States, and is
BEA’s most comprehensive survey of such investment in terms of subject matter. In nonbenchmark years, BEA links data from its quarterly and annual sample surveys to data from the
benchmark survey to derive universe estimates for those years.
Proposed changes for the 2012 benchmark survey include changes in reporting criteria and the
addition, deletion, and modification of specific data items on the survey forms. The proposed
changes are intended to minimize respondent burden while considering the needs of data users.
More information on the proposed changes is provided in the attachment. Copies of 2007 BE-12
forms can be downloaded at www.bea.gov/fdi. Please contact me by email, at
[email protected], or fax, at (202) 606-2894, if you have any questions or comments about
our plans for the benchmark survey.
Sincerely,

David H. Galler
Chief
Direct Investment Division
Attachment

Proposed Changes for the 2012 BE-12,
Benchmark Survey of Foreign Direct Investment in the United States
Reporting criteria
Changes in reporting thresholds for 2012 BE-12
(thresholds are based on the value of assets, sales, and net income, positive or negative)
Form for
2007 BE-12
BE-12(LF)
BE-12(SF)
BE-12 Mini
(complete report)
BE-12 Mini
(abbreviated report)

Reporting thresholds
2007
$175 million
majority-owned affiliates
$40 million
$15 million
< $15 million

Form for
2012 BE-12
BE-12A
BE-12B
BE-12C
(complete report)
BE-12C
(abbreviated report)

Reporting thresholds
2012
$300 million
majority-owned affiliates
$60 million
$20 million
< $20 million

Additions
ƒ Questions will be added regarding the use of fair value accounting on the balance sheet.
Companies that indicate that they did use fair value accounting will be asked to provide
the amount of net property, plant, and equipment, of total assets, and of total liabilities
that was recorded at fair value.
ƒ Questions will be added to collect information on assets, liabilities, and interest receipts
and payments that are related to banking activities.
ƒ Several check-box questions will be added asking whether U.S. affiliates purchased
contract manufacturing services from others or performed contract manufacturing
services for others. They will also be asked whether they owned the materials used in
contract manufacturing and if the company that performed or purchased the service was
located in the United States or abroad.
ƒ A question will be added asking if the U.S. affiliate has equity in its foreign parent(s)
(reverse investment). An item will be added to collect voting percent, equity percent, and
the dollar amount of the investment.
ƒ Several check-box questions will be added to ensure that certain types of finance
companies do not report intercompany debt to BEA that is already reported on Treasury
International Capital surveys.
Deletions
The following data items that were eliminated from the BE-15, Annual Survey of Foreign Direct
Investment in the United States, in 2008, will also be eliminated from the BE-12:
ƒ Balance sheet items: cash, current receivables, allowances for doubtful accounts, other
current assets, other noncurrent assets, current liabilities and long-term debt, other
noncurrent liabilities
ƒ The breakdown of sales of services to foreign persons into sales of services to the foreign
parent group, to foreign affiliates owned by the U.S. affiliate, and to other foreign persons
ƒ The breakdown of employment and employee compensation by occupational
classification
ƒ The breakdown of total employee compensation into wages and salaries and employee
benefit plans

ƒ Composition of external finances
ƒ Manufacturing employment by state
ƒ Gross property, plant, and equipment by state
ƒ Commercial property by state
Several other items will be eliminated:
ƒ Location of the primary U.S. headquarters of the U.S. affiliate
ƒ Employees covered by collective bargaining agreements
ƒ Acres of U.S. land owned
ƒ Basis (shipped or charged) for trade data (check-box questions)
ƒ Exports/imports shipped to/by foreign affiliates owned by U.S. affiliate by country of
origin/destination (as in the benchmark surveys for 2002 and earlier years, these columns
will be combined with the columns “shipped to/by all other foreign persons”)
ƒ Withholding taxes on interest payments and interest receipts
Modifications
ƒ The question on financial accounting standards will be reworded to ask respondents
whether their data are reported according to U.S. Generally Accepted Accounting
Principles (U.S. GAAP), according to International Financial Reporting Standards, or
according to other accounting standards (which they will be asked to specify). Text is
provided in Attachment B.
ƒ Questions on withholding taxes on dividends and on distributed earnings will be
combined
Other changes
ƒ The consolidation rule for the survey will be modified. The new rule will be more
consistent with U.S. GAAP. Under the new rule, a U.S. affiliate must file on a fully
consolidated domestic U.S. basis, including the full consolidation of all U.S. business
enterprises proceeding down each ownership chain whose voting securities are more than
50 percent owned by the U.S. business enterprise above.