Reconciliation Do You Need Counseling To Succeed? Timothy Baxter Special Projects Branch Foreign Trade Division U.S. Census Bureau Department of Commerce

2 When do you need to reconcile and can differences be resolved? Reconciliation is done when there is a significant difference between trading partner’s values. Some differences can be resolved. To do so we try to find measurable reasons, and then assign dollar amounts for those reasons that both sides agree are legitimate.

3 Common sources of discrepancies Valuation of goods Definition of goods traded Trade through a third Country Geographic Coverage Classification issues Undercounting or under reporting

4 What It Takes To Get Through It It takes a lot of resources. It takes a lot of time. It takes a lot of patience. If ( If? ) politics becomes a factor it takes a lot more of the above.

5 Is it worth it? Maybe, but I will take some convincing on that. On the plus side –Might point out some deficiencies. e.g. Need better tracking of exports –It’s supposed to give you a better sense of what is actually happening in trade, and therefore in your economy. –Also, better policy making. On the not so plus side –You won’t explain all of the difference, and it’s maybe more accurate to say most.

6 Lessons Learned? Experience counts. Sometimes too much reliance on past work. You don’t find many actual mistakes. Has to be a cooperative effort, with the same goals on both sides. The most successful/efficient reconciliations are when it’s strictly a technical exercise. Reconciliations are never strictly technical exercises.

Counseling any one? Timothy Baxter