asked the Chancellor of the Exchequer (1) whether he will publish a table showing, for each half-year from January 1971 to December 1973, the percentage of the total increase in total corporate profits in the private sector which was attributable to adjustments in the book value of inventories;(2) whether he will publish a table showing, for each half-year from January 1971 to December 1973, the percentage of the total increase in non-financial corporate profits which was attributable to adjustments in the book value of inventories.

, pursuant to his reply [OFFICIAL REPORT, 1st February 1974; Vol. 868, c. 181], gave the following information:It is not clear to which adjustments in the book value of inventories the Questions refer. Information about the increases in gross trading profits of companies, before and after deducting estimates of stock appreciation, are given in the following table.

PERCENTAGE INCREASE OVER PRECEDING HALF-YEAR IN GROSS TRADING PROFITS OF ALL COMPANIES, SEASONALLY ADJUSTED
	Before deducting stock appreciation	After deducting stock appreciation
1971—
January—June	+ 6	− 1
July-December	+ 2	+18
1972—
January-June	+ 7	+ 1
July-December	+12	+ 5
1973—
January—June	+18	+17
1973—
March-September	+15	+ 2

PERCENTAGE INCREASE OVER PRECEDING YEAR IN GROSS TRADING PROFITS OF NON-FINANCIAL COMPANIES
	Before deducting stock appreciation	After deducting stock appreciation
1971	+ 8	+10
1972	+15	+13

An estimate of gross trading profits in the final quarter of 1973 is not yet available; half-yearly estimates for non-financial companies are not available. Stock appreciation is the difference between the change during a period in the book value of stocks and the estimated physical change valued at the average prices of the period in question. The effect of normal accounting methods is that in times of rising prices the book value of stocks increases by more than the physical volume valued at the prices of the period in question, and profits thus include an amount which in national accounting terms is regarded as a form of capital gain rather than as income contributing to the national product. The estimates of stock appreciation are regarded as subject to a wide margin of error. The basis of estimation is described in Chapter XIII of "National Accounts Statistics: Sources and Methods" (Her Majesty's Stationery Office).