The term flow of funds has both business and economic meanings. In business, flow of funds refers to a statement of the sources and application of funds in the organization. In this context it is often referred to as a funds-flow statement or cash-flow statement. More often flow of funds refers to data showing the movement of savings and the sources and uses of funds through the economy. Since 1955 the FEDERAL RESERVE SYSTEM has published quarterly and annual data on flow-of-funds accounts. These data measure the financial flows across sectors of the economy, tracking funds as they move from those sectors that serve as sources of CAPITAL through FINANCIAL INTERMEDIARIES (such as banks, MUTUAL FUNDS, and pension funds) to sectors that use the capital to acquire productive and financial ASSETS. The flow-of-funds accounts are useful in identifying economic trends. They show, for example, how the growth of debt for each sector changes in the sources of household credit as well as the development of new FINANCIAL INSTRUMENTS for providing credit. In recent years flow-of-funds data have been used to document the widely discussed “WEALTH effect”—the effect of change in households’ net worth on savings and CONSUMPTION decisions. The data are also used to estimate the impact of changing credit conditions on output and spending in the economy. The Federal Reserve’s flow-of-funds accounting system tracks over 40 types of financial instruments, including savings accounts, MORTGAGEs, corporate BONDS, STOCK MARKET shares, mutual fund shares, and bank LOANS. Financial transactions are recorded for 30 economic sectors, including nonfinancial sectors (households, nonprofit organizations, businesses, and government) and financial sectors (banks, INSURANCE companies, pension funds, and other financial intermediaries). In flow-of-funds accounting, total sources of funds must equal total uses of funds. Analysis of the data allows macroeconomic forecasters to estimate the impact of policy measures and project the impact of changing market conditions on output and INCOME in the economy.