Non-Substantive Change (Three new ESP Inquiries)

REVISION OF COMPANY ORGANIZATION SURVEY COLLECTION

The U.S. Census Bureau requests a non- substantive change to the Company Organization Survey (COS) questionnaire for survey year 2011. The revision will add three new inquiries as part of the Enterprise Statistics Program (ESP). The three inquiries are:

1) Operating Revenues and Net Sales;

2) Royalties and License Fees; and

3) Manufacturing Activities.

In 2010 the Census Bureau pre-tested these questions under its Generic Clearance for pretesting research. For this test the Census Bureau mailed an alternate version of questionnaire NC-99001, which included the three new inquiries, to a small sample of about 200 multi-location companies mailed in the 2010 COS.

For 2011, the Census Bureau requests approval to mail a questionnaire similar to the pretested version of Form NC-99001. The Census Bureau intends to collect data from all multi-location companies selected for mailing in the 2011 COS. A copy of the new version of the NC-99001 form for the 2011 COS is attached. Data collected in the 2011 COS will be used to baseline 2012 COS data and aid in preparing required edits and publication plans for the ESP questions during the 2012 Economic Census year. The additional questions will not change the average time to complete the NC-99001 form.

The ESP is intended to relate statistics at an establishment-level directly to enterprise-level statistics by industry. Linkage of establishment-level economic data to appropriate companies and industries information is necessary: (i) to be sure which firms/industries are responsible for economically important activities, (ii) to test the accuracy of company- and establishment-based industry aggregates; and (iii) to support analysis of the effects of firm and industry structure on business and industry performance.

ESP data will be linked longitudinally, giving the program the capacity to represent enterprise dynamics (i.e., births and deaths, expansions and contractions) at the level where competitive performance is ultimately registered. The new Enterprise Statistics Program expects to match basic company data (e.g., firm structure, industry, size, location, employment, payroll, and sales/receipts) and related data (e.g., trade data, data on the foreign operations of U.S. multinationals, data on capital spending, and corporate financial data). This matching operation creates an enriched enterprise statistics database capable of illuminating the causes and consequences of enterprise growth and decline.

The ESP also responds to expressed customer needs and the recommendations and appeals of economic statistics advisory bodies and opinion leaders. Linking establishment and enterprise data has been strongly endorsed by the Bureau of Economic Analysis staff, including:

• Carol A. Robbins

Industry Accounts

Bureau of Economic Analysis

201-606-9923

• Ned G. Howenstine

Balance of Payments

Bureau of Economic Analysis

202-606-9845

• Ruth A. Bramblett

Source Data Coordinator

Bureau of Economic Analysis

202-606-9653

• David H. Galler

Chief, Direct Investment Division

Bureau of Economic Analysis

202-606-9835

Other data users include:

• Andrew Reamer

The Brookings Institution

1775 Massachusetts Ave, NW

Washington, D.C. 20036

202-994-7866

• E.J. Reedy

Ewing Marion Kauffman Foundation

4801 Rockhill Road

Kansas City, MO 64110

816-932-1078

Questions regarding this non-substantive change and the Company Organization Survey can be directed to Mrs. Shirin Ahmed, phone: 301-763-2558 or email: shirin.anne.ahmed@census.gov

The three additional inquiries on Form NC-99901 are:

• 3B OPERATING REVENUES AND NET SALES

A. Your company's operating revenues and net sales generated from U.S. operations (i.e., located in the 50 States and the District of Columbia) in 2011.

Include:

•Sales of goods and services to foreign firms

• Revenues of discontinued operations

Exclude:

• Sales generated by your company’s foreign operations

•Domestic inter-company sales

Special instructions for tax-exempt firms: Report revenues, realized gains and losses and contributions for all classes of net assets regardless of restrictions.

Operating revenues and net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $ __________

B. Does the amount reported on line A include inter-company sales by your company’s domestic operations to foreign subsidiaries or foreign affiliates?

Yes - Go to 3C

No - Go to line C

C. If not already included on line A, report inter-company sales by your company’s domestic operations to foreign subsidiaries and foreign affiliates . . . . $ _________

• 3C ROYALTIES AND LICENSE FEES FOR THE USE OF INTELLECTUAL PROPERTY

A. Did your company's U.S. operations earn revenues in 2011from royalties and license fees for rights to use intellectual property?

Include:

• Revenues from royalties and license fees for intellectual property owned by your company's domestic operations (i.e., located in the 50 states and the District of Columbia).

• Royalties and license fees paid to your company's domestic operations by foreign subsidiaries.

Exclude:

• Sales involving the transfer of ownership rights.

• Sales of and products sold as end-use licenses.

Yes - Go to line B

No - Go to 3D

B. Revenues from royalties and license fees for rights to use intellectual property in

2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ __________

C. Revenues from your company's U.S. operations, as reported in line B, for the following types of royalties and license fees in 2011 . . . . . . . . . . . . $ __________

1. Technological or industrial processes (Include patents, trade secrets, and proprietary technology. Exclude computer software.) . . . . . . . . . . . . . . . . . . . . . $ __________

2. Entertainment, artistic, educational, and literary original works (Include royalties and license fees for rights to perform, broadcast, reproduce, and sell copyrighted materials and other intellectual property such as films, television and radio programs, written works, and musical and other artistic works. Exclude computer software.) . . $_______

3. Software – Rights to reproduce, distribute, or use software protected by copyright and owned or controlled by the licensor. (Exclude sales of software sold with end-use licenses, as well as custom software and programming services.) . . . . . . $_________

4. Business format franchise sales and fees included in line B, if any . . . $ _______

5. TOTAL (Add lines C1 through C4. Total should equal line B.) . . $ __________

• 3D MANUFACTURING ACTIVITIES

In 2011, did your company do any of the following activities related to manufacturing?

A. Operate manufacturing facilities (such as a factory, plant, or mill) where products are completed or partially produced?

 Yes

 No - Go to line C

B. Provide contract manufacturing services to other companies incorporating their patents, trade secrets, or proprietary technology?

 Yes

 No - Go to line C

Estimate the percent of operating revenues and net sales, as reported in 3B, from contract manufacturing services.

 Less than 25%

 25 to 49%

 50 to 74%

 75 to 99%

 100%

C. Purchase contract manufacturing services from other companies or foreign subsidiaries of your company incorporating your company’s patents, trade secrets, or proprietary technology?

Yes

 No - Go to 44

4

1. Use 3rd party contract manufacturing services inside the U.S.?

 Yes

 No

2. Use 3rd party contract manufacturing services outside the U.S.?

 Yes

 No

3. Use your company's foreign subsidiaries' or affiliates' contract manufacturing services at locations outside the U.S.?

 Yes

 No

4. Estimate the percent of the cost of sales from expenses for contract manufacturing services.

 Less than 25%

 25 to 49%

 50 to 74%

 75 to 99%

 100%