how to read government deficit and debt

Economic situation of the government described by the indicators of the national accounts is currently under the spotlight of the professional public. The indicators have its relevance to considerations of the fiscal sustainability and the European Monetary Union enlargement. However, awareness of the methodology is ether weak; the indicators are in many cases confused with other indicators related to public finance. The main aim of the text is to provide a detailed explanation of nature of key indicators used for the purpose of the Excessive Deficit Procedure. At the same time, main differences between indicators related to the state budget, public sector and EDP procedure are outlined.