This paper traces the development of the so-called mou conversion and its oper ational details. It points out that the impact of mou conversion on the reported land average depend on the structure of conversion rates and the distribution o f good lands and poor lands in the jurisdiction. Except in some peripheral distr icts where specially favorable conversion rates had been set in order to encoura ge reclamation activities, the mou conversion in most inland districts tended to overstate, rather than understate, land averages simply because there existed m ore good lands than poor lands.