Income Tax Assessment Act 1997

CHAPTER 6 - THE DICTIONARY  

PART 6-1 - CONCEPTS AND TOPICS  

Division 960 - General  

Subdivision 960-D - Functional currency  

Operative provisions

SECTION 960-70   What is the applicable functional currency ?  

Australian resident required to prepare financial reports under section 292 of the Corporations Act 2001

960-70(1)    
If you make a choice under item 1 of the table in subsection 960-60(1) with effect from the start of a particular income year, your applicable functional currency for:

(a) that income year; and

(b) each later income year for which the choice is in effect;

is the sole or predominant *foreign currency in which you kept your accounts at the time when you made the choice.

Permanent establishment, offshore banking unit or transferor trust

960-70(2)    
If you make a choice under item 2, 3 or 5 of the table in subsection 960-60(1) in relation to a *permanent establishment, an *offshore banking unit or a *transferor trust with effect from the start of a particular income year, the applicable functional currency of the establishment, unit or trust for:

(a) that income year; and

(b) each later income year for which the choice is in effect;

is the sole or predominant *foreign currency in which the establishment, unit or trust kept its accounts at the time when you made the choice.

Controlled foreign company

960-70(3)    

If you make a choice under item 4 of the table in subsection 960-60(1) in relation to a *controlled foreign company (CFC) with effect from the start of a particular *statutory accounting period, the applicable functional currency of the CFC for:

(a) that statutory accounting period; and

(b) each later statutory accounting period for which the choice is in effect;

is the sole or predominant *foreign currency in which the CFC kept its accounts at the time when you made the choice.

Note:

The attributable income of a controlled foreign company is calculated separately for each attributable taxpayer - see section 381 of the Income Tax Assessment Act 1936 .

Calculating capital gains and losses on indirect Australian real property interests

960-70(3A)    

If subsection 960-61(2) applies, your applicable functional currency for the purposes of that subsection is the sole or predominant currency in which you keep your accounts at the time of the *CGT event.

Accounts

960-70(4)    
For the purposes of this section, accounts means:

(a) ledgers; and

(b) journals; and

(c) statements of financial performance; and

(d) profit and loss accounts; and

(e) balance-sheets; and

(f) statements of financial position;

and includes statements, reports and notes attached to, or intended to be read with, any of the foregoing.