Taxation (International and Other Provisions) Act 2010 section 489

References to amounts recognised in financial statements

Section 489 explains what is meant by an amount being "recognised" in financial statements for the purposes of Part 4 of the Act, including how to handle foreign currency amounts and reclassified items.

• An amount counts as "recognised" even if it forms only part of a larger amount that appears in the financial statements
• Amounts expressed in a foreign currency must be translated into sterling using the average exchange rate for the period, calculated from daily spot rates
• An amount previously recorded as other comprehensive income counts as recognised in profit or loss for a period if it is reclassified (recycled) into profit or loss for that period
• These rules apply consistently throughout Part 4 of the Act wherever the term "recognised" is used in relation to financial statements