Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 2/45)
Character Range: 5913107–5915847

were securitised in accordance with that purpose before the joining time;
 (g) at the joining time the *market value of the joining entity's interest in the underlying securitised assets is nil, or is substantially less than the amount of the securitisation liability.

705‑80  Liabilities of the joining entity—reductions/increases for purposes of step 2 in working out allocable cost amount

Application
 (1A) This section applies to an accounting liability to the extent that it is a liability of a kind described in:
 (a) paragraph 705‑70(1AC)(c); or
 (b) paragraph 705‑70(1AC)(d).

Adjustment for unrealised gains and losses
 (1) If:
 (a) for income tax purposes, an accounting liability, or a change in the amount of an accounting liability, (other than one owed to a *member of the joined group) is taken into account at a later time than is the case in accordance with the joining entity's *accounting principles for tax cost setting; and
 (b) assuming that, for income tax purposes the accounting liability or change were taken into account at the same time as is the case in accordance with those standards or statements, the joined group's allocable cost amount would be different;
Note: The difference would arise because subsection 705‑70(1) includes income tax liabilities and steps 3 and 5 of the table in section 705‑60 are affected by the time at which changes in liabilities are taken into account for income tax purposes.
then the amount to be added under subsection 705‑70(1) for the accounting liability is:
 (c) if the difference is an increase—increased by the amount of the increase; and
 (d) if the difference is a decrease—decreased by the amount of the decrease.

Use of reliable estimate
 (2) In working out for the purposes of subsection (1) an amount at a particular time or in respect of a particular period, use the most reliable basis for estimation that is available.
Example: The amount of a change in liability for employee leave entitlements over a period.

705‑85  Liabilities of the joining entity—increases for purposes of step 2 in working out allocable cost amount

Increase in step 2 amount for employee share interests
 (1) If any *membership interest (an employee share interest) in the joining entity needed to be disregarded under section 703‑35 in order for the joining entity to be a *wholly‑owned subsidiary of the *head company at the joining time, the step 2 amount worked out under section 705‑70 is increased by the sum of the *market values of those interests, reduced in each case by the reduction amount (if any) worked out under subsection (2) of this section.

Reduction amount
 (2) There is a reduction amount if the *market value of the employee share interest at the time it was