Document ID: chunk:federal_register_of_legislation:C2025C00029:section:12:p6
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 12 (pt 6/43)
Character Range: 3960157–3963087

financial arrangement because of paragraph (4)(a), the anticipated dividend referred to in that subparagraph is a hedged item for the arrangement even if subsection (10) is not satisfied in relation to the anticipated dividend.

230‑340  Generally whole arrangement must be hedging financial arrangement
 (1) Subject to subsections (2), (3) and (4), the whole of a *financial arrangement must satisfy the requirements of subsection 230‑335(1) or (3) for the arrangement to be a hedging financial arrangement.

Partial hedges
 (2) If a *financial arrangement:
 (a) is an options contract; and
 (b) hedges risk only in part by reference to changes in the intrinsic value of the options contract;
the arrangement may be treated as a hedging financial arrangement to the extent to which the part of the arrangement referred to in paragraph (b) satisfies the requirements of subsection 230‑335(1) or (3).
 (3) If a *financial arrangement:
 (a) is a forward contract; and
 (b) has a spot price element and an interest element;
the arrangement may be treated as a hedging financial arrangement to the extent to which the spot price element satisfies the requirements of subsection 230‑335(1) or (3).

Proportionate hedges
 (4) A specified proportion of a *financial arrangement may be treated as a hedging financial arrangement to the extent to which that proportion of the arrangement satisfies the requirements of subsection 230‑335(1) or (3).

Separate financial arrangements if partial or proportionate hedge
 (5) If a part (or parts), or a proportion (or proportions), of a *financial arrangement is (or are) treated as a *hedging financial arrangement under subsection (2), (3) or (4):
 (a) the part (or each of the parts), or the proportion (or each of the proportions), of the arrangement that is (or are) treated as a hedging financial arrangement is taken to be a separate financial arrangement for the purposes of this Division; and
 (b) the remaining part or proportion (if any) of the arrangement is taken to be a separate financial arrangement for the purposes of this Division.
 (6) Subsection (5) has effect even if there would not be separate *arrangements under subsection 230‑55(4).

230‑345  Requirements not satisfied because of honest mistake or inadvertence
  If a *derivative financial arrangement, or a *foreign currency hedge, that you have would not be a *hedging financial arrangement only because the requirements of paragraph 230‑335(1)(b) or (c), or both, are not satisfied because of an honest mistake or inadvertence, it is nevertheless a hedging financial arrangement if the Commissioner considers this appropriate having regard to:
 (a) your documented risk management practices and policies; and
 (b) your record keeping practices; and
 (c) your accounting systems and controls; and
 (d) your internal governance processes; and
 (e) the circumstances surrounding the mistake or inadvertence (including