Document ID: chunk:federal_register_of_legislation:F2024L00884:body:0:p17
Version: federal_register_of_legislation:F2024L00884
Segment Type: other
Provision Reference: 
Character Range: 42068–45179

must exclude amounts that have been used to adjust:
(a)          goodwill and intangible assets; and
(b)          defined benefit superannuation assets.
13.         In order to apply the treatment in paragraph 9 of this Attachment, a life company must:
(a)          have procedures in place to monitor changes in relevant laws and taxation practices that may affect the written opinions it is required to obtain covering netting of deferred tax assets and deferred tax liabilities; and
(b)          ensure that the written opinions are updated in the event of changes in laws or taxation practices overseas that could materially impact on overseas taxation authorities continuing to allow netting of deferred tax assets and deferred tax liabilities.

Gains and losses arising from changes in own creditworthiness
14.         A life company must eliminate all unrealised gains and losses that have resulted from changes in the value of liabilities (including capital instruments) and any associated embedded derivatives, due to changes in the life company's own creditworthiness. Additional Tier 1 and Tier 2 Capital instruments must continue to be measured for capital adequacy purposes at their contractual values. Additional Tier 1 Capital and Tier 2 Capital instruments can be hedged in accordance with accounting standards.

Goodwill and other intangibles
15.         Subject to paragraph 17 of this Attachment, a life company must deduct the following net of any associated deferred assets and deferred tax liabilities that would be extinguished if the assets involved become impaired or derecognised under Australian Accounting Standards:
(a)          goodwill and any other intangible assets[17] arising from an acquisition, net of adjustments to profit or loss reflecting any changes arising from 'impairment' of goodwill; and
(b)          other intangible assets net of adjustments to profit or loss reflecting amortisation and impairment. Intangible assets are as defined in Australian Accounting Standards and include capitalised expenses and capitalised transaction costs. These include, but are not limited to:
(i)            costs associated with debt raisings and other similar transaction-related costs that are capitalised as an asset;
(ii)         costs associated with issuing capital instruments if not already charged to profit and loss;
(iii)       capitalised information technology software costs; and
(iv)        other capitalised expenses including capitalised expenses of a general nature such as strategic business development initiatives. These include, in addition to the above listed items, other forms of transaction costs and like costs that are required to be deferred/capitalised and amortised as part of the measurement of assets and liabilities under Australian Accounting Standards.
16.         The balance of any transaction costs and like items that are capitalised and deferred as an asset must be netted off against the balance of any income deferred as a liability relating to the products giving rise to the capitalised transaction costs (i.e. only deferred costs and