Valuation shortcut 3
This shortcut is not available for joining entities that were majority owned by the prospective head company at 27 June 2002. The trading stock of such entities must be treated as a retained cost base asset.
The terminating value at the joining time can be taken as the market value for assets that are items of trading stock, except where either of the following applies:
- the trading stock comprises livestock, standing or growing crops, crop-stools and trees planted and tended for sale
- the value of the trading stock has been affected by market volatility, market collapses, obsolescence or any other event to the extent that its terminating value would not be a reasonable approximation of its market value at the joining time. In such cases, the trading stock should be market valued appropriately at the joining time.