• Part H: Consolidation valuation shortcuts

    Consolidation: Valuation shortcut options

    The following valuation shortcut options are for consolidation purposes only. They enable businesses to avoid the need to obtain new valuations for certain assets and membership interests. These shortcuts, which are provided under the Commissioner's general administrative powers, provide a reasonable approximation of the true market value of the asset.

    Use of these options may avoid the need for new valuations for the purpose of setting assets costs. However, the valuation shortcut options are not available for calculating a joining entity's market value for the purpose of determining the maximum use of transferred losses.

    The use of valuation shortcut options reduces the risk of the ATO undertaking a market valuation review of the assets for which the shortcut options have been used.

    Table H1: Consolidation: Valuation shortcut options

    Valuation shortcut

    Type of asset

    Valuation option

    1

    Depreciating assets (not including intangible assets) that have not been depreciated on an accelerated basis, whose individual adjustable values are 1% or less of the joining subsidiary's allocable cost amount (ACA)

    Adjustable value (which can be revised to ignore any balancing adjustment amount that reduced the adjustable value) can be used as market value

    2

    Depreciating assets (not including intangible assets) that have been depreciated on an accelerated basis, whose individual adjustable values are 1% or less of the joining subsidiary's allocable cost amount (ACA)

    Adjustable value, revised to ignore the effect of accelerated depreciation (and which can be revised to ignore any balancing adjustment amount that reduced the adjustable value), can be used as market value

    3

    Trading stock (other than livestock and growing crops) that is not a retained cost base asset

    Terminating value at the joining time may be used as market value except in certain circumstances

    4

    Employee share scheme shares

    Existing market valuation updated if appropriate

    5

    Unlisted shares

    Existing market valuation updated if appropriate

      Last modified: 01 Jul 2015QC 21245