Income Tax Assessment Regulations 1997
(item 12 of the table in subsection 960-50(6) of the Act, as modified, and subregulation 960-50.01(2) )
TRANSLATION OF CURRENCY AMOUNTS - RULES AND OTHER REQUIREMENTSPART 1 - RULES AND REQUIREMENTS FOR ITEM 12 OF THE TABLE IN SUBSECTION 960-50(6) OF THE ACT 1.2 CHOICE OF DAILY EXCHANGE RATE 1.2(1)
For item 12 of the table in subsection 960-50(6) of the Act, as modified, an entity may translate all amounts of a particular currency, relating to a particular day, into Australian currency using an exchange rate that is applicable at a time, on that day, chosen by the entity (a daily exchange rate ). 1.2(2)
If the entity chooses a daily exchange rate relating to a particular day, the entity must choose a daily exchange rate relating to each subsequent day in the income year using the same time of the day as the time to which the first daily exchange rate related. 1.2(3)
(a) the entity is not permitted to translate amounts using a daily exchange rate if the use of the rate would not be appropriate having regard to the entity's business or activities; and
(b) the entity must obtain the rate from a source that is not an associate of the entity, and not the entity itself, unless the Commissioner notifies the entity that it may obtain the rate from 1 or more specified sources; and
(c) the entity must translate amounts relating to the relevant day using that rate.
If an entity is a trader that takes currency positions as part of its business, the use of a single exchange rate for its activities on a day would not be appropriate having regard to its business.
Associate is defined in subsection 995-1(1) of the Act.