CFM51110 | Derivative contracts: the matters and computational rules: disregarding credits and debits

CTA09/S598, SI2004/3256

Secondary legislation

The regulatory power referred to at CFM51034 in CTA09/S598 gives the Treasury power to modify these basic rules by regulations in specified cases. Regulations may prescribe that certain amounts included in a company’s accounts are disregarded, or that amounts which are not shown in a company’s accounts are brought into account.

The most widely applicable regulations that have been made under this power are SI 2004/3256, the so-called Disregard Regulations. These regulations deal predominantly with hedging under IAS and amongst other things, deal with difficulties arising from the taxation of amounts recognised, for example, in reserves, which would have been brought into account for tax before the amendments made by F(2)A15 - see CFM51110. Detailed guidance is at CFM57000+, or in relation to hedges of net investment in a foreign operation - ‘forex matching’ - at CFM62000+.