(1) A * foreign exchange retranslation election under subsection 230 - 255(1) applies to each of your * financial arrangements:
(a) that are * Division 230 financial arrangements; and
(b) that are recognised in financial reports of a kind referred to in paragraph 230 - 255(2)(a) that are audited, or required to be audited, as referred to in paragraph 230 - 255(2)(b); and
(c) in relation to which you are required by:
(i) * accounting standard AASB 121 (or another accounting standard prescribed by the regulations for the purposes of this paragraph); or
(ii) if that standard does not apply to the preparation of the financial report--a comparable accounting standard that applies to the preparation of the financial report under a * foreign law;
to recognise, in the financial reports, amounts in profit or loss (if any) that are attributable to changes in currency exchange rates; and
(d) that you start to have in the income year in which you make the election or in a later income year.
This subsection has effect subject to section 230 - 270.
Note: The election also has consequences under Subdivision 775 - F for arrangements that are not Division 230 financial arrangements.
(2) If, but for this subsection, paragraphs (1)(b) and (c) would not be satisfied in relation to a * financial arrangement because the arrangement is an intra - group transaction for the purposes of:
(a) * accounting standard AASB 127 (or another accounting standard prescribed by the regulations for the purposes of this paragraph); or
(b) if that standard does not apply to the preparation of the financial report--a comparable accounting standard that applies to the preparation of the financial report under a * foreign law;
paragraphs (1)(b) and (c) are taken to be satisfied in relation to the arrangement.
Note: Financial arrangements between members of a consolidated group or MEC group are not covered by this subsection because the single entity rule in subsection 701 - 1(1) operates to treat them as not being financial arrangements for the purposes of this Division.
(a) the * financial arrangement would not be a financial arrangement if the following provisions were disregarded:
(i) Division 9A of Part III of the Income Tax Assessment Act 1936 (which deals with offshore banking units);
(ii) Part IIIB of that Act (which deals with Australian branches of foreign banks etc.); and
(b) paragraphs (1)(b) and (c) would be satisfied in relation to the financial arrangement if the arrangement had been between 2 separate entities; and
(c) the * foreign exchange retranslation election under subsection 230 - 255(1) is made by:
(i) if section 121EB of the Income Tax Assessment Act 1936 applies--the OBU mentioned in that section (disregarding the operation of that section); or
(ii) if section 160ZZW of that Act applies--the bank mentioned in that section (disregarding the operation of that section);
paragraphs (1)(b) and (c) are taken to be satisfied in relation to the
arrangement.