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HMRC internal manual

Corporate Finance Manual

Old rules: derivative contracts: basic rules pre FA 2004: change of accounting method

Change of accounting method

This guidance applies to periods of account beginning before 1 January 2005

FA02/SCH26/PARA15(6) ensures that, where

  • the company changes authorised accounting methods, and
  • an amount is brought into the company’s accounts because of the change

then the amount should be included in the taxable debits and credits. The reason for this rule is that it might otherwise be argued that the amount caused by the change arises neither under the old method nor the new, and so might fall out of account entirely.

For an example see CFM84200.