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EW 1: What this subpart does
or “This section summarises the financial arrangements rules and their purposes”
You could also call this:

“Financial arrangement rules take priority over other rules unless stated otherwise”

The rules about financial arrangements are very important. They decide when and how much money you earn or spend in a financial arrangement. These rules are more important than other rules, unless those other rules say they are more important.

When you spend money in a financial arrangement, you can’t include it in certain costs. For example, you can’t include it in the cost of things you buy to sell later if you don’t sell many things. You also can’t include it in the cost of farm animals, racehorses, things you buy to sell for profit, trees for timber, buying or making movies, looking for oil, or developing oil fields.

If you want to know more about how to value things you buy to sell, you can look at subpart EB. For information about valuing farm animals, you can check subpart EC.

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Next up: EW 3: What is a financial arrangement?

or “A financial arrangement is an agreement to receive or pay money now or in the future”
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Part E Timing and quantifying rules
Financial arrangements rules

EW 2Relationship of financial arrangements rules with other provisions

  1. The financial arrangements rules prevail over any other provision in relation to the timing and quantifying of income and expenditure under a financial arrangement to which the financial arrangements rules apply, unless the other provision expressly or by necessary implication requires otherwise.

  2. Expenditure under a financial arrangement to which the financial arrangements rules apply is not included in—

  3. the cost of trading stock for low-turnover traders under subpart EB (Valuation of trading stock (including dealer’s livestock)):
    1. the cost of livestock under subpart EC (Valuation of livestock):
      1. the cost of bloodstock under subpart EC:
        1. the cost of revenue account property:
          1. the cost of timber:
            1. the cost of acquiring a film or a film right:
              1. film production expenditure:
                1. petroleum development expenditure:
                  1. petroleum exploration expenditure.

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