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FE 16B: Total group non-debt liabilities
or “Calculating a group's total non-debt financial obligations”
You could also call this:

“Adding up a company group's debts and assets”

When you’re part of a company that has too much debt, you need to figure out how much debt your whole group of companies has compared to what it owns. This is called the debt percentage. To work this out, you need to add up all the money your group owes and all the things it owns.

You do this by following special rules for combining the money and things of all the companies in your group. These rules are called ‘generally accepted accounting practice’. They help you remove any money that companies in your group owe to each other, so you only count the real debts.

You can use one of two ways to do this:

  1. You can use the financial rules from the country where the main company that owns your group lives. You can find out more about this in section FE 18(1)(a).

  2. Or, you can use the general accounting rules that most companies use.

Both of these ways help you get a clear picture of how much your whole group of companies owes compared to what it owns.

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Next up: FE 18: Measurement of debts and assets of worldwide group

or “How to measure a worldwide group's debts and assets for tax purposes”
Next

Part F Recharacterisation of certain transactions
Interest apportionment on thin capitalisation: Debt percentage of worldwide group

FE 17Consolidation of debts and assets

  1. For an excess debt entity that is a company, the debt percentage of a worldwide group is calculated under generally accepted accounting practice for the consolidation of companies for the purposes of eliminating intra-group balances by consolidating the debts and assets of the members of the entity’s worldwide group using—

  2. a financial standard used in the country in which the entity’s ultimate non-resident parent company resides, as described in section FE 18(1)(a), if applicable; or
    1. generally accepted accounting practice.

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