SCHEDULES

SCHEDULE 8FORM AND CONTENT OF ACCOUNTS PREPARED BY SMALL COMPANIES

PART IIACCOUNTING PRINCIPLES AND RULES

SECTION DFAIR VALUE ACCOUNTING

Inclusion of financial instruments at fair value

34A

1

Subject to sub‐paragraphs (2) to (4), financial instruments (including derivatives) may be included at fair value.

2

Sub‐paragraph (1) does not apply to financial instruments which constitute liabilities unless—

a

they are held as part of a trading portfolio, or

b

they are derivatives.

3

Sub‐paragraph (1) does not apply to—

a

financial instruments (other than derivatives) held to maturity;

b

loans and receivables originated by the company and not held for trading purposes;

c

interests in subsidiary undertakings, associated undertakings and joint ventures;

d

equity instruments issued by the company;

e

contracts for contingent consideration in a business combination;

f

other financial instruments with such special characteristics that the instruments, according to generally accepted accounting principles or practice, should be accounted for differently from other financial instruments.

4

If the fair value of a financial instrument cannot be determined reliably in accordance with paragraph 34B, sub‐paragraph (1) does not apply to that financial instrument.

5

In this paragraph—

  • “associated undertaking” has the meaning given by paragraph 20 of Schedule 4A; and

  • “joint venture” has the meaning given by paragraph 19 of that Schedule.