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Companies Act 2006

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Companies Act 2006, Section 844 is up to date with all changes known to be in force on or before 13 December 2017. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations. Help about Changes to Legislation

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  • Act amendment to earlier affecting provision S.I. 2008/373 reg. 11(1) by S.I. 2013/1971 reg. 9(a) (This amendment not applied to legislation.gov.uk. Amending Regulations revoked (1.10.2013) without ever being in force by S.I. 2013/2224, reg. 2)
  • Act amendment to earlier affecting provision S.I. 2008/373 reg. 3(4) by S.I. 2013/1971 reg. 4 (This amendment not applied to legislation.gov.uk. Amending Regulations revoked (1.10.2013) without ever being in force by S.I. 2013/2224, reg. 2)

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844Treatment of development costsE+W+S+N.I.
This section has no associated Explanatory Notes

(1)Where development costs are shown or included as an asset in a company's accounts, any amount shown or included in respect of those costs is treated—

(a)for the purposes of section 830 (distributions to be made out of profits available for the purpose) as a realised loss, and

(b)for the purposes of section 832 (distributions by investment companies out of accumulated revenue profits) as a realised revenue loss.

This is subject to the following exceptions.

(2)Subsection (1) does not apply to any part of that amount representing an unrealised profit made on revaluation of those costs.

(3)Subsection (1) does not apply if—

(a)there are special circumstances in the company's case justifying the directors in deciding that the amount there mentioned is not to be treated as required by subsection (1),

(b)it is stated—

(i)in the case of Companies Act accounts, in the note required by regulations under section 396 as to the reasons for showing development costs as an asset, or

(ii)in the case of IAS accounts, in any note to the accounts,

that the amount is not to be so treated, and

(c)the note explains the circumstances relied upon to justify the decision of the directors to that effect.

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Commencement Information

I1S. 844 wholly in force at 6.4.2008; s. 844 not in force at Royal Assent see s. 1300; s. 844 in force at 6.4.2008 by S.I. 2007/3495, art. 3(1)(k) (with savings in arts. 7, 12 and subject to transitional adaptations in Sch. 1 paras. 14-20 and with savings in Sch. 4 paras. 33-35)

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