PART 3 PREPARATION OF GROUP ACCOUNTS

CHAPTER 1 GENERAL

Meaning of “aggregate gross income”
11. (1) For the purposes of Schedule 6 the aggregate gross income for a financial year of a group consisting of a parent charity and its subsidiary undertaking or undertakings is to be determined by eliminating all group transactions for that year from the group income for that year.
(2) For the purposes of this regulation—
(a) “corresponding financial year” has the meaning given by paragraph (3);
(b) “gross income” means, in relation to a non-charitable subsidiary undertaking, the amount of income of that undertaking that would be construed as its gross income were it a charity;
(c) “group income” means the aggregate of—
(i) the gross income of the parent charity for the financial year;
(ii) the gross income of each charitable subsidiary undertaking of that parent charity for the corresponding financial year; and
(iii) the gross income of each non-charitable subsidiary undertaking of that parent charity for the corresponding financial year;
(d) “group transactions” means—
(i) all income and expenditure relating to transactions between members of the group;
(ii) all gains and losses relating to transactions between members of the group;
(e) “members of the group” is to be construed in accordance with paragraph 1(5) of Schedule 6.
(3) Subject to paragraph (4), “corresponding financial year” in relation to a subsidiary undertaking means—
(a) in the case of a subsidiary undertaking whose financial year ends with that of the parent charity, that year;
(b) in any other case, the financial year of the subsidiary undertaking ending immediately before the end of the financial year of the parent charity.
(4) If the figures for the corresponding financial year of a subsidiary undertaking cannot be obtained without disproportionate expense or undue delay, the latest available figures from the accounting records of the subsidiary undertaking for the same financial year as that of the parent charity are to be taken.