Companies Act 1985

269 Treatment of development costs. U.K.

(1) Subject as follows, where development costs are shown as an asset in a company’s accounts, any amount shown in respect of those costs is to be treated—

(a) under section 263, as a realised loss, and

(b) under section 265, as a realised revenue loss.

(2) This does not apply to any part of that amount representing an unrealised profit made on revaluation of those costs; nor does it 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), F1 . . .

(b) [F2 it is stated–

(i) in the case of Companies Act individual accounts, in] the note to the accounts required by paragraph 20 of Schedule 4 [F3 paragraph 20 of Schedule 8] (reasons for showing development costs as an asset)[F4 , or

(ii) in the case of IAS individual accounts, in any note to the accounts,] that the amount is not to be so treated[F5 , and

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

Textual Amendments

F1 Word in s. 269(2)(a) omitted (12.11.2004 with effect as mentioned in reg. 1(2) of the amending S.I.) by The Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 (S.I. 2004/2947), reg. 3, Sch. 1 para. 25(2)

F2 S. 269(2)(b)(i) and preceding words inserted (12.11.2004 with effect as mentioned in reg. 1(2) of the amending S.I.) by The Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 (S.I. 2004/2947), reg. 3, Sch. 1 para. 25(3)(a)

F3 Words in s. 269(2)(b) inserted (1.3.1997) by S.I. 1997/220, reg. 7(7)

F4 S. 269(2)(b)(ii) and preceding word substituted for word (12.11.2004 with effect as mentioned in reg. 1(2) of the amending S.I.) by The Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 (S.I. 2004/2947), reg. 3, Sch. 1 para. 25(3)(b)

F5 S. 269(2)(c) and preceding word substituted for words (12.11.2004 with effect as mentioned in reg. 1(2) of the amending S.I.) by The Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 (S.I. 2004/2947), reg. 3, Sch. 1 para. 25(3)(c)