Paragraph 27 F1

England, Wales and Scotland

(1)

Subject to the qualification mentioned below, the purchase price or production cost of—

(a)

any assets which fall to be included under any item shown in a small company’s balance sheet under the general item “stocks”; and

(b)

any assets which are fungible assets (including investments);

may be determined by the application of any of the methods mentioned in sub-paragraph (2) below in relation to any such assets of the same class.

The method chosen must be one which appears to the directors to be appropriate in the circumstances of the company.

(2)

Those methods are—

(a)

the method known as “first in, first out” (FIFO);

(b)

the method known as “last in, first out” (LIFO);

(c)

a weighted average price; and

(d)

any other method similar to any of the methods mentioned above.

(3)

For the purposes of this paragraph, assets of any description shall be regarded as fungible if assets of that description are substantially indistinguishable one from another.

Annotations

Textual amendments

F1: Sch. 8 substituted (1.3.1997) by S.I. 1997/220, reg. 2(2), Sch. 1

Notes on Schedule 8

Textual amendments

F1: Sch. 8 repealed (6.4.2008) by Companies Act 2006 (c. 46), ss. 1295, 1300, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 1 (with arts. 7, 12)