(1) The question whether a company has an adjusted unrealised loss at an alteration time (the relevant alteration time ) is worked out in this way (the individual asset method ), unless the company chooses to work it out using the * global method (set out in subsection (1B)).
Note: Certain alteration times are disregarded (see subsections 165-115K(2) and (4)).
(1A) Step 1 in the method statement in subsection (1) does not apply to an amount that was counted at an earlier alteration time if the company has chosen to use the * global method of working out whether it has an adjusted unrealised loss at that earlier time.
(1B) The global method of working out whether the company has an adjusted unrealised loss at the relevant alteration time is as follows:
(a) a * CGT asset that the company owned at the relevant alteration time was also * trading stock or a * revenue asset at that time; and
(b) the asset's * cost base at the relevant alteration time is less than the amount that, if the relevant alteration time were a changeover time, would be compared under section 165-115F with the asset's * market value in working out a notional revenue gain or notional revenue loss that the company would have at the changeover time in respect of the asset;
then, for the purposes of step 2 of the method statement in subsection (1B) of this section, the amount that would be so compared is to be taken into account instead of that cost base.
(1D) A choice to use the * global method must be made on or before:
(a) the day on which the company lodges its * income tax return for the income year in which the relevant alteration time occurred; or
(b) such later day as the Commissioner allows.
(2) However, the company does not have an adjusted unrealised loss at the relevant alteration time if the company would, at that time, satisfy the maximum net asset value test under section 152-15.