SCHEDULE 1COMPANIES ACT INDIVIDUAL ACCOUNTS: COMPANIES WHICH ARE NOT BANKING OR INSURANCE COMPANIES
PART 2ACCOUNTING PRINCIPLES AND RULES
SECTION BHISTORICAL COST ACCOUNTING RULES
Miscellaneous and supplementary provisions
Excess of money owed over value received as an asset item25
1
Where the amount repayable on any debt owed by a company is greater than the value of the consideration received in the transaction giving rise to the debt, the amount of the difference may be treated as an asset.
2
Where any such amount is so treated—
a
it must be written off by reasonable amounts each year and must be completely written off before repayment of the debt, and
b
if the current amount is not shown as a separate item in the company’s balance sheet, it must be disclosed in a note to the accounts.