
TY  - JOUR
A1  - Murray, J.H. 
A1  - Miller, A.K. 
T1  - LONG-TERM CONSTRUCTION CONTRACTS&#x2014;SOME ISSUES IN RELATION TO THE TAXATION OF FINANCIAL ARRANGEMENTS RULES
JF  - The APPEA Journal
JO  - The APPEA Journal
Y1  - 2006
VL  - 46
IS  - 1
SP  - 561
EP  - 568
KW  - 
UR  - https://doi.org/10.1071/AJ05036 
N2  - The Gorgon gas development project has an estimated cost of A$11 billion, the Bayu-Undan gas project has an estimated cost of A$4.2 billion and the Otway Basin gas project has an estimated cost of A$1.1 billion. The specialised equipment, technology and labour required for these costly oil and oas infrastructure projects must usually be sourced internationally and as such their costs are typically denominated in United States (US) dollars. Due to the value and long term nature of these projects, associated foreign exchange gains and losses are often significant.From an Australian income tax perspective, the treatment of foreign exchange gains and losses has been particularly uncertain and inconsistent for many years. As a result, taxation legislation in this area has recently undergone significant change. The new Taxation of Financial Arrangements legislation introduced in December 2003, has raised some complex and practically challenging concepts in relation to foreign exchange gains and losses on long term construction contracts. This paper will address two such concepts, namely forex realisation event 4 and the short-term foreign exchange rules. In particular, it will consider some of the potential compliance risk areas and how they can be managed when applying these concepts to long term construction contracts. 
ER  -

