sec.17HWhat is a licensee’s current ratio

### sec.17H What is a licensee’s current ratio A licensee’s current ratio is worked out using the following formula— where— CA means the licensee’s current assets. CL means the licensee’s current liabilities. The ratio must not be rounded up. For subsection (1) , an asset is a current asset of a licensee if, when the current ratio is worked out— the asset is treated as an asset of the licensee for working out the licensee’s net tangible assets under part 4 ; and the asset— is of the type that is realised, sold or consumed in the ordinary course of carrying on the licensee’s business; or is to be realised within 12 months after the day the current ratio is being worked out; or is held for trading within the meaning of Australian Accounting Standard AASB 9; or is cash or a cash equivalent, other than an asset that is restricted from being exchanged or used to settle a liability under the Australian Accounting Standards; or is a loan given by the licensee to a related entity if, on the day the current ratio is worked out, the related entity has current assets that are sufficient to repay the loan in full. However, an asset is not a current asset if the asset— is real property, unless the property is— listed on the market for sale when the current ratio is worked out; and valued under the Australian Accounting Standards at cost, or the net realisable value of the property, whichever is lower; or is a deed of covenant asset. For subsection (1) , a liability is a current liability of the licensee if the liability is payable by the licensee within 12 months after the day the current ratio is worked out. This section applies subject to section 17I . s 17H ins 2019 SL No. 30 s 24 amd 2019 SL No. 100 s 6 (sec.17H-ssec.1) A licensee’s current ratio is worked out using the following formula— where— CA means the licensee’s current assets. CL means the licensee’s current liabilities. (sec.17H-ssec.2) The ratio must not be rounded up. (sec.17H-ssec.3) For subsection (1) , an asset is a current asset of a licensee if, when the current ratio is worked out— the asset is treated as an asset of the licensee for working out the licensee’s net tangible assets under part 4 ; and the asset— is of the type that is realised, sold or consumed in the ordinary course of carrying on the licensee’s business; or is to be realised within 12 months after the day the current ratio is being worked out; or is held for trading within the meaning of Australian Accounting Standard AASB 9; or is cash or a cash equivalent, other than an asset that is restricted from being exchanged or used to settle a liability under the Australian Accounting Standards; or is a loan given by the licensee to a related entity if, on the day the current ratio is worked out, the related entity has current assets that are sufficient to repay the loan in full. (sec.17H-ssec.4) However, an asset is not a current asset if the asset— is real property, unless the property is— listed on the market for sale when the current ratio is worked out; and valued under the Australian Accounting Standards at cost, or the net realisable value of the property, whichever is lower; or is a deed of covenant asset. (sec.17H-ssec.5) For subsection (1) , a liability is a current liability of the licensee if the liability is payable by the licensee within 12 months after the day the current ratio is worked out. (sec.17H-ssec.6) This section applies subject to section 17I . - (a) the asset is treated as an asset of the licensee for working out the licensee’s net tangible assets under part 4 ; and - (b) the asset— (i) is of the type that is realised, sold or consumed in the ordinary course of carrying on the licensee’s business; or (ii) is to be realised within 12 months after the day the current ratio is being worked out; or (iii) is held for trading within the meaning of Australian Accounting Standard AASB 9; or (iv) is cash or a cash equivalent, other than an asset that is restricted from being exchanged or used to settle a liability under the Australian Accounting Standards; or (v) is a loan given by the licensee to a related entity if, on the day the current ratio is worked out, the related entity has current assets that are sufficient to repay the loan in full. - (i) is of the type that is realised, sold or consumed in the ordinary course of carrying on the licensee’s business; or - (ii) is to be realised within 12 months after the day the current ratio is being worked out; or - (iii) is held for trading within the meaning of Australian Accounting Standard AASB 9; or - (iv) is cash or a cash equivalent, other than an asset that is restricted from being exchanged or used to settle a liability under the Australian Accounting Standards; or - (v) is a loan given by the licensee to a related entity if, on the day the current ratio is worked out, the related entity has current assets that are sufficient to repay the loan in full. - (i) is of the type that is realised, sold or consumed in the ordinary course of carrying on the licensee’s business; or - (ii) is to be realised within 12 months after the day the current ratio is being worked out; or - (iii) is held for trading within the meaning of Australian Accounting Standard AASB 9; or - (iv) is cash or a cash equivalent, other than an asset that is restricted from being exchanged or used to settle a liability under the Australian Accounting Standards; or - (v) is a loan given by the licensee to a related entity if, on the day the current ratio is worked out, the related entity has current assets that are sufficient to repay the loan in full. - (a) is real property, unless the property is— (i) listed on the market for sale when the current ratio is worked out; and (ii) valued under the Australian Accounting Standards at cost, or the net realisable value of the property, whichever is lower; or - (i) listed on the market for sale when the current ratio is worked out; and - (ii) valued under the Australian Accounting Standards at cost, or the net realisable value of the property, whichever is lower; or - (b) is a deed of covenant asset. - (i) listed on the market for sale when the current ratio is worked out; and - (ii) valued under the Australian Accounting Standards at cost, or the net realisable value of the property, whichever is lower; or