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there is no method of accounting for the group as a whole.
Furthermore, section 446 controls the determination of the method
of accounting.
Section 446 supports the conclusion that the consolidated
return regulations are not a method of accounting. Section
446(c) lists four methods of accounting that are permissible:
(1) The cash method, (2) an accrual method, (3) any other method
permitted by chapter 1 of the Code, and (4) any permissible
combination of the three aforementioned methods. The
consolidated return regulations are neither the cash method nor
an accrual method. The consolidated return regulations are
authorized under chapter 6 of the Code. Section 446(c) and the
consolidated return regulations simply do not treat the
regulations (or more specifically, the matching rule contained in
section 1.1502-13(b)(2), Income Tax Regs.) as a method of
accounting. See Vernon C. Neal, Inc. v. Commissioner, T.C. Memo.
1964-220.
Additionally, section 446(a) and (e) refer to the method of
accounting on the basis of which the taxpayer regularly computes
his income in keeping his books. Corporations do not keep their
books based on the consolidated return regulations; the
consolidated return regulations make adjustments to each
corporation's income determined under each corporation's separate
method of accounting. The Commissioner's supervisory authority
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