Playback Speed
Rectangle 2
IAS 24 Related Party Disclosures
slide: Welcome
- Close members of the family of a person
-
Those family members who may be expected to influence, or be influenced by, that person in their dealings with the entity and include:
• That person’s children and spouse or domestic partner;
• Children of that person’s spouse or domestic partner;
• Dependants of that person or that person’s spouse or domestic partner.
- Compensation
-
Includes all employee benefits (as defined in IAS 19 Employee Benefits) including employee benefits to which IFRS 2 Share-based Payment applies. Employee benefits are all forms of consideration paid, payable or provided by the entity, or on behalf of the entity, in exchange for services rendered to the entity. It also includes such consideration paid on behalf of a parent of the entity in respect of the entity. Compensation includes:
• Short-term employee benefits, such as wages, salaries and social security contributions, paid annual leave and paid sick leave, profit-sharing and bonuses (if payable within twelve months of the end of the period) and non-monetary benefits (such as medical care, housing, cars and free or subsidised goods or services) for current employees;
• Post-employment benefits, such as pensions, other retirement benefits, post-employment life insurance and post-employment medical care;
• Other long-term employee benefits, including long-service leave or sabbatical leave, jubilee or other long-service benefits, long-term disability benefits and, if they are not payable wholly within twelve months after the end of the period, profit-sharing, bonuses and deferred compensation
• Termination benefits; and
• Share-based payment.
- Control of an investee
-
An entity controls an investee when the investor is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
- Government-related entity
-
An entity that is controlled, jointly controlled or significantly influenced by a government which refers to government, government agencies and similar bodies whether local, national or international.
- Joint control
-
The contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.
- Joint venturer
-
A party to a joint venture that has joint control over that joint venture.
- Key management personnel
-
Those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity.
- Related party
-
A related party is a person or entity that is related to the entity that is preparing its financial statements (in IAS 24 referred to as the “reporting entity”).
a. A person or a close member of that person’s family is related to a reporting entity if that person:
(i) Has control or joint control of the reporting entity;
(ii) Has significant influence over the reporting entity; or
(iii) Is a member of the key management personnel of the reporting entity or of a parent of the reporting entity.
b. An entity is related to a reporting entity if any of the following conditions applies:
(i) The entity and the reporting entity are members of the same group (which means that each parent, subsidiary and fellow subsidiary is related to the others).
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which the other entity is a member).
(iii) Both entities are joint ventures of the same third party.
(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v) The entity is a post-employment benefit plan for the benefit of employees of either the reporting entity or an entity related to the reporting entity. If the reporting entity is itself such a plan, the sponsoring employers are also related to the reporting entity.
(vi) The entity is controlled or jointly controlled by a person identified in (a).
(vii) A person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity).
(viii) The entity, or any member of a group of which it is a part, provides key management personnel services to the reporting entity or to the parent of the reporting entity.
- Related party transaction
-
A transfer of resources, services or obligations between a reporting entity and a related party, regardless of whether a price is charged.
- Significant influence
-
The power to participate in the financial and operating policy decisions of an entity, but is not control or joint control of those policies.
Welcome to the IAS 24 Related Party Disclosures e-learning.