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What are Related Parties and Related Party Transactions ?
in Agenda 2063 by Diamond (50,977 points) | 22 views

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Reference is made to the definition of related parties and related party transactions in International Accounting Standard 24. A related party is:

(a) a member of the Board or of the key management personnel of the organisation;

(b) any other person that significantly controls or influences the organisation;

(c) any close member of the family (such as the individual's domestic partner and children, children of the individual's domestic partner and other dependants of the individual or of the individual's domestic partner) of any individual referred to in (a) or (b);

(d) any entity controlled or significantly influenced by the organisation or by any individual referred to in (a) or (b); (e) any entity under joint control with the organisation;

(f) any entity that significantly controls or influences the organisation. A related party transaction shall be understood as a transfer of resources, services or obligations between related parties and the organisation, regardless of whether a price is charged.

This includes among others: purchases or sales of goods, property and other assets; rendering or receiving of services; leases; transfers of research and development; transfers under licence agreements; financial arrangements (including loans and equity contributions in cash or in kind); provision of guarantees or collateral; commitments to do something if a particular event occurs or does not occur in the future, including executory contracts; etc.
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