- This topic has 1 reply, 2 voices, and was last updated 5 years ago by
.
- Posts
Hi sir,
based on your note, party is related to an entity if control is controlled under common control with entity.
In bpp kit q emcee there was a scenario that says 2 directors on mgmt board of emcee and airlines and answer said “IAS 24 deems parties are not related simply because they have director or key manager in common thus entities are not related”
Can you further elaborate how to distinguish when common control is common that is RP.
Do we need to establish that there’s a structure of shareholding of the company/group first. But if the question doesnt mention that and simply state the directors involvement then how so..
Hi,
You need to look at the level of control the director/key management personnel exerts over each of the two companies that they are sat on. If the director is one of many on the board of one of the companies, then how can they exert control/influence over any transactions between the tow companies? They would find it difficult and therefore not immediately a related party.
Thanks
- You must be logged in to reply to this topic.