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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Related party
Hello tutor
IAS 24 says : A person or a close member of that person’s family is related to a reporting entity if that person: (ii) has significant influence over the reporting entity;
and An entity is related to a reporting entity if any of the following conditions applies:(vii) A person identified above has significant influence over the entity.
Kaplan example gives :
Mr X has significant influence over entity A and B.
But it says A and B are NOT related party.
why is that so? Let say entity A is reporting entity, and entity B is significantly influenced by person identified above, are they not related?
Thank you
A and B are not automatically RPs – but they might be – it would depend on whether Mr X actually uses significant influence to persuade A, for example, to buy goods from B.