IAS 24 — Related Party Disclosures - IAS Plus

IAS 24 requires disclosures about transactions and outstanding balances with an entity's related parties. The standard defines various classes of entities ... IASplus IASplus Global(English) Global(English) Global(Deutsch) Canada(English) Canada(Français) UnitedKingdom(English) LoginorRegister DeloitteUser? Login LoginName Password Login Register | Forgotpassword Welcome Myaccount Logout IASplus Global(English) Global(English) Global(Deutsch) Canada(English) Canada(Français) UnitedKingdom(English) Togglenavigation⋮ Searchsite Togglenavigation Home News Publications Meetings Standards Projects Jurisdictions Resources MyIASPlus Topics Communications Togglenavigation⋮ Searchsite Navigation Standards Effectivedates InternationalFinancialReportingStandards InternationalAccountingStandards IFRICInterpretations SICInterpretations Otherpronouncements Navigation InternationalAccountingStandards IAS1—PresentationofFinancialStatements IAS2—Inventories IAS7—StatementofCashFlows IAS8—AccountingPolicies,ChangesinAccountingEstimatesandErrors IAS10—EventsAftertheReportingPeriod IAS11—ConstructionContracts IAS12—IncomeTaxes IAS14—SegmentReporting(Superseded) IAS15—InformationReflectingtheEffectsofChangingPrices(Withdrawn) IAS16—Property,PlantandEquipment IAS17—Leases IAS18—Revenue IAS19—EmployeeBenefits(2011) IAS19—EmployeeBenefits(1998)(superseded) IAS20—AccountingforGovernmentGrantsandDisclosureofGovernmentAssistance IAS21—TheEffectsofChangesinForeignExchangeRates IAS22—BusinessCombinations(Superseded) IAS23—BorrowingCosts IAS24—RelatedPartyDisclosures IAS26—AccountingandReportingbyRetirementBenefitPlans IAS27—SeparateFinancialStatements(2011) IAS27—ConsolidatedandSeparateFinancialStatements(2008) IAS28—InvestmentsinAssociatesandJointVentures(2011) IAS28—InvestmentsinAssociates(2003) IAS29—FinancialReportinginHyperinflationaryEconomies IAS30—DisclosuresintheFinancialStatementsofBanksandSimilarFinancialInstitutions IAS31—InterestsInJointVentures IAS32—FinancialInstruments:Presentation IAS33—EarningsPerShare IAS34—InterimFinancialReporting IAS35—DiscontinuingOperations(Superseded) IAS36—ImpairmentofAssets IAS37—Provisions,ContingentLiabilitiesandContingentAssets IAS38—IntangibleAssets IAS39—FinancialInstruments:RecognitionandMeasurement IAS40—InvestmentProperty IAS41—Agriculture Info IAS24—RelatedPartyDisclosures QuickArticleLinks Overview IAS24RelatedPartyDisclosuresrequiresdisclosuresabouttransactionsandoutstandingbalanceswithanentity'srelatedparties.Thestandarddefinesvariousclassesofentitiesandpeopleasrelatedpartiesandsetsoutthedisclosuresrequiredinrespectofthoseparties,includingthecompensationofkeymanagementpersonnel. IAS24wasreissuedinNovember2009andappliestoannualperiodsbeginningonorafter1January2011. HistoryofIAS24 Date Development Comments March 1983 ExposureDraftE25DisclosureofRelatedPartyTransactions July 1984 IAS24RelatedPartyDisclosuresissued Effective1January1986 1994 IAS24wasreformatted 18 December 2003 IAS24RelatedPartyDisclosures Effectiveforannualperiodsbeginningonorafter1January2005 22 February 2007 ExposureDraftState-controlledEntitiesandtheDefinitionofaRelatedPartypublished Commentdeadline25May2007 11 December 2008 ExposureDraftRelationshipswiththeState(ProposedamendmentstoIAS24)published Commentdeadline13March2009 4 November 2009 IAS24RelatedPartyDisclosuresissued Effectiveforannualperiodsbeginningonorafter1January2011 12 December 2013 AmendedbyAnnualImprovementstoIFRSs2010–2012Cycle(entitiesprovidingkeymanagementpersonnelservices) Effectiveforannualperiodsbeginningonorafter1July2014 RelatedInterpretations None AmendmentsunderconsiderationbytheIASB None SummaryofIAS24 ObjectiveofIAS24 TheobjectiveofIAS24istoensurethatanentity'sfinancialstatementscontainthedisclosuresnecessarytodrawattentiontothepossibilitythatitsfinancialpositionandprofitorlossmayhavebeenaffectedbytheexistenceofrelatedpartiesandbytransactionsandoutstandingbalanceswithsuchparties. Whoarerelatedparties? Arelatedpartyisapersonorentitythatisrelatedtotheentitythatispreparingitsfinancialstatements(referredtoasthe'reportingentity')[IAS24.9]. (a)Apersonoraclosememberofthatperson'sfamilyisrelatedtoareportingentityifthatperson: (i)hascontrolorjointcontroloverthereportingentity; (ii)hassignificantinfluenceoverthereportingentity;or (iii)isamemberofthekeymanagementpersonnelofthereportingentityorofaparentofthereportingentity. (b)Anentityisrelatedtoareportingentityifanyofthefollowingconditionsapplies: (i)Theentityandthereportingentityaremembersofthesamegroup(whichmeansthateachparent,subsidiaryandfellowsubsidiaryisrelatedtotheothers). (ii)Oneentityisanassociateorjointventureoftheotherentity(oranassociateorjointventureofamemberofagroupofwhichtheotherentityisamember). (iii)Bothentitiesarejointventuresofthesamethirdparty. (iv)Oneentityisajointventureofathirdentityandtheotherentityisanassociateofthethirdentity. (v)Theentityisapost-employmentdefinedbenefitplanforthebenefitofemployeesofeitherthereportingentityoranentityrelatedtothereportingentity.Ifthereportingentityisitselfsuchaplan,thesponsoringemployersarealsorelatedtothereportingentity. (vi)Theentityiscontrolledorjointlycontrolledbyapersonidentifiedin(a). (vii)Apersonidentifiedin(a)(i)hassignificantinfluenceovertheentityorisamemberofthekeymanagementpersonneloftheentity(orofaparentoftheentity). (viii)Theentity,oranymemberofagroupofwhichitisapart,provideskeymanagementpersonnelservicestothereportingentityortotheparentofthereportingentity*. *RequirementaddedbyAnnualImprovementstoIFRSs2010–2012Cycle,effectiveforannualperiodsbeginningonorafter1July2014. Thefollowingaredeemednottoberelated:[IAS24.11] twoentitiessimplybecausetheyhaveadirectororkeymanagerincommon twoventurerswhosharejointcontroloverajointventure providersoffinance,tradeunions,publicutilities,anddepartmentsandagenciesofagovernmentthatdoesnotcontrol,jointlycontrolorsignificantlyinfluencethereportingentity,simplybyvirtueoftheirnormaldealingswithanentity(eventhoughtheymayaffectthefreedomofactionofanentityorparticipateinitsdecision-makingprocess) asinglecustomer,supplier,franchiser,distributor,orgeneralagentwithwhomanentitytransactsasignificantvolumeofbusinessmerelybyvirtueoftheresultingeconomicdependence Whatarerelatedpartytransactions? Arelatedpartytransactionisatransferofresources,services,orobligationsbetweenrelatedparties,regardlessofwhetherapriceischarged.[IAS24.9] Disclosure Relationshipsbetweenparentsandsubsidiaries.Regardlessofwhethertherehavebeentransactionsbetweenaparentandasubsidiary,anentitymustdisclosethenameofitsparentand,ifdifferent,theultimatecontrollingparty.Ifneithertheentity'sparentnortheultimatecontrollingpartyproducesfinancialstatementsavailableforpublicuse,thenameofthenextmostseniorparentthatdoessomustalsobedisclosed.[IAS24.16] Managementcompensation.Disclosekeymanagementpersonnelcompensationintotalandforeachofthefollowingcategories:[IAS24.17] short-termemployeebenefits post-employmentbenefits otherlong-termbenefits terminationbenefits share-basedpaymentbenefits Keymanagementpersonnelarethosepersonshavingauthorityandresponsibilityforplanning,directing,andcontrollingtheactivitiesoftheentity,directlyorindirectly,includinganydirectors(whetherexecutiveorotherwise)oftheentity.[IAS24.9] Ifanentityobtainskeymanagementpersonnelservicesfromamanagemententity,theentityisnotrequiredtodisclosethecompensationpaidorpayablebythemanagemententitytothemanagemententity’semployeesordirectors.Insteadtheentitydisclosestheamountsincurredbytheentityfortheprovisionofkeymanagementpersonnelservicesthatareprovidedbytheseparatemanagemententity*.[IAS24.17A,18A] *TheserequirementswereintroducedbyAnnualImprovementstoIFRSs2010–2012Cycle,effectiveforannualperiodsbeginningonorafter1July2014.   Relatedpartytransactions.Iftherehavebeentransactionsbetweenrelatedparties,disclosethenatureoftherelatedpartyrelationshipaswellasinformationaboutthetransactionsandoutstandingbalancesnecessaryforanunderstandingofthepotentialeffectoftherelationshiponthefinancialstatements.Thesedisclosurewouldbemadeseparatelyforeachcategoryofrelatedpartiesandwouldinclude:[IAS24.18-19] theamountofthetransactions theamountofoutstandingbalances,includingtermsandconditionsandguarantees provisionsfordoubtfuldebtsrelatedtotheamountofoutstandingbalances expenserecognisedduringtheperiodinrespectofbadordoubtfuldebtsduefromrelatedparties Examplesofthekindsoftransactionsthataredisclosediftheyarewitharelatedparty purchasesorsalesofgoods purchasesorsalesofpropertyandotherassets renderingorreceivingofservices leases transfersofresearchanddevelopment transfersunderlicenceagreements transfersunderfinancearrangements(includingloansandequitycontributionsincashorinkind) provisionofguaranteesorcollateral commitmentstodosomethingifaparticulareventoccursordoesnotoccurinthefuture,includingexecutorycontracts(recognisedandunrecognised) settlementofliabilitiesonbehalfoftheentityorbytheentityonbehalfofanotherparty Astatementthatrelatedpartytransactionsweremadeontermsequivalenttothosethatprevailinarm'slengthtransactionsshouldbemadeonlyifsuchtermscanbesubstantiated.[IAS24.21] Quicklinks Deloittee-learningonIAS24 IAS24—Itemsnotaddedtotheagenda Relatednews IASBpublisheseditorialcorrections 02Feb2022 AASBresearchintoexecutiveremunerationdisclosurerequirements 30Sep2021 EuropeanUnionformallyadoptsAnnualImprovementstoIFRS-Cycle2010-2012andamendmentstoIAS19 09Jan2015 AgendaforMay2014EmergingEconomiesGroupmeeting 26May2014 EFRAGupdatesendorsementstatusreportfordraftendorsementadviceonannualimprovementcycles 31Jan2014 IASBconcludesthe2010-2012AnnualImprovementscycle 12Dec2013 AllRelated RelatedPublications DeloittecommentletterontentativeagendadecisiononIAS24—Relatedpartydisclosures 01Apr2015 EFRAGendorsementstatusreport9January2015 09Jan2015 IFRSinFocus—IASBissuesAnnualImprovements:2010-2012Cycle 12Dec2013 Batch#13ofextractsfromtheESMAdatabaseofIFRSdecisions 04Apr2013 AllRelated RelatedProjects Annualimprovements—2010-2012cycle IAS24—Statecontrolledentitiesanddefinitionof'relatedparty' ImprovementstoexistingInternationalAccountingStandards(2001-2003) AllRelated Contactus About Legal Privacy Cookies FAQs ©2022.SeeLegalformoreinformation. 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