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PRESENTATION ON “RELATED PARTY DISCLOSURES” IAS 24 Vs. AS 18 AN OVERVIEW JULY 9, 2010 PowerPoint PPT Presentation


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PRESENTATION ON “RELATED PARTY DISCLOSURES” IAS 24 Vs. AS 18 AN OVERVIEW JULY 9, 2010. 1. CONTENTS AS 18 Vs. IAS 24: AN OVERVIEW. SPECIFIC DIFFERENCES: BASIC DIFFERENCES IN DEFINITIONS ETC WHEN INDIVIDUALS ARE INVOLVED AS STAKEHOLDERS WHEN ENTITIES ARE INVOLVED AS STAKEHOLDERS

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PRESENTATION ON “RELATED PARTY DISCLOSURES” IAS 24 Vs. AS 18 AN OVERVIEW JULY 9, 2010

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Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

PRESENTATION

ON

“RELATED PARTY DISCLOSURES”

IAS 24 Vs. AS 18

AN OVERVIEW

JULY 9, 2010

1

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Contents as 18 vs ias 24 an overview

CONTENTSAS 18 Vs. IAS 24: AN OVERVIEW

  • SPECIFIC DIFFERENCES:

    • BASIC DIFFERENCES IN DEFINITIONS ETC

    • WHEN INDIVIDUALS ARE INVOLVED AS STAKEHOLDERS

    • WHEN ENTITIES ARE INVOLVED AS STAKEHOLDERS

  • OTHER DIFFERENCES

  • ADDITIONAL DEFINITIONS AND CLARIFICATIONS

2

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Primary accounting references

PRIMARY ACCOUNTING REFERENCES

AS 18: “RELATED PARTY DISCLOSURES”

IAS 24: “RELATED PARTY DISCLOSURES”

EXPOSURE DRAFT: “AS 18 (REVISED 20XX) CORRESPONDING TO IAS 24”

ACCOUNTING STANDARD INTERPRETATIONS

ASI 13 (AGGREGATION OF TRANSACTIONS)

ASI 19 (INTERPRET THE TERM ‘INTERMEDIARIES’)

ASI 21 (NON EXECUTIVE DIRECTORS…….)

GUIDANCE NOTE ON REMUNERATION PAID TO KEY MANAGEMENT PERSONNEL

3

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Basic differences in definitions etc

BASIC DIFFERENCES IN DEFINITIONS, ETC.

4

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Relatives vs close family members

RELATIVES Vs. CLOSE FAMILY MEMBERS

EXTENDED/RELAXED

5

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

EXTENDED/RELAXED

RELATIVES Vs. CLOSE FAMILY MEMBERS

AS 18: RELATIVES

  • Spouse;

  • Son; Daughter;

  • Brother; Sister;

  • Father; and Mother;

IAS 24: CLOSE MEMBERS OF FAMILY

  • Spouse/domesticpartner;

  • Children of the person or of spouse or of domestic partner; and

  • Dependents of the person or of spouse or of domestic partner;

who may be expected to influence the individual/person or

be influenced by the individual/person.

6

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Extended definition of kmp

EXTENDED DEFINITION OF KMP

EXTENDED

7

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Extended coverage of kmp

EXTENDED COVERAGE OF KMP

EXTENDED

8

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

AS 18:

S is related to Mr. X in S’ financial statements

S is not related to Mr. Y in S’ financial statements

IAS 24

S is related to both Mr. X and Mr. Y in S’ financial statements

EXTENDED

EXTENDED COVERAGE OF KMP

Mr. X

(KMP)

Mr. Y

(KMP)

Subsidiary

(S)

Parent

(P)

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

EXTENDED/RELAXED

DIFFERENCE IN DEFINITION OF GOVT……….

10

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Differences when individuals are involved as stakeholders

DIFFERENCES WHEN INDIVIDUALS ARE INVOLVED AS STAKEHOLDERS

11

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Differences when individuals are stakeholders

DIFFERENCES: WHEN INDIVIDUALS ARE STAKEHOLDERS

RELAXED

12

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

IAS 24 Paras 9(a)(i)(ii)(iii) and 9(b)(vi)

POSITION AS TO INDIVIDUALS AS STAKEHOLDERS IN IAS 24

IAS 24 Paras 9(a)(i) and 9(b)(vii)

Mr. X

Mr. X

Entity B

Control or

joint control

Entity B

Significant

influence

or

KMP

Entity A

Control

or

joint control

or

significant influence

or

KMP

Entity A

control

or

joint control

IAS 24: A AND B ARE RELATED TO EACH OTHER IN THEIR FINANCIAL STATEMENTS

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

AS 18 Para 3(c)(d)(e)

POSITION AS TO INDIVIDUALS AS STAKEHOLDERS IN AS 18

Mr. X

Entity A

Control

or

Significant influence

or

KMP

Entity B

Control

or

Significant influence

or

KMP

  • AS 18:

    • A and B are related to each other in both their financial statements.

CONTROL AND SIGNIFICANT INFLUENCE IN AS 18 [para 3(c)] ARE PRIMARILY CONSEQUENT TO VOTING POWER. IN IAS 24, VOTING POWER IS NOT THAT RELEVANT

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

IAS 24 Para 9(b)(vi) and AS 18 Para 3(c)(d)(e)

DIFFERENCE ON ACCOUNT OF JOINT CONTROL

UNIFORMITY

  • IAS 24:

    • A and B are related to each other if there is joint control in both.

  • AS 18:

    • Does not use the term joint control in relation to individuals. However, by implication, joint control is generally regarded as an influence that is stronger than significant influence.

Mr. X

Entity A

Joint control

Entity B

Control

or

Joint control

or

Significant influence

or

KMP

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

IAS 24:

Entities over which significant influence is exercised by a common person are not related to each other.

AS 18:

A and B are related to each other in both their financial statements.

RELAXED

DIFFERENCE WHEN AN INDIVIDUAL HAS SIGNIFICANT INFLUENCE

Mr. X

Significant influence

over entity A

Significant influence

over entity B

  • .

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

IAS 24:

Entities having common KMP are not related to each other.

AS 18:

A and B are related to each other in both their financial statements.

RELAXED

DIFFERENCE WHEN AN INDIVIDUAL IS A COMMON KMP

Mr. X

KMP of entity A

KMP of entity B

  • .

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

IAS 24:

An entity in which a person has significant influence, would not be related to other just because that person is a KMP of the other entity

AS 18:

A and B are related to each other in both their financial statements.

RELAXED

DIFFERENCE WHEN AN INDIVIDUAL HAS KEY POSITION AND SIGNIFICANT INFLUENCE

Mr. X

Significant influence

over entity A

KMP of entity B

  • .

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

DIFFERENCES WHEN ENTITIES ARE INVOLVED AS STAKEHOLDERS

19

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Difference when entities are involved as stakeholders

DIFFERENCE WHEN ENTITIES ARE INVOLVED AS STAKEHOLDERS

EXTENDED

20

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

AS 18: [para 3(b)]

Co ventures or co associates are not related to each other.

(anomaly).

IAS 24: [paras 9(b)(iii) (iv)]

B and C are related to each other in both their financial statements if they are either co ventures or one is a venture and the other is an associate.

Co associates are not related to each other (as in AS 18 also).

EXTENDED

DIFFERENCE ON ACCOUNT OF JOINT VENTURES AND ASSOCIATES

Entity A

Entity B

Joint venture or an associate

Entity C

Joint venture

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Other differences

OTHER DIFFERENCES

22

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

REGULATORY

DISCLOSURES SUBJECT TO CONFIDENTIALITY

23

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

AS 18:

No specific coverage as to entities that are post employment benefit plans, as related parties.

IAS 24: [para 9(b)(v)]

A and B are related to each other in both their financial statements

EXTENDED

DIFFERENCE ON ACCOUNT OF POST EMPLOYMENT BENEFIT PLANS

Entity A

Entity B

Post employment benefit plan for the benefit of employees of Entity A or entity related to A

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Extended disclosures of managerial compensation

EXTENDED DISCLOSURES OF MANAGERIAL COMPENSATION

EXTENDED/IMPLEMENTATION

25

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Option as to disclosure of volume of transactions

OPTION AS TO DISCLOSURE OF VOLUME OF TRANSACTIONS

OPTION/EXTENDED

26

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

EXTENDED

ADDED DISCLOSURES FOR GOVT RELATED ENTITIES……….

27

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Additional definitions in as 18

ADDITIONAL DEFINITIONS IN AS-18

28

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

CLARIFICATORY

ADDITIONAL DEFINITIONS IN AS 18, THOUGH NOT IN IAS 24

29

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Clarifications in as 18

CLARIFICATIONS IN AS-18

30

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

CLARIFICATORY

CLARIFICATORY TEXT IN AS-18, THOUGH NOT IN IAS 24

31

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

CLARIFICATORY

CLARIFICATION REGARDING AGGREGATION OF TRANSACTIONS

32

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Recap

RECAP…….

33

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Recap1

RECAP……….

DIFFERENCES: IAS 24 Vs. AS 18

BASIC DIFFERENCES IN DEFINITIONS ETC

WHEN INDIVIDUALS ARE INVOLVED AS STAKEHOLDERS

WHEN ENTITIES ARE INVOLVED AS STAKEHOLDERS

OTHER DIFFERENCES

ADDITIONAL DEFINITIONS AND CLARIFICATIONS

34

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

THANK YOU FOR YOUR KIND ATTENTION

The information contained herein is of general nature and is for discussions only

35

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

CONTACT DETAILS:

KAUSHAL KISHORE

+91-9811103133

[email protected]

36

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Coverage of commitments

COVERAGE OF COMMITMENTS

CLARIFICATORY

38

Kaushal Kishore. DRAFT FOR DISCUSSIONS


Presentation on related party disclosures ias 24 vs as 18 an overview july 9 2010

CLARIFICATORY

CLARIFICATION REGARDING REGULATORY DISCLOSURES

39

Kaushal Kishore. DRAFT FOR DISCUSSIONS


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