The Definition of Related Parties Under AASB 124 Excludes Entities

question 33

Multiple Choice

The definition of related parties under AASB 124 excludes entities (other than those specified earlier in the relevant paragraph) where the related-party relationship:

• A) Is a relationship formed more than 5 years prior to the current reporting period.
• B) Results solely from normal dealings of local governments.
• C) Is a commonly known and transparent link between entities in the public sphere.
• D) Is based on a relationship to the directors through marriage only.
• E) None of the given answers.

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Definitions:

Equation of Exchange

An economic formula representing the relationship between the money supply, its velocity, the price level, and the volume of transactions in an economy.

Money Supply

The collected amount of financial resources in an economy at a pointed-out time.

Velocity of Money

The speed at which money circulates from one transaction to another, and the frequency at which a single unit of currency is utilized within a specific timeframe.

Nominal GDP

The total market value of all final goods and services produced within a country's borders in a specific time period, measured using current prices without adjusting for inflation.