For a Reporting Entity That Has Participated in Related-Party Transactions

question 15

Multiple Choice

For a reporting entity that has participated in related-party transactions that are material, disclosure in the financial report should include:

• A) the nature of the relationship and the terms and manner of settlement.
• B) details of the transactions within major classifications.
• C) a statement to the effect that a transaction was consummated on terms no less favourable than those that would have been obtained if the transaction had been with an unrelated party.
• D) a reference to deficiencies in the entity's internal control.

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Definitions:

Monthly

Occurring or done once a month.

Compounded Annually

Interest calculation method where interest is added to the principal once a year, allowing the total sum to grow at an annual rate.

Accumulate Interest

The process by which earned interest is added to the principal, allowing future interest calculations to be based on the increased balance.

Constant Amount

A fixed sum that does not change over a specified period.