Which of the Following Statements Is Correct

question 52

Multiple Choice

Which of the following statements is correct?

• A) A related-party transaction is a transfer of resources, services or obligations between related parties that is not at arm's length.
• B) The existence of a related-party transaction can expose an entity to risks or opportunities that otherwise would not have existed in the absence of the relationship.
• C) Related parties include organisations that are under the control or significant influence of the entity and individuals such as key management personnel and their close family members.
• D) The existence of a related-party transaction can expose an entity to risks or opportunities that otherwise would not have existed in the absence of the relationship, and related parties include organisations that are under the control or significant influence of the entity and individuals such as key management personnel and their close family members.

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Definitions:

Reaction

The process of responding to internal or external stimuli, which can involve physical, emotional, or intellectual responses.

Denial

A psychological defense mechanism where a person refuses to accept reality or facts, hence avoiding dealing with painful feelings.

Learning Organization

Describes an organization that facilitates the learning of its members and continuously transforms itself to better respond to changes in the environment.

Systems Thinking

An analytical framework for understanding the complex interrelationships within an organization or system rather than viewing components in isolation.