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3. Close family members of an individual are those who may be expected to influence or be influenced by that individual
in their dealings with the entity. Close family members include all of the following, except
a. The individual’s spouse and children
b. Children of the individual’s spouse
c. Dependents of the individual or the individual’s spouse
d. Brothers and sisters
4. It is the method used in pricing transactions between related parties by making reference to comparable goods sold in
an economically comparable market to a buyer unrelated to the seller.
a. No specific method c. Fixed price method
b. Cost plus 10 % mark-up method d. Uncontrolled price method
5. PAS 24 requires disclosure of compensation of key management personnel. Which of the following would not be
considered “compensation” for this purpose?
a. Short-term benefits b. Share-based payments
c. Termination benefits d. Reimbursement of out-of-pocket expenses
6. If there have been related party transactions during the year, an entity needs to make, at a minimum, certain
disclosures. Which of the following is not a required minimum disclosure?
a. The amount of the related party transactions.
b. The amount of the outstanding related party balances and their terms and conditions along with the details of
guarantees given and received
c. The amount of similar transactions with unrelated parties to establish that comparable related party transactions have
been entered at arm’s length.
d. Provisions for doubtful debts related to the amount of outstanding related party balances and expense recognized
during the year in respect of bad or doubtful debts due from related parties.
7. The minimum disclosures prescribed under PAS 24 are to be made separately for certain categories of related parties.
Which of the following is not among the list of categories specified under the Standard for purposes of separate
disclosure?
a. Entities with joint control or significant influence over the entity.
b. The parent company of the entity
c. An entity that has a common director with the entity
d. Joint ventures in which the entity is a venturer.
ANSWERS:
1. C
2. D
3. D
4. D
5. D
6. C
7. C
8.