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AS 18

Radhika (CA Final) (194 Points)

06 May 2010

My company name is Radhee (P)Ltd. Ankit is a share holder in Radhee (P)Ltd and he is a director for Rahul(P)Ltd. now i would like to knoe whether Radhee(P)Ltd and Rahul(P)Ltd are related parties or not?

Regards

Radhee

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(Guest)

i want to know the % of shareholding of ankit. if ankit is a holder of 20% or more shareholding or exercise significant influence on rahul ltd. then there is a related party relationship between ankit and rahul ltd. according to para 3(c) of AS-18 and also the relationship between rahul and radhee ltd. under para 3 (e).

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Ankit CA and CS (Manager - Accounts) (204 Points)
Replied 06 May 2010

As per AS 18, Key manegerial personnel(Executive Director) is a Related party. Now comes the point of shareholding, from percentage holding 2 figures are there 20%(associate) and 50%(Subsidiary) then only related party comes into picture.

A person, if he is a director a Co. and shareholder in another co. it does not means that both the company will be related. Unless there is a relation ship between two companies they cantbe related party.

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vikash rathi (Chartered Accountant) (787 Points)
Replied 06 May 2010

Originally posted by : Arvind
	i want to know the % of shareholding of ankit. if ankit is a holder of 20% or more shareholding or exercise significant influence on rahul ltd. then there is a related party relationship between ankit and rahul ltd. according to para 3(c) of AS-18 and also the relationship between rahul and radhee ltd. under para 3 (e).