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AS 18_Opinion required (urgent)

aditya behere (Article Assistant) (123 Points)

22 December 2009

Where there is an indirect influence (through other companies having control/significant influence in the reporting enterprise - i.e. company in which the individual has substantial interest, is a shareholder of reporting enterprise) of an individual can that individual be treated as a related party of the reporting enterprise

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6 Replies

Navneet Gupta (Article) (129 Points)
Replied 24 December 2009

i m not able to understand your query, please explain in simple words

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aditya behere (Article Assistant) (123 Points)
Replied 28 December 2009

for eg: Reporting Entp. - ABC Ltd.

X ltd, Y ltd, Zltd, P ltd collectively hold 60% stake in ABC Ltd.

Mr. T has substantial interest in all - X ltd, Y ltd, Z ltd & P Ltd.

Can Mr. T be treated as a Related Party under AS 18 for ABC ltd.

kishore choudhury (article asst.) (114 Points)
Replied 30 December 2009

yes as per AS - 18 Mr. T will be treated as an related party

CA Ashish Bansal (Manager Finance & Accounts) (73 Points)
Replied 30 December 2009

If any of X ltd, Y ltd, Z ltd & P Ltd has substantial interest in ABC Ltd than only Mr T will be a Related Party is AS 21 is not applicable and

if AS 21is applibable Mr T is a Related Party

gauravtonk (CA - DM Audit) (25 Points)
Replied 04 January 2010

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Venkat (Student) (74 Points)
Replied 13 January 2010

Related Parties include parties that have control or have significant influence over reporting entity (includes Parent company, major investors) In the given case Mr.T has substantial interest in X ltd, Yltd, Zltd and P ltd (Major investors) and therfore Mr.T will be treated as Related party.