Amounts incurred by the entity for the provision of key management personnel services that are provided by a separate management entity shall be disclosed.
The disclosures required by paragraph 18 shall be made separately for
each of the following categories:
the parent;
entities with joint control of, or significant influence over, the
entity;
subsidiaries;
associates;
joint ventures in which the entity is a joint venturer;
key management personnel of the entity or its parent; and
other related parties.
The classification of amounts payable to, and receivable from, related parties in the different categories as required in paragraph 19 is an extension of the disclosure requirement in IAS 1 Presentation of Financial Statements for information
to be presented either in the statement of financial position or in the notes. The categories are extended to provide a more comprehensive analysis of related party balances and apply to related party transactions.
The following are examples of transactions that are disclosed if they are with a
related party:
purchases or sales of goods (finished or unfinished);
purchases or sales of property and other assets;
rendering or receiving of services;
leases;
transfers of research and development;
transfers under licence agreements;
transfers under finance arrangements (including loans and equity
contributions in cash or in kind);
provision of guarantees or collateral;
commitments to do something if a particular event occurs or does not occur in the future, including executory contracts1 (recognised and
unrecognised); and
settlement of liabilities on behalf of the entity or by the entity on behalf
of that related party.
Participation by a parent or subsidiary in a defined benefit plan that shares risks between group entities is a transaction between related parties (see paragraph 42 of IAS 19 (as amended in 2011)).
Disclosures that related party transactions were made on terms equivalent to those that prevail in arm's length transactions are made only if such terms can be substantiated.
Items of a similar nature may be disclosed in aggregate except when
separate disclosure is necessary for an understanding of the effects of related party transactions on the financial statements of the entity.
Government-related entities
A reporting entity is exempt from the disclosure requirements of
paragraph 18 in relation to related party transactions and outstanding
balances, including commitments, with:
a government that has control or joint control of, or significant
influence over, the reporting entity; and
another entity that is a related party because the same government has control or joint control of, or significant influence over, both the reporting entity and the other entity.
If a reporting entity applies the exemption in paragraph 25, it shall
disclose the following about the transactions and related outstanding
balances referred to in paragraph 25:
the name of the government and the nature of its relationship with the reporting entity (ie control, joint control or significant
influence);
the following information in sufficient detail to enable users of the entity's financial statements to understand the effect of
related party transactions on its financial statements:
the nature and amount of each individually significant
transaction; and
for other transactions that are collectively, but not
individually, significant, a qualitative or quantitative indication of their extent. Types of transactions include those listed in paragraph 21.
IAS 37 Provisions, Contingent Liabilities and Contingent Assets defines executory contracts as contracts
under which neither party has performed any of its obligations or both parties have partially performed their obligations to an equal extent.
In using its judgement to determine the level of detail to be disclosed in accordance with the requirements in paragraph 26(b), the reporting entity shall consider the closeness of the related party relationship and other factors relevant in establishing the level of significance of the transaction such as
whether it is:
significant in terms of size;
carried out on non-market terms;
outside normal day-to-day business operations, such as the purchase and
sale of businesses;
disclosed to regulatory or supervisory authorities;
reported to senior management; subject to shareholder approval.
Effective date and transition
An entity shall apply this Standard retrospectively for annual periods beginning on or after 1 January 2011. Earlier application is permitted, either of the whole Standard or of the partial exemption in paragraphs 25-27 for government-related entities. If an entity applies either the whole Standard or that partial exemption for a period beginning before 1 January 2011, it shall disclose that fact.
IFRS 10, IFRS 11 Joint Arrangements and IFRS 12, issued in May 2011, amended paragraphs 3, 9, 11(b), 15, 19(b) and (e) and 25. An entity shall apply those amendments when it applies IFRS 10, IFRS 11 and IFRS 12.
Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS 27), issued in October 2012, amended paragraphs 4 and 9. An entity shall apply those amendments for annual periods beginning on or after 1 January 2014. Earlier application of Investment Entities is permitted. If an entity applies those amendments earlier it shall also apply all amendments included in Investment Entities at the same time.
Annual Improvements to IFRSs 2010-2012 Cycle, issued in December 2013, amended paragraph 9 and added paragraphs 17A and 18A. An entity shall apply that amendment for annual periods beginning on or after 1 July 2014. Earlier application is permitted. If an entity applies that amendment for an earlier period it shall disclose that fact.
Withdrawal of IAS 24 (2003)
This Standard supersedes IAS 24 Related Party Disclosures (as revised in 2003).
Appendix
Amendment to IFRS 8 Operating Segments
This amendment contained in this appendix when this Standard was issued in 2009 has been
incorporated into IFRS 8 as published in this volume.