Related-Party Transaction

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Related-Party Transaction

A transaction between two businesses that have a personal or other relationship. For example, a publicly-traded company may be inclined to hire a large, minority shareholder as a supplier. In small businesses, a company may hire the owner's brother-in-law to repair the driveway. Related-party transactions are legal, but create the potential for conflicts of interest. Thus, publicly-traded companies are required to report them on their 10-K forms.
References in periodicals archive ?
said the new rules on related-party transactions were approved by the Monetary Board last month.
The complexity and risks associated with recognition and disclosure of related-party transactions are significant.
Affiliates of the Evangelical Council for Financial Accountability (ECFA) have one year to comply with a new standard for setting compensation and addressing related-party transactions.
Despite this, the IRS found that the IRC Section 36(c) (5) exception that excludes related-party transactions incorporated the IRC Section 267(b)(6) exclusion for transactions between a fiduciary and a beneficiary of the same trust.
Across regions, Latin America regulates related-party transactions the least, imposing the weakest requirements for disclosure and approval.
The arm's-length standard is employed to ensure that related-party transactions dearly reflect the income of each party and to prevent tax evasion.
This proposal recognizes the reality of current corporate structures and addresses a long-outstanding source of frustration with respect to related-party transactions.
htm, provides auditors and accountants with guidance on the timely subject of related parties and related-party transactions.
A transaction is considered to be compliant with the arm's length principle when conditions imposed and prices paid in related-party transactions are comparable to those imposed and paid by independent enterprises in comparable circumstances.
PA 95-3, Auditing Related Parties and Related-Party Transactions (the PA) was issued because, as indicated in the first sentence of the document, "One of the more important and yet, more difficult, aspects of the financial statement audit is the identification of related parties and transactions with related parties.
Media coverage of the allegations notwithstanding, William Aramony's offense was not an expensive lifestyle but the creation and maintenance of an intricate network of related-party transactions which had the not coincidental side effect of making him a bit richer.
Most of the exports have been related-party transactions by multinational corporations, like Goodyear and Michelin.