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Is work done for director's in-laws a related party transaction.

Small building firm undertook work for director's parents-in-law.  Job appears to have been priced at commercial rates and accounts for around 6% of company's annual turnover.  Is this required to be disclosed as a related party transaction and, if so, are in-laws required to be named or can they be referred to as 'members of the director's close family' ?  (accounts prepared under FRSSE 2008)



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31st Jul 2012 15:46

Well as Euan has not replied yet, I might as well put my opinion in. If the in-laws can influence the director, then they are related, and you need to disclose.


Edit - and you do need to name them - though it does seem over the top doesn't it?!


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By taxguru
31st Jul 2012 16:06

Well, if you think, considering the transaction and the business you're in, the disclosure might influence decisions made by the users of the financial statements ('materiality') then you should disclose under 'members'. In general terms, 6% of the turnover would look material, though!

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31st Jul 2012 16:14

What a palava ....... it's

What a palava ....... it's going to be interesting asking the director how much influence his in-laws have over him.

Is disclosure also required in abbreviated accounts ?








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31st Jul 2012 16:46

Disclosure not required in abbreviated accounts - thankfully, there is some respite!

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