Related party disclosure

Related party disclosure

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Hi

Directors husband has been paying for company assets and has a few leases and HP's in his name as finance company wouldn't lend to the company.

Does a related party disclosure note need to be included in accounts.  And should I mention leases being in his name?

What should I write in the "description of relationship" for the note? Husband of director?

Any thoughts appreciated.

Replies (3)

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By johngroganjga
23rd May 2015 09:46

Yes, yes and yes.

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By Phil653
23rd May 2015 12:43

Thanks John,

that is what I thought,

Im getting confused with the legislation, as

FRSSE states that two or more parties are related when, at any time during the financial period: •one party has direct or indirect control of the other party

•the parties are subject to common control from the same source

•one party has significant influence over the financial and operating policies of the other party, to an extent that the other party might be inhibited from pursuing its own separate interests

 

FRS 8 defines a ‘related party transaction’ as: ‘the transfer of assets or liabilities or the performance of services by, to or for a related party irrespective of whether a price is charged.’ [FRS 8 paragraph 2.6] FRSSE states that related parties of a reporting entity including the following:

•parent undertakings, subsidiary and fellow subsidiary undertakings

•associates and joint ventures

investors with significant influence and their close families •

directors of the reporting entity and of its parent undertakings

 

so does this relationship come under investors with significant influence and their close families?

 

Thanks

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By johngroganjga
23rd May 2015 13:00

You haven't told us whether the director in question has any shareholding in the company, but if she has, and if it is a significant one, then yes of course her husband comes within the definition you highlight.

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