Question 1

Close family members of key management personnel include:

Accepted Answer

A)  domestic partner and children. 
B)  children of domestic partner. 
C)  dependents of domestic partner. 
D)  all of the given answers. 
A)  domestic partner and children. 
B)  children of domestic partner. 
C)  dependents of domestic partner. 
D)  all of the given answers.

Question 2

AASB 124 provides guidance regarding the measurement of remuneration amounts for directors such that:

Accepted Answer

A)  Remuneration should be measured at cost to the entity or related party and includes any money, consideration or employee benefits paid, payable or provided. 
B)  Where directly identifiable, the remuneration should be measured at cost; however, where the measurement of considerations or benefit requires an estimation, the amount should be reflected at fair value according to an arm's length transaction for a similar consideration or benefit. 
C)  Remuneration amounts should be disclosed at the fair value of the elements of the emoluments package offered, including any benefits or consideration that take the form of access to resources of the entity or its related parties. 
D)  Remuneration amounts should be disclosed at the net realisable value of the elements of the emoluments package offered. In the case of benefits or considerations that take the form of access to resources of the entity or its related parties, these should be disclosed at the deprival value to the relevant entity. 
A)  Remuneration should be measured at cost to the entity or related party and includes any money, consideration or employee benefits paid, payable or provided. 
B)  Where directly identifiable, the remuneration should be measured at cost; however, where the measurement of considerations or benefit requires an estimation, the amount should be reflected at fair value according to an arm's length transaction for a similar consideration or benefit. 
C)  Remuneration amounts should be disclosed at the fair value of the elements of the emoluments package offered, including any benefits or consideration that take the form of access to resources of the entity or its related parties. 
D)  Remuneration amounts should be disclosed at the net realisable value of the elements of the emoluments package offered. In the case of benefits or considerations that take the form of access to resources of the entity or its related parties, these should be disclosed at the deprival value to the relevant entity.

Question 3

Disclosure information under AASB 124 is aggregated by:

Accepted Answer

A)  forex currency base, size of the transaction and class of related party. 
B)  size of the transaction, type of transaction and frequency of the transaction. 
C)  type of transaction, nature of terms and conditions and class of related party. 
D)  nature of terms and conditions, class of related party and frequency of the transaction. 
A)  forex currency base, size of the transaction and class of related party. 
B)  size of the transaction, type of transaction and frequency of the transaction. 
C)  type of transaction, nature of terms and conditions and class of related party. 
D)  nature of terms and conditions, class of related party and frequency of the transaction.

Question 4

What additional disclosures are required of disclosing entities with regards to related-party transactions?

Accepted Answer

AASB 124 requires various items of discl

Question 5

The disclosures required by AASB 124 for key management personnel include:

Accepted Answer

A)  the name of the person. 
B)  the position held. 
C)  dates identifying the period of responsibility. 
D)  all of the given answers. 
A)  the name of the person. 
B)  the position held. 
C)  dates identifying the period of responsibility. 
D)  all of the given answers.

Question 6

A close family member of someone who is key management personnel is considered to be a related party.

Accepted Answer

A) True 
 B)False

Question 7

The disclosure requirements of AASB 124 are grouped in part by:

Accepted Answer

A)  currency of transaction-transactions should be grouped by currency of the transaction so that users can identify any forex risk associated. 
B)  size-three broad categories of disclosure are required depending on the percentage size of the transaction relative to the turnover of the entity. The categories are 0.5 per cent-9 per cent, 10 per cent-20 per cent, 21 per cent and over. 
C)  frequency-transactions repeated during the period are distinguished from one-off transactions. 
D)  subsidiaries, associates-joint venturers in which the entity is a joint venturer. 
A)  currency of transaction-transactions should be grouped by currency of the transaction so that users can identify any forex risk associated. 
B)  size-three broad categories of disclosure are required depending on the percentage size of the transaction relative to the turnover of the entity. The categories are 0.5 per cent-9 per cent, 10 per cent-20 per cent, 21 per cent and over. 
C)  frequency-transactions repeated during the period are distinguished from one-off transactions. 
D)  subsidiaries, associates-joint venturers in which the entity is a joint venturer.

Question 8

Tennant Creek Ltd has following transactions during the year:
$\begin{array}{|l|l|}
\hline \text { I }& \text { Leasing arrangement with an associate } \
\hline \text { II } & \text { Sale of products to a major customer } \
\hline \text { III } & \text { Transactions in a joint venturer } \
\hline IV & \text { Immaterial loan to key management personnel } \
\hline \mathrm{V} & \text { Allowance for bad debts from a related party } \
\hline \text { VI }& \text { Purchase of goods from a major supplier }\
\hline
\end{array}$
Which of the following lists all the related-party transactions that are required to be disclosed in AASB 124 Related Party Disclosures?

Accepted Answer

A)  I and III 
B)  III and V 
C)  II, III and IV 
D)  I, IV and V 
A)  I and III 
B)  III and V 
C)  II, III and IV 
D)  I, IV and V

Question 9

In order for control to exist as the basis for a related-party disclosure the capacity to control must have been demonstrated as having been exercised in the past.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following standards is applied for determining materiality?

Accepted Answer

A)  AASB 124 
B)  AASB 13 
C)  AASB 1031 
D)  AASB 116 
A)  AASB 124 
B)  AASB 13 
C)  AASB 1031 
D)  AASB 116

Question 11

A major supplier with whom an entity transacts a significant volume of business is considered a related party in AASB 124 Related Party Disclosures.

Accepted Answer

A) True 
 B)False

Question 12

Entities that have a controlling entity in common are considered to be 'other related parties'.

Accepted Answer

A) True 
 B)False

Question 13

Related parties are not considered to be interdependent.

Accepted Answer

A) True 
 B)False

Question 14

The commentary to AASB 124 identifies factors that would normally indicate the existence of control.These factors include:

Accepted Answer

A)  the capacity to withdraw a material amount of loan capital. 
B)  the power to dominate the composition of the board of directors or governing body. 
C)  the authority to determine the outcome of significant local council decisions relevant to the entity. 
D)  the capacity to withdraw a material amount of loan capital and the power to dominate the composition of the board of directors or governing body. 
A)  the capacity to withdraw a material amount of loan capital. 
B)  the power to dominate the composition of the board of directors or governing body. 
C)  the authority to determine the outcome of significant local council decisions relevant to the entity. 
D)  the capacity to withdraw a material amount of loan capital and the power to dominate the composition of the board of directors or governing body.

Question 15

The definition of related parties under AASB 124 excludes entities (other than those specified earlier in the relevant paragraph)where the related-party relationship:

Accepted Answer

A)  is a relationship formed more than 5 years prior to the current reporting period. 
B)  results solely from normal dealings of local governments. 
C)  is a commonly known and transparent link between entities in the public sphere. 
D)  is based on a relationship to the directors through marriage only. 
A)  is a relationship formed more than 5 years prior to the current reporting period. 
B)  results solely from normal dealings of local governments. 
C)  is a commonly known and transparent link between entities in the public sphere. 
D)  is based on a relationship to the directors through marriage only.

Question 16

Which of the following is usually not a related party as referred to in AASB 124 Related Party Disclosures?

Accepted Answer

A)  subsidiary 
B)  associate 
C)  son-in law of the chief executive officer 
D)  trade union official 
A)  subsidiary 
B)  associate 
C)  son-in law of the chief executive officer 
D)  trade union official

Question 17

An alternate director who is not acting in that capacity is considered a related party in AASB 124.

Accepted Answer

A) True 
 B)False

Exam 25: Related Party Disclosures

Close family members of key management personnel include:

AASB 124 provides guidance regarding the measurement of remuneration amounts for directors such that:

Disclosure information under AASB 124 is aggregated by:

What additional disclosures are required of disclosing entities with regards to related-party transactions?

The disclosures required by AASB 124 for key management personnel include:

A close family member of someone who is key management personnel is considered to be a related party.

The disclosure requirements of AASB 124 are grouped in part by:

In order for control to exist as the basis for a related-party disclosure the capacity to control must have been demonstrated as having been exercised in the past.

Which of the following standards is applied for determining materiality?

A major supplier with whom an entity transacts a significant volume of business is considered a related party in AASB 124 Related Party Disclosures.

Entities that have a controlling entity in common are considered to be 'other related parties'.

Related parties are not considered to be interdependent.

The commentary to AASB 124 identifies factors that would normally indicate the existence of control.These factors include:

The definition of related parties under AASB 124 excludes entities (other than those specified earlier in the relevant paragraph)where the related-party relationship:

Which of the following is usually not a related party as referred to in AASB 124 Related Party Disclosures?

An alternate director who is not acting in that capacity is considered a related party in AASB 124.

An Overview of the Australian External Reporting Environment

The Conceptual Framework of Accounting and Its Relevance to Financial Reporting

Theories of Accounting

An Overview of Accounting for Assets

Depreciation of Property, plant and Equipment

Revaluations and Impairment Testing of Non-Current Assets

Inventory

Accounting for Intangibles

Accounting for Heritage Assets and Biological Assets

An Overview of Accounting for Liabilities

Accounting for Leases

Accounting for Employee Benefits

Share Capital and Reserves

Accounting for Financial Instruments

Revenue Recognition Issues

The Statement of Comprehensive Income and Statement of Changes in Equity

Accounting for Share-Based Payments

Accounting for Income Taxes

The Statement of Cash Flows

Accounting for the Extractive Industries

Accounting for General Insurance Contracts

Accounting for Superannuation Plans

Events Occurring After the End of the Reporting Period

Segment Reporting

Earnings Per Share

Accounting for Group Structures

Further Consolidation Issues I: Accounting for Intragroup Transactions

Further Consolidation Issues II: Accounting for Non-Controlling Interests

Further Consolidation Issues IV: Accounting for Changes in the Degree of Ownership of a Subsidiary

Accounting for Equity Investments,including Investments in Associates and Joint Arrangements

Accounting for Foreign Currency Transactions

Translating the Financial Statements of Foreign Operations

Accounting for Corporate Social Responsibility

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