Related parties

In which of the stages of Audit do we obtain undestanding of related Parties

• Risk Assessment and Planning
• Respond to Risk
• Evaluate and Conclude
• All of the above

what is not performed as part of obatining undersatnding of related party transaction under Risk Assessment and Planning Stage

• Understand relationships and transactions through inquiry of management about the identity of related parties, the nature of relationships, and the purpose of transactions, if any
• Remain alert to related party information, including inspecting confirmations, meeting minutes, and other records or documents
• Perform appropriate substantive audit procedures relating to such newly identified related parties or significant related party transactions.
• Understand significant transactions outside the normal course of business, including inquiries of management about the nature of the transactions and whether related parties are involved

What are the documents we inspect to obtain understanding of related party relationship and transaction

• Entity structure chart and Related Party listing obtained from Management
• Significant Agreements
• Minutes of the meetings
• All of the above

Which is not an example of transaction outside normal course of business

• Complex Equity Transaction
• Sale transaction within similar terms and normal discounts within normal course
• Transaction with offshore entities in jurisdictions with less rigorous corporate laws or regulation
• Sales transaction with unusually large discounts or returns

In which stages of audit do we communicate related party information within engagement teams

• Risk Assessment and Planning
• Respond to Risk
• Evaluate and Conclude
• Option 1 & 2

Which are Relevant Assertion for Auditing Due from related parties

• Existence, Completeness and Accuracy
• Existence, Accuracy and Valuation & Allocation
• Existence, Occurance and Completeness
• Existenece, Valuation & Allocation and Rights & Obligation

In which stage of audit do we consider whether the facts and circumstances of the entity’s related party relationships and transactions have been appropriately summarized and presented so that the disclosures are understandable.

• Preliminary Activities
• Risk Assessment and Planning
• Respond to Risk
• Evaluate and Conclude

Which is not a Potential source of information for related party transaction

• Responses to external confirmation
• Shareholder register and filings with regulators
• Internal document prepared by management
• Income tax returns

Related party transaction should be recorded at?

• Arms length price
• Market price
• Transaction price
• None of above

If the auditor identifies related parties or significant related party transactions that management has not previously identified or disclosed to the auditor, the auditor shall:

• Promptly communicate the relevant information to the other members of the engagement team.
• Perform appropriate substantive audit procedures relating to such newly identified related parties or significant related party transactions.
• Reconsider the risk that other related parties or significant related party transactions may exist that management has not previously identified
• All of the above