WorksheetsChapter 8 Notes - Part 2
Total questions: 20
Worksheet time: 24mins
PAS 24 Related Party Disclosures recognizes that related party relationships are a normal feature of business and that the existence of related party relationships and transactions between an entity and its related parties may have an effect on the financial position and profit or loss of an entity
TRUE
FALSE
significant influence is the power to participate in the financial and operating policy decisions of an entity, but is not control over those policies.
TRUE
FALSE
Darrell Joe Assumption and Rex Collide-one share joint control over Joint Venture Co. Assumption and Collide-one are related parties.
TRUE
FALSE
The financial position and profit or loss Of an entity may be affected by a related party relationship even if related party transactions do not occur.
TRUE
FALSE
Two subsidiaries are not related parties simply because they have a common parent.
TRUE
FALSE
To enable financial statement users to form a view about the effects of the related party transactions, PAS 24 requires certain disclosures to be made. Which of the following disclosures is not a mandated disclosure under PAS 24?
Relationships between parents and subsidiaries irrespective of whether there have been transactions between those related parties.
Names of all the "associates" that an entity has dealt with during the year.
Name of the entity's parent and, if different, the ultimate controlling party.
If neither the entity's parent nor its ultimate controlling entity produces financial statements available for public use, then the name of the next most senior parent that does
so.
If there have been related party transactions during the year, an entity needs to make, at a minimum, certain disclosures. Which of the following is not a required minimum disclosure under PAS 24?
The amount of the related party transactions.
The amount of the outstanding related party balances and their terms and conditions along with details of guarantees given and received.
The amounts of similar transactions with unrelated (third) parties to establish that comparable related party transactions have been entered at arm's length.
Provisions for doubtful debts related to the amount of outstanding related party balances and expense recognized during the year in respect of bad or doubtful debts due from related parties.
The minimum disclosures prescribed under PAS 24 are to be made separately for certain categories of related parties. Which of the following is not among the list of categories specified under the Standard for the purposes of separate disclosure?
Entities with joint control or siginificant influence over the entity.
The parent company of the entity.
An entity that has a common director with the entity.
Joint ventures in which the entity is a venturer.
Which of the following is not considered a close family member under PAS 24?
the individual's domestic partner and children
children of the individual's domestic partner
dependents of the individual or the individual's domestic partner
the sons and daughters of a subsidiary
Which of the following are most likely related parties?
Two entities that have a director in common.
Two venturers that share joint control over a joint venture.
A customer, supplier, franchisor, distributor or general agent with whom an entity transacts a significant volume of business, by virtue of the resulting economic dependence.
The reporting entity and its "funded" post-employment benefit plan.
Operating segments used by management in its internal reporting are also operating segments used for external reporting.
TRUE
FALSE
Operating segments that do not meet any of the quantitative thresholds are considered non-reportable for external reporting even if those segments are considered reportable for internal reporting.
TRUE
FALSE
Under the PFRS 8 quantitative threshold based on revenue, an operating segment is reportable it its revenue, excluding intersegment sales or transfers, is 10% or more of the combined external revenues of all operating segments.
TRUE
FALSE
PFRS 8 Operating Segments does not require non-listed entities to present operating segment disclosures.
TRUE
FALSE
The entity-wide disclosures of PFRS 8 apply only to entities that have more than one reportable segment.
TRUE
FALSE
Which of the following is not among the quantitative thresholds under PFRS 8?
at least 10% of total revenues (external and internal)
at least 10% of the higher of total profits of segments reporting profits and total losses of segments reporting losses, in absolute amount.
at least 10% of total assets (inclusive of intersegment receivables).
at least 10% of total revenues (external only)
Segment A qualifies under the 10% test of total revenues but not on the profit or loss and total assets tests. Segment A ...
is not a reportable segment
is nonetheless included in the "all others" segment
may be reported as a separate segment
a. all of these
HOW MANY REPORTABLE SEGMENTS DOES CORREY HAVE?
Correy Corp. and its divisions (each is an operating segment) are engaged solely in manufacturing operations. The following data (consistent with prior years' data) pertain to the operations conducted for the year ended December 31, 20X1:
Three
Four
Five
Six
264,000
260,000
204,000
200,000
PFRS 8 requires which of the following approaches in identifying operating segments?
Managers's Approach
Gentle Approach
DIrect Approach
Management Approach
