Convoluted Ltd is a company dealing in rare metals internationally. It has 40 employees (25 in the UK). It is owned by Joe King Ltd, a company registered in the Cayman Islands and is known to deal with several other UK and overseas companies also owned by that company. The company has four directors who are all UK residents and who do not own any shares in the company.
The company has a pension scheme with employee and employer trustees and is heavily indebted to its bankers.
The auditors are Sew & Sew, who are newly appointed.

Discussion
– List some possible related parties of this company.
– From the auditor’s point of view what risks are there that all the requirements of FRS 102 may not be met?
– Set out a section in the overall audit plan covering the requirements of ISA(UK)550.
– List some possible substantive tests on the subject of related party transactions and ultimate control.