The company from time to time engages in transactions with a few companies in Montreal. This is usually around the winter season. The company has a 35% equity in each of these companies. The remaining 75% of each company is owned by family members who are not directly involved in the company that you have selected. In the winter of the financial year being assessed, the company recorded $50M in management expenses relating to these companies. Upon further investigation, the market value of these services is $62M.

1. Under what circumstances would these companies be considered related parties?

2. If these companies qualify as related parties, what specific disclosures are required per the applicable accounting standard?

3. What entry/remeasurement would be necessary under IFRS?

Answer rating: 100% (QA)

1 a A director or his relative b Key managerial person or his relative c A company wherein a director surpervisor or relative is a compainion d A nonp... View the full answer