Questionnaire on Related Parties

View Page Stats
See who's visiting this page.

Introduction:

Accounting Standard (AS) 18 issued by the Institute of Chartered Accountants of India requires disclosure of related parties and related party relationships in the financial statements of an entity. An auditor is required to state in his report whether the accounting standards as specified by the institute have been followed or not. Thus, to make such a statement, he must have the relevant information on Related Parties and Related Party Relationships. SAP 23 on “Related Parties” guides the auditor on how to get the relevant information, the various procedures, checks etc. required to gather the same.

Importance of Related Party Questionnaire:

SAP 23 clearly states that an auditor cannot be expected to have the knowledge of al the related Parties and Related Party Relationships. Thus, to obtain the necessary information, a questionnaire on related parties becomes essential. Also, AS 18 states that Associates and Joint Ventures as related parties. Thus, by issuing questionnaire, one can also gather basic information necessary for compliance with AS 23 and AS 27. After obtaining answers to the questionnaire, the auditor should obtain a representation from management as given in SAP 23.

Below is given the questionnaire on related parties and related party relationships. The questions are framed assuming that X Ltd. is the reporting enterprise. Please note that the questions stated are not the only possible questions. There may be many more questions that can be framed.

Please Tick the relevant column

and provide necessary explanations on a separate sheet

Sr. No.	Questions	Yes	No	Not Applicable
1.	Questions on the nature of X Ltd. Is X Ltd. a state-controlled enterprise?
2.	Is X Ltd a banking institution or any other institution governed by RBI specifications of confidentiality?
3.	If answer to the above is yes, please specify the relevant specifications.
4.	Questions on Control: Whether any enterprise holds by itself or through one or more of other enterprises more than one half of the voting power of X Ltd.? If yes, specify the following: Name of the enterprise Extent of Holding
5.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
6.	Whether X Ltd. owns by itself or through one or more other enterprises more than one half of the voting power of any other enterprise? If yes, specify the following: Name of the enterprise Extent of Holding Name of other enterprises through which X ltd. holds such interest and its extent of holding in them.
7.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
8.	Questions on Control and for Associates Whether any enterprise’s consent is required for appointing a person as director of X Ltd.? If yes, specify the following: Name of the enterprise Name of the director
9.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
10.	Whether a person is appointed as director in X Ltd. because of the position held by him in other enterprise? If yes, specify the following: Name of the enterprise Name of the director Position held by him in such other enterprise
11.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
12.	Does any other company nominate any director of X LTD.? If yes, specify the following: Name of the company Name of the director.
13	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
14.	Whether the appointment of a director of any other enterprise requires consent or concurrence of X Ltd.? If yes, specify the following: Name of the enterprise Name of the director
15	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
16.	Whether a person is appointed as a director of any other enterprise because he holds a specific position in X Ltd.? If yes, specify the following: Name of the enterprise Name of the person Position held by the person in X Ltd.
17.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
18.	Whether a director of any other company is being nominated by X Ltd.? If yes, specify the following: Name of the enterprise Name of the director so nominated
19.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
20.	Does any other enterprise owns by itself or through one or more of other enterprises, 20 per cent or more of the voting power in X Ltd.: If yes, specify the following: Name of the enterprise Extent of Holding Name of Other Enterprises through which the enterprise holds such an interest in X Ltd.
21.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
22.	Whether any individual owns by himself or through his holdings in other enterprises, 20 per cent or more of the voting power in X Ltd.? If yes, specify the following: Name of the individual Extent of holding Name of the enterprises through whom he hold such interest Name of the relatives such as spouse, son, daughter, brother, sister, father and mother of the individual
23.	Whether there have been any transactions with the above-referred individual and / or his / her relatives? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
24.	Whether X Ltd. owns by itself or through one or more of other enterprises, 20 per cent or more of the voting power in any other enterprise? If yes, specify the following: Name of the enterprise Extent of Holding Name of other enterprises through which X Ltd. holds such an interest and its extent of holding in them
25.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
26.	Whether any enterprise participates in the financial and / or operating policy decisions of X Ltd., though holding less than 20 per cent of the voting power in X Ltd.? If yes, specify the following: Name of the enterprise Nature of decisions in which it participates Extent of Holding, if any
27.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
28.	Whether any individual participates in the financial or operating policy decisions of X Ltd., though holding less than 20 per cent of the voting power in X Ltd.? If yes, specify the following: Name of the individual Nature of decisions in which he participates Extent of Holding, if any Names of relatives of the individual such as spouse, son daughter, brother, sister, father and mother
29.	Whether there have been any transactions with the above-referred individual and / or his / her relatives? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
30.	Whether X Ltd. participates in the financial and / or operating decisions of any other enterprise, though holding less than 20 per cent of the voting power in such other enterprise? If yes, specify the following: Name of the Enterprise Nature of decisions in which X Ltd. participates Extent of Holding, if any
31.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
32.	Questions on Joint Venture: Whether X Ltd. has made any contractual arrangement to own assets, liabilities and / or enterprises jointly with some other enterprises? If yes, specify the following: Name of the enterprise(s) Nature of Contract Share of X Ltd. in Joint Venture Description of Jointly held assets and the amount of each asset Description of Jointly held liabilities and the amount of each liability Name of the Joint Venture entity
33.	Whether there have been any transactions with the above-referred enterprise? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.
34.	Questions on Key Management Personnel Please specify the names of Managing Directors, Whole Time Directors, Ordinary Directors and Managers at the top management level and also the names of their relatives such as spouse, son, daughter, brother, sister, father and mother
35.	Whether there have been any transactions with the above-referred persons? If yes, provide the following details: Aggregate volume of the transaction entered into with such enterprise The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date from such parties at that date and the same for the previous year, if applicable. The amounts written off or written back in the period in respect of debts due from or to it.

Questions

Questions on Control and for Associates

Questions on Key Management Personnel