Related party transactions are:
A) quite rare, and are therefore a reason for auditors to avoid new client relationships due to the increased risk.
B) required to be disclosed in the financial statements.
C) assumed to be arms-length transactions unless they are disclosed in the financial statements.
D) considered to be a warning sign of going concern issues.

Question

Quizplus · Accepted Answer

Related party transactions are required to be disclosed in the financial statements according to accounting standards. This is important information for stakeholders to be aware of as related party transactions may have an impact on the financial performance and position of the entity.

Related Party Transactions Are