Reasons for the requirement to disclose related-party transactions include:
A) These transactions will always be eliminated in a consolidation so otherwise there would be no record of them in a set of consolidated accounts.
B) A history of corporate scandals involving related-party transactions in Australia, the US, the UK and Canada.
C) The risk that the auditor may be a related party and this must be disclosed.
D) A history of corporate scandals involving related-party transactions in Australia, the US, the UK and Canada; and the risk that the auditor may be a related party and this must be disclosed.
E) None of the given answers.

Question

Quizplus · Accepted Answer

Related-party transactions have been involved in numerous corporate scandals, which is why disclosure is required to ensure transparency and prevent conflicts of interest.

Reasons for the Requirement to Disclose Related-Party Transactions Include