Ind AS 24
Active
Related Party Disclosures
Requires disclosure of related party relationships, transactions and outstanding balances, converged with IAS 24, with a genuine alignment of the Key Managerial Personnel definition to the Companies Act, 2013.
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Conceptual Framework Linkage
Identical transparency philosophy to IAS 24
Ind AS 24 applies the IDENTICAL principle as IAS 24 – financial statements must disclose the POSSIBILITY that an entity's financial position/performance may have been affected by the EXISTENCE of related parties and by transactions with them, even in the ABSENCE of actual transactions.
HOW IND AS 24 MAPS TO THE FRAMEWORK
Transparency – related party relationships can affect an entity's profit/loss and financial position even without any actual transactions – identical to IAS 24KMP alignment with Companies Act – Indian practice interprets "key management personnel" CONSISTENTLY with the Companies Act, 2013's Section 2(51) statutory definition, which SPECIFICALLY enumerates roles (Managing Director, Whole-time Director, CFO, Company Secretary, CEO) – a more PRESCRIPTIVE identification than IAS 24's own broader "authority and responsibility for planning, directing, controlling" test
This is NOT a divergence in Ind AS 24's own underlying PRINCIPLE from IAS 24 – it is a genuinely Indian INTERPRETIVE alignment, anchoring the broader IAS 24 concept to specific statutory roles under company law.
Related party categories – identical to IAS 24
CategoryExample
Entities with control/joint control/significant influenceParent, subsidiary, associate, JV
Key management personnelDirectors, CFO, CEO, Company Secretary
Close family members of KMPSpouse, children, dependants
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Scope & Applicability
What Ind AS 24 covers
Ind AS 24 applies to identifying related party relationships/transactions, outstanding balances, and circumstances requiring disclosure – IDENTICAL scope to IAS 24.
Key definitions you must know
Related party
IDENTICAL definition to IAS 24 – a person/entity related to the reporting entity via control, joint control, significant influence, or KMP status.
KMP (Companies Act sense)
Specific statutory roles enumerated under Section 2(51) of the Companies Act, 2013.
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Identifying Related Parties
Identical to IAS 24
Substance-based identification, considering control, joint control, and significant influence relationships (cross-referencing Ind AS 110, 111, 28) – IDENTICAL to IAS 24.
4
Key Management Personnel (with worked example)
Broader IAS 24 principle, applied via Companies Act specifics in India
Example 1: Identifying KMP for an Indian listed company
An Indian listed company has a Managing Director, a CFO, a Company Secretary, and a Non-Executive Independent Director who does not participate in day-to-day management decisions.
The Managing Director, CFO, and Company Secretary are KMP under BOTH the Companies Act, 2013's statutory definition AND IAS 24's broader "authority/responsibility" test. The Non-Executive Independent Director is ALSO typically included as KMP under the Companies Act's definition (which specifically includes directors), even though their day-to-day operational involvement might be more limited than IAS 24's own principles-based test alone might suggest – illustrating the Indian statutory alignment's slightly BROADER practical net for board members.
5
Related Party Transactions
Identical to IAS 24
A transfer of resources, services, or obligations between a reporting entity and a related party, REGARDLESS of whether a price is charged – IDENTICAL definition to IAS 24.
6
Government-Related Entities Exemption
Identical to IAS 24
Reduced disclosure requirements for transactions with OTHER government-related entities (where the reporting entity is itself government-related) – IDENTICAL exemption to IAS 24, RELEVANT for India's extensive public sector undertaking (PSU) landscape.
7
Companies Act KMP Alignment – The Indian Divergence Point
A genuinely important interpretive alignment
Section 2(51) of the Companies Act, 2013 provides a SPECIFIC, enumerated list of roles constituting KMP (CEO, Managing Director, Whole-time Director, CFO, Company Secretary, and any officer notified by the Central Government) – a more PRESCRIPTIVE, statute-anchored identification than IAS 24's own broader "authority and responsibility for planning, directing, controlling" functional test. In PRACTICE, Indian preparers typically ensure their Ind AS 24 KMP population is CONSISTENT with (and generally at least as broad as) this Companies Act list, given the overlapping compliance context (e.g. Schedule V managerial remuneration disclosures, Section 188 related party transaction approval requirements).
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Pricing of Related Party Transactions
Identical to IAS 24
Ind AS 24 does NOT require related party transactions to be at arm's length, nor does it prescribe pricing methodologies – IDENTICAL to IAS 24, though Indian companies separately navigate transfer pricing requirements under the Income Tax Act for TAX purposes, a distinct regulatory layer from Ind AS 24 itself.
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Disclosure Requirements
Identical disclosure requirements to IAS 24
Parent-subsidiary relationships disclosed regardless of transactionsKMP compensation by category (short-term, post-employment, share-based)Nature of relationship and transaction details for material related party transactions
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Critical Judgments & Estimates
Where management judgement matters most
SIGNIFICANT JUDGEMENTS
Identifying the complete KMP population consistent with both Ind AS 24 and Companies Act requirementsAssessing significant influence for less obvious related party relationships
SIGNIFICANT ESTIMATES
None typically significant – Ind AS 24 is primarily a disclosure standard
Indian companies must also separately track Section 188 Companies Act approval requirements for MATERIAL related party transactions – a compliance obligation layered ALONGSIDE, not replacing, Ind AS 24's own disclosure requirements.
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Ind AS 24 vs IAS 24 – Full Comparison
Comprehensive comparison table
FeatureIAS 24Ind AS 24
Related party identification, transaction disclosure, government-related exemptionStandard modelIDENTICAL – no substantive divergence
KMP definition anchorBroad, principles-based functional testPractically aligned with Companies Act, 2013 Section 2(51)'s specific enumerated roles
Ind AS 24's UNDERLYING principles are essentially IDENTICAL to IAS 24 – the KMP alignment is a genuinely Indian INTERPRETIVE practice anchoring the standard's own broader test to specific statutory company law roles.
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Statement Mapping
Where every Ind AS 24 disclosure lands
Disclosure itemLocationNotes
Related party relationships and transactionsNotesIdentical to IAS 24
KMP compensationNotesCategorised by type, identical to IAS 24
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Related Standards
Cross-reference map
StandardConnection
IAS 24The global counterpart standard, converged with an interpretive KMP alignment
Section 2(51), 188, Schedule V (Companies Act, 2013)Supplies the statutory KMP definition and related party transaction approval/remuneration requirements
Ind AS 110 / 111 / 28Supply the control/joint control/significant influence tests underlying related party identification
Quick-reference glossary
Close family members
Family members expected to influence/be influenced by a person in dealings with the entity – identical to IAS 24.
Section 188
The Companies Act, 2013 provision requiring board/shareholder approval for material related party transactions.
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Quick-Reference Glossary
Related party
IDENTICAL definition to IAS 24 – a person/entity related to the reporting entity via control, joint control, significant influence, or KMP status.
KMP (Companies Act sense)
Specific statutory roles enumerated under Section 2(51) of the Companies Act, 2013.
Close family members
Family members expected to influence/be influenced by a person in dealings with the entity – identical to IAS 24.
Section 188
The Companies Act, 2013 provision requiring board/shareholder approval for material related party transactions.
Financial statement key
BS Balance sheet
IS Income statement
SE Statement of changes in equity
OCI Other comprehensive income
SCF Statement of cash flows