AS 18 Related Party Transactions
This query is : Resolved
02 September 2024
Hi sir/ mam
Please clarify my doubt regarding AS18
1. Is Subsidiary's Associate is Related party the Reporting entity (i.e Holding company of Subsidiary) ?
2. Is Associate's subsidiary is related to to Reporting entity ( i.e investing entity)
3. Is subsidiary's or Associates JV is Related Party to the reporting entity?
Thankyou
Please clarify my doubt regarding AS18
1. Is Subsidiary's Associate is Related party the Reporting entity (i.e Holding company of Subsidiary) ?
2. Is Associate's subsidiary is related to to Reporting entity ( i.e investing entity)
3. Is subsidiary's or Associates JV is Related Party to the reporting entity?
Thankyou
12 August 2025
Hey! Your queries on AS 18 (Related Party Transactions) are important for correct disclosure. Let me clarify each one:
1. Is Subsidiary’s Associate a Related Party to the Reporting Entity (Holding Company of Subsidiary)?
No, not automatically.
Related party relationship is direct or indirect control, significant influence, or common control.
The holding company’s subsidiary’s associate is related to the subsidiary, but not necessarily related to the holding company.
Only if the holding company has control or significant influence over that associate does it become a related party.
2. Is Associate’s Subsidiary Related to the Reporting Entity (Investing Entity)?
No, not automatically.
The associate’s subsidiary is related to the associate, but not directly related to the investing company unless the investing company has control/significant influence over the associate’s subsidiary.
AS 18 considers related parties based on control/influence; indirect relations beyond associate’s immediate control are not related parties.
3. Is Subsidiary’s or Associate’s JV a Related Party to the Reporting Entity?
Yes, if the JV is controlled or significantly influenced by the subsidiary or associate.
AS 18 states that a joint venture of a subsidiary or associate is considered a related party to the reporting entity if the reporting entity has control, joint control, or significant influence over that JV.
So, if the reporting entity’s control extends through the subsidiary or associate to the JV, it is a related party.
Summary Table:
Query Related Party to Reporting Entity?
Subsidiary’s Associate Not necessarily unless control/influence exists
Associate’s Subsidiary Not necessarily unless control/influence exists
Subsidiary’s or Associate’s JV Yes, if reporting entity has control/joint control/significant influence
1. Is Subsidiary’s Associate a Related Party to the Reporting Entity (Holding Company of Subsidiary)?
No, not automatically.
Related party relationship is direct or indirect control, significant influence, or common control.
The holding company’s subsidiary’s associate is related to the subsidiary, but not necessarily related to the holding company.
Only if the holding company has control or significant influence over that associate does it become a related party.
2. Is Associate’s Subsidiary Related to the Reporting Entity (Investing Entity)?
No, not automatically.
The associate’s subsidiary is related to the associate, but not directly related to the investing company unless the investing company has control/significant influence over the associate’s subsidiary.
AS 18 considers related parties based on control/influence; indirect relations beyond associate’s immediate control are not related parties.
3. Is Subsidiary’s or Associate’s JV a Related Party to the Reporting Entity?
Yes, if the JV is controlled or significantly influenced by the subsidiary or associate.
AS 18 states that a joint venture of a subsidiary or associate is considered a related party to the reporting entity if the reporting entity has control, joint control, or significant influence over that JV.
So, if the reporting entity’s control extends through the subsidiary or associate to the JV, it is a related party.
Summary Table:
Query Related Party to Reporting Entity?
Subsidiary’s Associate Not necessarily unless control/influence exists
Associate’s Subsidiary Not necessarily unless control/influence exists
Subsidiary’s or Associate’s JV Yes, if reporting entity has control/joint control/significant influence
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- House Property Reporting in ITR
- Internship/Academic shown in Salary Pay Slip of a Doctor
- TDS Claim year
- Rent lease agreement
- Refund of 20%pre-deposit paid for stay application
- Nomination of Bank for refund in itr 2
- Relief u/s Section 89
- TDS Challan Code
- SALE BILL AGAINST GOODS RETURN
- REGARDING SECTION 44AE
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
