Related Parties and Transactions

Free CPA AUD (Auditing & Attestation) lesson in Assessing Risk and Developing a Planned Response. 10 min read, ~1,553 words.

AU-C 550 governs related parties; ASC 850 governs disclosure. Related party transactions are presumed a significant risk unless rebutted in writing. Identification covers management, directors, immediate family (incl. adult children, in-laws), controlled entities, equity-method investees, JVs, 10% owners. Identification requires inquiry plus inspection of minutes, records, and prior working papers...

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What this lesson covers

Content
Example 1
Example 2
Common Mistakes
Check Your Understanding
Exam Shortcuts

Learning objectives

II.G3

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