11-09-2003, 08:26 AM
Hi
Transactions entered by related parties needs to be on commercial basis. If they are not then adjustments are needed in the Financial statements (FS). The fact also needs disclosing in the notes.
Management charges from associates and subsideries is a grey area both from the taxation and general viewpoint. Its inclusion in code of corporate goverence (though i am in the process of reading/understanding the code myself as we speak) means that tight grip is intended through the code to eradicate window dressing of FS.
Its interesting, as we need a clear understanding as to what is acceptable that would satisfy the code and also satisfy the Tax authorities (there might be an element of trade off) and you know where there is a chance of a trade off, auditors outperfrom others.
The best strategy is to adjust values to market values, but having said that I class auditors as businessman/woman first and then auditors. anything that would satisfy the authorities and serve the prupose of clients within the regulatory and legal framwork is the point of excelence as a businessman.
Thanks
zubair
Transactions entered by related parties needs to be on commercial basis. If they are not then adjustments are needed in the Financial statements (FS). The fact also needs disclosing in the notes.
Management charges from associates and subsideries is a grey area both from the taxation and general viewpoint. Its inclusion in code of corporate goverence (though i am in the process of reading/understanding the code myself as we speak) means that tight grip is intended through the code to eradicate window dressing of FS.
Its interesting, as we need a clear understanding as to what is acceptable that would satisfy the code and also satisfy the Tax authorities (there might be an element of trade off) and you know where there is a chance of a trade off, auditors outperfrom others.
The best strategy is to adjust values to market values, but having said that I class auditors as businessman/woman first and then auditors. anything that would satisfy the authorities and serve the prupose of clients within the regulatory and legal framwork is the point of excelence as a businessman.
Thanks
zubair
