IAS 24 — State controlled entities and definition of 'related party'


The main objectives of this project is to address:

  • The requirements in IAS 24 Related Party Disclosures for entities with significant state ownership when they transact with similar entities
  • Whether, when an associate of an entity is preparing its own financial statements, the requirements of IAS 24 should include, as related party transactions, transactions between the associate and a subsidiary of the associate's significant investor.

State-controlled entities

Prior to a revision of IAS 24 in 2003, state-controlled entities were exempted from the related party disclosures. That exemption was removed in the 2003 revision, which took effect in 2005 and continues in force today.

Therefore, profit-oriented state-controlled entities that use IFRSs must disclose transactions with other state-controlled entities. In those jurisdictions, such as China, where state-controlled entities are a major segment of the economy, the volume of disclosures under the requirements of the current IAS 24 has become burdensome and unwieldy, impairing understandability and usefulness of the financial statements.


Current status of the project

This project has been completed. The IASB issued a revised IAS 24 Related Party Disclosures on 4 November 2009.


Project milestones

July 2006 Added to the IASB's agenda
22 February 2007 Exposure Draft State-controlled Entities and the Definition of a Related Party published Comment deadline 25 May 2007
11 December 2008 Exposure Draft Relationships with the State (Proposed amendments to IAS 24) published Comment deadline 13 March 2009
4 November 2009 IAS 24 Related Party Disclosures issued Effective for annual periods beginning on or after 1 January 2011

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.