The Board discussed responses to the exposure draft (ED) Relationships with the State, published in December 2008, and decided tentatively:
- that the proposed exemption for state-controlled entities should, as proposed in the ED, apply in all cases of common state control, even if the entities in question are related for other reasons.
- not to limit the proposed exemption for transactions within a group headed by a publicly quoted entity or with an entity�s direct owner.
- not to require additional disclosure about direct related party transactions within a state-controlled sub-group.
- that when the exemption applies, an entity should disclose the nature and extent of individually significant transactions and of transactions that are significant collectively but not individually.
- to replace the definition of �state� that appeared in the exposure draft State-controlled Entities and the Definition of a Related Party with the definition of �government� that appears in IAS 20 Accounting for Government Grants and Disclosure of Government Assistance. The Board does not intend to give further guidance on how to interpret the meaning of �government�.
- that, as proposed in the ED, two entities are related to each other whenever a person or a third entity has joint control over one entity and that person (or a close member of that person�s family) or the third entity has joint control or significant influence over the other entity.
- to delete references to significant voting power from the definition of a related party.
- that the amendments would apply prospectively for periods beginning on or after 1 January 2011, with early adoption permitted.
- that the amendments do not require re-exposure.
The Board instructed the staff to proceed to drafting the amendments to IAS 24, for issue later this year.