Mosby Brothers Inc. is part of a big industrial group of companies that complies with IFRS. Mosby Brothers Inc. is seeking advice from IFRS specialists on whether the following transactions need to be reported under IAS24 and, if so, to what extent.

Remuneration and other payments made to the entity’s chief executive officer (CEO) during the year 2020 were as follows.

-An annual salary of £2 million
-Share options and other share-based payments valued at £1 million

-Contributions to retirement benefit plan amounting to £1 million

-Reimbursement of his travel expenses for business trips totalling £1.2 million

 

Sales made during the year 2020 to:

-Mosby Parents Inc.: This is a parent company, and the value of sales is £35 million.

-Ted Inc.: This is an associate company, and the value of sales is £25 million.

-Eriksen Inc.: A company which have three directors in common, and the value of sales is £10 million.

 

a) Please advise Mosby Brothers Inc. on related party transactions that need to be disclosed and draft a sample related party transactions footnote for the CEO payments to guide the entity. (5 marks)

b) What are the main disclosures requirements under IAS24? (7 marks)