Question 2 (15 marks)

(a)Encik Hashim holds a majority of ordinary shares in Hero Sdn Bhd. Emas Sdn Bhd is a major supplier of Hero Sdn Bhd, but there is no ownership of Emas Sdn Bhd by Hero Sdn Bhd or vice versa. However, Encik Hashim's son holds a majority of ordinary shares in Emas Sdn Bhd.

Required:

Identify and explain the related parties of Hero Sdn Bhd and Emas Sdn Bhd in accordance with MFRS 124

(5 marks)

(b)Mr Kim is an executive director of Wonder Sdn Bhd. Wonder Sdn Bhd has the power to participate in the financial and operating policy decisions of Success Sdn Bhd. Mr. Kim is an independent director of Success Sdn Bhd. He received director salary from Wonder Sdn Bhd and director fee from Success Sdn Bhd for the services provided. Mr Kim has separate appointment letters with both companies.

Required:

Discuss the disclosures for the director salary and director fee paid to Mr. Kim in the financial statements of Wonder Sdn Bhd and Success Sdn Bhd.

(4 marks)

(c)Timuran Sdn Bhd is a subsidiary of Wise Sdn Bhd. Timuran Sdn Bhd and Angkasa Sdn Bhd established a joint venture to build a bridge for the state government. Each company holds 50% of equity in the joint venture, which was incorporated as Ultra Sdn Bhd. The estimated duration to build the bridge is 36 months. Mr Thomas is a member of boards of directors for Timuran Sdn Bhd, Angkasa Sdn Bhd and Ultra Sdn Bhd.

Required:

Identify and explain the related parties of Timuran Sdn Bhd and Ultra Sdn Bhd in accordance with MFRS 124.