Related Party Transactions: Definition & Examples

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

A related-party transaction occurs when two parties _____.

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1. When preparing financial statements, any transactions among partners, associates, family members, management, or other business owners is defined as a _____ .

2. Related-party transactions can present a risk to a company, including:

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About This Quiz & Worksheet

The worksheet/quiz combo is a tool that lets you determine how much you know about related-party transactions. Examples of these transactions and what they involve are topics addressed on the quiz.

Quiz & Worksheet Goals

Take the quiz to gauge your comprehension of:

  • A risk that related-party transactions can pose to companies
  • Examples of a related-party transaction
  • The definition of a related-party transaction
  • Act that requires auditors to complete a routine risk assessment to evaluate a company's internal controls

Skills Practiced

  • Information recall - access the knowledge you have gained about examples of a related-party transaction
  • Knowledge application - use your knowledge to answer questions about the definition and risks of a related-party transaction
  • Reading comprehension - ensure that you draw the most important details from the lesson on related-party transactions

Additional Learning

Related Party Transactions: Definition & Examples is a lesson that lets you review more topics, including:

  • Definitions of a related party
  • Ways to mitigate risk when getting involved in related-party transactions
  • Roles of the SEC
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