Related party transactions note in the Annual Report

Related parties and transactions with them, if you have those, are to be disclosed in a separate note. 

What’s the note about is first off stating who is considered a related party (note that it’s something your local accounting framework should define) and then shortly describing which transactions your company has with its related parties.

When this introductory part is done it’s disclosing the transactions and related balances for the current and prior period that’s the next part of the note. Preferably you’d display the amounts divided into groups by the parties (i.e. “owners” or “parent”, “close family members of the key management personnel” etc.)

Another thing to show within this note is the remunerations paid to the management. As they are the ones managing the company it’s always important to know what they get for it and furthermore if there are any liabilities due to management (shares to be issued to them, bonus schemes etc).