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CIMAPRA19-F02-1 Exam - Topic 5 Question 121 Discussion

Which of the following examples would be classed as related parties ofJH Ltd due to the power they possess to directly influence the company?1: JH Ltd's managing director2: The son of JH Ltd's managing director, who is an intern in the company's office3: The brother of JH Ltd's managing director, whose business supplies a large amount of production material for the company4: JH Ltd's subsidiary company, AL Ltd5: BR PLC, one of JH Ltd's regular customers
B) 1
A) 1&4
F) Increased prices for raw materials, which was passed on to customers by both entities.
E) 1, 2 & 3
D) 2, 3 & 4
C) 1, 2, 3 & 4

CIMAPRA19-F02-1 Exam - Topic 5 Question 121 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam
Question #: 121
Topic #: 5
[All CIMAPRA19-F02-1 Questions]

Which of the following examples would be classed as related parties ofJH Ltd due to the power they possess to directly influence the company?

1: JH Ltd's managing director

2: The son of JH Ltd's managing director, who is an intern in the company's office

3: The brother of JH Ltd's managing director, whose business supplies a large amount of production material for the company

4: JH Ltd's subsidiary company, AL Ltd

5: BR PLC, one of JH Ltd's regular customers

Show Suggested Answer Hide Answer
Suggested Answer: B

by Ines at Jan 26, 2026, 10:36 PM

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Burma
1 month ago
I’m not sure about the intern. Does he really have influence?
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Deandrea
1 month ago
The subsidiary company too, right? They have direct control.
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Shawn
1 month ago
Agreed, but what about the brother? He influences through his business.
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Elliot
2 months ago
I think the managing director is definitely a related party.
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Johnna
2 months ago
BR PLC as a related party? Not sure about that one.
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Lashandra
2 months ago
The brother supplying materials? That's a gray area, but I see the connection.
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Lorrie
4 months ago
Wait, how is the intern related? Seems a stretch to me.
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Karan
4 months ago
Totally agree, the managing director is a clear related party!
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Rosendo
4 months ago
Definitely the managing director and the subsidiary company.
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Shawna
4 months ago
I bet the managing director's brother is getting a sweet deal on those production materials. Wink wink.
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Javier
4 months ago
The managing director's son as an intern? That's nepotism at its finest! What a joke.
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Dick
4 months ago
BR PLC, a regular customer, doesn't seem like a related party to me. That's a stretch.
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Angelo
5 months ago
JH Ltd's subsidiary company AL Ltd is clearly a related party, as they are under the same corporate control.
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Meaghan
5 months ago
The brother's business supplying a large amount of material to JH Ltd makes them a related party, no doubt about it.
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Emmanuel
5 months ago
The son of the managing director, even as an intern, could be considered a related party since they have a close family connection.
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Yun
5 months ago
The managing director of JH Ltd is definitely a related party due to their power to influence the company.
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Billy
5 months ago
I think the brother supplying materials might be a gray area. He has a business relationship, but does that really give him influence? I need to double-check that.
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Josefa
5 months ago
The subsidiary company, AL Ltd, should definitely be a related party because it’s under the same control as JH Ltd. That one seems straightforward.
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Alecia
6 months ago
I'm not so sure about the son being an intern. I feel like he might not have enough power to be considered a related party, but I could be wrong.
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Felix
6 months ago
I remember we discussed related parties in class, and I think the managing director definitely qualifies as a related party since they have direct influence.
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Queen
7 months ago
I'm feeling confident about this question. The key is identifying the parties that have the power to directly impact the company's decisions and operations.
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Carry
7 months ago
This is a good opportunity to show my understanding of the related party concept. I'll carefully analyze each example and apply the criteria to determine which ones qualify.
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Linwood
7 months ago
Okay, I think I've got this. The managing director, their family members, and the supplier business would all be considered related parties due to their ability to influence the company. The customer wouldn't be a related party.
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Filiberto
7 months ago
Hmm, I'm a bit unsure about this one. I know the managing director and subsidiary are related parties, but I'm not sure about the other examples.
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Brock
7 months ago
This looks like a question on related parties and their influence on a company. I'll need to think about the definitions and criteria for related parties.
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Remedios
19 days ago
The brother supplying materials could influence decisions as well.
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Juan
24 days ago
What about the subsidiary company? That seems relevant too.
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Temeka
29 days ago
I think the managing director is definitely a related party.
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