TESTING COMPLIANCE WITH IAS 24 FOR RELATED PARTIES LISTED ON BUCHAREST STOCK EXCHANGE

Data quality is a key aspect for the investors in decision process. A special attention must be paid to data disclosed by related parties through Annual and Periodical Tax Reports published for the end users. Sometimes end users do associate transactions among related parties with creative/aggressive accounting, the quality of information disclosed in their Financial Reports being affected by such techniques. Companies listed on the Bucharest Stock Exchange do apply regulations on affiliated entities and transactions between them as stipulated by the International Accounting Standard IAS 24 Related Party Disclosures. Following above-mentioned statements, we are willing to verify how Romanian listed businesses are complying to regulations related to relationships and transactions among related parties. The scope of the present study consists in calculating Data Disclosure Index for transactions between related parties in compliance to IAS 24 requirements using Cooke technique. This study output shows that 50% of data disclosed concerning relationships and transactions between related parties contains higher disclosure rates in case of compulsory data submitted compared to voluntary disclosed data.