·
The bonus is aone- page
summary of the article:

“What's a
little debt between friends?How
to...

Question

·
The bonus is aone- page
summary of the article:

“What's a
 little debt between friends?How
 to apply accounting rules for related-party transactions” by Ralph M.
 Pucek, CPA and Glenn E. Richards, CPA.– This article can be found in the
 Journal of Accountancy June 2013 issue.

You can find this article in the aicpa.org website.

David · Accepted Answer

Related Party transactions have been found to be leading to several accounting failures and 
frauds and this necessitates the need for proper reporting and disclosure and which in itself is 
a very risky and complicated task. These complexities arise more so in respect of three main 
types of related party transactions. These include a case where an owner’s debt is converted 
into equity, related party forgiveness of debt and related party forgiveness of other liabilities. 
The accounting rules for conversion of owner’s debt to equity and the other related party 
transactions are contained in FASB ASC Section 470-50-40, Debt Modifications and 
Extinguishments,

· The bonus is aone- page summary of the article: “What's a little debt between friends? How to apply accounting rules for related-party transactions” by Ralph M. Pucek, CPA and Glenn E. Richards,...

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