# ASC 850-972: Related Party Disclosures — Real Estate—Common Interest Realty Associations

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/850/972/)

Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.

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## ASC 850-972: Related Party Disclosures — Real Estate—Common Interest Realty Associations

### Machine-generated study aids

```json
{
  "summary": "This Subtopic applies the general related party disclosure requirements of Topic 850 to common interest realty associations (CIRAs), such as condominium and homeowners' associations. Its core point is that when board members, officers, or developers provide services to the association — for example insurance, maintenance, or management services — those transactions may require related party disclosure under Topic 850. Its scope follows that of Subtopic 972-10 (see 850-972-15-1).",
  "key_points": [
    "The Subtopic addresses the related party disclosure requirements of common interest realty associations (850-972-05-1).",
    "Scope and scope exceptions are the same as those of the Overall Real Estate—Common Interest Realty Associations Subtopic, Section 972-10-15 (850-972-15-1).",
    "Insurance, maintenance, or management services provided to a CIRA by individual board members, officers, or developers may require disclosure in conformity with Topic 850 (850-972-50-1).",
    "The Subtopic adds no measurement or recognition guidance; it only points to the disclosure requirements of Topic 850."
  ],
  "categories": [
    "Disclosure",
    "Industry-specific"
  ],
  "audience_level": "introductory",
  "student_note": "Short but testable: the point is that a developer or board member who also sells the association insurance or management services is a related party, so the arrangement must be disclosed. A common misunderstanding is thinking arm's-length pricing eliminates the disclosure — Topic 850 requires disclosure regardless, and cautions against asserting terms were equivalent to arm's-length unless substantiated.",
  "related_topics": [
    "850-10",
    "972-10",
    "972-235",
    "235-10"
  ],
  "key_concepts": [
    "related party transactions",
    "common interest realty associations",
    "board members and officers",
    "developer services",
    "management services",
    "disclosure requirements"
  ]
}
```

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## ASC 850-972-05: 05 Overview and Background

[Read section](https://asc.understandingaccounting.org/asc/850/972/#05-overview-and-background)

SEC content: no

##### [850-972-05-1](https://asc.understandingaccounting.org/asc/850/972/#850-972-05-1)

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This Subtopic addresses the disclosure requirements of common interest realty associations for related party transactions.

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## ASC 850-972-15: 15 Scope and Scope Exceptions

[Read section](https://asc.understandingaccounting.org/asc/850/972/#15-scope-and-scope-exceptions)

SEC content: no

#### Overall Guidance

##### [850-972-15-1](https://asc.understandingaccounting.org/asc/850/972/#850-972-15-1)

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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 972-10-15.

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## ASC 850-972-50: 50 Disclosure

[Read section](https://asc.understandingaccounting.org/asc/850/972/#50-disclosure)

SEC content: no

##### [850-972-50-1](https://asc.understandingaccounting.org/asc/850/972/#850-972-50-1)

Pending content: no

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Some individual board members, officers, or developers may provide [common interest realty associations](https://asc.understandingaccounting.org/glossary/c/#common-interest-realty-association "An association, also known as a community association, responsible for the governance of the common interest community, for which it was established to serve. A common interest realty association is generally funded by its members via periodic assessments by the common interest realty association so that it can perform its duties, which include management services and maintenance, repair, and replacement of the common property, among other duties established in the governing documents and by state statute.") with insurance, maintenance, or management services. Such services may require disclosure in conformity with Topic 850.