38. Related Party Transactions

For the purpose of these Consolidated Financial Statements parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial and operational decisions as defined by IAS 24 Related Party Disclosures. Related parties may enter into transactions which unrelated parties might not, and transactions between related parties may not be effected on the same terms, conditions and amounts as transactions between unrelated parties.

The Group has applied the exemption as allowed by IAS 24 not to disclose all government related transactions, as the parent of the Company is effectively being controlled by the Russian Government. The table below summarises transactions in the ordinary course of business with either the parent company or associates and joint ventures.

The Group enters into transactions with related parties based on market or regulated prices. Short-term and long-term loans provided as well as debt are based on market conditions available for not related entities.

As of December 31, 2014 and 2013 the outstanding balances with related parties were as follows:

December 31, 2014 Parent company Parent's subsidiaries and associates Associates and joint ventures
Cash and cash equivalents 13,780
Short-term financial assets 1,719 1,295
Trade and other receivables 1,257 3,038 13,190
Other assets 38 3,762 1,889
Long-term financial assets 23,541
Total assets 1,295 22,299 39,915
Short-term debt and other current financial liability (981)
Trade and other payables (1,096) (2,217) (1,956)
Other current liabilities (2,108) (507) (328)
Long-term debt and other non-current financial liability (57,552)
Total liabilities (60,756) (2,724) (3,265)
December 31, 2013 Parent company Parent's subsidiaries and associates Associates and joint ventures
Cash and cash equivalents 32,965
Short-term financial assets 16,248 2,869
Trade and other receivables 2,760 3,178 3,497
Other assets 635 3,010 1,326
Long-term financial assets 2,587 6,494
Total assets 3,395 57,988 14,186
Short-term debt and other current financial liability 1,246
Trade and other payables 1,277 3,432 2,488
Other current liabilities 1 761 413
Long-term debt and other non-current financial liability 3,897 1,000
Total liabilities 5,175 4,193 5,147

For the period ended December 31, 2014 and 2013 the following transactions occurred with related parties:

Year ended December 31, 2014 Parent company Parent's subsidiaries and associates Associates and joint ventures
Crude oil, gas and oil products sales 14,259 22,523 42,790
Other revenue 16 414 10,830
Purchases of crude oil, gas and oil products 38,825 84,599
Production related services 14,737 19,092
Transportation costs 8,176 1,519 2,717
Interest income 821 1,772
Year ended December 31, 2013 Parent company Parent's subsidiaries and associates Associates and joint ventures
Crude oil, gas and oil products sales 9,929 21,994 48,156
Other revenue 158 321 6,420
Purchases of crude oil, gas and oil products 31,250 84,618
Production related services 145 13,597 17,089
Transportation costs 4,727 2,025 6,120
Interest income 788 486

Transactions with Key Management Personnel

For the periods ended December 31, 2014 and 2013 the Group recognized RUB 1,420 million and RUB 1,181 million, respectively, as compensation for key management personnel (members of the Board of Directors and Management Committee). The compensation consists of salaries, bonuses including SAR and other contributions.