Key Management Personnel (KMP) refers to those individuals who hold critical and senior positions within an organization, responsible for oversight and strategic decision-making. Typically, this includes roles such as the Chief Executive Officer (CEO), Chief Financial Officer (CFO), various directors, and other senior executives. KMP are often involved in crafting the directions of the company, impacting its financial performance through their decisions due to their roles in governance, planning, and control.

For example, the Head of Finance of a corporation may be considered a KMP as they oversee the financial operations and ensure adherence to regulatory standards. Recognition of KMP as an idea is especially significant in financial reporting as demonstrated by standards such as IAS 24 - Related Party Disclosures, which require entities to disclose transactions involving KMP to ensure transparency and accountability.

Understanding the scope and influence of KMP is crucial for those conducting balance sheet reconciliations or reviewing a month-end close checklist, ensuring that financial decisions are aligned with the intended strategic goals of the organization. Proper identification of KMP within an organization aids in clear communication and effective governance.