The Accounting and Reporting Recommendations (Swiss GAAP FER) are Swiss The recommendations are available digitally as a pdf or in a bundle of the. Swiss GAAP FER governs aspects of accounting and reporting and is geared toward Crypto currencies according to Swiss GAAP FER (PDF, in German). This checklist shall support in applying the Swiss GAAP FER standards as well as in reviewing the completeness of its disclosure requirements.
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Switch to Swiss GAAP FER – Motives and methodology December Accounting. A number of public companies have recently decided to switch from IFRS. terney.info You can use the attached voucher code to download the digital version of the title in PDF format free of charge. 1. Visit the eBookshop website. either to IFRS for SMEs or Swiss GAAP FER has implications far beyond the entity's financial reporting function; to highlight some of the key differences between.
Borrowing costs are capitalised if certain criteria are met. In case of capitalisation, specific criteria must be met. IFRS for SMEs: There are two sections dealing with financial instruments: a section for simple payables and receivables, and other basic financial instruments; and a section for other, more complex financial instruments.
Most of the basic financial instruments are measured at amortised cost; the complex instruments are generally measured at fair value through profit or loss. Securities as part of current assets are valued at actual fair value.
Receivables are valued at par value. Liabilities are normally recorded at par value too. The measurement of derivatives depends on its classification held for trading, hedging or held for other purposes.
However, there are a number of detailed application differences, some of which are more restrictive under IFRS for SMEs for example a limited number of risks and hedging instruments are permitted. Neither effectiveness tests nor extensive documentation are required.
Neither restrictions regarding hedged risks nor hedging instruments are specified. Non-financial assets and goodwill Full IFRS: For tangible and intangible assets, there is an accounting policy choice between the cost model and the revaluation model. Goodwill and other intangibles with indefinite lives are reviewed for impairment and not amortised. All intangible assets, including goodwill, are assumed to have finite lives and are amortised. Intangible assets, if acquired, are measured at cost and amortised.
Intangible assets, if internally developed, can be capitalised at cost and amortised, if the criteria for capitalisation are fulfilled. Goodwill resulting from a business combination may either be capitalised and amortised or be offset against equity. All assets are to be tested for impairment. The latter are not amortised and an annual impairment test is required. The amortisation approach therefore applies to all intangible assets. These intangibles are tested for impairment only when there is an indication.
If the useful life cannot be determined, the presumed amortisation period is five years. In justified cases, the amortisation period can be extended to a maximum of 20 years. At every balance sheet date intangibles are tested for impairment when there is an indication for a potential impairment.
Full IFRS: IFRS 5, Non-current assets held for sale and discontinued operations, requires non-current assets to be classified as held for sale where the carrying amount is recovered principally through a sale transaction rather than through continuing use.
Full IFRS: The use of an accrued benefit valuation method the projected unit credit method is required for calculating defined benefit obligations. IFRS for SMEs: The circumstance-driven approach is applicable, which means that the use of an accrued benefit valuation method the projected unit credit method is required if the information that is needed to make such a calculation is already available, or if it can be obtained without undue cost or effort. If not, simplifications are permitted in which future salary progression, future service or possible mortality during an employee s period of service are not considered.
Swiss GAAP FER: The pension accounting is based on the financial statements of the pension fund, no additional actuarial valuation is necessary however, in order to establish financial statements of the plan, actuarial valuation is necessary.
Income taxes Full IFRS: A deferred tax asset is only recognised to the extent that it is probable that there will be sufficient future taxable profit to enable recovery of the deferred tax asset. IFRS for SMEs: A valuation allowance is recognised so that the net carrying amount of the deferred tax asset equals the highest amount that is more likely than not to be recovered.
A deferred tax asset may only be recognised to the extent that it is probable that there will be sufficient future taxable profit to enable recovery of the deferred tax asset. Full IFRS: No deferred tax is recognised upon the initial recognition of an asset and liability in a transaction that is not a business combination and affects neither accounting profit nor taxable profit at the time of the transaction.
It should be measured using the probability-weighted average amount of all the possible outcomes. There is no probable recognition threshold. However, in practice comparable to IFRS. An entity has public accountability if it files or is in the process of filing its financial statements with a securities commission or other regulatory organisation for the purpose of issuing any class of instrument in a public market or if it holds assets in a fiduciary capacity for a broad group of outsiders.
Banks, insurance companies, securities brokers and dealers, and pension funds are examples of entities that hold assets in a fiduciary capacity for a broad group of outsiders.
Small listed entities are not included in the scope of the standard. IFRSs apply to all general purpose financial statements, which are directed towards the common information needs of a wide range of users.
Small organisations have the possibility to only apply the framework and selected central standards core FER. Criteria for the application of core FER are: a balance sheet total of CHF 10 million, b annual net sales of CHF 20 million, c 50 fulltime employees on average per year.
If an entity does not exceed two of the three criteria in two consecutive years it is eligible to apply core FER. The following factors are not essential in assessing the existence of an asset: Its physical substance.
The right of ownership. Refer to chapter 7: Non-financial liabilities and equity. Equity is the residual amount of assets less liabilities. Refer to chapter 4: Income and expenses. Expenses Refer to chapter 4: Income and expenses.
Recognition of the elements of the financial statements Recognition is the process of incorporating in the balance sheet or income statement an item that meets the definition of an element and satisfies the following criteria: It is probable that any future economic benefit associated with the item will flow to or from the entity.
The item has a cost or a value that can be measured reliably. In addition, regard needs to be given to the materiality considerations. An item that fails to meet the recognition criteria may qualify for recognition at a later date as a result of subsequent circumstances or events.
However, certain categories of financial instruments, investments in associates and joint ventures, investment property and agricultural assets are valued at fair value. All items other than those carried at fair value through profit or loss are subject to impairment. The measurement basis most commonly adopted is historical cost.
However, certain items are valued at fair value for example, investment property, biological assets and certain categories of financial instruments. All items carried at historical cost are subject to impairment. Offsetting assets and liabilities or income and expenses is not permitted unless it is required or permitted by individual sections in the IFRS for SMEs.
Offsetting assets and liabilities or income and expenses is only allowed in objectively substantiated cases and if this does not result in a misleading presentation.
A substantiated case occurs, if a Swiss GAAP FER standard requires or allows offsetting and if the economic content of a transaction or an event is thereby reflected. Besides the going concern, accrual and gross principles, Swiss GAAP FER users have to consider the following further core principles: substance over form, matching of cost and revenue and prudence. Information is material if its omissions or misstatement could influence the economic decisions of users made on the basis of the financial statements.
Materiality depends on the size of the omission or misstatement judged in the particular circumstances. The four qualitative characteristics under IFRS are understandability, relevance, reliability and comparability. Materiality is a sub-characteristic of relevance. Substance over form, prudence and completeness are sub-characteristics of reliability. Timeliness and balance between benefit and cost are defined as constraints on relevant and reliable information instead of as qualitative characteristics.
Swiss GAAP FER stipulates the following qualitative requirements for financial statements: materiality, consistency, comparability, reliability and clarity. The characteristics of substance over form, prudence and matching of cost and revenue are treated as an underlying basis of financial statements see above.
This is achieved by applying the appropriate section of the IFRS for SMEs and the principal qualitative characteristics outlined above. In extremely rare circumstances, entities are permitted to depart from IFRS for SMEs, only if management concludes that compliance with one of the requirements would be so misleading as to conflict with the objective of the financial statements.
The nature, reason and financial impact of the departure is explained in the financial statements. If there are open questions that are not answered by a respective standard, the Swiss GAAP FER framework as well as the general principle of a true and fair view should be applied.
There are five mandatory exceptions, 12 optional exemptions and one general exemption to the requirement for retrospective application. This is the beginning of the earliest period for which full comparative information is presented in accordance with full IFRS in its first IFRS financial statements. Not addressed. A reconciliation of the profit or loss reported under its previous financial reporting framework for the latest period in its most recent annual financial statements to its profit or loss under IFRS for SMEs for the same period.
In practice, a reconciliation would be presented in most cases.
Hedge accounting. Discontinued operations. Measuring non-controlling interests. Share-based payment transactions. Fair value or revaluation as deemed cost for PPE, investment property or intangible assets. Cumulative translation differences. Separate financial statements. Compound financial instruments. Deferred income tax. Extractive activities. Arrangements containing a lease. Decommissioning liabilities included in the cost of PPE. There are additional exemptions such as borrowing costs and leases.
Impracticable is defined in the glossary as being: When the entity cannot apply it after making every reasonable effort to do so. Not applicable. They set the requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content. Compliance cannot be claimed unless the financial statements comply with all the requirements of this standard. Management may not depart from the standard if the relevant regulatory framework prohibits this.
Under certain circumstances, the statements under b and c may be combined into one statement of income and retained earnings. The entity may use titles for the statements other than those used in the standard.
In addition, management includes a statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes a retrospective restatement or when it reclassifies items in its financial statements. A set of financial statements comprises: a Balance sheet. In addition, the annual report comprises a management report that does not need to be audited.
However, the following items are required to be presented on the face of the balance sheet as a minimum: Assets: Cash and cash equivalents. Trade and other receivables. Financial assets. Investment property. Intangible assets. Biological assets. Investments in associates and in joint-ventures.
Current tax assets. Deferred tax assets. Liabilities and equity: Trade and other payables.
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