The new accounting law
The new accounting law went into effect on 1 January 2013. The new legislation is not applicable until the financial year 2015, or for consolidated financial statements not until the financial year 2016.
The new accounting law
The new accounting law is effective regardless of the legal form of the company and features a uniform structure. Consequently, the key criterion is no longer the legal form, but rather the company's economic significance. The accounting-relevant provisions in the Swiss company law (Swiss Code of Obligations, Art. 662-663b) have therefore been repealed. The thirty-second part of the Code of Obligations now includes the “Financial Reporting and Accounting Principles” for all company formations. The differences are noteworthy particularly with regard to company size:
|Swiss Code of Obligations||Company size||Criteria / accounting|
|1. Section||General provisions||Less than CHF 500,000 in revenues|
|Art. 957 para. 2||Sole proprietorships and partner-ships with less than CHF 500,000 in revenues||Standard accounting practice possi-ble (income/expense accounting)|
|Art. 958 para. 2||Small- and medium-sized enter-prises (SMEs) = non-fulfilment of criteria for larger companies||Only annual report with balance sheet, profit and loss statement and notes|
|3. Section||Accounting for larger companies||More than CHF 20 million in assets, CHF 40 million in revenues,, 250 full-time employees|
|Art. 961 et seq||Larger companies (obligation of ordinary audit)||Additional documentation:
Cash flow statement
|4. Section||Financial statements according to recognised accounting standards||
|Art. 962 et seq||Publicly listed companies||Recognised accounting standards according to the requirements of the relevant stock exchange|
|5. Section||Consolidated financial statements|
|Art. 963 et seq||Consolidated financial statements||Preparation according to recognised accounting standards or ordinary accounting principles; stipulated by Swiss law.|
Annual report / management report / retention
The accounting practice applies to the annual report that contains the financial statements comprising the balance sheet, profit and loss statement and notes. The annual review is sup-planted by the management report, which nonetheless only larger companies are required to prepare, subject to approval by the Annual General Meeting.
The annual report must be submitted to the relevant company entity or person for approval within six months following the end of the respective financial year and signed by the chairman of the company’s executive management or board of directors, as well as the person responsi-ble for accounting within the firm.
The signed annual report as well as audit report must be retained for a period of ten years in written format. The other accounting records and documents do not have to be retained in paper format.
Presentation, currency and language
The balance sheet and profit and loss statement may be presented in account or report format. The accounting practice is carried out in the local currency or the currency relevant for the company’s business activities. If the local currency is not used, the values must be addition-ally provided in the local currency too. The accounting practice is carried out in one of the na-tional languages or English.
The financial statements are governed by section 2, articles 959–960e of the Swiss Code of Obligations, regardless of legal form. However, the principle of prudence is still applicable, which nonetheless may not hinder the reliable assessment of the company’s financial situation. Fol-lowing is a selection of the most significant revisions:
- - The minimum structure for all entities and persons required to maintain accounting records is now bindingly stipulated, and the sequence of the accounts has been determined.
- Proprietary equity interests are reported as negative items in share capital.
- Costs relating to company formation, capital increase and organisation may no longer be recognised.
- Accounts receivable and liabilities relative to direct or indirect vested interests and entities, as well as relative to companies in which there is a direct or indirect investment, in each case must be reported separately in the balance sheet or notes.
- Assets and liabilities are generally valued on an individual basis, insofar as they are sig-nificant and not normally compiled as a group based on their similarity for valuation purpos-es.
- Assets with discernable market prices may be valued accordingly, even when they ex-ceed the nominal value or acquisition value. This valuation option must be reported in the notes.