Summary of similarities and differences 2007/2008 Edition
IFRS – US GAAP – Swiss GAAP FER
Summary of similarities and differences
2007/2008 Edition This PricewaterhouseCoopers publication is for those who wish to gain a broad understanding of the key similarities and differences between IFRS, US GAAP and Swiss GAAP FER. No summary publication can do justice to the many differences of detail that exist between IFRS, US GAAP and Swiss GAAP FER. Even if the guidance is similar, there can be differences in the detailed application, which could have a material impact on the financial statements. It needs to be stressed that this brochure deals with the main differences only. Many more pages would be needed to be more comprehensive, but that was not our objective with this publication. This publication focuses on the measurement similarities and differences most commonly found in practice. When applying the individual accounting frameworks, readers should consult all the relevant accounting standards and, where applicable, their national law. Listed companies should also follow relevant securities regulations. IFRS and US GAAP are globally acknowledged accounting standards for which a broad range of theoretical background, interpretations and literature is available. Swiss GAAP FER focuses on accounting for small and medium sized organisations and groups based in Switzerland; if there are questions that are not answered by a respective standard, the general principle of a true and fair view should be applied. This summary is based on IFRS and US GAAP developments up to August 2007 and on Swiss GAAP FER as applicable from January 1, 2007. It does not cover Swiss GAAP FER 14 Consolidated financial statements of insurance companies, Swiss GAAP FER 21 Accounting for charitable, social non-profit organisations and Swiss GAAP FER 26 Accounting of pension plans. We trust you will find this publication useful in helping you identify the key differences between IFRS, US GAAP and Swiss GAAP FER.
SUBJECT Accounting framework Historical cost or valuation
Swiss GAAP FER
Generally uses historical cost, but intangible assets, property, plant and equipment (PPE) and investment property may be revalued to fair value. Derivatives, certain other financial instruments and biological assets are revalued to fair value. Full retrospective application of all IFRS effective at the reporting date for an entity’s first IFRS financial statements, with some optional exemptions and limited mandatory exceptions. Reconciliations of profit or loss in respect of the last period reported under previous GAAP, of equity at the end of that period and of equity at the start of the earliest period presented in comparatives must be included in an entity's first IFRS financial statements.
No revaluations except for certain types of financial instrument.
Basically, historical cost convention applies. However, for several balance sheet positions Swiss GAAP FER defines deviations from that convention (fair value) or allows choices between two options. First-time adoption requires a presentation of the prior year balance sheet in compliance with Swiss GAAP FER only.
First-time adoption of accounting framework
First-time adoption of US GAAP requires retrospective application. There is no requirement to present reconciliations of equity or profit or loss on first-time adoption of US GAAP.
Financial statements Components of financial statements Two years’ balance sheets, income statements, cash flow statements, changes in equity and accounting policies and notes. Similar to IFRS, except three years required for SEC registrants for all statements except balance sheet. Specific accommodations in certain circumstances for foreign private issuers that may offer relief from the three-year requirement. Entities may present either a classified or non-classified balance sheet. Items on the face of the...