Content Overview Table of Contents ....................................... VII Acknowledgements ..................................... XV Index of Abbreviations ................................... XVII List of Figures . ....................................... XXV Index of Cited Authorities . ..............................XXVII Documentation . ....................................... LXIII Introduction and Personal Remarks .......................... 3 § 1 Financial Reporting .................................. 9 § 2 International Accounting Harmonisation and Differences ....... 15 § 3 IFRS Basics ........................................ 35 § 4 IFRS Adoption ...................................... 49 § 5 IFRS’ Legal Nature and Forms of Influence ................. 59 § 6 IFRS’ Influence on Other Standards ...................... 83 § 7 Previous Research and the Revision of the CO ............... 103 § 8 Informal Norms ..................................... 115 § 9 Prudence in Conflict with Fair Presentation ................. 129 § 10 Manifestations of IFRS’ Impact on the CO ................. 149 § 11 Interpretation of Domestic Accounting Rules ............... 179 Conclusion ............................................ 211 Synopsis .............................................. 215 Note 1: References in Swiss Law to Recognised Standards ............ 225 Note 2: CO’s wording ..................................... 227 V Table of Contents Content Overview ...................................... V Acknowledgements ..................................... XV Index of Abbreviations ................................... XVII List of Figures . ....................................... XXV Index of Cited Authorities . ..............................XXVII Documentation . ....................................... LXIII Abstract .............................................. 1 Introduction and Personal Remarks .......................... 3 A. Subject of Investigation . .............................. 3 B. Process of Investigation . .............................. 5 C. Terminology . ....................................... 6 § 1 Financial Reporting .................................. 9 A. Financial Reporting ................................... 9 B. Financial Reporting Standard ............................ 10 C. Development of Financial Reporting Regulations in Switzerland .... 11 D. Interim Conclusion ................................... 12 § 2 International Accounting Harmonisation and Differences ....... 15 A. Globalisation and Regionalisation ......................... 16 I. Reasons for an International Accounting Harmonisation .......... 17 1. Better for Investors . .............................. 18 2. Lower Expenses in Preparation . ..................... 19 3. Better Mobility of the Registered Office .................. 19 II. Arguments against Harmonisation ......................... 20 1. Competition between the Standards ..................... 20 2. Adaptability to Domestic Circumstances .................. 21 3. Providing more Information .......................... 21 B. Forms of Differences .................................. 21 I. Divergences (Abweichungen) ............................ 22 II. Absences (Fehlen) .................................... 22 C. Differences between Norms ............................. 23 VII Table of Contents I. Differences between Continental Europe and Anglo-Saxon Accounting Systems ........................................... 24 II. Rule vs Principle Based . .............................. 25 III. Static and Dynamic Accounting Theory ..................... 26 IV. The Influence of the ‘Authoritative Principle’ (Massgeblichkeitsprinzip) ............................... 28 1. In General ...................................... 28 2. In Switzerland ................................... 29 V. Language . ....................................... 30 D. IASB’s Role in the Harmonisation Process ................... 32 E. Interim Conclusion ................................... 33 § 3 IFRS Basics ........................................ 35 A. About IFRS . ....................................... 35 B. Evolution of the IFRS Foundation ......................... 36 C. The IASB . ....................................... 37 I. In general . ....................................... 37 II. Composition . ....................................... 38 III. IASB and the UNO Criteria for NGOs . ..................... 39 D. IFRS’ Structure ...................................... 40 E. Development of Standards .............................. 41 F. IFRS’ LegalForm.................................... 41 G. IFRS’ Underlying Principle ............................. 42 H. IFRS for SMEs ...................................... 42 I. IFRS’ Interpretation ................................... 43 I. Basics ............................................ 43 II. IFRS’ Interpretation Principle ............................ 43 III. Process of Interpretation . .............................. 43 1. Searching for a Suitable Norm ......................... 43 2. Verification of the Result ............................ 44 J. IFRS vs US GAAP ................................... 45 K. Interim Conclusion ................................... 47 § 4 IFRS Adoption ...................................... 49 A. Reasons for the Adoption of IFRS ......................... 49 B. Forms ............................................ 50 C. Example: European Union .............................. 52 VIII Table of Contents I. Endorsement ....................................... 53 II. Process ........................................... 53 III. Criteria ........................................... 55 D. Interim Conclusion ................................... 57 § 5 IFRS’ Legal Nature and Forms of Influence ................. 59 A. History of IFRS’ Influences on Swiss Commercial Accounting Law . 59 B. IFRS’ Legal Nature under Swiss Law . ..................... 60 I. Qualification ....................................... 60 II. Consequences ....................................... 64 C. Through References in a Broader Sense ..................... 65 I. Incorporation ....................................... 67 II. References in a Narrower Sense ........................... 68 III. General Clause ...................................... 71 1. In General ...................................... 71 2. GAAP . ....................................... 72 3. Which Sources are Part of the Swiss Recognised Financial Reporting Principles? . .............................. 75 D. Through Analogy .................................... 77 I. In General . ....................................... 77 II. Applied in Swiss Commercial Accounting Law . ............. 78 III. Example for Swiss Commercial Accounting Law . ............. 78 E. Through Comparative Law .............................. 79 I. In General . ....................................... 79 II. Example for Swiss Commercial Accounting Law . ............. 81 F. Interim Conclusion ................................... 81 § 6 IFRS’ Influence on Other Standards ...................... 83 A. Swiss GAAP FER’s Impact on the CO . ..................... 83 I. Basics ............................................ 83 II. Similarities to and Differences from IFRS .................... 85 III. Rather Swiss GAAP FER than IFRS or IFRS for SMEs? .......... 85 1. Reasons for and against Swiss GAAP FER . ............. 86 2. IFRS or Swiss GAAP FER, with the Example of the Migros Group 88 3. Summary ....................................... 89 IV. In Comparison to the CO . .............................. 89 V. Legal Nature . ....................................... 89 VI. Swiss GAAP FER’s Influence on the CO .................... 90 B. IPSAS’ Influence on Swiss National Finances ................. 92 I. Financial Report in the Public Sector . ..................... 92 IX Table of Contents II. IPSAS ............................................ 92 III. HRM2 ............................................ 93 IV. Comparison between HRM2 and IPSAS ..................... 96 V. NRM............................................. 96 VI. EPSAS ........................................... 97 VII. Influence of Public Financial Reporting on Commercial Accounting Rules ............................................. 97 C. EU-IFRS’ Influence on Swiss Law . ..................... 98 I. In General . ....................................... 98 II. Relevance for Swiss Law . .............................. 98 D. Interim Conclusion ................................... 100 § 7 Previous Research and the Revision of the CO ............... 103 A. Legislature . ....................................... 104 B. Case Law . ....................................... 104 C. Doctrine . ....................................... 105 D. Comparison ‘oCO-CO-IFRS’ ............................ 108 I. Art962CO ........................................ 108 II. Effects on Company Law . .............................. 109 III. Effects on Taxation ................................... 112 E. Interim Conclusion ................................... 113 § 8 Informal Norms ..................................... 115 A. Informal Norms Defined . .............................. 116 I. Definition . ....................................... 116 II. Differentiation ...................................... 116 B. Informal Norms’ Use.................................. 118 I. In General . ....................................... 118 II. Problems and Advantages with Informal Norms . ............. 119 III. Permissibility of References