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Erstellt / Aktualisiert 20.03.2020 / 23.03.2020
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Fenster schliessen

What is financial reporting?

financial reporting is how a company communicates about financial information with its stakeholders

accountants are trained communicators in business language

Fenster schliessen

Why do we need financial reporting?

so that we can make decisions based on the financial reports

  • For example, investors require financial reports to

    – make investment decisions; and

    – monitor management performance

    – good performers (companies, projects, managers, etc.) get more capital investment

Fenster schliessen

Types of financial reporting

  • Depending on the purpose of reporting:

    • -  External reporting

    • -  Internal/management reporting

    • -  Tax reporting

  • Depending on accounting practice:

    • -  Cash flow basis

    • -  Accrual basis

  • Depending on the type of company:

    • -  Proprietorship

    • -  Partnership

    • -  Corporations (publicly traded vs privately held)

Fenster schliessen

What does financial reporting for public companies?

provides financial information about a company to its external stakeholders (investors, consumers etc.)

 

Fenster schliessen

Tell me the most typical things about financial reporting?

- typically done periodically

-follows some reporting standards like swiss gaap fer, IFRS etc. 

-includes financial statements, annual reports, filings with the governemtn and stock exchange

Fenster schliessen

Which is the regulatory framework in Switzerland?

  • Schweizerische Obligationenrecht, or Swiss Code of Obligations (SCO), is the fundamental commercial law of Switzerland

  • The consolidated financial statements can be prepared following IFRS, US GAAP, or Swiss GAAP FER

  • Publically-traded firms in SIX Swiss Exchange

    - must follow IFRS, US GAAP if traded in main standard

    - may also follow Swiss GAAP FER if traded in domestic standard

Fenster schliessen

IFRS?

-issued since 1973, most used worldwide by large multinational firms

Fenster schliessen

U.S. GAAP

  • oldest standard with a history dating back to 1930’s, most complex with dense regulation and stringent enforcement