Swiss GAAP FER: principles, thresholds and choosing a reporting framework

What is Swiss GAAP FER?

Swiss GAAP FER is a modular set of accounting recommendations. In French, it is known as Swiss GAAP RPC, for Recommandations relatives à la présentation des comptes. These are two names for the same framework, not competing standards.

Its objective is financial information that gives a true and fair view of financial position, performance and cash flows. The applicable requirements depend on size, activity and whether consolidated financial statements are prepared.

A family-owned SME may use FER to make its reporting clearer for a bank. A group may need consistent policies across subsidiaries. A donor-funded organisation may face contractual or sector-specific reporting requirements. Start with the purpose of the accounts, not the label.

When is FER required or useful?

Not every Swiss SME must adopt Swiss GAAP FER. Adoption may be voluntary or arise from legislation, listing rules, the articles of association or an agreement. For a listed entity, check the requirements of its actual market segment.

Ask the bank, investor or other recipient to confirm the required framework, disclosures, consolidation scope and assurance level in writing. A request for more transparent figures is not necessarily a request for a full change of framework.

FER reporting does not automatically replace statutory accounts under the Swiss Code of Obligations. Keep the reconciliation between statutory, tax and reporting figures clear.

Core FER: size criteria and scope

An organisation can apply core FER if at least two of the following criteria are not exceeded in two successive years:

Core FER comprises the conceptual framework and FER 1–6. Its requirements include valuation, presentation, a cash flow statement, off-balance-sheet transactions and notes. It is a complete package, not a menu of optional disclosures.

Groups must assess the relevant size on a consolidated basis and also apply FER 30 on consolidated financial statements. Larger organisations apply the additional applicable standards. Listed companies cannot limit their reporting to core FER and must also consider FER 31.

These criteria are specific to core FER. Do not confuse them with thresholds for statutory audit or bookkeeping obligations.

Swiss statutory accounts versus FER

Understanding the balance sheet, income statement and notes to the accounts makes it easier to identify which differences matter to your business.

Example: an inventory adjustment

Assume inventory has a historical cost of CHF 220,000. In the statutory accounts, a flat-rate valuation adjustment has reduced its carrying amount to CHF 180,000. Documented net realisable value is at least CHF 220,000, and there is no economic impairment.

Under the assumptions of this example, the FER carrying amount is CHF 220,000. The CHF 40,000 adjustment reverses a hidden reserve; it does not revalue the inventory to its selling price and creates no cash receipt.

The effect on equity, the reporting period and deferred taxes must be analysed. If stock is actually damaged or obsolete, the economic write-down cannot simply be removed.

Swiss GAAP FER or IFRS?

The choice depends on what users of the financial statements need and accept. A parent company, international investor or market may require IFRS. FER may meet the needs of Swiss stakeholders where an accepted Swiss framework is appropriate.

Do not judge implementation effort solely by the number of pages in a standard. Consolidation, pension obligations and acquisitions can make either project demanding. Confirm expectations first, then budget both the initial conversion and recurring annual work.

Consolidation and goodwill under FER 30

The revised FER 30 applies to financial years beginning on or after 1 January 2024. Group reporting requires consistent accounting policies and the appropriate treatment of subsidiaries, other investments and intragroup transactions.

For goodwill, FER permits capitalisation and amortisation or an offset against equity with the required disclosures. Offsetting goodwill does not make its economic consequences disappear.

When capitalised, goodwill is amortised over its estimated useful life, which cannot exceed 20 years. If that useful life cannot be determined, amortisation takes place over five years. Document the acquisition analysis and policy choice when the transaction occurs.

Prepare a reliable first FER close

1. Start with a reliable statutory trial balance. Reconcile balances and complete the year-end closing checks.
2. Define the reporting perimeter. Identify entities, users and applicable recommendations.
3. Document policies and differences. Review inventory, depreciation, pensions, taxes and other material topics.
4. Record supported adjustments. Keep calculations, assumptions and approvals traceable.
5. Prepare the full reporting package. Include cash flows, notes and comparative figures.
6. Validate and repeat. Assign responsibilities and maintain a process that can be reproduced each year.

A clear reconciliation is more valuable than an unexplained spreadsheet of closing entries. The underlying accounting principles should remain understandable to management as well as to the preparers.

Frequently asked questions