Swiss Group Accounting Guide
Swiss Group Accounting (Consolidated) — CO/OR • Swiss GAAP FER • IFRS
Swiss parent companies often ask when a consolidated financial statement (“Konzernrechnung”) is required, what it must contain, how to include subsidiaries and joint ventures, and how taxes are presented under Swiss GAAP FER vs. IFRS or the Swiss Code of Obligations (CO/OR). This guide explains the Swiss-specific rules in a practical, investor-friendly way.
Below you’ll find a linked table of contents, a concise explainer of the legal framework, and an extensive FAQ-style structure.
Who must prepare a consolidated financial statement in Switzerland?
Under Art. 963 CO/OR, a Swiss parent that controls one or more undertakings must prepare consolidated financial statements. Control may arise via majority voting rights, the right to appoint/remove most board members, or other means of dominant influence.
Small-group exemptions & higher-level consolidation
A legal entity is exempt if, together with controlled undertakings, it does not exceed two of three thresholds for two consecutive years: total assets CHF 20m, revenue CHF 40m, and 250 average FTE (Art. 963a CO/OR). Exemption also applies if the group is included in equivalent higher-level consolidated accounts that are publicly available.
Components of the consolidated financial statements
Swiss consolidated financial statements typically comprise a consolidated balance sheet, income statement and notes per the chosen framework (CO/OR minimum vs. Swiss GAAP FER vs. IFRS). Many groups also provide a group management report in practice or per listing rules.
Group management report
The report explains performance, risks/opportunities, outlook and key non-financial aspects. For SIX-listed issuers, additional disclosure directives apply.
Optional/standard statements under FER/IFRS
Under Swiss GAAP FER and IFRS, a cash flow statement and a statement of changes in equity are standard. Under CO/OR-only consolidated accounts, they are not always mandatory but are common for transparency.
Consolidation scope & methods
The scope includes the parent and all controlled subsidiaries; rare exclusions may apply (immateriality, disproportionate cost, or severe long-term restrictions). Under FER/IFRS, uniform accounting policies are required at group level.
Full consolidation (subsidiaries)
Controlled entities are combined line-by-line; intragroup balances/transactions and unrealised profits are eliminated. Non-controlling interests are presented separately in equity and result allocation.
Proportionate consolidation (joint ventures)
Under Swiss GAAP FER, proportionate consolidation may be used for certain joint ventures. Under IFRS, joint ventures are generally accounted for using the equity method (IFRS 11).
Equity method (associates)
Associates and JVs not proportionately consolidated are included using the equity method, reflecting the investor’s share of post-acquisition results and OCI.
Exclusions from consolidation
In limited cases, entities can be excluded (e.g., immaterial in aggregate, disproportionate effort, severe long-term restrictions). Materiality is assessed at the group level.
Publication, timing & audit
Swiss groups must have consolidated accounts audited and approved in time for the AGM. Public availability depends on listing status and sector-specific rules.
AGM timing & public availability
The AGM must be held within six months after year-end to approve the accounts. In Switzerland, financial statements of non-listed companies are generally not public; listed issuers publish per exchange rules.
Audit requirements
Consolidated accounts are subject to an ordinary audit. Stand-alone entities may have a limited examination, but consolidation triggers the ordinary audit regime.
Purpose, users & “true and fair view”
Consolidated financial statements present a true and fair view of the group’s assets, liabilities, financial position and performance as a single economic entity, supporting decisions by investors, lenders, employees and other stakeholders.
Frameworks in Switzerland: CO/OR, Swiss GAAP FER, IFRS (US GAAP)
Swiss law (Arts. 957 ff. CO/OR) sets minimum requirements. Recognised standards include Swiss GAAP FER, IFRS, and US GAAP (particularly for SIX’s International Reporting Standard).
SIX Swiss Exchange reporting standards
On the SIX Swiss Exchange, permitted frameworks depend on the reporting standard: the International Reporting Standard requires IFRS or US GAAP; the Swiss Reporting Standard requires Swiss GAAP FER. Periodic reporting and disclosure follow SIX directives.
Voluntary FER/IFRS for non-listed groups
Non-listed groups may elect Swiss GAAP FER or IFRS for consolidation to enhance comparability and provide a true and fair view. Separate CO/OR statutory accounts remain required for legal/tax purposes.
Taxes in consolidation (current & deferred)
Commercial accounting and taxation are related but distinct. Swiss tax returns are based on statutory (CO/OR) stand-alone accounts; consolidated accounts inform stakeholders but are not the direct tax base.
FER vs. CO/OR treatment
Swiss GAAP FER (e.g., FER 11) requires recognition of current and deferred taxes using a balance-sheet approach. In CO/OR-only consolidated accounts, deferred taxes are not explicitly mandated; many groups therefore adopt FER or IFRS for robust deferred-tax accounting.
Temporary differences from consolidation
Purchase price allocation, fair-value step-ups and elimination of intragroup profits typically create temporary differences; these give rise to deferred taxes under FER/IFRS.
Typical tax disclosures
Usual FER/IFRS disclosures include applied tax rate(s), a reconciliation from expected to reported tax expense, and movements in deferred tax assets/liabilities by source, including unrecognised DTAs (e.g., loss carryforwards).
Frequently asked Questions about Swiss Group Accounting:
ℹ️ Click a question to reveal the answer:
Who must prepare consolidated financial statements in Switzerland?
Any Swiss parent that controls one or more undertakings must consolidate (Art. 963 CO/OR), unless an exemption applies.
What are the Swiss “small-group” exemption thresholds?
Two of three not exceeded for two consecutive years: total assets CHF 20m, revenue CHF 40m, and 250 FTE on average (Art. 963a CO/OR).
Which frameworks can Swiss groups use (CO/OR, Swiss GAAP FER, IFRS, US GAAP)?
All are recognised in Switzerland. SIX’s International Reporting Standard permits IFRS or US GAAP; the Swiss Reporting Standard requires Swiss GAAP FER.
Are consolidated financial statements publicly available in Switzerland?
Only for listed issuers (per stock-exchange rules). For non-listed entities, accounts are generally not public.
When must the AGM approve the consolidated accounts?
The AGM must be held within six months after the financial year end; the accounts must be ready for approval at that meeting.
Are consolidated accounts audited in Switzerland?
Yes. Consolidated financial statements are subject to an ordinary audit by a licensed auditor.
What are the core components of Swiss consolidated accounts?
Consolidated balance sheet, income statement, and notes. Under FER/IFRS, include a cash flow statement and statement of changes in equity.
Which consolidation methods are used in Switzerland?
Full consolidation for subsidiaries; proportionate consolidation for certain JVs under Swiss GAAP FER; equity method for associates (and IFRS joint ventures).
Can immaterial subsidiaries be excluded from consolidation?
In limited cases (e.g., immaterial in aggregate or severe long-term restrictions). Materiality is assessed at the group level.
How are intra-group transactions treated on consolidation?
Eliminate intercompany balances, income/expenses, dividends, and unrealized profits to present the group as one economic entity.
How are business combinations treated under Swiss frameworks?
Under FER/IFRS, purchase price allocation recognises identifiable assets/liabilities at fair value; the difference is goodwill (subsequent treatment per the chosen standard).
How are non-controlling interests (NCI) presented?
NCI are shown separately in equity and in the allocation of profit or loss.
Do Swiss GAAP FER financial statements require deferred taxes?
Yes. FER 11 requires recognition of current and deferred taxes using a balance-sheet method with appropriate note disclosures.
Are deferred taxes required under CO/OR-only consolidated accounts?
The CO/OR provides minimum rules and does not explicitly mandate deferred taxes. Many groups therefore apply Swiss GAAP FER or IFRS for robust tax accounting.
How are taxes presented in the consolidated income statement?
A tax expense line includes current tax and (if using FER/IFRS) deferred tax. Pillar Two top-up taxes may require specific disclosures under the chosen standard.
What determines the choice between Swiss GAAP FER and IFRS?
Listing standard, investor base, complexity, and cost/benefit. International comparability favors IFRS; domestic focus and cost-efficiency often favor Swiss GAAP FER.
Are there interim reporting obligations for listed Swiss groups?
Yes. SIX requires periodic (e.g., semi-annual) reporting per its Directive on Financial Reporting and listing rules.
Where are Swiss consolidated accounts filed or archived?
There is no Bundesanzeiger-style registry. Listed issuers publish per SIX rules; entities must retain records 10 years and submit stand-alone accounts with tax returns.
What are typical pitfalls for first-time Swiss consolidations?
Scope errors, missing or late intercompany eliminations, weak PPA documentation, and incomplete deferred-tax analysis under FER/IFRS.
Does choosing FER/IFRS replace statutory CO/OR accounts?
No. CO/OR statutory accounts remain required for each Swiss entity; FER/IFRS govern the consolidated accounts and (if elected) any additional “true and fair view” reporting.