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Old 11.09.2015, 16:36
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Major Differences in Accounting in CH?

Hi -

I've done accounting for several businesses in other countries (mostly my own), so am familiar with accounting and bookkeeping basics.

Are there certain laws/regulations I need to be aware of in CH? Would appreciate a few, if only so I can test the professional accountants on whether they know what they're talking about or not.

Thanks
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Old 11.09.2015, 17:19
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Re: Major Differences in Accounting in CH?

Is this a dumb question or what ?

How can you "test a professional accountant" when you have no idea what is allowed or not !
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Old 11.09.2015, 17:38
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Re: Major Differences in Accounting in CH?

I've hired and interviewed many professional accountants in my career and they're definitely not all of the same caliber.

I'm just trying to understand what some of the basics differences might be with other countries, which I think is a valid question.
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Old 11.09.2015, 20:03
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Re: Major Differences in Accounting in CH?

There are two accounting approaches specific to Switzerland:

1) FER Swiss GAAP: This is "economic" external reporting and would have similarities to IFRS and US GAAP.

2) Statutory/ Obligationsrecht (OR): This is the required statutory reporting for the government and for tax purposes.

Suggest you google on these to learn more about them and to identify differences to what you learned in other countries.
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Old 13.09.2015, 21:02
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Re: Major Differences in Accounting in CH?

Thanks Mulhollander!

So - a couple interesting things so far, in case anyone comes across this thread in setting up their own business in the future.

Swiss law has stricter rules than most countries in how you can distribute salary and dividends - you must pay yourself up to their deemed "salary appropriate for your profession" before you can take out dividends. Generally based on their salarium calculator as far as I can see.

Also the reporting requirements are more nuanced than other places in terms of what is required - it varies based on the size, purpose, etc. of your enterprise.

Some of the above and other interesting stuff here from April 2014 - http://www.lexology.com/library/deta...b-5c745b9f5d5a
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Old 13.09.2015, 21:22
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Re: Major Differences in Accounting in CH?

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Thanks Mulhollander!

So - a couple interesting things so far, in case anyone comes across this thread in setting up their own business in the future.

Swiss law has stricter rules than most countries in how you can distribute salary and dividends - you must pay yourself up to their deemed "salary appropriate for your profession" before you can take out dividends. Generally based on their salarium calculator as far as I can see.

Also the reporting requirements are more nuanced than other places in terms of what is required - it varies based on the size, purpose, etc. of your enterprise.

Some of the above and other interesting stuff here from April 2014 - http://www.lexology.com/library/deta...b-5c745b9f5d5a

And you're looking for guidance to hire accountants..........

It's cantonnal driven mainly
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Old 13.09.2015, 22:01
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Re: Major Differences in Accounting in CH?

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Thanks Mulhollander!

So - a couple interesting things so far, in case anyone comes across this thread in setting up their own business in the future.

Swiss law has stricter rules than most countries in how you can distribute salary and dividends - you must pay yourself up to their deemed "salary appropriate for your profession" before you can take out dividends. Generally based on their salarium calculator as far as I can see.

Also the reporting requirements are more nuanced than other places in terms of what is required - it varies based on the size, purpose, etc. of your enterprise.

Some of the above and other interesting stuff here from April 2014 - http://www.lexology.com/library/deta...b-5c745b9f5d5a
Although there are no minimum salary requirements for company owners in US tax law, the IRS also looks for company owners who "underpay" themselves to reduce their payroll taxes and take the income as dividends. This describes such a case:

"-The IRS already has the ability to go after professional corporations that underpay employment taxes. That's how this case came up in the first place.
- If you want to use an S corporation to reduce your payroll taxes, remember that hogs get slaughtered, and treating only $24,000 of $200,000 of professional firm earnings as salary is on the porcine side.
There's no safe-harbor or fixed minimum wage required by the law. If you are setting salaries for the owners of a professional business, a reasonable place to start is to look at the salaries of the highest-paid non-shareholders. If the shareholders are doing as much work as the non-shareholders, you could have trouble passing the red-face test if you pay them less than non-owners."

http://www.rothcpa.com/archives/006062.php
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Old 14.09.2015, 00:15
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Re: Major Differences in Accounting in CH?

Ask about hidden reserves.
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Old 14.09.2015, 03:31
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Re: Major Differences in Accounting in CH?

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Ask about hidden reserves.
Were you thinking of the fact that unnecessary reserves are, well, unnecessary or that unnecessary reserves don't need to be reversed if determined to be unnecessary?

Art. 960a

II. Assets
1. In general
1 When first recorded, assets must be valued no higher than their acquisition or manufacturing costs.
2 In any subsequent valuation, assets must not be valued higher than their acquisition or manufacturing costs. Provisions on individual types of assets are reserved.
3 Loss in value due to usage or age must be taken into account through depreciation, while other losses in value must be taken into account through valuation adjustments. Depreciation and valuation adjustments must be applied in accordance with generally recognised commercial principles. They must be deducted directly or indirectly from the relevant assets and charged to the profit and loss account and may not be shown under liabilities.
4 For replacement purposes and to ensure the long-term prosperity of the undertaking, additional depreciation and valuation adjustments may be made. For the same purposes, the cancellation of depreciation and valuation adjustments that are no longer justified may be dispensed with.

Art. 960e
III. Liabilities
1 Liabilities must be entered at their nominal value.
2 If past events lead to the expectation of a cash outflow in future financial years, the provisions probably required must be made and charged to the profit and loss account.
3 Provisions may also be made in particular for:
1. regularly incurred expenditures from guarantee commitments;2. renovations to tangible fixed assets;3. restructuring;4. securing the long-term prosperity of the undertaking.
4 Provisions that are no longer required need not be cancelled.
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