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Switzerland National Professional Accountancy Organisation Website: Treuhand-Kammer - Swiss Institute of Certified Accountants and Tax Consultants Update for October 2007 Update for April 2006 Financial Reporting Framework in Switzerland (April 2006 Update) Adoption of IFRSs in Europe Effective in 2005 Switzerland is not a member of the European Union and, therefore, is not subject to the EU IAS Regulation or Accounting Directives. The Swiss Foundation for Accounting and Reporting publishes accounting standards (ARR/FER, or 'Swiss GAAP'). Compliance with ARR/FER is required by all companies. However, compliance with IFRSs ensures compliance with ARR/FER, and many large Swiss companies have, for a number of years, followed IASs/IFRSs. Starting with annual reports for 2005 and interim reports for 2006, most Swiss companies whose equity shares are listed on the main board of the Swiss Exchange are required to prepare their financial statements using either IFRSs or US GAAP. Swiss GAAP will not be permitted. The only exception is for Swiss companies listed on the main board that are not multinational (that is, operate primarily in Switzerland). Those companies may continue to use the Swiss GAAP, or they may choose IFRSs or US GAAP. Foreign listed companies may continue to use a national GAAP that the Exchange deems to be equivalent to IFRS or US GAAP. The main board of the Swiss Exchange lists the shares of approximately 280 Swiss and 120 non-Swiss companies. October 2007 Update Swiss Exchange guidance on IFRS implementation The Swiss Stock Exchange (SWX) has released its Annual Communique (PDF 26k) identifying the areas on which they expect to focus in their regulatory reviews of annual financial reports for 2007 and semi-annual financial reports for 2008 of Swiss Exchange (SWX) listed companies. The areas of focus will be: Disclosures of financial instruments (IFRS 7) Accounting policies (IAS 1) Income taxes (IAS 12) Related party disclosures (IAS 24) Intangible assets from business combinations (IAS 38/IFRS 3) Further, the SWX has updated its Admission Board Circular No. 6 (PDF 136k), which identifies 24 IFRS issues that have led to discussions with or actions against issuers in the past.