The legal body of the Commission for Financial Reporting Standards is held by a foundation that was created in 1984. The Board of the Foundation appoints up to 30 members to the Commission. The appointment is made ad personam but under consideration of the environment and of the interests of the members concerned.
In the sense of a coalition or coordination of interests model, the physical composition of the Commission shall represent the different stakeholders (and also the language regions) in a manner that is as balanced as possible. Public agencies cooperate with the Commission through (non-voting) observers.
The current work, mainly the preparation of the wording or changes to recommendations, is performed by the president of the Commission and an Executive Committee of the Commission consisting of a maximum of six members (appointed out of the Commission) and by a technical secretary. The Commission selects topics for the preparation of recommendations.
The Executive Committee delegates the preparatory work to a subcommittee, which is normally headed by one of its members and in which other interested parties are represented.
Deloitte AG acts as auditor of the foundation.
The stated goal is establish a “Commission for Financial Reporting Standards” of a maximum of 30 people and to ensure that people from business, auditing and accounting, employers’ and workers’ organisations, universities, the public sector and other circles interested in financial reporting are always present in this Commission and in appropriate compositions.
The Commission is responsible for drafting recommendations for financial reporting that take into account conditions in Switzerland and demonstrate practicable approaches for companies.
These recommendations are intended to help harmonise accounting and reporting in Switzerland, improve comparability and generally increase the quality of accounting and reporting in Switzerland.
The Commission can also give its opinion on questions of general interest. The dissemination of the recommendations is to be promoted and their application and verification by auditors should help to increase the acceptance of the financial statements of Swiss companies abroad.
As part of our mission statement, the FER foundation, with Prof. Dr. Peter Leibfried as president of the Commission, is focusing on increasing the quality of accounting and reporting in Switzerland and encouraging the creation of an active community of users through the targeted launch of various event formats (such as the annual conference, Swiss GAAP FER on-site, etc.).
The number of FER users increased sharply. The FER focused on the fine-tuning of existing regulations and closed important gaps in regulation, such as for revenue recognition. In order to take into account the specific characteristics of listed companies in the sense of public accountability, FER adopted Swiss GAAP FER 31 “Complementary recommendation for listed companies”, leading to greater transparency and better international comparability.
The recommendations are revised, under the direction of Prof. Dr. Conrad Meyer, to better meet the needs of small and medium-sized enterprises. The new modular structure consists of four building blocks: the framework, core FER, further standards and Swiss GAAP FER for groups of organisations. In addition, the recommendations are made more comprehensive with important industry regulations, in particular Swiss GAAP FER 26 “Accounting of pension plans”.
In addition to the refinement and supplementation of recommendations on the most important items in financial statements, specific Swiss issues such as pension provision are taken into account. New territory was again staked out in 1997 with Swiss GAAP FER 21 “Accounting for charitable non-profit organisations”.
Under the leadership of Prof. Dr. Giorgio Behr, the recommendations are rapidly expanded to address the effects of internationalization on financial reporting. In 1994, the number of recommendations has already reached 15. With Swiss GAAP FER 14 “Consolidated financial statements of insurance companies”, FER ventured into industry-specific rules for the first time. The current market presence of Swiss GAAP FER originates during this period. SIX Swiss Exchange adopts the FER in its listing rules as one of the permitted standards for the financial reporting of public companies.
The FER succeeds in making initial steps toward greater transparency in financial reporting — despite differing interests of and resistance from different professional groups. In 1990, five recommendations were passed under the leadership of Prof. Dr. André Zünd. A recommendation for the consolidated financial statements is even included.
In 1984, based on the initiative of Prof. Dr. André Zünd of the University of St.Gallen, EXPERTsuisse (the Swiss Expert Association for Audit, Tax and Fiduciary, formerly the Schweizer Treuhand-Kammer) launched the idea of founding an independent institution concerned with the further development of accounting and reporting standards in Switzerland.