Category Archives: IFRS vs Swiss GAAP FER

Goldbach Media: from IFRS to Swiss GAAP FER

Another SIX listed company moving to Swiss GAAP FER from the notoriously inflexible and expensive IFRS (loved by auditors $$$). Previous examples from the third quarter 2013 were Meyer Burger and Burkhalter Holding and in the first quarter 2014 Kaba (see links at bottom of post).


Goldbach Group changes over to Domestic Standard on 8 December 2014

Küsnacht-Zürich, 10.11.2014. On 7 November 2014, SIX Swiss Exchange
approved the petition of Goldbach Group AG to change over to the Domestic
Standard on 8 December 2014, under the condition that all obligations of
public disclosure are met.

From 8 December 2014, the 6,010,920 registered shares, each with a nominal
value of CHF 1.25, of Goldbach Group AG, headquartered in Küsnacht-Zürich
(ticker symbol: GBMN), will be traded for the first time with the Domestic
Standard of the SIX Swiss Exchange. The last day of trading with the Main
Standard will be 5 December 2014.

The change in standards (segment change) is associated with the transition
from the current International Financial Reporting Standards (IFRS) to the
Swiss GAAP FER standard and will apply retroactively from the 2014 fiscal
year.

Switching accounting practice from IFRS to Swiss GAAP FER will mainly lead
to adjustments where company mergers are involved (treatment of goodwill
and immaterial assets from acquisitions), the treatment of cumulative
foreign currency differences in equity, and the calculation of benefit
liabilities. The switch will have a positive influence on turnover for
2014, as a reclassification of the cumulative exchange differences recorded
as equity with regard to the sale of a foreign subsidiary is no longer
required. The balance will be reduced due to the new treatment of goodwill
and the lower benefit liabilities. Accounting equity will be lower due to
the new treatment of goodwill, and current balance sheet risks will be
reduced. A detailed reconciliation account for the switch from IFRS to
Swiss GAAP FER will be included in the 2014 Annual Report.


Goldbach Group has been quoted in the main segment of the SIX Swiss
Exchange since June 15th, 2007 (Valor 487094, ISIN CH0004870942, ticker
symbol: GBMN).

Further information: www.goldbachgroup.com oder www.goldbach.com


Other examples: Kaba KABNMeyer Burger MBTN / Burkhalter Holding BKRN

Another Swiss SIX-listed Company Switches from complex IFRS to pragmatic Swiss GAAP FER

After Meyer Burger (SIX: MBTN) at the end of October 2013 and Burckhalter Holding (SIX: BKRN) beginning of October 2013 today a further company has joined the list of those dissatisfied with IFRS rules, complexity and costs: Kaba (SIX: KABN) released this press release today: kaba-switches-from-ifrs-to-swiss-gaap-fer. Kaba Group sells its products and solutions all over the world. Its main markets are Europe, North America and, increasingly, the Asia-Pacific region.

The press release:

Kaba switches from IFRS to Swiss GAAP FER

The Board of Directors of Kaba Holding AG has decided to change to Swiss GAAP FER for the preparation of the company’s consolidated accounts as from the new financial year (starting 1 July 2014). Kaba’s registered shares remain listed on the SIX Swiss Exchange and are still included in the Swiss Performance Index (SPI).

Kaba Holding has used the IFRS accounting standard since 2004. In recent years this standard has become more and more demanding. It has required increasingly complex and time-consuming details and disclosures, which have tied up ever more internal resources. Swiss GAAP FER takes a more pragmatic approach that meets all the needs of a medium-sized international company like Kaba Group and those of its stakeholders while keeping the work required to a sensible level. Using Swiss GAAP FER, Kaba will continue to report fully and transparently in accordance with the “true and fair” principle.

The application of the new accounting standard will allow Kaba to charge all goodwill through shareholders’ equity. This will reduce the level of total assets and the equity ratio, which, based on the last audited balance sheet of 30 June, will come to around 47%. Now that the proportion of long-term assets is lower, Kaba has defined a new target for the equity ratio of 20%. Even after the switch this target figure will easily be exceeded. The change of system will also make it simpler to value Kaba’s pension fund liabilities. Under Swiss GAAP FER there will no longer be any need to carry out expensive actuarial valuations. For the 2012/13 financial year, the absence of amortisation on intangibles would have left consolidated net profit around 5% higher. As a result of the switch from IFRS to Swiss GAAP FER, Kaba’s registered shares will now be traded in the Domestic Standard. Following the decision by Kaba’s Board of Directors to make this change, an application has been submitted accordingly to the SIX Swiss Exchange AG.

Kaba will produce a detailed assessment of the previous year under the new accounting system when it publishes the 2014/15 results.

Meyer Burger moves from IFRS to Swiss GAAP FER

Just two weeks after Burkhalter Holding (see post) another SIX listed company has decided to switch from IFRS to Swiss GAAP FER. Meyer Burger has cited growing complexity, the overly detailed rules (costly) of IFRS as factors behind their decision to switch to Swiss GAAP FER. They are convinced that Swiss GAAP FER is a solid framework permitting a true and fair view. The shares of Meyer Burger (Ticker: MBTN) will remain listed on the domestic standard of the SIX Swiss Exchange.

As was the case at Burkhalter Holding they will use equity capital to offset the goodwill and pension plans will also see adjustments; the amount of liabilities for these will sink. For the last published balance sheet as of June 30th the switch will still result in a equity capital ratio of over 50%.

The detailed numbers and changes will be published on March 14, 2014 in the annual report 2013.

Link to the press release published today

Burkhalter Holding moves from IFRS to Swiss GAAP FER

Today the board of Burkhalter Holding (Ticker: BKRN) announced the switch from IFRS to Swiss GAAP FER. The main reasons given were the treatment of pension plans and of goodwill and in a further remark the steady increase of rules (read: making accounting more tedious and expensive with IFRS).

They can now offset the equity capital, which will sink, with goodwill. As they no longer need to adhere to IAS 19 the employee benefits will also free up equity capital.

The adjusted EPS will be lower: CHF 4.29 instead of CHF 4.53. Same with EBIT: CHF 29.3m instead of CHF 30.9m. The fall is due to the discount rate changing from the market rate (IAS 19) to a higher calculatory rate (as for tax calculations for example) for the employee benefit plans.

Update: also see the post regarding Meyer Burger (Ticker: MBTN) switching from IFRS to Swiss GAAP FER (Oct-18-2013)

Due to the change Burkhalter Holding will have to move from the Main Standard to the Domestic Standard.

Media Release: Burkhalter-Holding_Switch_to_Swiss_GAAP_FER_from_IFRS