The principles of accounting

In the area of accounting, there are several principles to observe. Accounting is regulated in Art. 957 et seq. of the Swiss Code of Obligations.

Principles of Accounting

The principles of proper accounting are:

• Accounting must be clear and understandable (Principle of Clarity)
• It must be complete (Principle of Completeness)
• It must be reliable
• It must focus on the essentials (Principle of Materiality)
• It must be cautious (Principle of Conservatism)
• The same standards must always be applied in presentation and valuation (Principle of Consistency)
• Assets and liabilities as well as expenses and revenues must not be offset against each other (Principle of Gross Reporting)
• It assumes that the business will continue to operate for the foreseeable future (Going Concern Principle)

Art. 958c of the Swiss Code of Obligations stipulates that accounting must be adapted to the specifics of the company and the industry, while preserving the statutory minimum content. The annual accounts must be prepared in a national language or in English. If the accounting is not in the national currency, the conversion of values must also be indicated in the national currency and the exchange rates used must be disclosed in the notes. Business books and accounting vouchers must be kept for a duration of 10 years.