Project process
Projects of the Foundation for Accounting and Reporting Recommendations generally run through two successive phases:
Selection of the topics
What determines which topics are selected are the timeliness and significance of the problem for the practice of accounting and reporting. The Executive Committee drafts in each case a work programme, which is then discussed and approved by the Commission. The work programme contains the topics to be worked on, the urgency of the work and the timeframe.
Phase 1: Review procedure
The review procedure is a pre-project phase, in which the timeliness, relevance and comprehensiveness of an existing recommendation are verified and / or an inventory of a current topic or important urgent problem is prepared.
The Commission (within the framework of the discussion and adoption of the Executive Committee’s work programme) commissions the Executive Committee to perform a review procedure. The Executive Committee is the operational body that supports and monitors the internal working group appointed for the review procedure to ensure that all important topics are addressed and prioritised in line with the Commission. The appointed working group is instructed to base its information and analyses broadly and can therefore also consider external information such as feedback from practitioners, academic literature, expert opinions, etc. Depending on the complexity and scope, a review procedure can take between a few months up to roughly 1 year. The result of the review procedure serves as a basis for the Commission to decide on further steps, which may include initiating a project to revise an existing or prepare a new recommendation. The results of the review procedure are publicly communicated.
Grounds for a review procedure:
- Ensure the timeliness, relevance and comprehensiveness of the recommendations
- Assist in the case of application difficulties
- Eliminate regulatory gaps and overregulation
- Safeguard the practical relevance of the Swiss GAAP FER
Phase 2: Project implementation
Depending on the outcome of the review procedure, the Commission may decide to implement a project, which means that the project would enter Phase 2. Alternatively, however, the Commission can also conclude after the review procedure that no adjustments are necessary, in which case there would be no further steps after Phase 1.
The duration of the project again strongly depends on the project scope, the complexity and the various claims of interest groups. On average, Phase 2 lasts about 2 years. Smaller topics that can be relatively well delineated can be processed faster.
Project implementation (Phase 2) is divided up as follows:
0.
Review procedure / project evaluation (Phase I)
1.
Preparation of a first draft:
Subcommittees appointed by the Executive Committee prepare a draft.
2.
Discussion and revision of the draft:
The Executive Committee discusses and revises the drafts with representatives of the subcommittees.
3.
Finalisation and adoption of the draft:
The corrected draft recommendation is handed to the Commission.
4.
Consultation period:
The consultation text is published in relevant professional journals, specialist publications and on the website of Swiss GAAP FER.
5.
Revision based on consultation comments:
The Executive Committee ensures that the consultation comments are taken into account in drafting the final version.
6.
Resolution and enactment:
A recommendation can only be put into effect with the approval of a qualified majority of the Commission.