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Ernst & Young Monthly News July 2008

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Tax and Transfer Pricing – Considerations for Offshoring Activities

(PDF, English, 356 kB)
Source: Der Schweizer Treuhänder 2008|6–7
Authors: Salim Damji, Georg Freimoser, Ernst & Young

Offshoring has developed as a result of economic pressure in some markets to one of the top strategic matters of many multinational enterprises. Besides the operational issues of these activities, the resulting transfer pricing and tax implications should also be considered.

Tax issues as per the draft on stock corporation and financial reporting law – points for discussion with regard to the key changes from a tax perspective stipulated in the message on the Swiss Code of Obligations

(PDF, German, 325 kB)
Source: Der Schweizer Treuhänder 2008|6–7
Authors: René Röthlisberger, Sarah Pflüger-Niggli, Ernst & Young

The draft and message on the revised stock corporation and financial reporting law contain some important changes from a tax perspective. This article addresses these issues and pinpoints the areas where changes can be expected and where there is need for action on further amendments. Special attention is paid to the newly introduced option of using financial statements prepared in accordance with a recognized accounting standard for tax purposes.

Tax issues as per the draft on stock corporation and financial reporting law – points for discussion with regard to the key changes from a tax perspective stipulated in the message on the Swiss Code of Obligations

(PDF, French, 171 kB)
Source: L'Expert-comptable suisse 2008|6–7
Authors: René Röthlisberger, Sarah Pflüger-Niggli, Ernst & Young

Summary in French of the Article "Tax issues as per the draft on stock corporation and financial reporting law – points for discussion with regard to the key changes from a tax perspective."

Fair-value balance sheet accounting for development properties

(PDF, German, 339 kB)
Source: Der Schweizer Treuhänder 2008|6–7
Authors: Daniel Zaugg, Christian Krämer, Rolf F. Bach, Ernst & Young

In October 2007 the IASB proposed various amendments to the International Financial Reporting Standards. One of these changes will have significant ramifications for the real estate sector. From now on development properties are to be reported in the balance sheet at fair value, and changes in value are to be booked to the income statement.

Taxes and financial statements

(PDF, French, 3.89 MB)
Source: Der Schweizer Treuhänder 2008|6–7
Authors: Marie-Hélène Revaz et Eric Duvoisin, Ernst & Young

This articles touches upon certain aspects relating to international standards, focussing specifically on taxes that come under IAS 12 "Tax on profit from ordinary activities", FAS 109 "Accounting for income taxes" or Swiss GAAP ARR 11 "Taxes". It recaps some basic concepts and then uses an example to illustrate the effective tax rates of the group seen as a performance indicator by market participants.

More rules for small businesses

(PDF, German, 116 kB)
Source: Handelszeitung | no. 12 | June 11–17, 2008
Authors: Roger Amhof, Markus Oppliger, Ernst & Young

Since the beginning of the year Swiss legislation has required more of SMEs in terms of risk management. Small businesses must now also formalize the way they deal with risks and sharpen the controls they have in place to manage them.

Don't forget VAT!

(PDF, French, 520 kB)
Source: Le Temps, June 11, 2008
Author: Patrick Conrady, Ernst & Young

Companies often perceive VAT as a risk. In the real estate sector, however, it can be used to optimize sales prices.

New Head of Corporate Communications and Marketing at Ernst & Young

(Media release, HTML, English, German, French)

Zurich, 9 June 2008 – Dr Alfred Raucheisen (42) assumed the position of Head of Corporate Communications and Marketing at Ernst & Young Switzerland at the start of June 2008. He was previously a researcher and lecturer at the Institute for Communication and Marketing of the University of Applied Sciences and Arts in Lucerne. Mr Raucheisen has ten years of experience in the field of auditing and advisory services. He succeeds Markus Bernhard, who left Ernst & Young in April 2008. Mr Raucheisen lives in Thalwil and is married with two children.

Tax Developments in Switzerland affecting Trusts, Indirect Partial Liquidations and Tax Holidays

(PDF, English, 194 kB)
Source: Bulletin for International Taxation, Volume 62, no. 6, June 2008
Authors: Markus F. Huber, Lionel Noguera, Ernst & Young

This article examines three recent tax developments in Switzerland. The first is the new guideline on the taxation of trusts, which deals with the types of trusts and the taxation of the economic beneficiary (income tax, wealth or annual capital tax, and withholding tax). The second development is the new guideline on indirect partial liquidation, which reframes the scope of this anti-abuse measure by redefining key terms such as "qualifying investments", "distribution" and "reserves distributable under commercial law": The last part of the article updates the federal tax holiday regime, a major instrument of Swiss regional policy: the tax relief under the new law and the areas of economic renewal with respect to which the relief is available.

What is the purpose of an ICS according to Swiss Auditing Standard 890?

(PDF, French, 230 kB)
Source: L'Expert-comptable suisse, 2008|4
Authors: Thomas Stenz, Christine Csibi, Ernst & Young

The responsibilities of the Board of Directors and executive management as well as the remit of the auditors have been defined: the new Swiss Auditing Standard (AS) 890 with regard to verifying the existence of an internal control system (ICS) has been adopted, thus allowing us to put the finishing touches to an arduous project which has been in the pipeline for several years now. This article by the Audit Committee of the Swiss Institute of Certified Accountants and Tax Consultants explains the key points.

Ernst & Young strengthens its organization – Ernst & Young Switzerland appoints 13 new partners

(Media release, HTML, English, German, French)

Zurich, June 27, 2008 – Ernst & Young, the most globally integrated professional services firm, appoints thirteen new partners for the new business year, who will start on 1 July 2008 in the audit, tax, transaction and advisory areas. “Our employees make the difference. These new partners will make us even more of a force to be reckoned with”, states Andreas Müller, Chairman of the Board of Directors for Ernst & Young Switzerland.

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