Swisscom’s consolidated financial statements in accordance with U.S. GAAP.

After reviewing the background section of the Swisscom AG in your textbook, provide answers to the following questions:

1. Use the information in Note 27 to restate Swisscom’s consolidated financial statements in accordance with U.S. GAAP. Begin by constructing debit/credit entries for each reconciliation item, and then post these entries to columns 2 and 3 using the worksheets provided in the textbook.
2. Calculate each of the following ratios under both IFRS and U.S. GAAP, and determine the percentage differences between them, using IFRS ratios as the base:

Net income / Net revenues
Operating income / Net revenues
Operating income / Total assets
Net income / Total shareholders’ equity
Operating income / Total shareholders’ equity
Current assets / Current liabilities
Total liabilities / Total shareholders’ equity

3. Which of these ratios is most (least) affected by the accounting standards used?

Sample Solution