Stable Coins and Accounting - Issues for a New Digital Currency

 From the "Journal of Accountancy"; December 2020


"The AICPA on Thursday published non-authoritative guidance on issues related to the accounting for digital assets.

The guidance, which consists of 13 questions and answers added to the free practice aid Accounting for and Auditing of Digital Assets, touches on topics including fair value, stablecoins, and how investment companies and broker-dealers should account for digital assets.

The practice aid defines digital assets broadly as digital records, made using cryptography for verification and security purposes, on a distributed ledger. Examples of digital assets include the crypto asset bitcoin, which operates on the Bitcoin blockchain, and ether, which operates on the Ethereum blockchain.

The new guidance is divided among the following five section titles:
  • Meeting the Definition of an Investment Company When Engaging in Digital Asset Activities.
  • Accounting by an Investment Company for Digital Assets It Holds as an Investment.
  • Recognition, Measurement, and Presentation of Digital Assets Specific to Broker-Dealers.
  • Considerations for Crypto Assets That Require Fair Value Measurement.
  • Accounting for Stablecoin Holdings.

“We are confident that this updated practice aid will address some of the questions that have arisen in the digital assets space,” said Matthew Schell, CPA, partner, Crowe LLP, and co-chair of the AICPA Digital Assets Working Group, which oversees the guide. “The Digital Assets Working Group will continue to provide needed guidance and support in this important evolving space.”

The AICPA created the practice aid in December with nonauthoritative guidance on accounting for digital assets. In July, nonauthoritative auditing guidance for digital assets was added to the practice aid.

Comments

Post a Comment

Popular posts from this blog

COVID 19 not Adverse to Venture Capital - MIT Sloan

1.  Analysts expected COVID-19 to take a toll on venture capital.  Instead, 2020 turned out to be the second biggest year for venture capital in history, with funds deploying some $141.9 billion in investments. That left investors feeling highly optimistic coming into 2021. At two recent events — the MIT Sloan Investment Conference and the MIT Fintech Conference — panelists identified  trends they believe will shape the industry post-pandemic : Impact investing continues to gain momentum.  “Impact is not mutually exclusive with financial returns,” said Connie Deng, a senior associate in venture capital at Emerson Collective. “We think they’re mutually beneficial.” Frontier markets  — economies in the developing world — are attractive because of their large, untapped populations, but country-specific dynamics require “a bit of trial and error,” said Amanda Cotterman, a Kenya-based managing partner of Equalife. An investment in standard technology can help revamp archaic industries.  “Th
Read more

What is A Successful Career?

  .....   Eric Eliasson and Lara Mitra synthesize interviews  with industry leaders into 10 career insights..... This article was from the MIT Sloan School of Management and identifies 10 ways to think about a "Successful Career." Ideas include: Diversify your passion portfolio Chase the real air Changing definition of success Planning makes perfect For explanation and more ideas, read the article and you may want to listen in to the related podcast. Here is the link to the article from MIT Sloan.
Read more