Cash & Cash Equivalent .

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  • #240862

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    Mogtaba Mohammed
    Participant

    If the company owned a cryptocurrencies where it should Presented it in the balance sheet and what is accounting transaction for cryptocurrencies ? 

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  • #240867

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    Lynn Roden
    HOCK international

    Hello Mogtaba Mohammed,

    That is an interesting question. The FASB has not issued any standards for accounting and reporting on cryptocurrency, and as of now, the FASB has not even added any project to its agenda to consider any different accounting treatment for it. So accountants have tried to answer the question using existing accounting standards. Cryptocurrencies do not fit the definition of cash or financial instruments, and most accountants consider them intangible assets with an indefinite life. However, that creates problems under US GAAP because US GAAP does not permit intangible assets to be written up if they gain in value–they can only be written down if they lose value from their original purchase price. (IFRS, though, does permit intangible assets to be written up.)

    Here is a link to an article about accounting for and reporting cryptocurrencies:

    https://www.mergersandinquisitions.com/cryptocurrency-accounting/

    If you want to really dig into it, I am also attaching a document published by the AICPA on the topic.

    Lynn

    #240965

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    Mogtaba Mohammed
    Participant

    Thank you for the helpful information .

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