Cryptocurrency? Digital asset? What’s the accounting?

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02/16/21

Cryptocurrency? Digital asset? We discuss what these terms mean and how they impact your financial statements.

As digital assets continue to make the headlines and push into the mainstream of finance, more questions are popping up on the accounting implications. In this episode, host Heather Horn and guests discuss the emerging asset class of cryptocurrencies and what it means for your financial statements. 

Topics include:

  • 0:29 - The cryptocurrency landscape: We begin with a brief introduction and explanation of the crypto markets and a look at what’s happening in the US from a regulatory standpoint.
  • 9:22 - Digital assets: We cover the different types of digital assets and what they are used for.
  • 12:04 - Picking a model: How do you determine the right accounting model to use for digital assets and what does that mean for impairment assessments? We look at:
    • 14:51 - The intangible asset model and how often to assess for impairment
    • 18:21 - How to measure fair value if your digital assets are impaired
  • 22:25 - Crypto custody: Sometimes companies use a custodian for the added security and safety of their digital assets. We discuss whether using a third party impacts the accounting.
  • 27:43 - Future expectations: How will the increasing use and acceptance of digital assets redefine financial services? We close with our thoughts on what the future might look like.

Want to learn more? See our Point of view, Cryptocurrencies: Time to consider plan B.

About our guest

Beth Paul is a partner and topical team leader in PwC’s National Office. In this role, Beth is responsible for a team of consultants that specialize in business combinations and related areas, such as consolidations, disposals, impairments, and segment reporting. Prior to this role, Beth was the Strategic Thought Leader in PwC’s National office, working closely with firm leadership to determine PwC’s position on emerging trends in auditing, accounting, and financial reporting matters.

Kevin Jackson is a director in PwC’s capital markets and accounting advisory practice. Kevin has 11+ years of experience assisting clients with complex accounting and financial reporting issues. Kevin is also a member of the AICPA's digital asset working group that provides interpretive guidance on how issuers and users of digital assets should apply existing accounting literature to their transactions.

About our host

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series, as well as periodic webcasts for the power and utilities industry. With nearly 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Contact us

Heather Horn

Heather Horn

US Strategic Thought Leader, National Professional Services Group, PwC US

David Schmid

David Schmid

International Accounting Leader, National Professional Services Group, PwC US

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