The American Institute of Certified Public Accountants Digital Assets Working Group recently updated a practice aid, Accounting for and auditing of digital assets, to include three new accounting sections, which address:
- Contracts involving derivatives and embedded derivatives
- Crypto asset lending
- Mining
Other accounting matters discussed in this practice aid include:
- Classification and measurement when an entity purchases crypto assets
- Recognition and initial measurement when an entity receives digital assets that are classified as indefinite-lived intangible assets
- Subsequent accounting for digital assets classified as indefinite-lived intangible assets
- Measurement of cost basis of digital assets that are classified as indefinite–lived intangible assets when derecognized
- Derecognition of digital asset holdings that are classified as indefinite-lived intangible assets
- Recognition of digital assets when an entity uses a third-party hosted wallet service
- 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
The audit-related content of the practice aid addresses:
- Client acceptance and continuance
- Risk assessment and processes and controls
- Laws and regulations and related parties
The practice aid also includes a blockchain universal glossary.
