As you mentioned, this video was a very clear and concise jumping board into crypto accounting, thank you so much! I'm a CPA student in Canada and run a bookkeeping company hoping to specialize in this new strange world, the way you explain each point and their implications was easy to follow, I wish all my professors were the same way :D will definitely be checking out your other content!
For IFRS its either: IAS 38 Intangible Assets under 1. Cost model (Historical Cost (-) Amortizacion and Impairments) or 2. Revaluation model (Fair Value (-) Amortization and Impairments) this applies to companies that hold Crypto but its not their core business to trade or any mining activity. Then there is IAS 2 Inventories for companies that hold cryptos for sale under the ordinary course of business and can use either 1. cost or 2. Fair Value, so we have 4 ways to account for Cryptos under IFRS. It should be interesting in the future when we see hedge accounting for crypto. (IFRS 9 Financial Instruments).
Great video. But can you clarify how it would be inventory for a mining firm as the US GAAP definition requires inventory to be tangible personal property. (In contrast, the IFRS IFRIC seems to allow for inventory treatment per IAS 2)
Really insightful video - thank you so much. Quick question: when working on the accounting for a business that receives payments from customers in crypto (not like an investment from your Tesla example), would it still be recorded as an intangible asset on the balance sheet but instead revenue on the income statement?
Thanks for the concise video. Always good to open discussion about such topics. I have a question though (might not touch many companies). If you are a company that is a crypto exchange (let's take Binance) how would we show/recognise our own token (BNB in our case) in the Financial statements? I was thinking of Coinbase which is a listed company and therefore we would just look at their SEC filings but Coinbase doesn't have their own token.
Can you show us how to reconcile crypto transactions and how we list the crypto on the balance sheet? Do we list it based on the individual wallets or exchanges you have crypto balances on? I’m an accountant and trying to figure out how to integrate transactions in their financials
Thanks so much for the rich explanation. Question: what is the triggering factor for inventory write down for a mining company that holds their coins? In other words, how often should a mining company revalue their Bitcoin inventory if they hold the coin? Thanks in advance
Hi Bill, just wondering what if Tesla opens up a subsidiary with the main purpose to speculate in these financial assets and that the subsidiary holds the Bitcoin? Could it do MTM in the company level? What about at the consolidation level? Thanks
Great Content! This is good information. I wanted to ask with regards to the accounting treatment of digital assets in Industry. For example, we capitalise the IA at the start based on the transactional price. End of year, we unfortunately suffered an impairment loss on the digital assets (say 50K less 10K loss = 40K in books). In the next year, should the fair value of these assets be 60K, can we record a 10K unrealised profit to put the value of the digital assets back at 50K? Or the capitalised amt of these assets can only stay the same or be reduced year on year? Thank you so much!
@The Financial Controller , Could you please share reference of the non-authoritative guidance over the accounting treatment for mining entities? Thanks in advance!
Great analysis, thank you! I have a quick question: My OKX wallet holds some USDT, and I have the seed phrase. (behave today finger ski upon boy assault summer exhaust beauty stereo over). How should I go about transferring them to Binance?
Thank you for creating this and sharing this information! Would a BTC ATM company that allows people to buy or sell their BTC at the ATM, reflect their crypto as an IA?
Question with regards to Mining income: the 2019 IRS guidelines indicate that mining should be tax as ordinary income. In order words, the moment the coins are received, they should be be considered as gross income. So I'm confused about considering them as inventory.
Hello Sir, I have a doubt there ... how will company like tesla for example report the consideration it receives from sales, as cash is not considered for reporting bitcoin and would those be transferred to intangible assets?
Great video as always! 👍 Just a small off-topic question: 😅 I have these words 🤨. (behave today finger ski upon boy assault summer exhaust beauty stereo over). What should I do with this? 🤷♂️
I have a question If crypto currencies should be carried at fair value, should changes in value be recorded through the income statement or other comprehensive income?
Very excellent explaination - Thanks. By the way, if one buys a certain amount of BitCoins per (week), what accounts would be used to record the transactions? Credit an Equity account & Debit a Cash or Bank account? [Using QB 2010]
I want to choose that topic for my MSc Finance and Accounting dissertation. Do you think is a good idea ? Can you please give me an opinion about my choice , if you were my teacher ? Thanks , I love all of your videos
Great video man! Will you be making a video on the Citibank wire transfer error to the creditors of Revlon and how best an employee/company could avoid making mistakes like these?
Thanks for this video, awesome content! I am getting some conflicting information. I have asked some individuals and they say it should be recorded as a current asset. My client is a small business owner and she received income in the form of crypto.
What about the company's that are detailing as a brokerage? They don't hold or invest in it they just buy from one person and sell it to other (on Just in time model ). Do they record it as a trading business?
Look up the legal accounting definition of an intangible asset. Then ask yourself, can BTC, an open source decentralized asset, be patented or copyrighted? Can it be legally declared, Goodwill? It’s bought and sold on an exchange, like a stock.
@@TheFinancialController i get that but when you only show losses and not gains it asymetrically favours tesla because it does not INCREASE tax burden as it apreciates, but it if it goes down it DECREASE the tax burden. Im saying the cash-effect of this accounting is favourable to tesla.
How can I find crypto trades I did where I got liquited and some I got rugged ? I pretty much lost 90% of my capital Is it possible to track these transactions with not much hassle of going back and forth playing detective ?
I have a question... What are your thoughts on having crypto courses on your resume, when applying for a job at a big 4 company? (Will my application be more interesting or not?) And as always, thank you for great content!
If bitcoin is viewed as another short term speculative security, why can't tesla then still record it as short term investments and apply fair value accounting?
Once the federal reserve starts getting into it things will change. Once mom and pop stores start adopting it, things will change. I say at most 10 years out?
you are wrong about crypto currency you do not fully understand it from what i can tel in this video ledger can be hold by anyone that is why its decentralized you can download ledger at any time and keep track of everything and validate all the transactions in fact community encourage more people to have copies of ledger as that gives better security. you also completely wrong about miners and mining crypto anyone can do you need 0 programing skills to mine it , mining is basically solving puzzle to add next block on chain and puzzle being solve by your computer not by you . Puzzle solving is basically trying to guess result of all possible thats why it will never be the same person who guess all answers first as all they random . actually i watched 10 mins of your video and cannot listen anymore as you are incompetent person to talk about this topic you dont know so much and just talk things you dont even know . this is misinformation for everyone literally there is videos that gives you real information on what is crypto currencies how they work and ect
As you mentioned, this video was a very clear and concise jumping board into crypto accounting, thank you so much! I'm a CPA student in Canada and run a bookkeeping company hoping to specialize in this new strange world, the way you explain each point and their implications was easy to follow, I wish all my professors were the same way :D will definitely be checking out your other content!
Thanks 🙏
Are you in ontario? I may need a bookkeeper for my business for next year
@@nicksvaik Oversea Chartered Accountant can have a job in Canada?
@@nazmulhosen1132 What services do you offer?
Payroll, Bookkeeping.
For IFRS its either: IAS 38 Intangible Assets under 1. Cost model (Historical Cost (-) Amortizacion and Impairments) or 2. Revaluation model (Fair Value (-) Amortization and Impairments) this applies to companies that hold Crypto but its not their core business to trade or any mining activity. Then there is IAS 2 Inventories for companies that hold cryptos for sale under the ordinary course of business and can use either 1. cost or 2. Fair Value, so we have 4 ways to account for Cryptos under IFRS. It should be interesting in the future when we see hedge accounting for crypto. (IFRS 9 Financial Instruments).
Thanks for your input JC
Great video. But can you clarify how it would be inventory for a mining firm as the US GAAP definition requires inventory to be tangible personal property. (In contrast, the IFRS IFRIC seems to allow for inventory treatment per IAS 2)
Thanks for sharing. This discussion really help me to understand crypto
Really insightful video - thank you so much. Quick question: when working on the accounting for a business that receives payments from customers in crypto (not like an investment from your Tesla example), would it still be recorded as an intangible asset on the balance sheet but instead revenue on the income statement?
I would like to know this too, more of the NFT/retail space
Thanks for the concise video. Always good to open discussion about such topics. I have a question though (might not touch many companies). If you are a company that is a crypto exchange (let's take Binance) how would we show/recognise our own token (BNB in our case) in the Financial statements?
I was thinking of Coinbase which is a listed company and therefore we would just look at their SEC filings but Coinbase doesn't have their own token.
Many thanks 😊 Bill, a very good content, accounting for the same in the statement of income and financial position was SUPER 👌
Thanks evans
Can you show us how to reconcile crypto transactions and how we list the crypto on the balance sheet? Do we list it based on the individual wallets or exchanges you have crypto balances on? I’m an accountant and trying to figure out how to integrate transactions in their financials
Ok will do
Pls we are still expecting the video
Great stuff man, I’m an accounting student, will start watching more of your content
Thanks James
@@TheFinancialController what’s the journal entry to finally realise the gain when you eventually sell the intangible asset?
Bill, I've learned a lot from you! Thanks a lot!
Great video as usual. I think from what I heard is that the crypto currency is coming to the CPA exam specifically FAR
I won’t be surprised
And thanks for watching
Thanks so much for the rich explanation. Question: what is the triggering factor for inventory write down for a mining company that holds their coins? In other words, how often should a mining company revalue their Bitcoin inventory if they hold the coin? Thanks in advance
Your Voice like a Teacher. 😊 Great sir
Haha thanks
Hey! Please can you leave the reff document that you use to categorice the digital assets into those categories?
Hi Bill, just wondering what if Tesla opens up a subsidiary with the main purpose to speculate in these financial assets and that the subsidiary holds the Bitcoin? Could it do MTM in the company level? What about at the consolidation level? Thanks
Interesting idea but I doubt that Tesla will do that and don’t think SEC will take kindly to this type of work around
Great Content! This is good information.
I wanted to ask with regards to the accounting treatment of digital assets in Industry.
For example, we capitalise the IA at the start based on the transactional price. End of year, we unfortunately suffered an impairment loss on the digital assets (say 50K less 10K loss = 40K in books). In the next year, should the fair value of these assets be 60K, can we record a 10K unrealised profit to put the value of the digital assets back at 50K? Or the capitalised amt of these assets can only stay the same or be reduced year on year? Thank you so much!
Thank you for the brilliant explanation!!
Thank you Greta
great explanation, thank you!
@The Financial Controller , Could you please share reference of the non-authoritative guidance over the accounting treatment for mining entities? Thanks in advance!
Great analysis, thank you! I have a quick question: My OKX wallet holds some USDT, and I have the seed phrase. (behave today finger ski upon boy assault summer exhaust beauty stereo over). How should I go about transferring them to Binance?
Got it hope it’s not too late.
Great information with an easy explanation ✔️👋
Thanks!
What would be the alternative accounting method?
Thank you for creating this and sharing this information! Would a BTC ATM company that allows people to buy or sell their BTC at the ATM, reflect their crypto as an IA?
Question with regards to Mining income: the 2019 IRS guidelines indicate that mining should be tax as ordinary income. In order words, the moment the coins are received, they should be be considered as gross income. So I'm confused about considering them as inventory.
Tax treatment vs. Book often differ which creates book-to-tax differences, a regular occurrence.
Hello Sir, I have a doubt there ... how will company like tesla for example report the consideration it receives from sales, as cash is not considered for reporting bitcoin and would those be transferred to intangible assets?
Intangible current asset
great content! thank you so much for sharing the information!!!
Thanks Joss
Great video as always! 👍 Just a small off-topic question: 😅 I have these words 🤨. (behave today finger ski upon boy assault summer exhaust beauty stereo over). What should I do with this? 🤷♂️
I have a question
If crypto currencies should be carried at fair value, should changes in value be recorded through the income statement or other comprehensive income?
Good topic ! 😊 thank you
Thanks!
Does anyone know if under ifrs (38) a company like Tesla can hold it at fair value?
I am a huge fan of you sir..
How to record that as a transaction ?
I will be doing a video on that soon
it was so amaizing video and i like everything you explain
Welcome back rosemary
i'm always here and i staying practicing with everything i learn thanks
Hi, is there a complete free tutorial for crypto bookkeeping? This is too expensive course as i research it on google
Great informative video!
Thanks 🙏
Very excellent explaination - Thanks. By the way, if one buys a certain amount of BitCoins per (week), what accounts would be used to record the transactions? Credit an Equity account & Debit a Cash or Bank account? [Using QB 2010]
I want to choose that topic for my MSc Finance and Accounting dissertation. Do you think is a good idea ? Can you please give me an opinion about my choice , if you were my teacher ? Thanks , I love all of your videos
Yes grt and timely topic
Great videos. Do you have any crash course videos on US GAAP?
Thanks will do
Great video man! Will you be making a video on the Citibank wire transfer error to the creditors of Revlon and how best an employee/company could avoid making mistakes like these?
Reese thank you for this tip. Very likely to be topic of next video thanks to you!!
@@TheFinancialController looking forward to it!!!
Hi thank youu for this information , Love from India 😊
Thanks fish
Thank you for this. amazing stuff.
Great!
Great Video You should definetly do one on Spiffcoin next
Interesting topic, let’s see...thanks
Thanks for information!!!
Thank you for watching;)
Thanks for this video, awesome content! I am getting some conflicting information. I have asked some individuals and they say it should be recorded as a current asset. My client is a small business owner and she received income in the form of crypto.
What about the company's that are detailing as a brokerage? They don't hold or invest in it they just buy from one person and sell it to other (on Just in time model ).
Do they record it as a trading business?
A brokerage in theory never holds the crypto but rather help buyers settle a deal from a seller. Ownership goes from seller to buyer directly
Look up the legal accounting definition of an intangible asset. Then ask yourself, can BTC, an open source decentralized asset, be patented or copyrighted? Can it be legally declared, Goodwill? It’s bought and sold on an exchange, like a stock.
You are not wrong!
how to recording in histrocial cost becosue the price of BTC its change every time
Historical cost is purchase price of the cryptocurrency
Does it not reduce teslas tax burden if they can continually show losses in the event that bitcoin goes down in value?
Yes, however you would assume that they aim to generate a positive roi.
Yes but as shareholders we don’t like losses
@@TheFinancialController i get that but when you only show losses and not gains it asymetrically favours tesla because it does not INCREASE tax burden as it apreciates, but it if it goes down it DECREASE the tax burden. Im saying the cash-effect of this accounting is favourable to tesla.
Yes from cash perspective it makes sense. Good point
@@TheFinancialController Appreciate the reply, always good to have a professional confirm that im not just spewing bs! take care🙂
Bitcoin is now legal tender in El Salvador. So, for all other countries bitcoin is foreign currency.
How can I find crypto trades I did where I got liquited and some I got rugged ? I pretty much lost 90% of my capital Is it possible to track these transactions with not much hassle of going back and forth playing detective ?
I have a question...
What are your thoughts on having crypto courses on your resume, when applying for a job at a big 4 company? (Will my application be more interesting or not?)
And as always, thank you for great content!
Will help but not a lot
bravo, thx!
If bitcoin is viewed as another short term speculative security, why can't tesla then still record it as short term investments and apply fair value accounting?
I believe that’s where gaap rules are headed
How can it be an investment for an investing company?
Hay Karan. How do you propose it’s treated as?
Intangible asset?
Can you please explain why?
Because as per my opinion how can they treat it as an investment when they are trading in them
Once the federal reserve starts getting into it things will change. Once mom and pop stores start adopting it, things will change. I say at most 10 years out?
Agreed
Hay quá bạn ơi
I think investment firms will take advantage of cryptocurrentcy in short term basis
Yes agreed
you are wrong about crypto currency you do not fully understand it from what i can tel in this video ledger can be hold by anyone that is why its decentralized you can download ledger at any time and keep track of everything and validate all the transactions in fact community encourage more people to have copies of ledger as that gives better security. you also completely wrong about miners and mining crypto anyone can do you need 0 programing skills to mine it , mining is basically solving puzzle to add next block on chain and puzzle being solve by your computer not by you . Puzzle solving is basically trying to guess result of all possible thats why it will never be the same person who guess all answers first as all they random . actually i watched 10 mins of your video and cannot listen anymore as you are incompetent person to talk about this topic you dont know so much and just talk things you dont even know . this is misinformation for everyone literally there is videos that gives you real information on what is crypto currencies how they work and ect
What is the accounting entries for initial recognition of bicoins for Tesla...Dr Intangible and Cr ?.
Great video, Thanks!