News SEC Chief Accountant to ICOs: Don't Skimp on Financial...

SEC Chief Accountant to ICOs: Don’t Skimp on Financial Reporting


- Advertisment -

The SEC’s chief accountant is cautioning businesses involved with initial coin offerings (ICOs) to be mindful of their financial reporting obligations.

Wesley Bricker, who has served as the regulator’s top accountant since last year, spoke on September 11 before the AICPA National Conference on Banks & Savings Institutions, held in Washington, DC. His speech, published by the SEC, covers a range of areas but notably concluded with an aside on ICOs.

After touching on some of the elements of the SEC’s statement on the subject in July – during which time the agency said federal securities laws may apply to some ICOs – Bricker raised a series of questions both issuers and holders of ICOs should consider for financial reporting.

For issuers, questions included:

  • Are there liabilities requiring recognition or disclosure?
  • Are there implications for the provision for income taxes?
  • Are there previously recognized assets that require de-recognition?
  • Are there revenues or expenses requiring recognition or deferral?
  • Is there a transaction with owners, resulting in debt or equity classification and possibly compensation expense?
  • What are the necessary financial statement filing requirements?

Likewise, he advised investors and token owners to ask:

  • Does specialized accounting guidance (such as for investment companies) apply to the holder’s financial statement presentation?
  • What are the characteristics of the coin or token in considering whether, how, and at what value, the transaction should affect the holder’s financial statements?
  • What is the nature of the holder’s involvement in considering whether the issuer’s activities should be consolidated or accounted for under the equity method?

Bricker ultimately cautioned that these are only “illustrative questions” and that, in a refrain from the previous SEC statement, the specifics of the ICO itself would determine what reporting requirements must be met.

“An entity involved in initial coin or token offering activities will need to consider the necessary accounting, disclosure and reporting guidance based on the nature of its involvement,” he told attendees.

Wes Bricker image via PwC

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at [email protected].

Source link


Please enter your comment!
Please enter your name here

Latest news

Why could GLBrain become a great solution to receive support during the crisis?

To support smaller and medium-sized businesses during the ongoing crisis, GLBrain offers services cost-free for all Austrians....

Make Fast and Secure Trades Using is a Cryptocurrency trading platform that allows users to buy and sell their Cryptocurrency in a...

Network Security Using Cryptography: Everything you need to know

This article will describe what is Network Security Using Cryptography and everything you need to know before...

Mercuriex Cryptocurrency Exchange Launches New Utility Token, SURF

MercuriEx Cryptocurrency Exchange, originally developed in 2017, came under new ownership in December 2019. Since taking over the exchange,...
- Advertisement -SEC Chief Accountant to ICOs: Don't Skimp on Financial Reporting

Fungibility: Bitcoin Mixers Favorite Term That No One Understands

Fungibility, perhaps the most important concept when dealing with a decentralized and anonymous currency, but does bitcoin...

Crypto can’t thrive in the real world – but stablecoins can

We can safely say that the hype about cryptocurrencies is pretty much over. The claims of Bitcoin...

Must read

Make Fast and Secure Trades Using is a Cryptocurrency trading platform that...
- Advertisement -SEC Chief Accountant to ICOs: Don't Skimp on Financial ReportingSEC Chief Accountant to ICOs: Don't Skimp on Financial Reporting

You might also likeRELATED
Recommended to you