Companies need to be careful with accounting for crypto – Accounting Today

Companies need to be careful with accounting for crypto – Accounting Today

As businesses invest funds in cryptocurrencies and sell assets like nonfungible tokens, they should be aware of the accounting and tax issues surrounding them, or risk running afoul of regulators.

With corporations like MicroStrategy and Tesla investing billions of dollars in cryptocurrencies, more companies are considering incorporating crypto into their business operations. The use of crypto presents opportunities and challenges for businesses, but as with any new frontier, there are some unknown dangers, along with enticing incentives. A new paper from Deloitte, Corporates Using Crypto, offers companies an overview of the types of questions and insights they should consider as they determine whether and how to use crypto, including issues related to corporate treasury, strategy, operations, risk, compliance, accounting and tax.

“We’re starting to see more and more corporates recognizing that as retail customers become more comfortable with holding cryptocurrencies, they are looking for other avenues to use that, rather than just investing in it,” said Tim Davis, a risk and financial advisory principal at Deloitte & Touche. “Retail-based companies don’t want to limit a customer that would prefer to pay in crypto by saying, ‘We’re only going to accept payment in regular [currency.]’ Some of that is making sure they’re providing the broadest possible outreach to how customers want to pay for the products and services.”

Concept Of Bitcoin Like A Computer Processor On Motherboard. 3D Scene.

Picasa/3dsculptor – Fotolia

As the value of assets like Bitcoin and Dogecoin rise, customers