The Australian government’s financial reporting standards agency is pushing for international action in the area of digital currencies.
The Australian Accounting Standards Board (AASB), a government agency tasked with overseeing the country’s reporting standards, has published a new position paper ahead of a December meeting of members from the International Accounting Standards Board (IASB). In sum, the paper argues that a more defined standard is needed both for digital currencies as well as other kinds of intangible assets.
The question of accounting standards has come up in the past, but the AASB’s paper might be one of the more consequential to date. Its release comes amid a controversial move by the Internal Revenue Service, the top US tax agency, to seek user records from digital currency exchange Coinbase.
According to the AASB paper, “clear” guidance is needed by accountants working with individuals or companies that handle digital currencies.
The paper’s author, Deloitte director Henri Venter, wrote:
“In our opinion, given the problems identified and the rapid growth of digital currencies, standard setting activity is required to provide clear accounting guidance for preparers and to ensure that financial statements provide relevant and useful information to users of those financial statements.”
Yet such a move would only solve part of the problem, the paper goes on to argue. At the heart of the issue is that there is a deeper lack of standards for so-called “intangible assets”, which would include digital currencies.
“…there is no accounting standard that deals with investments in intangible assets or other commodity type assets that are not financial instruments or inventory,” the paper notes. “Consequently, we recommend that the IASB develop a standard that would address the accounting for investments in intangible assets and commodities.”
The Accounting Standards Advisory Forum, a body within the IASB, is set to meet on 8th and 9th December in London. According to documents published by the IASB, members will offer their takes on possible paths to creating standards for digital currencies.
The full paper can be found below:
1612 ASAF 05 AASB DigitalCurrency by CoinDesk on Scribd
Image via Shutterstock