Accounting Treatment of Digital Assets
The rules deciding how a company records the digital assets it holds in its published financial statements.
For years under United States generally accepted accounting principles, holdings were treated as indefinite-lived intangible assets: written down whenever the price dipped below cost, and never written back up until sold. The result was a reported carrying value that could only ratchet downward and that bore little relationship to what the holdings were worth. The Financial Accounting Standards Board changed this with Accounting Standards Update 2023-08, which requires qualifying crypto assets to be measured at fair value with changes recognized in net income, effective for fiscal years beginning after December 15, 2024. Under IFRS, holdings are generally accounted for as intangible assets, or as inventory for broker-traders, so cross-border comparisons of the same holdings can differ.
На практике
Under the older impairment model, a company that bought at one price, saw a sharp drop, and then saw a full recovery would still report the depressed value on its balance sheet until it sold.
Распространённое заблуждение
That the balance-sheet figure equals what a company's holdings are worth, when under the historical impairment model the carrying amount could only fall and routinely understated the position.