CFund Capital will make financial disclosures in accordance with FASB latest cryptocurrency accounting standards
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According to a post on the FASB website, the Financial Accounting Standards Board (FASB) on January 5, 2023 updated its December 14, 2022, “provisional decision on Accounting and Disclosure of crypto assets.” Updated accounting standards documents indicate that investment companies and non-profit entities should separately report financial statements for their crypto assets in accordance with corresponding requirements.
FASB has also determined that companies will be required to disclose a number of specific items regarding their crypto assets and activities:
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Significant holdings: A company would provide a listing of the specific assets they hold (with a focus on those assets that are deemed to be significant, or material) and would disclose the asset name, the quantity held, along with the cost basis and fair value of holdings
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A reconciliation or roll-forward of crypto assets for the respective period: This would include beginning balances, along with additions, dispositions, gains/losses (whether realized or unrealized), etc. that have occurred during the period to arrive at the ending balance at the end of the period. The Board may also require that companies provide supplemental information stating the cumulative gains/losses of a company’s current holdings
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The fair value of restricted assets and the nature of those restrictions: A company may have tokens that are locked up and otherwise inaccessible to them. In that case, the company would need to disclose this in the disclosures so users of financial statements are able to gain an understanding of which assets are liquid
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Follow the existing disclosure requirements outlined in ASC 820 for fair value measurements more broadly: This would specifically include classification levels within the fair value hierarchy and disclosures of related party transactions
“This is good news for many people in the digital asset industry who have been advocating this change.” CFund…
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