In our comment letter responding to the FASB’s proposed ASU, Intangibles – Goodwill and Other – Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, we generally agree with the FASB’s proposal and believe that fair value is the most appropriate way to measure crypto assets. However, we offer some suggestions designed to enhance the understandability and operability of the guidance, especially by clarifying the scope criteria and disclosures around a crypto asset’s cost basis.
Further, we believe that it would be beneficial to add a project to the FASB’s agenda focusing on how to recognize and derecognize crypto assets. While entities currently follow the intangible assets guidance for recognizing and derecognizing crypto assets, the economics underlying many crypto asset transactions is actually more similar to the economics of financial assets. Since the recognition and derecognition guidance in U.S. GAAP significantly differs for nonfinancial and financial assets, we believe that clarifying which model better reflects the economics of crypto asset transactions would benefit the practice overall.
Download our letter to read our comments in full.