SEC Chief Accountant to ICOs: Don’t Skimp on Financial Reporting

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The SEC’s chief accountant is cautioning businesses involved with initial coin offerings (ICOs) to be mindful of their financial reporting obligations.

Wesley Bricker, who has served as the regulator’s top accountant since last year, spoke on September 11 before the AICPA National Conference on Banks Savings Institutions, held in Washington, DC. His speech, published by the SEC, covers a range of areas but notably concluded with an aside on ICOs.

After touching on some of the elements of the SEC’s statement on the subject in July – during which time the agency said federal securities laws may apply to some ICOs – Bricker raised a series of questions both issuers and holders of ICOs should consider for financial reporting.

For issuers, questions included:

  • Are there liabilities requiring recognition or disclosure?
  • Are there implications for the provision for income taxes?
  • Are there previously recognized assets that require de-recognition?
  • Are there revenues or expenses requiring recognition or deferral?
  • Is there a transaction with owners, resulting in debt or equity classification and possibly compensation expense?
  • What are the necessary financial statement filing requirements?

Likewise, he advised investors and token owners to ask:

  • Does specialized accounting guidance (such as for investment companies) apply to the holder’s financial statement presentation?
  • What are


    Read more ... source: CoinDesk.com

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