Identifying a performance obligation
IFRSAccurate and consistent revenue recognition is a cornerstone of sound financial reporting for all businesses, ensuring comparability across industries and markets.
Our ‘IFRS Viewpoint’ series provides insights from our global IFRS team on applying IFRSs in challenging situations.
Each edition will focus on an area where the Standards have proved difficult to apply or lack guidance. This edition provides guidance on some of the basic issues encountered in accounting for cryptocurrencies, focussing on the accounting for the holder. A future IFRS Viewpoint will explore other more complex issues, such as those relating specifically to cryptocurrency miners.
What’s the issue?
The popularity of cryptocurrencies has soared in recent years, yet they do not fit easily within IFRS’ financial reporting structure. For example, an approach of accounting for holdings of cryptocurrencies at fair value through profit or loss may seem intuitive but is incompatible with the requirements of IFRS in most circumstances. In this Viewpoint, we explore the acceptable methods of accounting for holdings in cryptocurrencies while touching upon other issues that may be encountered.
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IFRS 18In April 2024, the International Accounting Standards Board (IASB) issued IFRS 18 ‘Presentation and Disclosure in Financial Statements’, replacing IAS 1 ‘Presentation of Financial Statements’ for annual reporting periods beginning on or after January 1, 2027”.
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