Washington, D.C. - Today, Congressman Tom Emmer (MN-06), along with the Congressional Blockchain Caucus, sent a letter to Chairman Richard Jones of the Financial Accounting Standards Board (FASB) urging the establishment of appropriate accounting standards for companies with digital asset holdings. Currently, the FASB has not developed any accounting standards for bitcoin holdings, and uniform accounting standards are needed to provide companies and stakeholders the necessary clarity to confidently engage with these assets.
Specifically, Congressman Emmer's letter recommends that the FASB update its definition of financial instrument to include digital assets and consider that companies hold digital currencies for varying purposes when assigning one of four different appropriate accounting standards.
"The growth of digital assets has been staggering and will only continue to rise. To ensure clear rules of the road, authoritative accounting guidance from the FASB is imperative. Companies with bitcoin holdings deserve clarity. If our institutions do not keep pace, engagement with digital assets will stall. I am urging the FASB to take the lead and issue guidance that will encourage the ongoing growth of this industry," said Emmer.
“With clear and appropriate authoritative accounting standards, companies will be able to clearly reflect the value of their digital asset holdings on their balance sheets, which offers investors and stakeholders more transparency and strengthens our markets," Emmer concluded.
"This is an important statement to establish much needed accounting standards for digital assets. Without this authoritative guidance, companies fortifying their balance sheets with digital assets are left to figure out the appropriate accounting method on their own – a barrier to adoption. The leadership of Congressman Emmer and Members of the Caucus will help clear a major obstacle preventing the United States from establishing a clear regulatory framework for digital assets. This letter is a great step towards strengthening U.S. competitiveness in this growing industry,” said Amy Davine Kim, Chief Policy Officer, Chamber of Digital Commerce.
"As an increasing number of major, mainstream companies hold or plan to hold digital assets on their balance sheets, it’s vital that policymakers put forward well-structured, clear accounting and reporting standard for those assets. Cultivating a transparent and considered accounting standard is integral for the increased mainstream adoption of digital asset investment. We commend Congressman Emmer and the other members of the Blockchain Caucus as they pursue consistent, pro-growth regulatory policies, ensuring the United States remains a leader in the digital asset economy," said Kristin Smith, Executive Director of the Blockchain Association
The way digital assets are accounted for on balance sheets has significant impact on financial statements and companies’ bottom lines. The Financial Accounting Standards Board (FASB) has not issued any accounting standards for digital assets. This results in companies conforming to non-authoritative guidance, and the lack of accounting certainty impacts stakeholders and financial statements. It also discourages companies from buying, holding, and using digital assets.
Read the letter here.