Across industries, visionary CEOs are turning to blockchain to reinvent the nature of commercial transactions and increase the value of their businesses. Moving beyond the hype and promise, those already using blockchain and those considering implementing it need to understand their regulatory, tax and accounting obligations to manage risk and safeguard value.
Aprio, LLP has been providing blockchain accounting, tax and consulting services to companies for over five years. This experience has enabled us to develop accounting and financial reporting best practices that help companies navigate the domestic and international accounting and tax obstacles associated with cryptocurrency and blockchain accounting. Let Aprio help you maximize the value of your blockchain ventures.
How a Blockchain CPA Firm Can Build Value for Your Organization
Let Aprio simplify your blockchain accounting to operationalize your blockchain business model. From entity structure to tax strategy, we help you fully realize the benefits that blockchain can deliver, including:
- Better transaction tracking and forecasting through double-entry accounting
- Distributed ledgers for real-time transactional transparency
- Streamlined trade and supply chain finance through blockchain banking
- Verification of performance and enforcement of negotiations using smart contracts
More specifically, here are some of the common blockchain tax and accounting challenges that Aprio helps domestic and international organizations resolve every day:
- Understand the tax and GAAP consequences of your cryptoassets and token activities
- Recognize revenue of tokens for tax and GAAP, including deferral of revenue and timing of recognition
- Determine whether the issuance in exchange for cryptocurrencies or fiat should be recognized as revenue, liability or equity for tax and GAAP purposes
- Save significant income tax by adjusting your fiscal year end
- Understand the cost and benefits of doing your token sale as an LLC versus a C-corporation
- Implement the best approach to track crypto-transactions and calculate realized and unrealized gain/loss for tax and GAAP purposes
- Account for the tax and GAAP consequences of transferring virtual currency to your employees and non-employees
- Determine if your company is eligible for a reduced tax rate if you sell tokens to non-U.S. buyers
- Determine if you qualify for the new Foreign-Derived Intangible Income (FDII) deduction
- Reduce your U.S. effective corporate tax rate on U.S. R&D initiatives with state and federal R&D tax credits
- Understand the tax consequences for U.S. controlled foreign corporation’s participation in a token sale
- Position foreign subsidiaries participating in token sales for U.S. income tax purposes
- Understand how the new Tax Cuts and Jobs Act provisions, such as GILTI and FDII, will impact your foreign corporation’s token sale
- Address consolidation requirements under the Variable Interest Entity (VIE) rule
- Account for incoming and outgoing cryptocurrencies and tokens
- Understand how ASC 606, Revenue from Contracts with Customers, will impact your net income and KPIs such as EBITA, for reporting periods after the mandatory private company adoption deadline of Dec. 15, 2018
Blockchain Audit Readiness Services: Assess and Improve Your Blockchain Accounting Controls
Accuracy and reliability of your accounting transactions and financial records are critical to making strategic business decisions and ensuring smooth audits. The accounting complexities associated with the blockchain distributed ledger, such as triple-entry bookkeeping, can prove challenging when preparing for audit. Aprio provides audit readiness services to help clients minimize risks and ease the stresses of audits of their blockchain ventures.
We support your leadership and your accounting team in improving the quality of financial information by identifying opportunities to improve the efficiency and effectiveness of the internal controls of key operating cycles. We assist in the assessment and improvement of:
- Reconciliations, such as transactions to/from your wallet, your proprietary platform, the blockchain and the general ledger
- Realized and unrealized gain/loss calculations and corresponding adjustments to your cryptoasset balances
- Templates that help supply information for the audit
- KPI models relevant for your business
Throughout this process, we also advise and train your accountant/bookkeeper to ensure a smooth transition.
Blockchain Services from Aprio
Regardless of whether your company is currently on the blockchain or planning a blockchain implementation, Aprio’s blockchain advisors help you move forward with confidence. From blockchain accounting and financial reporting to domestic and international tax compliance, leverage Aprio’s blockchain expertise to find your company’s next.
Contact Mitchell Kopelman or more information about Aprio’s blockchain accounting services.
Initial Coin Offering Services
Aprio LLP offers services related to initial coin offerings and crypto-currencies. These services are tax related and offered through Aprio LLP. Any information contained on Aprio’s website is for general purposes and is not intended to imply investment advice.