1. IFRS 9 Financial Instruments
Applicability: This standard is often applied to cryptocurrencies that are held for trading purposes.
Key Provisions:
- Classification and Measurement: Crypto-assets might be classified as financial assets at fair value through profit or loss, particularly if they are held for trading.
- Impairment: IFRS 9 requires entities to measure and recognise impairment losses on financial assets.
- Derecognition: Guidelines on when to remove a financial asset from the balance sheet.
2. IAS 38 Intangible Assets
Applicability: Cryptocurrencies are often accounted for as intangible assets when they are held for reasons other than trading.
Key Provisions:
- Recognition and Measurement: Initial recognition at cost and subsequent measurement can be either at cost less any accumulated amortization and impairment losses or revalued amount.
- Impairment Testing: Regular impairment testing and recognition of impairment losses.
3. IAS 2 Inventories
Applicability: Applied when cryptocurrencies are held for sale in the ordinary course of business.
Key Provisions:
- Measurement: Cryptocurrencies held as inventory are typically measured at the lower of cost and net realizable value.
- Cost Formulas: The standard provides guidance on cost formulas that can be used to assign costs to inventories.
4. IFRS 15 Revenue from Contracts with Customers
Applicability: Relevant when a company enters into transactions involving cryptocurrencies in exchange for goods or services.
Key Provisions:
- Revenue Recognition: Provides a framework for the timing and amount of revenue recognition, which may be relevant when crypto-assets are used in sales transactions.
5. IFRS 13 Fair Value Measurement
Applicability: Relevant for measuring the fair value of cryptocurrencies, especially under IFRS 9 and IAS 38.
Key Provisions:
- Fair Value Hierarchy: Outlines a fair value hierarchy and requires entities to maximise the use of observable inputs and minimise the use of unobservable inputs when measuring fair value.
Disclosure: Requirements for disclosures about fair value measurements.
6. IAS 1 Presentation of Financial Statements
Applicability: Provides overall guidance for the presentation of financial statements, applicable to all aspects of crypto-assets reporting.
Key Provisions:
- Classification and Disclosure: Guidance on the classification of crypto-assets on the balance sheet and the related disclosures in the financial statements.
7. IAS 12 Income Taxes
Applicability: Relevant for accounting for income taxes related to transactions involving cryptocurrencies.
Key Provisions:
- Deferred Tax: Deals with the recognition of deferred tax assets and liabilities for future tax consequences of transactions, including those involving cryptocurrencies.
Conclusion
While IFRS does not have standards specifically designed for cryptocurrencies, the existing standards provide a framework for accounting and reporting these assets. The choice of the appropriate standard depends on the nature of the cryptocurrency and the purpose for which it is held. As the digital asset landscape continues to evolve, there may be further developments or specific guidance issued by the IFRS Foundation or the International Accounting Standards Board (IASB) in the future.
