In a move to enhance accounting transparency related to virtual asset transactions, the South Korean government will require companies that issue or hold virtual assets to disclose clear and detailed information.
The Financial Services Commission on July 11 added mandatory disclosure items related to virtual assets and discussed the direction of accounting for virtual assets.
“The plan aims to provide more consistent and clear information about companies that issue or hold virtual assets. However, the government has cautioned that the volatility or uncertainty of the virtual asset itself does not decrease just because the accounting standards for virtual assets have been established,” said The Financial Services Commission.
The measures to enhance transparency in accounting and disclosure related to virtual assets include supervisory guidelines for accounting for each transaction related to virtual assets and revision of accounting standards that obligates disclosure of virtual asset transactions.
For virtual assets, the guidelines clarify the classification of virtual assets, and for virtual asset operators, the guidelines provide clarity on whether to recognize customer-entrusted virtual assets as an asset or liability in the operator’s financial statement.
“In addition, the government plans to prepare and distribute audit procedure guidelines that external auditors can refer to when auditing companies that hold, develop, and issue virtual assets,” said Benzinga.
The government plans to hold at least one briefing session for each stakeholder, such as listed companies, virtual asset operators, and accounting firms, over the next two months to sufficiently listen to their opinions.
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Produced in association with Benzinga
Edited by Judy J. Rotich and Newsdesk Manager
