The FASB has issued ASU 2023-08, Intangibles – Goodwill and Other – Crypto Assets. ASU 2023-08 is intended to provide users with more decision-useful information in the accounting for crypto assets.

With the exception of certain industry-specific guidance, entities have been required to account for crypto asset holdings as indefinite-lived assets that were tested for impairment at least annually and an impairment loss is recorded if the fair value of the crypto asset is less than the carrying value. However, subsequent increases in the carrying value or reversal of impairment charges were prohibited.

Under the new guidance, an entity is required to subsequently measure crypto assets that meet certain criteria at fair value through earnings in each reporting period. ASU 2023-08 also updates the disclosure requirements for crypto assets to include, among other things, details about each significant crypto holding, a rollforward of the asset balance, information regarding dispositions during the period and the related gains and losses.

The provisions of ASU 2023-08 are effective for all entities for fiscal years beginning after December 15, 2024 and will require a cumulative-effect adjustment to the opening balance of retained earnings. Early adoption is permitted, including for financial statements that have not yet been issued.  

The full text of ASU 2023-08 can be found here.
 

Published: 01/03/2024

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