Sunday, April 2

Report: SEC Rejects MicroStrategy’s Accounting Practices Regarding Bitcoin By Cointelegraph

©Reuters. Report: SEC Rejects MicroStrategy’s Accounting Practices Regarding Bitcoin

The business intelligence company MicroStrategy would have acted contrary to the accounting practices of the Securities and Exchange Commission (SEC) in its purchases of cryptocurrencies.

According to a report by Bloomberg, an SEC comment letter published Thursday showed that the regulator objected to MicroStrategy reporting its purchases of () based on non-GAAP, or generally accepted, accounting principles. The business intelligence firm has reported that it used these methods to calculate the figures for its BTC purchases excluding the “impact of stock-based compensation expenses and impairment losses and gains on sale of intangible assets” – essentially, nullifying some of the effects of cryptocurrency market volatility.

  • MicroStrategy CEO Won’t Sell Company’s BTC Reserves Despite Crypto Winter

Apparently, GAAP standards are not designed to report the value of cryptocurrencies. However, MicroStrategy has purchased 124,391 BTC as of December 30, representing more than $4.7 billion in value through various purchases totaling approximately $3.8 billion since August 2020. The company reported that it used non-GAAP practices to exclude cost “accumulated impairment losses” and based the value of his holdings on the market price of 1 BTC at 4:00 EST on the last day of each period.

Read the full article on Cointelegraph

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