[ShopCat]

Originally Posted by Wayne 962

Sorry, but you are mistaken. I suggest that you Google this topic to learn more about it. The IFRIC indicates that cryptocurrencies are generally intangible assets under IAS 38 Intangible Assets. These assets need to be tested on an annual basis for "impairment." A discussion of this can be found in this article as well as other articles by the "big four" accounting firms:

https://www.accountingtoday.com/news/companies-investing-in-crypto-may-be-in-for-a-rude-accounting-surprise


-Wayne

Yes, I was mistaken on the current guidance, which I think will change, as that is a trash way to account for these holdings. I was thinking logically as a (former) accountant, I think I underestimated the silliness of GAAP and IFRS, they never cease to amaze. Also, as a small business, the rules are not the same for me. PWC even put out a release saying this is not in line with reality. https://www.pwc.com/us/en/cfodirect/publications/point-of-view/cryptocurrency-bitcoin-accounting.html

It will be interesting to see how they adjust now that more institutions are holding Bitcoin and Ethereum on their books. But this still will not IMO make profit forecasting for Telsa more difficult. So they could have losses from bitcoin (depending on when they do their annual test) but will never have gains until they sell. Also interested if running a node and/or mining would give them enough argument to exempt them from the intangible asset classification. All of this is "interpretation" at this point.

This still does not make giving the money away to shareholders better or even a comparable option. And Tesla is still in the green on their relatively small cash bet for now.