SEC’s Chief Accountant: Firms With Digital Assets Still Need to Keep Their Books in Order
Wesley Bricker, chief accountant for the U.S. Securities and Exchange Commission (SEC), has said that the advent of digital assets and blockchain technology does not change the “fundamental responsibility” of firms when it comes to their financial reporting activities.
Bricker’s remarks were made as part of a speech delivered before the AICPA National Conference on Banks & Saving Institutions in Washington, D.C. Monday, September 17.
Bricker opened by stressing it was crucial for the accounting profession to keep abreast of emerging technologies to ensure it can adequately fulfil its role as gatekeeper for “issuer compliance related to financial reporting.”
He went on to emphasize that innovations in technology can in fact be “the ally of a company’s business and financial reporting activities, not their opponent”:
“It follows that changes in technology need not work against investors and the public capital markets. Moreover, companies must continue to maintain appropriate books and records—regardless of whether distributed ledger technology (such as blockchain) smart contracts, and other technology-driven applications are (or are not) used.”
Bricker emphasized that for firms and their auditors alike, the existing parameters of auditing standards and federal securities laws, with their attendant reporting obligations – where they apply – should continue to be closely adhered to.
“Distributed ledger technology and digital assets, despite their exciting possibilities, do not alter this fundamental responsibility,” he stressed.
Recent high-profile developments on the crypto regulatory landscape in the U.S. have seen the SEC extend its purview to oversee crypto hedge funds, FINRA muscle in on a case of alleged securities fraud, and a New York federal judge ruling that securities laws are applicable for dealing with crypto fraud allegations.