Accounting and Auditing Challenges of Crypto Currency: A Case Study of PayPal

Report writing
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Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Crypto currencies....................................................................................................................3
Advantages of crypto currency...............................................................................................5
Crypto currency under GAAP................................................................................................5
Accounting for crypto currency by Paypal.............................................................................6
Accounting and Auditing challenges......................................................................................6
CONCLUSION................................................................................................................................8
REFRENCES...................................................................................................................................9
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INTRODUCTION
Crypto Currency is the new and popular form of digital currency, which is acting as a
replacement for going ownership and physical forms of currency. It has gained wide popularity
in recent years and this affecting accounting and business practises across industries. Many
start-up businesses have also opened up offering crypto currency exchange and usage facilities.
In addition to this financial institutions and businesses are also entering the crypto currency
market by enabling their consumers to exchange crypto currencies (Antonakakis, Chatziantoniou
& Gabauer, 2019). The company selected for this report is American company PayPal. It is an
American multinational financial technology company which supports online payment systems
in different international markets and act as an alternative for traditional methods of transferring
finance such as checks or money orders. This report looks at the current usage of crypto
currencies along with the benefits of using crypto currencies. The ways in which crypto
currency is accounted under generally accepted accounting principles issued by the financial
accounting Standards Board is also included in this report. The accounting standards for crypto
currency by PayPal and the challenges introduced in context of accounting and auditing
governing bodies because of introduction of crypto currencies is also included in this report.
MAIN BODY
Crypto currencies
The basic features of crypto currency include she decentralization of digital money which can be
used over the Internet so that money transfer and transfer of financial assets becomes easier. The
aim of crypto currency is to revolutionize the ways in which people invest bank and utilize
money by helping create a decentralized medium for transfer of money and finance. The first
crypto currency was launched in the year 2008 and termed as Bitcoin. It is currently the most
popular crypto currency in the world and is considered the most influential crypto currency
paving the way for formation of other types of crypto currency (Borri, 2019).
Apart from Bitcoin other types of crypto currency are etherium Bitcoin cash Litecoin,
EOS Tezoz and Zcash. The commonality between different type of crypto currency is that they
are all formed to support decentralized exchange and transfer of money so that they can act as an
alternative form traditional mediums which are under the centralized system supervised by
governments and financial institutions. Different crypto currencies utilize different technologies
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