The Accounting Point Of View About The Crypto Currency #1
Image Source: Cryptocurrency
The basic concept of accounting
The basic concepts of accounting are several points, among them the concept of measurement with unit money, entity concept, business continuity concept, concept of kos, double aspect, accounting period, conservatism, realization, matching, consistency, and materiality. Thus, for the purposes of the study, only the basic concepts which are accounting postulates and related to the basic assumptions of accruals should be used as the basis for accounting recording.
The Measurement Concept of Money
This concept implies that money is a common and most appropriate measure of economic activity and is the right basis for measurement of accounting analysis. In record keeping, the monetary unit represented by money is highly relevant, simple, universally available, understandable and useful. In general, with the existence of money as a measuring tool, making the presentation of accounting with the monetary unit more can be communicated on information of economic resources owned and presented in the form of quantitative information. This is what makes users more financial reports can see the objectivity of information economic resources for the company to be able to make rational economic decisions.
What is cryptocurrency?
A cryptocurrency is a digital exchange medium that functions similar to traditional money, but has no physical form and only in digital form. The first digital currency was Bitcoin which was released in 2009 by Satoshi Nakamoto, and since then many other alternative digital currencies have sprung up thanks to the huge popularity possessed by Bitcoin. Cryptocurrency is a form of digital currency that uses cryptographic principles to carry out distribution, decentralized and secure financial systems where you can mine and trade them.
Cryptocurrency is designed to gradually introduce a new currency unit, putting the value on the total amount of money that will ever be outstanding.
When comparing cryptocurrency with traditional money, the most important difference is that no group or individual can significantly influence money production because the value to be distributed has been set and will not change. therefore digital currencies will not experience inflation.
Bitcoin is the first digital currency to implement the full cryptocurrency protocol.
Image Source: credit-on-line.ru
Crypto currency transactions in accounting
The current velocity of money is increasing in line with the increasingly global development. Where money itself in traditional economics is defined as any generally accepted means of exchange. By using this means of exchange can be any object that can be accepted by everyone in the community in the process of exchange of goods and services. In the development of modern economics, money is defined as something that is available and generally accepted as a means of payment for the purchase of goods and services -services and other valuable assets as well as for debt repayment. As for some opinions of experts also mentions the function of money as a means of delay payment.
The nominal value is the value written on each currency or value written on the money itself.
Basically this virtual currency invocation can be done by using translation to payment with virtual currency which is commonly used by company, that is with functional currency. In doing this translation can be adjusted to the value of the company's assets and liabilities. With technological advances that make payments more diverse, then an accountant is required to understand and develop the knowledge they have. For the exchange system itself using virtual currency makes an accountant must understand the currency and set the real value of the currency. In addition, an accountant must also understand that some virtual currency used for the transaction is a currency that has a recognized and valid value or not.
Experience an accountant in cryptocurrency
The experience that an accountant has in relation to the recognition and measurement of value in a company's transaction, therefore an accountant must be able to use his or her experience and knowledge as well as knowledge to develop and apply for the recognition of transactions using the virtual currency. But, essentially in determining the transaction with this virtual currency, an accountant must also be able to understand which currency is legitimate to use or which is illegal that can not be acknowledged.
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