How It Works
The Process of Building a Statement of Digital Assets
The number of businesses that operate with digital currencies and digital assets is increasing at a noticeable rate as these instruments move into more parts of finance, trade, and commerce.
It is the finance team’s responsibility to manage and close the books, evaluate the performance of the business, determine and record tax exposures, manage the treasury, and perform financial planning and analysis functions. The finance team will need to effectively communicate the balances and analytics surrounding them.
The steps to build a Statement of Digital Assets seamlessly fit into existing processes outlined in brief here and in more detail in the paper.
Wallet Activity
Creation of an accurate Statement of Digital Assets starts with the wallets of an organization.
Subledger Platform
The subledger is a crypto-specific software tool that acts as an aggregator of wallet activity and allows for proper tracking of digital assets.
General Ledger
Digital asset activity can be tagged in the subledger and then pushed to the general ledger for appropriate classification.
Statement of Digital Assets
Data from the subledger and the general ledger is then used to create a Statement of Digital Assets.
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The Benefits of a Statement of Digital Assets
Book Value vs Fair Market Value
SoDA acts as a level-setting analysis for an organization to view all of its digital assets at both book value and fair market value in the same context.
Fair Market Value Idiosyncrasies
SoDA provides a comprehensive source of truth to navigate the presentation of tokens, native tokens, NFTs, restricted tokens, real world assets, and other digital asset forms.
Wallets, Assets and Roles
SoDA provides clarity to the entire picture of digital asset liquidity, providing transparency and a key tool to monitor wallet hygiene.
A More Complete Liquidity Picture
SoDA is designed to address many of the accounting nuances that working with digital assets entails.