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ISAR Workshop Digital currencies and blockchain: implications for accounting


22 October 2018
12:00 - 15:30 hrs. Palais des Nations, E-Building, Room XXVI
Geneva
, Switzerland

The UNCTAD ISAR Workshop is held on a yearly basis right before the ISAR session. It addresses technical emerging issues in the accounting and reporting areas. This year’s workshop focused on emerging issues in the area of blockchain technology, digitalization and cryptocurrencies. These technological developments are creating disruptive changes in the financial sector and their effects, including risks and opportunities, on business practices and the accountancy profession are undeniable. 206 participants from 60 countries registered for the Workshop.
 
The First panel featured speakers from Deloitte, PwC, the Institute of Chartered Accountants in England and Wales (ICAEW) and the Chartered Financial Analysts (CFA) Institute. They focused on the various applications of blockchain technology including real time and continuous assurance, smart contracts, etc. The also stressed the key features of blockchain, i.e. propagation, permanence and programmability. They spoke of the effects of this technology on the way businesses conduct their activities, and the impact this technology will have on the accounting and reporting procedures, and on the accountancy profession. They also highlighted challenges including the language barrier between accountants and technologists, the need for continuous learning, the lack of clear guidance and accounting standards regarding how to deal with blockchain technology applications, and the need to ensure collective trust. They mentioned opportunities for new assurance and audit services and emphasized that the accounting profession will have a role to play because it will be indispensable to rely on the human insight to make sure that the business transactions are a representation of the reality and to analyze and understand its meaning.
 
The keynote speaker from the International Federation of Accountant (IFAC) spoke of the need for accountants to quickly adapt to changes in business and the society. He stressed the transformation in business models, the need to anticipate changes and permanently adapt strategies; he also mentioned that new talents and expertise are needed in the market. He said that the impact on the accountancy profession is very high and highlighted changes in legislation, technology; clients and users; and the market.
 
The second panel featured speakers from financial reporting standard setters namely the Australian Accounting Standards Board (AASB), the Accounting Standards Board of Japan (ASBJ) and the International Accounting Standards Board (IASB).  The speakers delved into the financial reporting requirements for transactions with cryptocurrencies and Initial Coin Offerings (ICOs). The speakers from Australia and Japan discussed the different accounting treatment options for entities holding cryptocurrencies in their jurisdictions. The speaker from ASBJ spoke of a new standard issued in Japan which prescribes how to recognize transactions with cryptocurrencies and highlighted challenges related to ICOs including the lack of an established definition of ICOs and tokens, the lack of regulation of white papers associated with the issuance of ICOs, the lack of consistency and the diversity in tokens, etc. The speaker from the IASB presented a summary of the board’s discussions up until now. He explained that IASB has conducted a review of financial statements prepared in accordance with International Financial Reporting Standards (IFRSs) and has also undertaken consultations with the emerging economies group, securities regulators and standards setters. He stated that the board will decide this month whether it will work on issuing a standard on this subject.
 
The Workshop highlighted the existence of several regulatory, institutional and capacity building challenges related to blockchain, but also stressed new opportunities for those who can adapt and learn not only in a fast but on a continuous manner. It also underscored the increasing number of transactions involving cryptocurrencies and ICOs, and the lack of clarity in the financial reporting standards and lack of consistency in how countries account for them.  Regulators need to pay attention to the risks, scams, volatility, money laundering and financing of terrorism. Therefore, addressing the issues posed by digital developments, including by sharing good practices and challenges, is necessary to help stakeholders, regulators, preparers and users of the reports in their efforts towards attaining high quality and reliable reporting.
Philippe Arraou
Board member
International Federation of Accountants

Philippe Arraou is Chartered Accountant in France and in Spain. After having leading his own practice during 30 years, he entered BDO and he is today Managing Partner for France.

He is immediate Past-President of the French Institute of CPA “Ordre des Experts Comptables”, since March 2017, and currently in charge of International Affairs for the French profession.

He is member of the IFAC Board, since November 2016, where he is chairing the “Technology Advisory Group”.

He is President of FCM, the Mediterranean Federation of Accountants, and Co-founder and first President of ETAF, the European Tax Advisers Federation. He is also first Vice President of “CILEA”, the Latin Committee Europe America. He was co-founder and first President of the European Federation EFAA from 1996 to 2000.

Mr. Arraou has published in many professional publications. In September 2016 he wrote a book : “The Digital Economy and the Certified Public Accountant”, prefaced by Emmanuel Macron.

In France he was decorated :
- in 2013 by the Minister of Budget, Cazeneuve, of the “Ordre National du Mérite”,
- in 2016 by the Minister of Economy, Macron, of the “Légion d’Honneur”.

David Szafran
Attorney
Eubelius

David Szafran is attorney at Eubelius, a member of the Brussels’ Bar, focusing in particular on advising clients on corporate governance and corporate law, legal compliance and risks management, especially in regulated sectors including the financial sector. He is also a member of the Supervisory Board of the Financial Services and Markets Authority of Belgium, chair of the audit committee and of the remuneration committee of a public company, board member of Transparency International Belgium, assessor vice president of the Belgian Competition Authority, assistant professor at the Free University of Brussels (ULB) and past-chair of ISAR 30th Session (UNCTAD) on corporate reporting. He was also a censor and member of the audit committee of the National Bank of Belgium.

He graduated in Law at the ULB in 1993 and obtained a post-university degree in economic and financial law at the ULB in 1995. Since then, he has been a lawyer at the Brussels’ Bar for over 6 years, member of cabinet of the deputy prime minister, Secretary general of the Institute of Registered Auditors for 13 years, and was a Director at PwC.

David Lyford-Smith
Technical Manager
ICAEW IT Faculty

David Lyford-Smith is an accountant and tech expert with particular interests in the digitalisation of tax systems, blockchain and cryptocurrencies, spreadsheet skills and best practice, and the place of technology in ICAEW’s professional qualifications. In his role in the IT Faculty, David liaises with various business and practice stakeholders as well as academic and political interests to create events and publications on a variety of thought leadership activities surrounding accountants in practice.

David began his career at BDO, beginning in audit before joining the coordination team of BDO’s Global Outsourcing division, based in Reading. David worked on supporting multinational companies with their compliance activities across international boundaries, and also spent time working on iXBRL tagging. David also ran BDO’s internal Excel training courses, travelling the country to speak on spreadsheet best practice and skills. In his final year at BDO, David transferred to a Senior Excel Practitioner role, spending 100% of his time on spreadsheet support, training, and standardisation.

A former ICAEW Excel Community volunteer, David then joined ICAEW full-time. In addition to his thought leadership activities, David also oversees the activities of the Excel Community and is a regular blogger for that community. He presents training and risk management sessions on spreadsheeting both for the ICAEW Academy and for the regional offices.

Peggy Gondo
Partner
PwC Assurance Technology and Innovation

Peggy is a UK PwC Assurance partner with experience in large scale technology development and providing audit and assurance services. She has spent the last 5 years in our Assurance Transformation team leading global investment programmes. Her focus is on: helping PwC’s Assurance practice innovate and respond to the impact of emerging technologies within client processes; considering how PwC can embrace on the new capabilities technology enables to support high quality delivery of their services; and adapting PwC to the future working practices technology will drive.

Marco Grossi
Director
Deloitte

<strong>Background</strong>

Marco Grossi is a Director in the Financial Services Audit and Advisory Compentency. He has over 16 years of audit, advisory and consulting experience in financial services, especially in Treasury and Investment Banking. He has gained extensive executive and management experience as a former CFO of Lehman Brothers Finance Switzerland. Marco holds a Master in Economics from the University of Basel (lic.rer.pol.) and a Swiss CPA.

As from 2016 he his member of the Deloitte Blockchain Assurance Team and part of Gobal Deloitte Blockchain Community covering Accounting, Audit and Assurance. He is leading Blockchain Assurance and –Audit in Switzerland and is part of major Global activities around Blockchain Technology.

<strong>Profile</strong>

- Leading Deloitte Blockchain Assurance Switzerland and part of Global efforts around Blockchain and Audit/Assurance

<strong>Experience:</strong>

- Expert in Blockchain and Cryptocurrencies, mainly Audit and Assurance and Business modelling/Process aligment old/new world

- ICO advisors

- Deloitte Treasury Specialist

<strong>Experience outside Deloitte:</strong>

- Worked for a Swiss Crypto Exchange and Security trader in Switzerland

- Investment Banking: CFO Lehman Brothers Switzerlnd

- Audit and Advisors in Financial Services and Big Corporates

<strong>Education</strong>

Swiss CPA and Master in Economics

Mohini Singh
Director of Financial Reporting Policy
CFA Institute

Mohini Singh is a director in the Financial Reporting Policy Group at CFA Institute. Her responsibilities include representing membership interests regarding financial reporting proposals of the IASB, FASB and other regulators. She drafts comment letters and position papers. In addition, she serves on the IAASB consultative advisory group, The IESBA consultative advisory group, and the XBRL US data quality committee. Most recently served as the Global Accounting Analyst leading CFA Institute’s IFRS implementation effort. Prior to joining CFA Institute, Ms. Singh served as a Policy Advisor for the Institute of International Finance where she worked on international policy initiatives in the areas of financial reporting and audit. She was General Manager and Financial Controller of Disha, a service organization dedicated to development programs for the underprivileged, and an audit manager at KPMG supervising audits and conducting due diligence reviews.

She is an ACA and is a member of the Institute of Chartered Accountants in England and Wales.

Craig Smith
Technical Manager
International Accounting Standards Board

Craig qualified as an accountant with the Institute of Chartered Accountants of Scotland while working in audit for BDO Jersey. After three years at BDO he left to join the financial services audit practice of Deloitte UK.
Craig joined the IASB in 2016, initially as a Technical Associate but latterly as an Assistant Technical Manager and then Technical Manager. Through the time at the IASB he has worked in the Implementation team. This has involved working with the IFRS Interpretations Committee to address implementation questions raised by stakeholders. In particular, Craig has focused on implementation questions about IFRS 15 Revenue from Contracts with Customers.
Craig has also been monitoring developments in cryptocurrencies on behalf of the IASB since December 2016.

Kris Peach
Chair
Australian Accounting Standards Board

Kris Peach was appointed as Chair of the Australian Accounting Standards Board (the Board) for a five-year term in November 2014 and has extensive experience in accounting standards setting. Prior to this appointment, she served the Board as its deputy chair (2004 to 2012) and was a member of the AASB’s Urgent Issues Group (2004 to 2005).

As part of her role as AASB Chair, Kris serves as a board member on both the  Australian <a href="http://www.frc.gov.au/about_the_frc/">Financial Reporting Council</a> and the <a href="https://www.xrb.govt.nz/about-xrb/nzasb/">New Zealand Accounting Standards Board</a>. She also represents Australia at an international level as a member of both the <a href="https://www.iasplus.com/en/resources/ifrsf/advisory/asaf">Accounting Standards Advisory Forum</a> and the <a href="http://www.aossg.org/index.php?option=com_content&amp;view=article&amp;… Oceanic Standard-Setters Group</a>.

From 2002 to 2014, Kris was a partner in KPMG’s International Standards Group and Australia’s Department of Professional Practice where she interpreted complex technical accounting issues for a wide range of public and private entities. She has also held a number of international financial reporting leadership roles within the firm.

Kris was the director at Open Gardens Victoria (2014 to 2015) and has volunteered as treasurer at a number of community groups.

Kris holds a Master’s in Business in Accounting from the Queensland University of Technology and a Bachelor in Business at Central Queensland University.

Yasunobu Kawanishi
Board member
Accounting Standards Board of Japan

Yasunobu Kawanishi is a Board member of the Accounting Standards Board of Japan (ASBJ). He started his career as an auditor with Asahi & Co., a firm that is now part of KPMG AZSA LLC. He has been involved in accounting standard-setting since 2003, and has experience working as a staff member of the U.S. Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB).


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