With blockchain technology and cryptocurrency accounting and auditing, the rules are changing...
As blockchain technology and cryptocurrencies occupy the economic world's agenda more and more every day, the rules of accounting and auditing are also being rewritten. Blockchain technology is a record system with an ever-growing database called distributed blocks, which is not connected to a central authority in a general sense. Everyone is transparently informed about the details of all transactions taking place in the specified database and registration system, and the transactions are protected by digital signatures (cryptography). Cryptocurrency, on the other hand, is internet-based digital money that uses cryptography to secure financial transactions, not connected to a central authority.

Block chain technology, the financial sector, banking, e-Government, Digital Identity, Internet of things (the Internet of Things - IOT), health sector, education sector, retail industry, legal system, insurance, and real estate industry, the music industry, supply chain management, marketing, media, tourism, telecommunications and the automotive sector from the beginning of the many diverse application area. So cryptocurrencies are a cluster that includes Bitcoin and subcoins. Blockchain technology is an ecosystem that includes cryptocurrencies as a higher cluster.
In 2008, Satoshi Nakamoto block chain and the emergence of crypto coins dubbed by a still unidentified person or group who actually wrote, “Bitcoin: A peer-to-Peer Electronic Cash System” is based on the article. Although blockchain technology was designed for cryptocurrency Bitcoin when it was first developed, it has also started to make its name with different application areas over time. In addition, various altcoins, which later became alternative to Bitcoin, also began to be traded. No doubt, all these important developments have raised a new critical question: "What does blockchain technology and cryptocurrencies bring to accounting and auditing?”

4 main titles

First, to address the issue of accounting for cryptocurrencies, there is currently no specific framework or standard in Turkey. In other words, the accounting and evaluation of cryptocurrencies is not related to specific legislation. In Turkey, although there is a provision with regard to the recognition of crypto coins, crypto, considering the basic principles and concepts of Accounting Reporting Standards to be a record of the money, reporting, and needs assessment processes. There are several approaches to how cryptocurrencies should be accounted for. It is possible to gather the approaches under four main headings in Turkey. According to some authors, academics and practitioners, cryptocurrencies should be considered and evaluated as a “commodity/commodity”. However, another group argues that it would be more accurate to accept and evaluate cryptocurrencies as “ready value”. In addition, some studies also indicate that it will be more accurate to accept and evaluate cryptocurrencies as “securities”. Finally, there are also opinions advocating the accounting and evaluation of cryptocurrencies as “money”. In cases where cryptocurrencies are accounted for and evaluated as “commodities/commodities”, other stocks are registered under the account. When cryptocurrencies are accounted for and evaluated as” ready value", they are tracked under the other ready values account. Other securities accounts are also used when cryptocurrencies are treated as “securities” and accounted for and evaluated. Finally, when it comes to accounting and evaluating cryptocurrencies as “money”, monitoring is carried out by opening sub-accounts under the cash register account. In the international arena, it is stated that cryptocurrencies should be accounted for and evaluated as “intangible assets” as a new and additional approach. From a general perspective, there are no generally accepted rules regarding the accounting and evaluation of cryptocurrencies. Therefore, accounting and evaluation of cryptocurrencies may find a wide place in International Accounting Standards (IAS), International Financial Reporting Standards (IFRS), Turkish Accounting Standards (TAS) and Turkish Financial Reporting Standards (TFRS) in the future.

Make fewer mistakes, compromise more

Furthermore, the ownership of business assets in an accounting sense and the status of existing business assets and foreign resources will gain much more certainty thanks to blockchain technology. Accounting is a branch of science related to recording, classifying, summarizing, reporting, analyzing and interpreting transactions and events that can be expressed with money. With blockchain technology, it will be possible to focus on planning, action taking and strategy development activities rather than bookkeeping activities in accounting. In this context, it is very likely that the importance of classical bookkeeping accounting has decreased and that the workplaces of accountants in the specified area have been eroded. In the future, accountants will be able to turn this into an opportunity by providing services, consulting and providing solutions related to blockchain and cryptocurrencies. Because blockchain technology will also accelerate the enteregration of Accounting Science with machine learning, artificial intelligence, cloud technology and data analytics. In addition, blockchain technology will mean more effective work for accountants, fewer mistakes, more compromises, and minimal cheating.

Audit work will be completed faster

Blockchain technology and cryptocurrencies shape auditing as well as accounting. In other words, the paths of blockchain technology, cryptocurrencies and control are crossing more and more every day. Audit is a systematic process that impartially collects and evaluates evidence in order to investigate the degree of compliance of events related to commercial activities with pre-determined criteria and to report the results to those interested. Because blockchain technology can record transactions between two parties in an efficient, persistent and verifiable format and serves as an open, transparent and distributed database, blockchain technology will primarily serve as a confirmation/verification tool for financial transactions. For example, today, both internal auditors and external auditors (independent auditors) frequently use memorandum of understanding. At the same time, auditors, financial analysts and bank credit allocation departments often request the financial statements of firms. Thanks to blockchain technology, it is estimated that these and similar transactions will be completely eliminated and eliminated. No doubt, this will ensure that audit operations are completed much faster and costs are minimized.

'Partial assurance' to close 'full assurance' transfer

In addition, today, auditors are unable to audit all departments, transactions and accounts in firms while conducting audit activities due to time constraints and financial constraints. Therefore, the sampling method is used in the audit. Thanks to blockchain technology, it is expected that the sampling method in the audit will also go down in history. Because, thanks to blockchain technology, auditors will be able to audit all departments, transactions and accounts subject to audit to cover all periods. In other words, since the entire statistical universe that is the subject of control can be controlled, sample selection will no longer be necessary. At this point, it is not difficult to say that the transfer of “partial assurance” in the audit will be closed and the transfer of “full assurance” will be switched.

In addition, it will take months to audit a number of high-value and consistent transactions today, while with the help of blockchain technology, this time will be reduced to a few hours. Dec December 31 audits are also carried out in the form of year-end audits or interim audits. Dec December 31 audits and interim audits will also be replaced by permanent (simultaneous) online audits, thanks to blockchain technology. In fact, when blockchain technology completes its evolution, it will be possible to carry out fully autonomous inspections.

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