Nature of Bitcoins and It’s Accounting Issues: A Proposed Model of Accounting for Bitcoins

Abstract

This research aims to examine the current practices of accounting for bitcoins by reviewing some studies which related to this topic, and thus for achieving the main objective of the study, which is to develop a proposed model to account for bitcoins that harmonizes accounting practices of bitcoins. The main objective of the study is to develop a proposed model to account for bitcoins that unify accounting practices of bitcoins. To achieve this objective, the researchers divided the research include the following: “Introduction” which aimed to gain a holistic view for the research, And then "Literature Review." In this chapter the researchers clarify the nature, characteristics, pros and cons, and also how the bitcoin system works, through reviewing number of papers, accounting academic journals, professional publications. After that, the researchers reviewing different current accounting practices for bitcoins, and the efforts of some formal organizations in accounting for bitcoins. Finally, the researchers represented A proposed framework for unifying the accounting practices for bitcoins; the proposed framework consisted of five main pillars, recognition and classification of bitcoins, measurement of bitcoins and disclosures for bitcoins. The study hypotheses were empirically tested, using descriptive statistics, Chi-Square and Mann-Whitney test, also a One-Way ANOVA test was done to examine the significant differences between the different groups in each category of the population, the academics, the issuers of financial statements and the accountants. By examining the proposed Model for accounting for bitcoins empirically, the hypotheses were accepted which determined that the proposed model provides a unify model can be used in accounting for bitcoins, and thus it will increase the quality of financial reports.