Reports are coming out that Big Four firms Deloitte and PricewaterhouseCoopers (PwC) have asked staff to disclose their crypto holdings in their annual risk assessment procedures.
The Big Four is a term that refers to the top accountancy firms Deloitte, Ernst & Young (E&Y), KPMG, and PwC.
They offer audit, tax, management consultancy, assurance, and legal services to the world’s top companies and governments. This puts them in a unique position regarding economic insights and awareness of future trends, particularly how they relate to digital transformation.
But what can we take from this event?
Risk assessment and compliance
According to the Economic Times, staff at Deloitte and PwC have been asked to disclose crypto holdings of ₹10 ($0.13) or more. So far, there are no reports on the position held by E&Y and KPMG or that this is part of a global policy outside of India.
“The firms fear conflict of interest if partners or any of their family members have bought crypto assets, said insiders.”
It’s worth noting that none of the Big Four have policies that prohibit staff from investing in digital assets. All the same, failure to disclose holdings could see staff fined or even fired.
Understandably, such disclosures should apply to partners and perhaps senior managers. But PwC requires all staff, even associates, to comply.
In one example, an associate was fined ₹25,000 ($330) for non-disclosure of her husband’s ₹10,000 ($130) crypto investment.
Commenting on the situation, a senior partner at one of the firms in question pointed out that crypto is mainly the preserve of younger, generally less senior, staff members.
“Most of these investments are done by the executives and young partners as most of the older ones stick to traditional investments such as equity and real estate.”
Is this the start of an anti-crypto stance?
The legality of crypto in India is somewhat ambiguous. A legal ruling banning digital currencies was subsequently overturned in March 2020. But, the government remains cagey on rubberstamping their use in India.
In the latest turn, a cryptocurrency bill that would clarify the matter was deferred yet again on the ground of seeking wider consultation.
A Big Four senior partner mentioned that staff disclosure of crypto holdings is necessary for transparency, especially as the firms count the central bank and government as clients.
“But we want to be above board as many of our projects involve directly working with the Reserve Bank of India (RBI) and the government.”
As overseers of international accounting standards, it makes sense that the Big Four firms practice what they preach and enforce disclosure requirements.
That being so, this event in isolation should not be interpreted as an anti-crypto stance by the Big Four. Instead, it seems like a precautionary measure to avoid falling foul of Indian authorities.
However, the uncertainty surrounding the cryptocurrency bill does introduce an element of confusion.
The post Big Four accountancy firms clamp down on employee crypto disclosures appeared first on CryptoSlate.
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