Indian companies have to disclose their cryptocurrency dealings from the next financial year, which will begin on April 1.
The country’s Ministry of Corporate Affairs amended Schedule III of the Companies Act, 2013 on Thursday to mandate both public and private companies to disclose their cryptocurrency holdings and other activities using digital currencies.
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According to the published gazette, the companies must disclose ‘profit or loss on transactions involving Cryptocurrency or Virtual Currency’, ‘amount of currency held as at the reporting date’, and ‘deposits or advances from any person for the purpose of trading or investing in cryptocurrency/ virtual currency’.
The companies have to report these crypto dealings in both their profit and loss statements and balance sheets.
Though none of the Indian companies has revealed any cryptocurrency investments yet, many public companies in the United States and Europe have invested heavily in digital currencies, which might have prompted the Indian ministry to bring such reporting laws.
However, it will be interesting to see if the existing Indian cryptocurrency exchanges have made any digital currency investments. US-based Coinbase, which is heading towards a public listing, revealed that it added Bitcoin to its balance sheet in 2012.
Confusions Around Crypto
Last month, the Indian securities market regulator informally directed initial public offering (IPO) promoters to liquidate their cryptocurrency investments.
India’s new crypto disclosure rule came when the country is possibly heading towards a crypto ban. Though the government already drafted a bill and was about to debate it in the recent parliament session, it was not tabled while the session saw an early closure today.