Digital Asset Business Accounts Rules 2021

Summary

These Rules, made by the Bermuda Monetary Authority under the Digital Asset Business Act 2018, set out the form and content requirements for the statutory financial returns that digital asset business licensees must prepare and file. They specify what the return must contain, how the balance sheet and accompanying notes must be prepared, and the standards an approved auditor's report must meet.

• Contents of the return: A statutory financial return must consist of an auditor's report, a statutory balance sheet, and accompanying notes to the balance sheet.
• Auditor's report: Must be signed by the licensed undertaking's approved auditor, addressed to the Authority, and state whether the balance sheet and notes comply with the Act and these Rules; any qualifications (scope restrictions, disagreements on valuation, non-compliance, going concern doubts, or other deficiencies) must be explained.
• Statutory balance sheet: Must be prepared on Form 1SFS (Schedule I) on an unconsolidated basis and audited by an approved auditor, starting with the first financial year after the undertaking obtains its digital asset business licence.
• Accompanying notes: Must set out the matters required by Schedule II on an unconsolidated basis.
• General preparation requirements: Returns must be in English, amounts shown in a single currency (generally the currency of the licensee's Bermuda books and records), converted to Bermudian dollar equivalents where required by the Authority, with comparative figures for the immediately preceding financial year.

The Rules apply to financial years commencing on or after 31 December 2020 and took operative effect on 24 February 2021. Schedules I and II (the prescribed forms) are published separately on the BMA website rather than in the Rules themselves.

Key obligations

• Prepare a statutory financial return for each relevant financial year consisting of an auditor's report, statutory balance sheet, and accompanying notes
• Ensure the auditor's report is signed by an approved auditor, addressed to the Authority, and states whether the balance sheet and notes comply with the Act and Rules, qualifying the report and explaining any deficiencies where applicable
• Prepare the statutory balance sheet using Form 1SFS (Schedule I) on an unconsolidated basis, audited by an approved auditor, from the first financial year after obtaining a digital asset business licence
• Set out in the accompanying notes the matters required by Schedule II on an unconsolidated basis
• Prepare all statutory financial returns in English and in a single currency consistent with the licensee's Bermuda books and records
• Convert amounts into Bermudian dollar equivalents where directed by the Authority under section 7(1)(f) or section 31 of the Act, or disclose the exchange rate used if permitted to report in another currency under section 8(1)
• Show corresponding comparative amounts for the immediately preceding financial year in all accounts

Applies to

digital asset business licensees, licensed undertakings

Deadlines

• financial years commencing on or after 31 December 2020: Scope of application: the Rules apply to statutory financial returns for financial years starting on or after this date
• 24 February 2021: Operative date of the Digital Asset Business Accounts Rules 2021

Related documents

• This document commences Digital Asset Business Act 2018
• This document is made under Digital Asset Business Act 2018