Big Four firm EY has debuted its Crypto-Asset Accounting and Tax tool, a technology solution designed to facilitate accounting and tax calculations for cryptocurrency transactions.
Coming as a slew of large accounting firms are opening cryptocurrency and blockchain services for clients, the U.S. rollout of CAAT is part of EY’s stated strategy to “lead the industry with blockchain-related capabilities and services worldwide.”
EY developed the tool by integrating recently acquired technology assets and related patents with other EY processes. The acquisitions were led by EY Foundry, a corporate venturing unit within EY Tax charged with developing transformational digital businesses.
EY aims to use CAAT to serve institutional clients that have crypto-assets on their balance sheets, as well as both institutional and individual clients who trade such assets on a smaller scale. The firm reports a significant increase in the number of clients that hold and trade crypto assets.
EY CAAT was designed with the ability to source transaction-level information from virtually all major exchanges. It consolidates data from multiple sources and allows for the automated production of various reports and dashboards, and preparation of IRS tax returns related to crypto-assets.
“The initial validation we have received from the market has been phenomenal, but it only represents the beginning,” said Michael Meisler, partner and EY global blockchain tax leader, in a statement. “EY professionals and clients alike are eager to leverage this technology. EY CAAT is the hallmark of our efforts in crypto-assets and blockchain from a tax perspective globally.”
Looking to the future, EY sees clients benefiting from CAAT, particularly those in asset management firms. Over time, the firm plans to leverage the product for high-net-worth individuals served by the EY private client services practice and make it available to users of EY TaxChat, a mobile tax preparation service that pairs users with licensed and experienced EY professionals who prepare individual tax returns.