- In case of company sale payments, the recipient is entitled to receive a payment based on the ‘trigger event’ (e.g., an IPO, sale of shares in an M&A transaction). At the time of issuing virtual shares, there is no certainty that such event will happen and there is no certainty in the value of the shares to be determined for that event. In such case, it is very probable that there are no obligations that you can recognise in your accounts at the time of issuing virtual shares. However, when the probability of the ‘trigger event’ occurrence increases and the details become clearer, you may need to recognise such obligation in your accounts.
- In case of milestone payments, the recipient has the right to receive certain (regular) payments at certain future dates or upon certain events. For example, payments will be made whenever the quarterly revenue of the company exceeds amount X. Depending on the set threshold, the monetary value of such obligation may be clear already at the time of issue of the virtual share or become clear very shortly and with regularity thereafter. So, you may need to record the obligation from the beginning and adjust it accordingly over time.
- Utility-like instruments (previously referred to as tokens) may take very different forms, e.g., a price discount, a free product, a rebate. Depending on the exact design of the program, such transactions may need to be recorded either in your balance sheet accounts or the P/L accounts.
- Badges which are designed to record an accomplishment or a participation in an event do not normally grant any economic rights or value to the recipient and are therefore not values that can be recognised in your financial reports. Issuing collectible tokens which represent digital items that are of value to a collector may affect your balance sheet if the digital items have been recorded as your assets.
Accounting matters are often discussed together with legal and tax aspects. Please see relevant sections - legal, taxation.