Big auditors haven’t been left out by the crypto craze. According to the Financial Times, world’s biggest auditing companies, including EY, PwC, and KPMG, are dipping their toes in the obscure business sector by recruiting a slew of industry experts, but they face many issues.
They “don’t have a choice”
Since the crypto boom happened, plenty of auditing firms jumped on the bandwagon despite the lack of certainty that surrounds this nascent asset class. Ernst & Young, a multinational accounting firm with a staggering $34.8 bln revenue, wasn’t an exception. EY’s Jeanne Boillet claims that they simply “didn’t have a choice” since many of their clients are keen on crypto.
Fueling the “Bitcoin vs. Blockchain” narrative
However, as a result of the crypto crash, the accounting behemoth is currently exploring Blockchain, the underlying technology of Bitcoin. PwC, the major competitor of EY, is also trying to capitalize on Blockchain. Ralph Weinberger, one of the PwC representatives, told the Financial Times that the company had already hired 400 employees that specifically focus on the Blockchain technology.
Major accounting firms are still willing to embrace Blockchain even if crypto doesn’t stand the test of time. Blockchain is currently disrupting many industries — from helping to increase the efficiency of the freigh shipping sector to aiding humanitarian organizations. Major accounting firms are already developing their Blockchain-powered solutions. Back in July, Deloitte, EY, KPMG, and PwC have formed a Blockchain consortium to test a new accounting service developed by Taiwan’s FSC.
Facing numerous challenges
Still, there is no clear-cut way of auditing cryptocurrencies, but regulators are already making progress in this niche. The Financial Reporting Council that auditing cryptocurrencies is not “a material issue,” but the practice may get under closer scrutiny in case of diverse accounting practices.
On top of that, accounting firms have to face numerous other challenges, such as the extreme volatility and the anonymity issues connected to crypto. Boillet claims that they are dead serious about performing due diligence on their clients.