Bitcoin: The Future of Money? 

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Bitcoin: The Future of Money? 

Bitcoin is the talk of the town. Seemingly overnight, the cryptocurrency has amassed both an exponential value in net- worth and world- wide attention. A bitcoin is now valued at over 4000 dollars. And the trend is catching on in South Africa. Supermarket giant Pick ‘n Pay announced that it would pilot Bitcoin payments at its head office in Cape Town, the first South African grocery retailer to do so. But what exactly is it?  You’re not alone if you find the system confusing. We will try shed light on this increasingly popular virtual currency, and give you both sides of the coin.

What are Bitcoins?

Put simply, Bitcoin is an electronic currency. This digital money is transferred from one electronic device to another and stored in a digital wallet. The wallet is a kind of virtual bank account.

Unlike Rand’s, Dollars and Pounds, it isn’t printed and no centralized system controls it. Once you own bitcoins, they function in a similar way to gold coins.

They hold value and you can use your bitcoins to purchase goods and services online or hold onto them as an investment.

How does it work?

Bitcoin works on a type of public ledger called blockchain.

A block chain holds a decentralized record of all transactions and is updated and held by all users of the network.

The bitcoin network has individuals called “miners” whose job is to verify transactions, in an attempt to make the process more secure. Furthermore, this open community of miners from around the world use software programs that follow a mathematical formula to produce bitcoins.

What are the advantages and disadvantages?

Advantages:

  • There is freedom to transact at any given time and to anywhere in the world. This facilitates complete control of your money.
  • It is anonymous. Payments are made and finalized without personal information being shared with a third party, protecting against identity theft.
  • There are very low fees or no fees at all. This works out cheaper compared to bank and credit card transactions.
  • Information is transparent. Anyone at any time can verify it.

Disadvantages: 

  • As it is a decentralized currency, it does not have the same consumer protection one would expect from banks. It operates outside of regulations.
  • There is a lack of awareness and understanding of Bitcoin and as a result the list of businesses accepting Bitcoin payments is still relatively small.
  • The price of bitcoin can increase or decrease without prediction and is subject to market validity. This is largely due to there being a limited amount of coins and demand for them changing every day.
  • It could encourage criminal activities such as money-laundering as it is not monitored by financial authorities.

What is the future of Bitcoin? Is it just a temporary fad or a 21st century version of gold here to stay?   Only time will tell. However, one thing is for certain; the world will be watching.

Betty Bookkeeper answers your questions on how royalties would apply

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Hi Betty

What is the normal manner in which royalties would apply?

Regards,
Sam

Hi Sam

It would form part of the company’s expenses or cost of sales. If the “royalties paid” is based on sales then it would form part of cost of sales. However you would have to understand the terms of the agreement in order to be clear.

I would suggest for now just ensure that all payments are allocated to a “royaties paid” account.

Once you have all the information I suggest you check with the company’s auditors as they will be the ones doing the final allocations (assuming the company will be audited).

Hope that helps!

Don’t forget that I’m here to answer your questions about the ICBA, or just queries about your accounting at work. All you have to do is email me with a copy of your ICBA membership certificate. Not yet a member? Send in your application form!

How much should a Financial Accountant earn?

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Article source: Payscale

Do you want to know what the average salary is for a Financial Accountant in South Africa?

A Financial Accountant earns an average salary of R313,580 per year. People in this job generally don’t have more than 20 years’ experience. A skill in Microsoft Excel is associated with high pay for this job.

To be successful as a Financial Accountant , it’s necessary to have skills in Bookkeeping, Accounting Reporting, Financial Analysis and Tax Compliance. A skill in Financial Analysis and Tax Compliance is associated with high pay for this job.

Broken down into cities in South Africa, the annual salary averages are:

The average pay for a Financial Accountant in Johannesburg is R346,983 per year.
The average pay for a Financial Accountant in Cape Town is R302,663 per year.
A Financial Accountant in Pretoria earns an average salary of R280,632 per year.
A Financial Accountant in Durban earns an average salary of R372,395 per year.
The average salary for a Financial Accountant in Sandton is R366,251 per year.

Work your way up as a financial accountant with the following Financial Accountant career paths:

CPD Principles and Practices

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CPD PRINCIPLES AND PRACTICES

Continuing Professional Development (CPD) is the process of tracking and documenting all the skills, knowledge and experience that you gain – formally and informally – as you work beyond your initial qualifications or training.

CPD is one of the requirements for renewing your ICBA membership, as on-going learning means you are keeping your industry knowledge current and relevant. Just like pilots, doctors and many other professionals, financial industry professionals need to keep their skills and knowledge up to date.

 

  1. CPD is the ongoing improvement of specific designation-linked competencies.
  2. CPD can occur;
    1. In the workplace
    2. During coaching and mentoring
    3. Outside of the workplace
    4. Through courses, workshops and seminars
    5. In self-directed learning
  3. CPD must be cognate with the designee’s profession.
  4. The designated professional takes reponsibility for his/her required CPD.
  5. The designated professional takes responsibility for CPD records as required by the body she/he belongs to.
  6. CPD points are typically measured in direct hours; one relevant CPD hour is one CPD point.

ICBA members must earn at least 20 CPD points every year. Each hour of learning you complete = 1 CPD point. These points are either:

Verifiable:

You have to prove your learning, e.g. provide an attendance certificate from seminars, workshops, etc. A minimum of 8 verifiable points is required (12 points minimum for Certified Technical Financial Accountant, Certified Technical Public Accountant, and Certified Financial Accountant members).

Non-verifiable:

Self-study that you keep a record of yourself, e.g. reading industry articles.

The Annual Africa Transfer Pricing Summit

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The Annual Transfer Pricing Conference has become the pre-eminent annual event for South African transfer pricing specialists to share ideas and update themselves on the latest transfer pricing trends. The event seeks to provide both a South African and regional perspective on the topic through transfer pricing experts from around the continent, including private practitioners and government officials from specific revenue authorities and from international organisations.

The 6th annual event is scheduled to take place from 15, 16 &17 November 2017

Book to attend this event now.

CPDtv Promotion for ICBA Members

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CPDtv offers verifiable Continuous Professional Development for accounting professionals. CPDtv has produced nearly 300 CPD programmes since their first programme in October 2009.

The service is designed to save time and money, both currencies in short supply in todays pressured society.

They have finalized our year end package that consists on a pack of 20 DVD’s with 20 1-hour programmes covering accounting , tax and ethics.

20 Verifiable CPD hours per year ( Starting anytime it suits you)
12 Taxation; 4 Accounting; 2 Ethics and 2 Other
DVD or download service
DVD’s delivered by courier
CPD Hours updated on a monthly basis on your behalf

CPDtv offer annual subscriptions at the following rates:

Individual Subscription: 
DVD Option R2950 per annum Download Option R2750

Corporate Subscription:
2 to 5 members : DVD Option R2800 per subscriber per annum. Download R2610
6 or more members: DVD Option R 2655 per subscriber per annum. Download R2475

Please note that although the subscription is on an annual basis it can be started at any time during the year and can also be backdated to include programmes already produced and distributed.

The subscription fee is payable by EFT, Credit Card and we also offer debit order facilities for the 2, 4 or 6 month payment period.

To see more go to CPDtv

Betty Bookkeeper answers your questions on whether legal expenses can be claimed for VAT

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Hi Betty

I would like clarity on an expenses for a Legal expense paid by the company – can I claim VAT if the invoice is Vated – does SARS allow for such a VAT claim ?

Regards,
Marc

Hi Marc

If the invoice is addressed to the company and it is a valid tax invoice then yes, the company may claim the VAT on this invoice.

Hope that helps!

Don’t forget that I’m here to answer your questions about the ICBA, or just queries about your accounting at work. All you have to do is email me with a copy of your ICBA membership certificate. Not yet a member? Send in your application form!