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Ideas for accounting efficiency

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Ideas for accounting efficiency

Wright began the session by noting he was approached by the UK’s tax authorities earlier this year (the HMRC) to discuss some of his finances.

The Bitcoin Masterclass (Zurich) Day 2

Dr Craig S. Wright, Chief Scientist at nChain, recent;y held the third edition of his Bitcoin Masterclass series at an exclusive venue in Zurich, Switzerland. The Masterclass course forms part of a monthly series aimed at helping attendees understand the fundamentals of Bitcoin and the technology behind it.

The Bitcoin Masterclass series will give you a comprehensive overview of Bitcoin’s history, theory and design. Wright discussed the future of Bitcoin and the unbounded scalability of nChain’s blockchain solutions, focusing on accounting and mapping transactions on-chain.

In the third session on day two, Dr Wright asked the attendees to break out and discuss the different ways that efficiency in accounting can be improved. Each group was specifically asked to consider privacy and the partial sharing of information and how blockchain can be used to help different industries with these issues.

Case study around inefficient taxing processes

Wright began the session by noting he was approached by the UK’s tax authorities earlier this year (the HMRC) to discuss some of his finances.

‘As is typically the case, they wanted to verify things. In my case, they saw that I had educational expenses. These I can validate – and giving the invoices (to the HMRC) is nice and easy. Secondly, They went to my employer (in my case nChain) who acknowledged that the (expenses) are related to my work. In both cases, this could have been so much easier.’

Using this example alone, Wright noted that the Education and Charity sectors alone stand to benefit from an accounting system that is far more intuitive and transparent than what is widely used today.

‘Rather than having someone send me a letter and receiving a call from a person at the HMRC, imagine how much easier it would be to pick up something that is an anomaly or an outlier,’ Wright said.

In another example, Wright noted that whenever he donates to charity (and wants to claim back for tax purposes) he has to keep those records and information at hand to prove it to the tax authorities. ‘Wouldn’t it be much easier for people to keep and collate all of that?’

Wright explained that this technology does not only assist in finding anomalies or other issues but can help with efficiency in other ways, including a real-time balance sheet and the ability to set up smart contracts for certain payments.

Some of the other specific issues which were considered during the workshop session included:

  • Educational records;
  • Corporate records;
  • University bills;
  • Charities;
  • Accounting efficiency.

Blockchain efficacy affected by ‘garbage in, garbage out’

As in other sessions during this masterclass, Wright noted that blockchains are not necessarily a fix-all. While blockchain technology is designed to be immutable and resistant to tampering, it is not impervious to mistakes made by humans interacting with it.

If incorrect information is entered, it can propagate throughout the blockchain and affect the integrity of the stored data. This can lead to misinformation or faulty records being perpetuated within the blockchain system.

Ryan Brothwell

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