Bitstamp's first annual statements - page 3.

Snipe85

sr. member

Activity: 756

Merit: 250

Infleum

Quote from: Nagle on January 05, 2015, 07:48:07 PM

Quote from: Snipe85 on January 05, 2015, 07:37:39 PM

Quote from: BITCOIN-PIZZA-DAY on January 05, 2015, 07:20:32 PM

Now bankrupt?

They lost 5 million out of 65 reported here. Not enough to go bankrupt Wink

In an extreme scenario they could get more if they sold the company and the buyer would cover the loss.

They don't get to cover their losses out of customer funds. If they lost $5M, and they have less than $5M of investor capital available, they are bankrupt.

Remember that they are fees and they aren't a new exchange so they must have a lot of cash on the side. If they really lost only 5 million it shouldn't be a problem.

Nagle

legendary

Activity: 1204

Merit: 1000

Quote from: Snipe85 on January 05, 2015, 07:37:39 PM

Quote from: BITCOIN-PIZZA-DAY on January 05, 2015, 07:20:32 PM

Now bankrupt?

They lost 5 million out of 65 reported here. Not enough to go bankrupt Wink

In an extreme scenario they could get more if they sold the company and the buyer would cover the loss.

They don't get to cover their losses out of customer funds. If they lost $5M, and they have less than $5M of investor capital available, they are bankrupt.

Snipe85

sr. member

Activity: 756

Merit: 250

Infleum

Quote from: BITCOIN-PIZZA-DAY on January 05, 2015, 07:20:32 PM

Now bankrupt?

They lost 5 million out of 65 reported here. Not enough to go bankrupt Wink

In an extreme scenario they could get more if they sold the company and the buyer would cover the loss.

pawel7777

legendary

Activity: 2436

Merit: 1561

Quote from: BITCOIN-PIZZA-DAY on January 05, 2015, 07:20:32 PM

Now bankrupt?

Don't think so. Even if they indeed lost 19000 BTC, the situation is manageable, if they have right people on-board.

BITCOIN-PIZZA-DAY

member

Activity: 82

Merit: 10

Now bankrupt?

JorgeStolfi

hero member

Activity: 910

Merit: 1003

Quote from: pawel7777 on September 21, 2014, 03:57:00 PM

Look at the Profit and loss account reserve. It's their first period of trading, they started with P&L reserve being zero, so they made a profit of $833k, possibly more if dividends have been declared/paid.

They must surely have taken some profits out over that year.

Quote

They couldn't just ignore the BTC holding tho, therefore it must have been included in 'cash in bank' position, which is not incorrect imho, despite the name 'cash...' it can also include cash equivalents.

If they did that, they took quite a bit of liberty in their reporting...

They had to pick a price to convert BTC to USD, and on 2013-10-31 the price varied from 195.10 to 203.75. Which one? (OK, they are not required to say, apparently.)

Also it would be ironic for them to call the blockchain a "bank" Cheesy

Let's round the price to 200 USD/BTC. Then, if that number includes the bitcoins, they held at most 330'000 BTC on that day, probably only some fraction of that. Just for comparison, on that day, their trade volume was 13741 BTC, MtGOX's was 4608 BTC. Hm...

pawel7777

legendary

Activity: 2436

Merit: 1561

Quote from: JorgeStolfi on September 21, 2014, 03:04:26 PM

It does not say how much profit they made.

I explained that in the first post. Look at the Profit and loss account reserve. It's their first period of trading, they started with P&L reserve being zero, so they made a profit of $833k, possibly more if dividends have been declared/paid.

Quote from: JorgeStolfi on September 21, 2014, 03:04:26 PM

Apparently it does not include their bitcoin holdings, since their assets (65.7 M USD) are described as "cash in the bank".

Agree, these accounts should have been more clear. They couldn't just ignore the BTC holding tho, therefore it must have been included in 'cash in bank' position, which is not incorrect imho, despite the name 'cash...' it can also include cash equivalents.

JorgeStolfi

hero member

Activity: 910

Merit: 1003

It does not say how much profit they made. It says only that, *as of Oct/2013*, they have about 64.9 M USD that belong to clients and about 820 k USD of their own. Apparently it does not include their bitcoin holdings, since their assets (65.7 M USD) are described as "cash in the bank".

2dogs

legendary

Activity: 1267

Merit: 1000

Quote from: pawel7777 on September 17, 2014, 05:17:00 PM

Yes, it's a regulatory requirement. The thing is, they did the very minimum they were required by law. It would be very wise of them get proper financial adviser/auditor and also prepare the extended, full accounts (to be more transparent and credible).

They also had some issues with filing the papers on time. I hope that any of the newly appointed directors has some solid knowledge and experience in such things.

Agree, quite poor.
Statements dated Oct 2013 (almost a year ago) and not approved by their board until last month?
No income statement, or statement of cash flows.

In fact, that stinks.

dleader

hero member

Activity: 592

Merit: 500

Quote from: sobriket on September 17, 2014, 05:38:45 PM

The state of assets is most worrisome.

servers... office equipment. what more do they need?

sobriket

full member

Activity: 144

Merit: 100

The state of assets is most worrisome.

pawel7777

legendary

Activity: 2436

Merit: 1561

Quote from: 2dogs on September 17, 2014, 04:37:16 PM

Thanks for the clarification.
Then it's not Bitstamp's election, but a regulatory compliance report, correct?

Yes, it's a regulatory requirement. The thing is, they did the very minimum they were required by law. It would be very wise of them get proper financial adviser/auditor and also prepare the extended, full accounts (to be more transparent and credible).

They also had some issues with filing the papers on time. I hope that any of the newly appointed directors has some solid knowledge and experience in such things.

2dogs

legendary

Activity: 1267

Merit: 1000

Quote from: pawel7777 on September 17, 2014, 04:19:26 PM

Quote from: ChrisKoss on September 17, 2014, 02:56:23 PM

What is the source of this document?

Companies House (UK)

Quote from: 2dogs on September 17, 2014, 01:31:55 PM

Agree, worthless - why publish this at all, Bitstamp?
Doesn't add much to their credibility - in fact, subtracts from it.

Bitstamp didn't publish that. IMHO they should have prepared proper accounts (audited) and publish it, but they didn't.

What you see is an extract from the abbreviated accounts, which, by law, they have to file with Companies House every year. Such accounts are publicly available in CH (for a small charge).

Thanks for the clarification.
Then it's not Bitstamp's election, but a regulatory compliance report, correct?

pawel7777

legendary

Activity: 2436

Merit: 1561

Quote from: ChrisKoss on September 17, 2014, 02:56:23 PM

What is the source of this document?

Companies House (UK)

Quote from: 2dogs on September 17, 2014, 01:31:55 PM

Agree, worthless - why publish this at all, Bitstamp?
Doesn't add much to their credibility - in fact, subtracts from it.

Bitstamp didn't publish that. IMHO they should have prepared proper accounts (audited) and publish it, but they didn't.

What you see is an extract from the abbreviated accounts, which, by law, they have to file with Companies House every year. Such accounts are publicly available in CH (for a small charge).

ChrisKoss

full member

Activity: 169

Merit: 100

What is the source of this document?

2dogs

legendary

Activity: 1267

Merit: 1000

Quote from: Nagle on September 16, 2014, 03:49:05 PM

They need an audit. They're not entitled to the "small company exemption" with assets of US$64 million. Here's the "Companies Act" section to which they refer. They may be able to claim that they were a small company in 2012, and get a year after becoming a large company in 2013 to comply. For 2014, they need a full audit.

Also, an annual statement normally contains both a statement of operations and a balance sheet. They just have a balance sheet, and one with too little information. All their liabilities, including customer deposits, are consolidated into one number.

This is worthless.

Agree, worthless - why publish this at all, Bitstamp?
Doesn't add much to their credibility - in fact, subtracts from it.

QuestionAuthority

legendary

Activity: 2156

Merit: 1393

You lead and I'll watch you walk away.

Quote from: pawel7777 on September 16, 2014, 04:39:20 PM

Quote from: Nagle on September 16, 2014, 03:49:05 PM

They need an audit. They're not entitled to the "small company exemption" with assets of US$64 million. Here's the "Companies Act" section to which they refer. They may be able to claim that they were a small company in 2012, and get a year after becoming a large company in 2013 to comply. For 2014, they need a full audit.

They may be entitled, if they have less than 50 employees (very likely) and turnover less than £6.5 million. The section of CA2006 quoted by you says:

Quote from: Nagle on September 16, 2014, 03:49:05 PM

Also, an annual statement normally contains both a statement of operations and a balance sheet. They just have a balance sheet, and one with too little information. All their liabilities, including customer deposits, are consolidated into one number.

This is worthless.

As a small company they can choose to present abbreviated accounts (and they did) with very limited info.

What I'm wondering is whether company with such activity falls under FCA/PRA regulations...

Quote from: QuestionAuthority on September 16, 2014, 04:26:45 PM

I thought Bitstamp was in the UK? Why is their financial statement in dollars?

UK law allows companies to present statements in their operational currency (for Bitstamp it's USD), they have to convert to GBP for tax purposes though.

Oh, got it, thanks.

pawel7777

legendary

Activity: 2436

Merit: 1561

Quote from: Nagle on September 16, 2014, 03:49:05 PM

They need an audit. They're not entitled to the "small company exemption" with assets of US$64 million. Here's the "Companies Act" section to which they refer. They may be able to claim that they were a small company in 2012, and get a year after becoming a large company in 2013 to comply. For 2014, they need a full audit.

They may be entitled, if they have less than 50 employees (very likely) and turnover less than £6.5 million. The section of CA2006 quoted by you says:

Quote from: Nagle on September 16, 2014, 03:49:05 PM

Also, an annual statement normally contains both a statement of operations and a balance sheet. They just have a balance sheet, and one with too little information. All their liabilities, including customer deposits, are consolidated into one number.

This is worthless.

As a small company they can choose to present abbreviated accounts (and they did) with very limited info.

What I'm wondering is whether company with such activity falls under FCA/PRA regulations...

Quote from: QuestionAuthority on September 16, 2014, 04:26:45 PM

I thought Bitstamp was in the UK? Why is their financial statement in dollars?

UK law allows companies to present statements in their operational currency (for Bitstamp it's USD), they have to convert to GBP for tax purposes though.

QuestionAuthority

legendary

Activity: 2156

Merit: 1393

You lead and I'll watch you walk away.

I thought Bitstamp was in the UK? Why is their financial statement in dollars?

twiifm

hero member

Activity: 784

Merit: 500

Thats the most abbreviated balance sheet I've ever seen. What's the point of this?

Topic: Bitstamp's first annual statements - page 3. (Read 5294 times)