This Notice establishes the formal requirements for asset declaration and revenue confirmation. Responsible parties are obligated to identify and declare all material assets within the covered categories and to confirm that reported revenue is supported by accurate, complete, and reconcilable records. Coverage extends to financial and digital securities, broker-dealer financial assets, physical and enterprise assets, and high-value financial assets.
Section I — Scope of Covered Assets
Asset declaration and revenue confirmation obligations under this Notice apply to the following primary categories. Each category must be declared where material and supported by documentation sufficient for revenue verification.
| Asset Category | Description | Primary Declaration Focus |
|---|---|---|
| Financial & Digital Securities | Marketable securities, digital assets, and related investment holdings | Holdings, cost basis, and realized/unrealized positions |
| Broker-Dealer Financial Assets | Assets held or controlled by registered broker-dealers under regulatory authority | Segregation, custody records, and position reporting |
| Physical & Enterprise Assets | Property, plant, equipment, and other tangible enterprise assets | Identification, location, and carrying amounts |
| High-Value & Financial Assets | Significant individual assets and complex financial instruments | Enhanced documentation and audit support |
Section II — Governing Framework
The following standards and authorities form the basis for the asset declaration and revenue confirmation practices described in this Notice.
| Instrument / Standard | Citation / Reference | Primary Focus |
|---|---|---|
| U.S. GAAP — Presentation of Financial Statements | ASC 205 / ASC 210 | Asset classification and disclosure |
| U.S. GAAP — Fair Value Measurement | ASC 820 | Valuation of financial and digital assets |
| Revenue Recognition | ASC 606 | Revenue confirmation and matching |
| Internal Revenue Code — Information Reporting | 26 U.S.C. § 6045 et seq. | Third-party asset and income reporting |
| SEC / Broker-Dealer Recordkeeping | SEA Rule 17a-3 / 17a-4 | Custody and position records |
Section III — Asset Declaration Requirements
Material assets within the covered categories must be formally declared. Declaration ensures that the existence, classification, and reported amounts of assets are transparent and verifiable against books, records, and third-party information returns.
- 01Identify and list all material assets by category, with a clear description or identifier for each item or position.
- 02State the acquisition or inception date, cost basis (or other applicable basis), and current reported carrying amount or fair value.
- 03Indicate the location, custody arrangement, or account in which the asset is held (including self-custodial wallets where applicable).
- 04Disclose any liens, encumbrances, or restrictions that affect title or transferability.
- 05Maintain contemporaneous source documents (statements, contracts, confirmations, custody reports) supporting each declared amount.
- 06Update the declaration promptly upon material acquisitions, disposals, or revaluations so that the declaration remains current.
Section IV — Revenue Confirmation Standards
Reported revenue must be confirmable against underlying asset activity, sales, transfers, and other revenue-generating events. Confirmation requires that revenue figures are reconcilable to source records and consistent with declared asset positions.
| Confirmation Element | What Must Be Supported | Typical Evidence |
|---|---|---|
| Gross revenue / proceeds | Total amounts recognized from sales, exchanges, or other transfers | Invoices, trade confirmations, 1099s, settlement reports |
| Timing of recognition | Period in which revenue was earned and recorded | Transaction dates, period-end cut-off schedules |
| Related asset positions | Assets sold, transferred, or otherwise disposed of | Asset register, position statements, wallet records |
| Counterparty / source | Identity or category of payer or exchange | Broker statements, exchange reports, contracts |
| Reconciliation to books | Agreement of revenue totals to general ledger and tax returns | Trial balance, revenue sub-ledgers, tax workpapers |
Section V — Reporting for Revenue Verification
Accurate asset declarations are essential to the verification of reported revenue. Supporting schedules and source documents must be maintained and made available for internal review, external audit, and regulatory examination.
- 01Maintain a current asset declaration schedule listing material assets by category, identifier, acquisition date, basis, and reported amount.
- 02Reconcile declared asset amounts to the general ledger and, where applicable, to custody or brokerage statements at least quarterly.
- 03Prepare and retain revenue confirmation workpapers that link period revenue to specific asset sales, transfers, or other revenue events.
- 04Document the basis for any fair-value or estimated amounts included in the declaration, including valuation sources and dates.
- 05Retain source documents for the periods required by applicable statutes of limitation and internal retention policy.
- 06Ensure that revenue reported on financial statements and tax returns is consistent with the Asset Declaration and with third-party information returns.
Incomplete or inconsistent asset declarations may result in material misstatement of assets and revenue. Such misstatements may lead to restatements, audit qualifications, regulatory findings, or challenges to reported revenue and taxable income. Contemporaneous, auditable documentation must be maintained at all times.
Section VI — Regulatory Oversight Tools
To ensure compliance with these requirements, regulatory authorities employ specific tools that examine consistency among declared asset positions, third-party information returns, and reported revenue.
| Tool / Program | Description | Primary Use |
|---|---|---|
| Automated Underreporter Programs | The IRS matches third-party asset and income reports (including 1099 forms) directly to filings to identify discrepancies in reported revenue, basis, or asset-related amounts. | Detection of underreported revenue or inconsistent asset declarations |
| Tax Certainty Programs (CAP) | For larger enterprises, the Compliance Assurance Process (CAP) facilitates cooperative engagement with the IRS to verify significant asset and revenue positions prior to filing. | Pre-filing verification and reduction of post-filing controversy |
Section VII — Compliance Responsibilities & Controls
Management is responsible for establishing and maintaining internal controls that ensure assets across all covered categories are properly declared and that reported revenue is confirmable.
- 01Adopt a written asset declaration policy defining materiality thresholds, required data fields, and approval requirements.
- 02Conduct periodic verification of major physical and high-value assets, and reconcile declared amounts to custody or register records.
- 03Require independent review of the Asset Declaration and revenue confirmation schedules prior to financial close and tax filing.
- 04Ensure timely recognition of acquisitions, disposals, and transfers, with corresponding updates to the Asset Declaration.
- 05Coordinate among accounting, tax, and operations functions to ensure declared assets and confirmed revenue remain consistent across books and returns.
- 06Maintain readiness for Automated Underreporter inquiries and, where applicable, participation in Tax Certainty / CAP processes.
Section VIII — Consequences of Non-Compliance
Failure to complete an accurate Asset Declaration, to support reported revenue with adequate records, or to comply with applicable reporting and disclosure requirements may result in severe civil, regulatory, and criminal consequences, including but not limited to the following:
| Issue | Potential Consequence | Reference |
|---|---|---|
| Willful non-compliance or concealment | Asset freezes and account restraints; temporary or permanent bans from regulated platforms or markets; civil injunctions | Court orders / regulatory enforcement |
| Criminal tax or securities violations | Prosecution in federal court; fines; imprisonment; potential total loss of undeclared or illicitly held assets through forfeiture | 26 U.S.C. § 7201 et seq. / Title 18 |
| Inadequate supporting documentation | Inability to support positions under examination; adverse findings under Automated Underreporter programs | IRC record-keeping rules |
| Inconsistency with third-party reports | Underreporter notices, proposed adjustments, accuracy-related and fraud penalties | IRC §§ 6662, 6663 |
| Incomplete or omitted asset declaration | Restatement of financial statements; audit qualification; referral for regulatory examination | ASC 250 / AU-C standards |
| Material weakness in internal control | Adverse internal-control opinion; heightened regulatory scrutiny; loss of market or counterparty confidence | SOX / COSO framework |
| Revenue not reconcilable to declared assets | Challenges to reported revenue; proposed tax adjustments; civil penalties and interest | ASC 606 / IRC assessment authority |
Non-compliance may escalate beyond financial restatement. Authorities may seek court orders to freeze accounts and digital asset wallets, impose industry or platform bans, pursue civil forfeiture of undeclared assets, and, in cases of willful evasion or fraud, initiate criminal proceedings that may result in total economic loss and personal liability for responsible individuals.
Section IX — Asset Declaration Schedule
Responsible parties are required to formally declare the existence, classification, basis, and reported amount of material assets within the covered categories. This declaration supports revenue verification, regulatory matching programs, and internal control assertions.
| Asset Category | Description / Identifier | Acquisition Date | Cost / Basis | Reported Amount | Custody / Location |
|---|---|---|---|---|---|
| Financial & Digital Securities | Equity portfolio — US large-cap (CUSIP basket) | Ongoing | $4,850,000 | $5,120,000 | Prime brokerage — segregated |
| Broker-Dealer Financial Assets | Client custody cash & securities | Ongoing | $12,400,000 | $12,400,000 | Registered BD — customer reserve |
| Physical & Enterprise Assets | Headquarters building & improvements (PPE-0412) | Ongoing | $8,750,000 | $7,291,667 | New York, NY — owned |
| Physical & Enterprise Assets | Data center equipment & servers (IT-2287) | Ongoing | $1,245,000 | $622,500 | Ashburn, VA — leased facility |
| High-Value & Financial Assets | Corporate aircraft (N482MC) | Ongoing | $18,200,000 | $13,650,000 | Teterboro, NJ — owned |
| Totals | $45,445,000 | $39,084,167 | |||
By completing and submitting this Asset Declaration, the declarant affirms that the information provided is complete and accurate to the best of their knowledge, that all material assets within the scope of this Notice have been identified, and that the stated amounts are consistent with the entity’s books and records and support the confirmation of reported revenue.
Material omissions or misstatements in the Asset Declaration may expose the entity and responsible individuals to the consequences described in Section VIII, including restatement risk, audit findings, and regulatory matching inquiries under Automated Underreporter Programs.
Section IX-B — Declare a Cryptocurrency Wallet
If you hold digital assets in a self-custodial or hosted wallet that is material to this declaration, you are required to declare such wallet by providing its public address and confirming ownership thereof. In the event multiple wallets are held, each material wallet must be separately declared. Asset declaration serves revenue verification purposes, as responsible parties frequently omit disclosure of all public wallet addresses and digital assets held in self-custodial or hosted wallets.
Section X — Acknowledgment of Compliance Obligations
By acknowledging this Notice, the responsible party confirms understanding of the requirements for formal asset declaration across all covered categories, confirmation of reported revenue against supporting records, and readiness for regulatory matching and certainty programs. Select one of the following declarations: