This study explored how to use smart contract technology to implement accounting principles for public use. To illustrate its feasibility, this study developed a design model of decentralized accounting contracts (DACs) and used revenue recognition to demonstrate how to apply the proposed model. Considering various scenarios of revenue recognition, this study adopted Solidity to program smart contracts for five use cases: (1) regular sale, (2) installment sale, (3) gift card sale, (4) a contracted sale with multiple performance obligations, and (5) a contracted sale with variable considerations over the contract price. The results showed that smart contracts can be created to fully address complex revenue recognition scenarios according to the Generally Accepted Accounting Principles (GAAPs). In conclusion, we discuss the implications of the study for business organizations, regulatory agencies, and the accounting profession.
Skip Nav Destination
Article navigation
Research Article|
April 05 2021
Using Smart Contracts to Establish Decentralized Accounting Contracts: An Example of Revenue Recognition
Journal of Information Systems ISYS-19-009.
Article history
Received:
March 26 2019
Accepted:
April 05 2021
Citation
Chi-Chun Chou, Nen-chen R Hwang, Gary P. Schneider, Tawei (David) Wang, Chang-Wei Li, William Wei; Using Smart Contracts to Establish Decentralized Accounting Contracts: An Example of Revenue Recognition. Journal of Information Systems 2021; doi: https://doi.org/10.2308/ISYS-19-009
Download citation file:
Sign in
Don't already have an account? Register
Client Account
You could not be signed in. Please check your email address / username and password and try again.
Sign in via your Institution
Sign in via your Institution
18
Views
0
Citations