How a Business Can Hold Alternative Assets on Its Balance Sheet — Treatment, Risks, and Best Practices

7 January 2026 Gaurishanker Puniani

Canadian businesses are increasingly exploring whether they should hold alternative assets such as Bitcoin, Ethereum, physical gold, silver, private equity, and non-operating real estate.

This article explains how corporations can hold these assets legally, how they are treated for accounting and tax purposes in Canada, where they should be stored, what risks exist, and what exposure levels make sense.

Asset Categories

Asset Type	Balance Sheet Classification
Cash	Current asset
Stocks / ETFs	Financial asset
Real estate	Capital asset
Gold / silver	Inventory or long-term investment
Bitcoin / Ethereum	Intangible asset (IFRS)
Private funds	Long-term investment

Canadian Tax Treatment Summary

Asset	Tax on Sale	Ongoing Tax	Notes
Gold / silver	Capital gain or business income	None	Depends on intent
Bitcoin / ETH	Capital or business income	None	CRA views as commodity
Real estate	Capital gains + recapture	Property tax	Depreciation impacts
Stocks / ETFs	Capital gains	Dividends taxable	Depends on corp type
Private equity	Capital gains	None	On exit

IFRS vs US GAAP Treatment

Asset	IFRS	US GAAP
Bitcoin / ETH	Intangible, impairment only	Same
Gold	Inventory or investment	Same
Stocks	Mark-to-market	Mark-to-market
Real estate	Cost model or fair value	Cost model

Should Businesses Hold Alternative Assets?

Only when:

• Operating cash is secure
• Debt obligations are manageable
• Liquidity needs are covered

Sensible Exposure Ranges

Business Stage	Alt Asset %
Early	0–5%
Stable	5–10%
Mature	10–20%
HoldCo	20–30%

Storage & Custody

Gold / Silver:
Royal Canadian Mint, Brinks, Loomis vaulting

Crypto:
Corporate cold wallets with multisig and documented access

Real estate:
Separate HoldCo or LP

How to Accumulate

Treasury policy approval
Gradual accumulation (DCA)
Annual rebalancing

Example

A Canadian HoldCo with $2M surplus:

Policy: 15% alternatives = $300K
Allocation:

$120K gold
$90K Bitcoin
$40K Ethereum
$50K private fund

2. Diagrams

Asset Flow Structure

Risk Pyramid

3. Printable Checklist

Before buying alternative assets:

☐ Emergency cash reserve funded
☐ No short-term debt pressure
☐ Board approval / policy
☐ Accounting classification defined
☐ Custody solution selected
☐ Tax implications reviewed
☐ Succession & access documented

4. Treasury Policy Template (Text)

Purpose:
To define how the company manages surplus capital.

Asset Classes Allowed:
Cash, gold, Bitcoin, Ethereum, private funds, real estate.

Exposure Limits:
Max 20% alternatives.

Rebalancing:
Annually.

Custody:
All assets must be held in corporate name with segregated custody.

Prohibited:
Margin, leverage, derivatives, personal custody.

5. Final Notes

This framework:
• Protects the company
• Keeps auditors comfortable
• Keeps CRA risk manageable
• Preserves optionality

Now lets look at the sample balance sheet:

Example: Corporate Balance Sheet With Alternative Assets

Example Company: ABC Holdings Inc. (Canada)
Purpose: HoldCo holding operating surplus and long-term assets
Currency: CAD

Balance Sheet — As at Dec 31, 2026

Assets

Current Assets

Item	Amount	Treatment
Cash and cash equivalents	$350,000	Face value
Short-term investments (GICs, T-Bills)	$150,000	Mark-to-market
Accounts receivable	$80,000	Face value
Total Current Assets	$580,000

Long-Term Assets

Financial / Alternative Assets

Item	Amount	Classification
Physical Gold (vaulted)	$120,000	Long-term investment
Physical Silver (vaulted)	$40,000	Long-term investment
Bitcoin (BTC)	$90,000	Intangible asset
Ethereum (ETH)	$40,000	Intangible asset
Private Equity Fund	$60,000	Long-term investment
Public equities (non-trading)	$100,000	Long-term investment
Subtotal – Alt & Financial	$450,000

Real Assets

Item	Amount	Classification
Investment property	$600,000	Capital asset
Less: accumulated depreciation	(80,000)	Contra asset
Net investment property	$520,000

Other

Item	Amount	Classification
Loan to subsidiary	$200,000	Long-term receivable

Total Long-Term Assets | $1,170,000 |

Total Assets = $1,750,000

Liabilities

Current Liabilities

Item	Amount
Accounts payable	$60,000
Income taxes payable	$40,000
Short-term debt	$50,000
Total Current Liabilities	$150,000

Long-Term Liabilities

Item	Amount
Mortgage on investment property	$350,000
Total Long-Term Liabilities	$350,000

Shareholders’ Equity

Item	Amount
Share capital	$200,000
Retained earnings	$850,000
Total Equity	$1,050,000

Total Liabilities & Equity = $1,750,000

✔ Balanced.

Accounting Treatment by Asset

Cash & GICs

• Current assets
• No depreciation
• Interest income taxable annually

Gold & Silver

• Classified as long-term investment (not inventory)
• Carried at cost
• No depreciation
• Taxable only when sold

Bitcoin & Ethereum

• Classified as intangible assets under IFRS
• Recorded at cost
• Tested for impairment (write-down if value drops below cost)
• No upward revaluation until sold
• Taxed on disposition

Private Equity Fund

• Long-term investment
• Valued based on NAV or valuation reports
• Gains taxed on exit

Investment Property

• Capital asset
• Depreciated annually
• Capital gain + recapture on sale

Loan to Subsidiary

• Long-term receivable
• Interest income taxable annually if charged

What This Shows

This balance sheet shows:

✔ Alternative assets sit alongside traditional assets
✔ They do not distort operations
✔ They are segregated from working capital
✔ They are governed by classification and accounting rules
✔ They remain passive, not speculative

Key Design Principles Illustrated

Liquidity first — current assets exceed current liabilities
Alternatives are capped (~25%) of total assets
Crypto is not treated as cash
Real estate is separated and depreciated
No leverage on volatile assets