Hi @lowway , I did some research with the aids of AI and found the following:
Option 1:
Foundation Passport supports message signing, and this is one of the most effective ways to prove ownership of an address:
- Get the receiving addresses used for withdrawals from the exchange (these are the ones that BTC was sent to).
- Using Envoy (or directly with Passport), your can sign a message with each of those addresses.
- The message can say something like:
-
"This address [Bitcoin address] is controlled by [SMSF name], ABN: [ABN]. Signed on [date]." - Provide the signed message + public address to the auditor, who can verify the signature independently using open-source tools or blockchain explorers with signature verification.
This method doesn’t rely on third-party software and is audit-grade proof of control over a wallet address.
Option 2:
If the wallet is structured for single-sig use (or if it's multisig but consistently structured), you can do the following:
- Export the xPub (or zPub, yPub, depending on address format) from the Foundation Passport via Envoy.
- Import that xPub into desktop wallet software that supports watch-only wallets and reporting, such as:
- Sparrow Wallet (Highly recommended, works with Passport)
- Specter Desktop
- Electrum
- These wallets can:
- Show all derived addresses.
- Show balances and transaction history.
- Export reports (CSV, PDF) of transactions and addresses.
Using Sparrow or Electrum, you can produce reports showing that the BTC resides in addresses derived from the wallet's xPub.
! Important Notes for Auditing SMSF Crypto Assets in Australia:
- Cold Wallet Must Be Solely Dedicated to the SMSF — No mixing with personal funds.
- Ownership Documentation — One should keep a declaration that the Passport wallet (serial number, if applicable) is dedicated to the SMSF.
- Screenshots or Photos of the wallet setup showing the name of the SMSF can also help.
- Date of acquisition, transaction history, and value at time of transfer are critical for audit and CGT records.
I've been using Foundation Passport as my Cold Wallet for BTC for almost a year now and use their dedicated app (Envoy) on my mobile as the interface to Bitaroo for converting AUD to BTC.
All has been good to date, however it's coming to the end of the FY and as this is all held in my SMSF, I'll need good reports to appease the independent auditor at tax time. Bitaroo allows both an AUD report dump and a BTC report dump on all transactions, which is great. My issue seems to be how to get similar type reports out of Envoy to prove that is where my cold wallet lives and what I hold in my cold wallet matches what went out of Bitaroo less fees.
So, does anyone have any ideas on how to source tax reporting type info (or even transaction type reports) from Envoy on behalf of Foundation Passport? I'm sure it will be a big issue for the auditor of my SMSF if I can't get something showing my current BTC holdings in some form of report.
Any thoughts (other than why did you use your SMSF)
Certainly, a fair question @skaex , but having to jump through the auditors hops each year to the extent that they want to see every receipt, every proof of transaction, etc before sign off, I know this will cause issues. The reason being that Bitaroo's reports in AUD and BTC show incoming dollars (that can be clearly matched to my SMSF bank account outgoings) but for outgoings, it does not show to whom or to where the withdrawal was sent. I've attached a snip from part of a Bitaroo report below to show what I mean.
So you can see that without the auditor having visibility over something my SMSF is stating as a stored asset, it will not get a tick.