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What is accounting treatment for gift cards?

With gifts cards becoming a major source of sales to retailers, what do you think is the acceptable accounting treatment for the sale of gift cards and for the expenses associated with printing the cards?

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Question ajoutée par Utilisateur supprimé
Date de publication: 2013/07/18
Asif Umer
par Asif Umer , Accounting Manager , Garden College Ltd

1.
Revenue should be recognized at the point when gift cards are utilized2.
Expense can be amortized on some reasonable basis (if material) considering different aspects

Prince Ninan
par Prince Ninan , Audit Executive , Lewis & Pecker

should be treated as a revenue expense and should be charged to sales promotion expense a/c or any other similar a/c

ABDUL MAJEED KUNNAM PADATH
par ABDUL MAJEED KUNNAM PADATH , Chief Accountant , Arab building materials

If Gfit VOucher is for any product,When redeem it by customer,it will be consider as100%Discount on sales.(Sales Discount Expences)...If we offer some percentage on reduction on Gift VOucher,when redeem it, that %amount on sales will be considered as Discount on Sales.

MOHAMMED ARIF
par MOHAMMED ARIF , Finance & Accounts Executive and Assistant Manager , ORBITZ CORPORATE & LEISURE TRAVELS (India) PVT LTD

Yes acceptable since the first priority is always given to the sales and accounting is the process to record, to analyze, to summarize and to keep the updated records of the business and it's growth, and as far as the question of expenses it is like an investment for growth.

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