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The gift card industry is growing exponentially with increasing amounts of gift cards going unredeemed and thereby resulting in significant liabilities on retailers’ balance sheets and breakage revenue on income statement that retailers have done nothing to earn. Little to no accounting guidance from the United States or international accounting standards board exists while the federal government has recently issued legislation to regulate the issuance of gift cards. Practitioners are making their own decisions on how to appropriately and transparently record and disclose these products and their related liabilities and revenues in their financial statements. At the same time, markets are demanding financial transparency and consistency in financial reporting. This paper critically examines the literature applicable to transparently reporting and disclosing gift card transactions in financial statements and considers future research implications related to the gap in accounting standards.