CashBack & Accounting

We must clearly state here that we are not certified accountants, we are not engaged with your company to give accounting advice, and the information shared here should not be construed as professional accounting advice. Our insights are based on observations and discussions within the industry, and individual circumstances may vary. It's always recommended to consult with a qualified accountant for specific guidance tailored to your business needs.

That being said, we've encountered various approaches that brands have taken. Here are a few observations:

  • Prepaid Visa Cards: Some brands classify CashBack selected as prepaid Visa cards as part of their sales and marketing expenditures. These are fixed expenses for the brand, and are directly tied to acquiring a customer. This can be advantageous because it moves from contra revenue (for discounts) to operating expenses. With this designation, there are no balance sheet implications.
  • Brand gift cards: Brands typically follow the same strategy that they use for other Brand gift cards issued
  • Unselected CashBack: Most brands make no provision on their balance sheets for unselected cashback. Typically, the vast majority of customers select their cashback method within a week, otherwise they do not select anything. The cashback selection link expires after 6 months.

These insights are not prescriptive. If you have further questions, we recommend consulting with an accounting professional.

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