I’m not an accountant, but I do know that gift cards should be recognized as revenue at the time of services rendered, not at the time of a sale of a gift card. Are grants similar in that a “gift card” is being granted and the revenue can be realized at a later date?
I'm not an accountant, but I believe that's revenue recognition.
I sell you a $10 gift card today. I can't recognize the revenue until you spend the $10.
However, if I know you're going to spend $10 less at my business this year, I can GIVE you a $10 gift card. Then, hopefully, you'll come to my business as usual. When you spend the $10, I can record that as revenue, and then I can record a $10 expense for the cost of sale.
Top line doesn't change. I think. But I'm not an accountant. I don't know.
