The accounting treatment of credit card rewards programmes : a South African perspective (part III)

Brink, Sophia M. (2017-10)

CITATION: Brink, S. M. 2017. The accounting treatment of credit card rewards programmes: a South African perspective Part III. Journal of Economic and Financial Sciences, 10(3): 567-592.

The original publication is available at


Most credit card issuers offer their cardholders participation in a customer loyalty programme. Currently all credit card rewards programmes fall within the scope of IFRIC 13. For annual reporting periods beginning on or after 1 January 2017 IFRIC 13 will be withdrawn and will be replaced by the new revenue Standard, IFRS 15. In the process of compiling the new revenue model, credit card rewards programmes raised various concerns and uncertainties regarding the application of IFRS 15 to credit card rewards programme transactions. Despite concerns raised, the IASB and FASB decided against providing any additional guidance to credit card rewards programmes and indicated that they leave it up to management’s judgement to determine how to account for these transactions. Although the effective date of the new revenue Standard is 1 January 2017, in view of the nature of a credit card rewards programme transaction it would be prudent for credit card rewards programmes to start collecting data immediately for the retrospective application. Given the time limit, the unanswered uncertainties and problem areas identified together with the minimal specific guidance to credit card rewards programmes, the main objective of the research reported in this article was to determine how to account for credit card rewards programme transactions, within the scope of IFRS 15 through the formulation of specific guidelines, and specifically to address the uncertainties raised by credit card rewards programme respondents. The study was also aimed at assisting credit card rewards programmes in converting from IFRIC 13 to IFRS 15 by highlighting the differences between the requirements contained in IFRIC 13 and IFRS 15.

Please refer to this item in SUNScholar by using the following persistent URL:
This item appears in the following collections: