It has been common practice for some businesses to have expiry dates on their gift cards. It is worth reading this old thread which discusses other examples pre and post Covid.
Businesses possibly have expiry dates which conform to the minimum standards required by the ACCC as the cards would be seen as a form of outstanding credit within the businesses accounting system. When the card was purchased, it would have been accrued against general revenue at that time. When it is used, it is a cost against the general revenue at that time.
There is often mistaken belief that the value if a gift card is held in some sort if trust/special account gaining interest…waiting for its monetary value to be used and withdrawn. If this was the case, expiry dates could be seen as unnecessary. Unfortunately this isn’t the case.
The cards would be a liability against the business and if they sat in their books for many years, liabilities could become considerable and could be seen to impact on the bottom line. Liabilities also have to be reported for public companies.
While it doesn’t seem to make sense as they have in effect received ‘money for nothing’ at the time a gift card was purchased, accountants see it as a liability when they are used.
Expiry dates should also be reasonable, that being giving the gift card holder reasonable time to use the cards. While Covid impacted on ability to use such cards (domestically) from time to time between March 2020 and late last year (except WA which was earlier this year) there has been opportunity to use the cards since then. It could be argued either way whether Jetstar’s position is reasonable.
