CERTYNEX IFRS ACADEMY

The bookshop chain Bons Lumière sells gift cards. In the region where it operates, an unclaimed property law requires it to remit to the public authority the balance of cards that remain unused at expiry (case data). Bons Lumière expects balances of EUR 4,000 never to be used. How does it account for this amount?

It recognises the EUR 4,000 as revenue in proportion to the use of the other cards by customers.

It recognises the EUR 4,000 as revenue when the cards expire, once their use becomes unlikely.

It recognises this amount as a liability, because it will have to be remitted to the public authority; no revenue is recognised for it.

It recognises the EUR 4,000 as revenue when the cards are sold, then recognises an expense when it pays that balance to the public authority.