Retail accounting

Retail accounting guides

• Retail accounting: the key IFRS issues4 minute readRetail accounting explained: store leases, inventory and shrinkage, loyalty points, gift cards, returns, supplier rebates, store impairment and KPIs under IFRS.
• Store leases under IFRS 163 minute readRetail store leases under IFRS 16: lease term with break clauses, turnover rent, rent-free periods, dilapidations and store closures, with an example.
• Retail inventory, shrinkage and the retail method3 minute readRetail inventory accounting under IAS 2: the retail method, estimating shrinkage between stock counts, markdowns and net realisable value, with an example.
• Loyalty programmes and material rights3 minute readHow retailers account for loyalty programmes under IFRS 15: points as a material right, allocating the sale price, redemption rates and coalition schemes.
• Gift cards and breakage3 minute readGift card accounting under IFRS 15: contract liabilities, breakage recognised as cards are redeemed, third-party sales and unclaimed property laws.
• Returns and refund liabilities3 minute readHow retailers account for returns and refund liabilities under IFRS 15: revenue net of expected returns, the refund liability and the return asset.
• Supplier rebates and allowances3 minute readHow retailers account for supplier rebates and vendor allowances under IAS 2: reducing inventory cost, tiered volume rebates, marketing contributions, accruals.
• Store impairment testing3 minute readHow retailers test stores for impairment under IAS 36: each store as a cash-generating unit, right-of-use assets, online sales, value in use, with an example.
• Franchise fees and revenue3 minute readHow franchisors recognise franchise revenue under IFRS 15: initial franchise fees over the licence term, sales-based royalties, pre-opening services, ad funds.
• Online marketplaces: principal or agent3 minute readOnline marketplace revenue under IFRS 15: principal or agent for third-party sales, control indicators, fulfilment services, and platform-funded discounts.
• Promotions, coupons and discounts3 minute readHow retailers account for promotions and coupons under IFRS 15: multi-buys, buy one get one free, vouchers for future purchases, manufacturer coupons, examples.
• Concessions and consignment stock3 minute readHow retailers account for concessions and consignment stock: principal or agent under IFRS 15, whose inventory it is under IAS 2, and how sales are shown.
• Retail KPIs: like-for-like sales and margins3 minute readRetail KPIs explained: like-for-like sales, gross margin, sales density, inventory turnover and EBITDA, how they relate to IFRS figures, and IFRS 18 rules.

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The standards behind these guides

About these guides

Each guide starts from an accounting issue retail companies actually face and works through it with numbers from the industry. 13 of 13 planned guides are published; more are added with every batch.