Bankrate.com publishes good article on Gift Card Risks

An insight into the economics of Gift Cards by Bankrate

It makes sense why some companies apply expoiration dates to gift cards

Bankrate.com has published a great article about the details of Gift Cards. They point out an important fact to realize, that companies are not able to recognixe thre revenue from Gift Cards until they are sold. This puts the accounting team of companies who use gift cards (almost 90% at this point) in a somewhat difficult position. Certainly the popularity and ease of use of gift cards make them extremely desireable to a company they have to watch that they do not lead to books that are inaccurate.

A real world example, your mother smartly gives you a $200 gift card to iTunes. In your excitement, you throw the card in the air and it falls down a heating vent never to be found again. Apple at this point believes they have earned $200 but can't recognize the money. They never will. For this situation exactly many companies place expiration dates on gift cards.

Here is a link to the article if you want to read it yourself:  http://www.bankrate.com/brm/news/cc/giftcard.asp