While you should always confirm with your accountant, generally speaking, Gift Card and Gift Certificate programs should be handled as an Other Current Liability on your Balance Sheet.
The thought process being that, when you sell a Gift Card or Gift Certificate, you have not actually earned any current period income. Rather, you owe a future good or service to the holder of the Gift Card or Certificate - thus you have a liability or future obligation.
While it varies by Point of Sale in terms of the best set up on the point of sale, Shogo supports mapping of gift card sales as well as gift card redemptions. If your point of sale requires any special set up in order to be properly handled in the Shogo accounting configuration, there should be a specific reference under that Point of Sale's help section.
In your chart of accounts, you can set up an account (again of type=Other Current Liability) called Gift Cards Outstanding, Unredeemed Gift Cards, or whatever makes the most sense to you and then simply map your gift card sales and redemptions to this account. At any point in time, the balance in this account should represent the net value you have of gift cards or certificates still outstanding.
An alternative would be to set up three accounts to track the gift card flows as follows:
Gift Cards Outstanding (Parent account)
- Gift Cards Sold (sub-account of Gift Cards Outstanding)
- Gift Cards Redeemed (sub-account of Gift Cards Outstanding)
This structure would allow you to see the total sold and the total redeemed, with the net balance displayed on your Balance Sheet in the parent Gift Cards Outstanding account.
However, if you are running a Cash Basis set of books or your accountant has determined you can recognize Gift Card sales and redemptions via income accounts, the Shogo configuration will support mapping this way as well as the above.
Tip: To the extent permitted, consider assigning a maximum term to the gift card or certificate on the face or back of the actual card or certificate.