kaal:claim:5454054-008

Funding LER rewards out of marketing budgets keeps them off the balance sheet, because marketing spend is expensed immediately under U.S. GAAP (ASC 606) and IFRS 15 rather than deferred as revenue the way traditional loyalty points are.

LER optimizes issuer benefits by funding rewards from issuers' marketing budgets. As such, they are treated as immediate expenses under U.S. GAAP (ASC 606) and IFRS 15. This avoids balance sheet liabilities associated with traditional loyalty points' deferred revenue.

Wulf A. Kaal, Liquid Equity Rewards (2025), Balance Sheet Benefits, p. 12
https://ssrn.com/abstract=5454054 · source PDF

Wulf A. Kaal, Liquid Equity Rewards (2025). SSRN: https://ssrn.com/abstract=5454054

• rewards funded from marketing budgets rather than issued as redeemable obligations

mechanismsupport: arguedeconomics

• restated_by kaal:claim:5583610-009 Because LER rewards are funded out of marketing budgets at roughly one to five cents per holder-day and expens...

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