Final Word from Wednesday, May 30, 2018
Under international accounting rules, frequent-flyer miles and other similar loyalty-program points are a liability on a company's balance sheet. The points must be repaid at some time in the future, just as a loan must be. Airlines and other sponsors of such loyalty programs sometimes change the terms as a way to reduce this liability. Making the points expire after a certain period of time is a favorite tactic. The EU has now served up a new trick for companies to use. Customers who didn't agree by May 25 to the new data-protection framework had their accounts - and points - canceled. "What else could we do?" ask the merchants who expect loyalty from their customers but don't always reciprocate. Of course they could have done something else. They could have sent customers their personal data and loyalty-point history and given them the option to reenter the data into the system at their convenience. Oh, but what a mess that would make of the balance sheet. [Czech Republic ČSA]
Glossary of difficult words
liability - a company's financial debt or obligation that arises during the course of business operations;
to serve up - to make something available; to provide;
merchant - a person involved in trade or commerce;
to reciprocate - to respond to (a gesture or action) by making a corresponding one;
at one's convenience - at a time or place of one's choice.