Sales bonuses are something not everyone is giving to their customers, but when you do, there are a few considerations to be kept in mind.

For one, do you issue credit invoices or does the customer itself issue invoices to you? Why is it important? Besides the obvious, defining obligations, it’s also a question of who does the initial measuring of the bonus and who has the opportunity to check if the calculation is accurate. 

Another question arising from the previous is the question of whether to accrue for the expense regardless of the actual invoices being issued by either of the party regularly? In short, regardless who issues the invoice and when, should you accrue for the expense each month?

I would say so yes. The reason is actually simple. Understanding your sales revenue amount is crucial for almost every business that’s actually selling goods or services. You wouldn’t want to account for the expense once a year only to realize your sales were actually smaller than what you expected and your result for the period also dropped suddenly once making the entry. So I do suggest accruing for the expense regularly based on your understanding of the amounts. Once the actual invoice comes in, the accrued amounts can easily be adjusted leaving with you with a far less extensive impact on the statements as compared to if you’d make the entry just once a year.