Preservation of the Gift Certificates

August 2, 1960 BIR RULING NO. 336-60 Messrs. Jugo, Elizalde & Associates Certified Public Accountant P. O. Box 2128, Manila Gentlemen : Reference is made to your letter of the 26th ultimo, requesting information whether or not, under the following circumstances, your client is under obligation to preserve the gift certificates referred to therein for a period of at least five years, and in the affirmative case, whether or not microfilms of said certificates can be kept in lieu of the originals thereof: "One of our clients is engaged in the issuance of Gift Certificates to be honored by accredited establishments within the Philippines. These Gift Certificates are issued by our client to interested parties for cash or on account. When these Gift Certificates are negotiated through any of the accredited establishments, the same are redeemed by the latter to our client who pays through a check voucher after deducting the corresponding discount. These Gift Certificates upon redemption by our client are marked 'Cancelled' and kept as part of their records." In answer thereto, I have the honor to inform you that as the aforementioned certificates constitute part of the accounting records of your client, the same should be preserved for a period of at least five years in accordance with section 337 of the Tax Code. LLphil Microfilms of the certificates in question cannot, for purposes of said section 337, take the place of the original certificates. A contrary rule may open the door to fraud. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue