Definition of point-of-sale (POS)

1. system that uses a computer terminal located at the point of sales transaction so that the data can be captured immediately by the computer system.
2. general point for revenue recognition. Generally Accepted Accounting Principles (GAAP) require the recognition of revenue in the accounting period in which the sale is deemed to have occurred. For services, the sale is deemed to occur when the service is performed. In the case of merchandise, the sale takes place when the title to the goods transfers from seller to buyer. In many cases, this coincides with the delivery of the merchandise. As a result, accountants usually record revenue when goods are delivered.

retail payment system that substitutes an electronic transfer of funds for cash, checks, or drafts in the purchase of retail goods and services. In a POS system, sales and payment information are collected electronically, including the dollar amount of the sale, the date and place of the transaction, and the consumer's account number. If the transaction is done on a bank credit or debit card, the payment information is passed on to the financial institution or payment processor, and the sales data is forwarded to the retailer's management information system for updating of sales records. Much of the actual processing volume is for credit card sales.