Originally Posted by RustyC
Also, any claims that inactive accounts are costing the airline any amount of money are total rubbish. The miles are valued at very low levels for the airline, and the administrative/computer costs are negligible in an age of e-mail.
However, the unused miles do have a monetary value that has to be accounted for on their balance sheet as a liability. Essentially, it's an outstanding debt. Expiring the miles allows them to write that off. I'm not an accountant so I don't know all the details or the exact valuation, but there's more involved than just the administrative/computer costs.