This bug is the root cause of a number of problems. Enemy kills only count when a pet does the last hit. I was having multiple problems when I read the March 24th patch notes and saw this:

• Mobs killed by pets or mobs under the influence of the Love Medallion artifact now count towards merchant unlock progress

I did some experiments and this is true, but they're also the only thing that consistently count. Melee kills, bow kills and artifacts do not register correctly. I am unsure about explosives.

Problems caused by this bug:

• wooden/diamond sword trophy
• passive aggressive trophy
• break the spell trophy
• jungle fungus trophy
• giant slayer trophy
• ancient hunter trophy and ancient mob registration
• luxury and mystery merchant upgrade counters