AR Inter Airline Settlement - Currencies & Exchange Rates

The five day rate is the mean average exchange rate for the five banking days ending on the 20th of each month preceding the clearance month. So for example the rate calculated from the five banking days ending on the 20th January will be used for the clearance month of February. The mean average rate is the mean average exchange rate for the whole of the clearance month. It is used when the five day rate for the clearance month varies by 6% or more from the five day rate of the previous clearance month. It becomes available on the 11th day of the calendar month.

These two rates are used depending on the business category. For Passenger, Cargo and Miscellaneous categories, the five day rate for the month prior to the clearance month will normally be used. For those currencies with a 6% or greater shift, then the mean average rate for the clearance month will supersede the five day rate. For the UATP category the five day rate for the clearance month will always be used.

* The five day rate for the month prior to the clearance month. All other five day rates for the clearance month.

Member airlines trade with each other in many currencies. However, settlement of billings is determined by the currency of the clearance relevant to the zone. From the following table we can see that Zone A airlines will settle in GBP (Pounds Sterling) and that all other settlements are handled in USD (United States Dollars).

Billing between airlines is carried out in many currencies. Within the Business Categories of Passenger, Cargo or UATP only zone currencies are permitted, whereas for the Miscellaneous Business Category any currency can be used. Although airlines may bill in many currencies they maintain their books in their own currency. For example Air New Zealand (a zone A member) bills in GBP and USD but maintains its books in NZD (New Zealand Dollars).

Business Category	Rate <6% Shift	Rate >6% Shift
Passenger	*5	day Mean Ave
Cargo	*5	day Mean Ave
UATP	5 day	5 day
Miscellaneous	*5	5 day Mean Ave

Zone	Description	Currency of Clearing Zone A B C
A	Sterling Zone	GBP USD USD
B	US Dollar Zone	USD USD USD
C	Airline Clearing House (ACH)	USD USD USD

NOTE The menu path shown is the default for the system. Your company may have customised menu options, so the path shown may not be accurate. Please contact your system administrator for details.