Well me again with my pet peeve topic
I'm not an accountant but I know a little bit about revenue recognition & various accounting standards such as GAAP / IFRS.
I would venture to say that when a customer is paying for air travel there are usually two components: the actual fee paid to the airline for the service of transporting you from A to B and various (usually a lot) of taxes and fees.
These are usually paid upfront by the customer and I'm sure any decent accountant would book them on different transitory accounts for further processing,
but definitely not as revenue. Diverting the taxes for other purposes could very likely be a criminal offence in various jurisdictions and I don't see how prudent accounting practices would allow the airline to use the airfares
before rendering the service. As such I am somewhat dismayed (but not really surprised to be honest) that the industry is seemingly not being able to actually reimburse the customers for services not rendered. I can understand that some of it is a part of the leverage they used to get the various bailouts which have now been implemented but my question is: are most / all airlines actually running fool of good accounting practices? If so how can their account be audited (at least for the publically traded one) ?