Westjet 1999 Annual Report Download - page 21

Years ended December 31, 1999 and 1998
(Tabular Amounts are Stated in Thousands of Dollars)
1. Significant accounting policies:
(a) Revenue recognition
Passenger revenue is recognized when air transportation is provided. The
value of unused tickets is included in the balance sheet as advance ticket
sales under current liabilities.
(b) Non-refundable passenger credits:
The Corporation, under certain circumstances, may issue future travel
credits which are non-refundable and which expire one year from the date
of issue. These passenger credits are recorded at a discount of their face
value. The utilization of passenger credits are recorded as revenue when
flown.
(c) Foreign currency:
Monetary assets and liabilities, denominated in foreign currencies, are
translated into Canadian dollars at rates of exchange in effect at the balance
sheet date. Other assets and revenue and expense items are translated at
rates prevailing when they were acquired or
incurred.
Exchange gains and losses arising on the translation of long-term monetary
items that are denominated in foreign currencies are deferred and
amortized on a straight-line basis over the remaining term of the related
monetary item.
(d) Inventory:
Materials and supplies are valued at the lower of cost
and replacement value. Aircraft expendables and
consumables are expensed as incurred.
(e) Deferred costs:
Sales and marketing and reservation expenses
attributed to the advance ticket sales are deferred and
expensed in the period the related revenue is
recognized. Included in prepaid expenses are
$1,169,000 (1998 - $873,000) of deferred costs.
WestJet Airlines 1999 Annual Report
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