Airline revenue accounting is the software that tracks the money from every airline ticket, from the moment the ticket is sold until the flight has flown, and splits it between airlines when one trip uses more than one airline. It also keeps the accounts for cargo. Accelya, which began as an Indian airline accounting company, is one of the main suppliers.
An airline sells a ticket weeks before the flight. Under accounting rules, that money is not yet the airline's revenue, because the airline still owes the passenger a flight. The airline records the money as unflown tickets, a kind of debt to its passengers. It counts the money as revenue only when the passenger actually flies. When the passenger service system (PSS) reports that the passenger boarded, revenue accounting moves that amount into revenue.
The harder job comes when one ticket covers flights on two airlines. This is called an interline ticket. Take, for example, a ticket from Indore to Singapore for ₹38,000. The first flight, Indore to Mumbai, is on one airline. The second, Mumbai to Singapore, is on its partner airline. The first airline sold the ticket and received the whole ₹38,000. So the two airlines must divide it. They use agreed rules, mostly based on the distance of each flight. This division is called proration. Here the first airline keeps ₹5,700 for its short flight, and the partner is owed ₹32,300 for the long flight. After the flights, the partner sends a bill. A clearing house run by IATA, the global association of airlines, adds up such bills between airlines and settles them every month.
Each step is checked. The software matches what was sold, what was flown and what partners have billed, and it explains every difference. This matching is called reconciliation. The software also calculates the commission owed to each travel agent and the taxes owed to each government.
Cargo is handled in the same way. Each shipment has an air waybill, which is the cargo equivalent of a ticket. These records come from the air cargo community system.
At the end of each month, revenue accounting sends totals to the airline's ERP system and to its financial close software, which prepare the airline's accounts. An airline with millions of passengers a month cannot do this by hand. A small error in proration, repeated across millions of tickets, adds up to crores of rupees.