collect evidence in cases in which the economic regulatory authority of the Civil Aeronautics Board is or may be involved and perform other duties imposed upon him by law. Section 407 (e) of the Federal Aviation Act of 1958, as amended, together with Part 240 of the Regulations of the Civil Aeronautics Board, provides in part that the Board, through its duly accredited special agents or auditors, shall at all times have access to, and may inspect and examine, all lands, buildings and equipment of any air carrier and all accounts, records, and memoranda, including all documents, papers, and correspondence, and make copies thereof.

The issuance of these credentials to the holder hereof constitutes an order and direction on the part of the Civil Aeronautics Board to such individual to carry out these duties as aforesaid and as more fully described in Part 240 of the Board's Economic Regulations.

Failure to honor these credentials will result in penalties as provided by law.

UNITED STATES OF AMERICA
CIVIL AERONAUTICS BOARD
WASHINGTON, D. C.

(d) Any identification card and credentials heretofore issued to any such employee of the Board referring to section 407 (e) or section 702(c) of the Civil Aeronautics Act of 1938, as amended, shall be deemed amended to refer, respectively, to section 407 (e) or section 701(c) of the Federal Aviation Act of 1958 and shall continue in effect according to their terms until modified, superseded, or recalled by the Board.

PART 241-UNIFORM SYSTEM OF ACCOUNTS AND REPORTS FOR CERTIFICATED AIR CARRIERS 1

1

Authority Under Which Accounting and Reporting Rules and Regulations are Prescribed and Administered. Administration

of Accounting and

Reporting Regulations. Definitions for Purposes of This System of Accounts and Reports. Air Carrier Groupings and Standard Name Abbreviations.

Standard Route Air Carrier Operation Abbreviations.

GENERAL ACCOUNTING PROVISIONS

Introduction to System of Accounts and Reports.

Applicability of System of Accounts and Reports.

Waivers From This System of Accounts and Reports.

General Description of System of Accounts and Reports.

System of Accounts Coding.
Records.

Accounting Entities.

Interpretation of Accounts.

Address for Reports and Correspond

ence.

Conversion to This System of Accounts and Reports.

General Accounting Policies.

Bases of Allocation Between Entities. Distribution of Revenues and Expenses Within Entities.

Transactions in Foreign Currencies.

Accounting Period.

Liability Accruals.

2-1 2-2

2-3

2-4

2-5

2-6

Federa Income Tax Accruals.

[ER-170, 17 F.R. 5609, June 21, 1952, as amended by ER-279, 24 F.R. 6975, Aug. 28, 1959]

Any air carrier, upon the demand of a special agent or auditor of the Board and upon the presentation of the identification card and credentials issued to him in accordance with this part, shall forthwith permit such special agent or auditor to inspect and examine all lands, buildings, and equipment of the carrier and all accounts, records, and memoranda, including all documents, papers, and correspondence now or hereafter existing, and kept or required to be kept by the carrier and shall permit such special agent or auditor to make such notes and copies thereof as he deems appropriate. [ER-170, 17 F.R. 5609, June 21, 1952]

2-11

Accounting for Transactions in Gross Amounts.

Depreciation and Amortization.

Contingent Assets and Contingent Liabilities.

35

36

Traffic and Capacity Elements.
General Corporate Elements.

AUTHORITY: The provisions of this Part 241 issued under sec. 204(a), 72 Stat. 743, 49 U.S.C. 1324. Interpret or apply sec. 407, 72 Stat. 766, 49 U.S.C. 1377, except as otherwise noted.

SOURCE: The provisions of this Part 241 contained in ER-327, 26 F.R. 4222, May 16, 1961, except as otherwise noted.

Section 01-Authority Under Which Accounting and Reporting Rules and Regulations are Prescribed and Administered

This Uniform Systems of Accounts and Reports for Certificated Air Carriers is

issued, prescribed and administered under the following provisions of the Federal Aviation Act of 1958, as amended (72 Stat. 731, 49 U.S.C. 1301):

GENERAL POWERS

SEC. 204. (a) The Board is empowered to perform such acts, to conduct such investigations, to issue and amend such orders, and to make and amend such general or special rules, regulations, and procedure, pursuant to and consistent with the provisions of this Act, as it shall deem necessary to carry out the provisions of, and to exercise and perform its powers and duties under, this Act.

FILING OF REPORTS

SEC. 407. (a) The Board is empowered to require annual, monthly, periodical, and special reports from any air carrier; to prescribe the manner and form in which such reports shall be made; and to require from any air carrier specific answers to all questions upon which the Board may deem information to be necessary. Such reports shall be under oath whenever the Board so requires. The Board may also require any air carrier to file with it a true copy of each or any contract, agreement, understanding, or arrangement, between such air carrier and any other carrier or person, in relation to any traffic affected by the provisions of this Act.

DISCLOSURE OF STOCK OWNERSHIP

SEC. 407. (b) Each air carrier shall submit annually, and at such other times as the Board shall require, a list showing the names of each of its stockholders or members holding more than 5 per centum of the entire capital stock or capital, as the case may be, of such air carrier, together with the name of any person for whose account, if other than the holder, such stock is held; and a report setting forth a description of the shares of stock, or other interest, held by such air carrier, or for its account, in persons other than itself.

FORM OF ACCOUNTS

SEC. 407. (d) The Board shall prescribe the forms of any and all accounts, records, and memoranda to be kept by air carriers, including the accounts, records, and memoranda of the movement of traffic, as well as of the receipts and expenditures of money, and the length of time such accounts, records, and memoranda shall be preserved; and it shall be unlawful for air carriers to keep any accounts, records, or memoranda other than those prescribed or approved by the Board: Provided, That any air carrier may keep additional accounts, records, or memoranda if they do not impair the integrity of the accounts, records, or memoranda prescribed or approved by the Board and do not constitute an undue financial burden on such air carrier.

INSPECTION OF ACCOUNTS AND PROPERTY

SEC. 407. (e) The Board shall at all times have access to all lands, buildings, and equipment of any carrier and to all accounts, records, and memoranda, including all documents, papers, and correspondence, now or hereafter existing, and kept or required to be kept by air carriers; and it may employ special agents or auditors, who shall have authority under the orders of the Board to inspect and examine any and all such lands, buildings, equipment, accounts, records, and memoranda. The provisions of this section shall apply, to the extent found by the Board to be reasonably necessary for the administration of this Act, to persons having control over any air carrier, or affiliated with any air carrier within the meaning of section 5(8) of the Interstate Commerce Act, as amended.

CLASSIFICATION

SEC. 416. (a) The Board may from time to time establish such just and reasonable classifications or groups of air carriers for the purposes of this title as the nature of the services performed by such air carriers shall require; and such just and reasonable rules and regulations, pursuant to and consistent with the provisions of this title, to be observed by each such class or group, as the Board finds necessary in the public interest.

SAFETY, ECONOMIC AND POSTAL OFFENSES

SEC. 901. (a) (1) Any person who violates (A) any provision of title III, IV, V, VI, VII, or XII of this Act, or any rule, regulation, or order issued thereunder, or under section 1002(1), or any term, condition or limitation of any permit or certificate issued under title IV, or (B) any rule or regulation issued by the Postmaster General under this Act, shall be subject to a civil penalty of not to exceed $1,000 for each such violation. If such violation is a continuing one, each day of such violation shall constitute a separate offense: Provided, That this subsection shall not apply to members of the Armed Forces of the United States, or those civilian employees of the Department of Defense who are subject to the provisions of the Uniform Code of Military Justice, while engaged in the performance of their official duties; and the appropriate military authorities shall be responsible for taking any necessary disciplinary action with respect thereto and for making to the Administrator or Board, as appropriate, a timely report of any such action taken.

(2) Any such civil penalty may be compromised by the Administrator in the case of violations of titles III, V, VI, or XII, or any rule, regulation, or order issued thereunder, or by the Board in the case of violations of titles IV or VII, or any rule, regulation or order issued thereunder, or under section 1002 (1), or any term, condition, or limitation of any permit or certificate issued under title IV, or by the Postmaster General in the case of regulations issued

by him. The amount of such penalty, when finally determined, or the amount agreed upon in compromise, may be deducted from any sums owing by the United States to the person charged.

FAILURE TO FILE REPORTS; FALSIFICATION OF
RECORDS

SEC. 902. (e) Any air carrier, or any officer, agent, employee, or representative thereof, who shall, knowingly and willfully, fail or refuse to make a report to the Board or Administrator as required by this Act, or to keep or preserve accounts, records, and memoranda in the form and manner prescribed or approved by the Board or Administrator, or shall, knowingly and willfully, falsify, mutilate, or alter any such report, account, record, or memorandum, or shall knowingly and willfully file any false report, account, record, or memorandum, shall be deemed guilty of a misdemeanor and, upon conviction thereof, be subject for each offense to a fine of not less than $100 and not more than $5,000.

REFUSAL TO TESTIFY

SEC. 902. (g) Any person who shall neglect or refuse to attend and testify, or to answer any lawful inquiry, or to produce books, papers, or documents, if in his power to do so, in obedience to the subpena or lawful requirement of the Board or Administrator, shall be guilty of a misdemeanor and, upon conviction thereof, shall be subject to a fine of not less than $100 nor more than $5,000, or imprisonment for not more than one year, or both.

FILING OF COMPLAINTS AUTHORIZED

SEC. 1002. (a) Any person may file with the Administrator or the Board, as to matters within their respective jurisdictions, a complaint in writing with respect to anything done or omitted to be done by any person in contravention of any provisions of this Act, or of any requirement established pursuant thereto. If the person complained against shall not satisfy the complaint and there shall appear to be any reasonable ground for investigating the complaint, it shall be the duty of the Administrator or the Board to investigate the matters complained of. Whenever the Administrator or the Board is of the opinion that any complaint does not state facts which warrant an investigation or action, such complaint may be dismissed without hearing. In the case of complaints against a member of the Armed Forces of the United States acting in the performance of his official duties, the Administrator or the Board, as the case may be, shall refer the complaint to the Secretary of the department concerned for action. The Secretary shall, within ninety days after receiving such a complaint, inform the Administrator or the Board of his disposition of the complaint, including a report as to any corrective or disciplinary actions taken.

INVESTIGATIONS ON INITIATIVE OF ADMINISTRATOR OR BOARD

SEC. 1002. (b) The Administrator or Board, with respect to matters within their respective jurisdictions, is empowered at any time to institute an investigation, on their own initiative, in any case and as to any matter or thing within their respective jurisdictions, concerning which complaint is authorized to be made to or before the Administrator or Board by any provision of this Act, or concerning which any question may arise under any of the provisions of this Act, or relating to the enforcement of any of the provisions of this Act. The Administrator or the Board shall have the same power to proceed with any investigation instituted on their own motion as though it had been appealed to by complaint.

ENTRY OF ORDERS FOR COMPLIANCE WITH ACT

SEC. 1002. (c) If the Administrator or the Board finds, after notice and hearing, in any investigation instituted upon complaint or upon their own initiative, with respect to matters within their jurisdiction, that any person has failed to comply with any provision of this Act or any requirement established pursuant thereto, the Administrator or the Board shall issue an appropriate order to compel such person to comply therewith. [ER-327, 26 F.R. 4222, May 16, 1961, as amended by ER-369, 27 F.R. 12817, Dec. 28, 1962]

Section 02-Administration of Accounting and Reporting Regulations

Delegated authority. Under authority delegated by the Board as set forth in § 385.18 of Part 385 of the Organization Regulations (14 CFR 385), effective January 20, 1962, the Chief, Office of Carrier Accounts and Statistics is authorized to take any or all of the following actions in administering the accounting, reporting, and record-retention requirements of the sundry parts of the Economic Regulations:

(a) Waive any of the accounting, reporting and record-retention requirements as warranted, to meet temporary or local conditions;

(b) Interpret the Board's accounting, reporting, and record-retention requirements;

(c) Establish detailed standard accounting, reporting and record-retention practices required to achieve conformance with regulations promulgated by the Board;

(d) Grant or deny, with the concurrence of the General Counsel and the Director, Bureau of Economic Regula

tion, requests for confidential treatment of preliminary year-end financial reports;

(e) Grant or deny requests by air carriers for substitution of their own forms or adaptation of Board forms to meet special needs where Board approval of such forms is required by the Economic Regulations;

(f) Establish classification of aircraft types for reporting financial data and traffic capacity statistics;

(g) Prescribe, in specific instances, different passenger weight standards to approximate variations in actual experience, for reporting passenger ton-miles and available ton-miles.

[ER-369, 27 F.R. 12817, Dec. 28, 1962]

Section 03-Definitions for Purposes of This System of Accounts and Reports

Account, clearing-an account used as a medium for the temporary accumulation of costs that are redistributed to appropriate applicable accounts.

on

Acquisition, date of the date which the title to owned property or equipment (or the right to use or control the reassignment of leased property or equipment) passes to the air carrier.

Act-The Federal Aviation Act of 1958, as amended.

Addition, property-additional equipment, land, structures, and other tangible property; extensions of fuel, water, and oil distribution equipment; additions to buildings and other structures; and additional safety devices applied to equipment not previously thus equipped. (See also Modification.)

Agent, cargo-any person (other than the air carrier performing the direct air transportation or one of its bona fide regular employees or an indirect air carrier lawfully engaged in air transportation under authority conferred by any applicable part of the Economic Regulations of the Board) who for compensation or profit: (1) Solicits, obtains, receives or furnishes directly or indirectly property or consolidated shipments of property for transportation upon the aircraft of an air carrier subject to this part, or (2) procures or arranges for air transportation of property or consolidated shipments of property upon aircraft of an air carrier subject to this part by charter, lease, or any other arrangement.

Agent, ticket-any person (other than the air carrier performing the direct air transportation or one of its bona fide regular employees, or an air carrier which subcontracts the performance of charter air transportation which it has contracted to perform) who for compensation or profit: (1) Solicits, obtains, receives, or furnishes directly or indirectly passengers or groups of passengers for transportation upon the aircraft of an air carrier subject to this part, or (2) procures or arranges for air transportation of passengers or groups of passengers upon aircraft of an air carrier subject to this part by charter, lease, or any other arrangement.

Agreement-any oral or written agreement, contract, understanding, or arrangement, and any amendment, revision, modification, renewal, extension, cancellation or termination thereof.

Air carrier-any citizen of the United States who undertakes, whether directly or indirectly or by a lease or any other arrangement, to engage in air transportation.

Air carrier, route-an air carrier holding a Certificate of Public Convenience and Necessity pursuant to section 401 (d) (1) or (2) of the Federal Aviation Act of 1958, as amended, authorizing it to engage in air transportation over a route, or routes, designated by the Board.

Air carrier, supplemental—an air carrier holding a certificate issued under section 401(d) (3) of the Federal Aviation Act of 1958, as amended, or a special operating authorization issued under section 417 of the Federal Aviation Act, or operating authority issued pursuant to section 7 or 9 of Public Law 87-528.

Air carrier, surviving—an entity (air carrier) which, as the result of a business combination, has acquired the net assets, and carries on the operations of, one or more predecessor air carriers, and which may be newly organized at the time of the combination or may be one of the predecessor air carriers.

Aircraft-any contrivance now known or hereafter invented, used or designed for navigation of or flight in the air.

Aircraft days assigned to service-carrier's equipment-the number of days that aircraft owned or acquired through rental or lease (but not interchange) are in the possession of the reporting air carrier and are available for service on the reporting carrier's routes plus the number of days that the above aircraft are in service on routes of others under

interchange agreements. Days that aircraft are out of service for periodic maintenance or major overhaul are included but days that newly acquired aircraft are on hand prior to availability for productive use and days that aircraft are rented or leased to others (for other than interchange) are excluded.

Aircraft days assigned to service-carrier's routes-same as Aircraft days assigned to service-carrier's equipment but excluding the number of days owned or rented equipment are in the possession of others under interchange agreements and including the number of days aircraft of others are in the possession of the air carrier under interchange agreements.

Aircraft, leased (rented)—aircraft obtained from (or furnished to) others under lease or rental arrangements. Leased and rented aircraft do not include those used under interchange agreements designed to provide oneplane service over the routes of the air carriers involved.

Aircraft type-a distinctive model as designated by the manufacturer.

Airport-a landing area regularly used by aircraft for receiving or discharging passengers or cargo.

Airport, alternate-an approved airport to which a flight may proceed if a landing at the airport to which the flight was dispatched becomes inadvisable.

great-circle distance, measured in statute miles, between airports as listed in the Civil Aeronautics Board's Official Airline Route and Mileage Manual. (See Part 247 of the Economic Regulations.)

Air transportation-the carriage by aircraft of persons, property, or mail.

Air transportation, supplemental—air transportation authorized pursuant to section 401(d) (3) or 417 of the Federal Aviation Act of 1958, as amended, or section 7 or 9 of Public Law 87-528.

Airworthiness (or Airworthy)—when applied to a particular aircraft or component part, it denotes the ability of such aircraft or component part to perform its function satisfactorily through a range of operations determined by the Federal Aviation Agency.

Allocate-to assign an item or group of items of investment, revenue, or cost to an object, activity, process, or operation, in accordance with cost responsibilities, benefits received, or other measure of apportionment.