Issue Overview

Phony Fernandes? Not exactly. AirAsia has messy accounting, but its low-cost credentials are indisputable

AirAsia

Phony Fernandes? Not exactly. AirAsia has messy accounting, but its low-cost credentials are indisputable

June 22nd, 2015 at 9:02 AM EDT
3 min read

Issue Overview

As Airline Weekly regularly warns when reporting AirAsia’s quarterly net results, things are not always as they seem. Last fall, for example (on Sept. 1, 2014), readers were advised to “keep in mind that [AirAsia’s] Malaysia unit’s revenues are plumped with lease transfer payments from subsidiaries.” We added: “It’s tough to calculate an accurate figure for the group as a whole due to accounting complexities.” Last quarter’s earnings summary included another surgeon general’s warning: “AirAsia has the most complex financial statements of any airline in the world that reports, due to its multiple joint ventures and large lease payments flowing from one subsidiary to another.”

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