SIS Functional Review James SHANNON RA44 – BUD 14 Sept 2010

SIS Functional ReviewJames SHANNON

RA44 – BUD14 Sept 2010

14 Sept 2010SIS – RA44 –SIS Review 2

Goal & Agenda

Project Overview The Need For IS Vision

IS Solution & Features Benefits & Changes Next Steps

To familiarize you with Simplified Interline Settlement and prepare you for tomorrow’s breakout sessions


Project Overview


Interline Settlement - Today

ICH

ATPCO

(incl F&F pre IDECValidation)

BilledEntity

BillingEntityCargo IDEC File (monthly)

Pax IDEC File (monthly)

F12 – (weekly)F1 – net amounts of inv

F2 - summary

Cargo IDEC File (monthly)


F3– (weekly)

Paper invoices, with coupon listing, coupons, rejects, supporting documents(monthly)

AIA F&FF&F: receives NFP value

ARC-Compass(NFP storage)

Previously released sales record

prorateengine prorate

engine

GDSsBSPs

ACHRecap sheets - weeklySettlement sheets –

(weekly)


SIS VisionFundamentally change, simplify and integrate the interline settlement process, delivering tangible financial benefits to the industry.

Invoices are electronic and not backed by paper Prime passenger billings do not require paper invoices or coupon listings IDEC formats are maintained with increased record types Passenger rejects, including any attachments, are submitted electronically

without paper Cargo and Mail billings are electronic and paperless Miscellaneous billings (including any supporting information) are electronic,

whether as data or with attachments Settlement action directly from ET systems is enabled


ISSolution & Features


Interline Settlement - Today

ICH

ATPCO


BilledEntity

BillingEntityCargo IDEC File (monthly)


F12 – (weekly)F1 – net amounts of inv

F2 - summary

Cargo IDEC File (monthly)


F3– (weekly)

Paper invoices, with coupon listing, coupons, rejects, supporting documents(monthly)

AIA F&FF&F: receives NFP value




engine

GDSsBSPs


(weekly)

14 Sept 2010SIS – RA44 –SIS Review 9SIS – Materials – RA42 Breakout Interfaces & Validation 9

Integrated Settlement

BilledEntity


BillingEntity

Ove

rall

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Billing & Invoicing ProcessesCentralRepository

“DigitalSignature”Company

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rall

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sSettlement Processes

ICH ACH

Processes at time of SalesNFP

engineARC COMPASS™

ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC


IS Overview – One Level Down

IS-XML

IS-IDECBillingRecord DB Supp.

Doc.

Usage File

ATPCO

InvoicePDF

BillingOutward

IS-WEB

IS-XML

IS-IDEC

Supp.Doc.

Supp.Doc.

DigitalSignature

Validation &Correction (IS-WEB)

Billing Carrier

Billing Value Confirmation

ATPCOATOS

InterfaceACH

ACH

InterfaceICH

ICH

IS-WEB

ValidationSupp. Doc.

Value DeterminationDigital

Signature


No F12 files.No recap sheets, either.

Nothing that you submit to the ICH or ACH today can be submitted after migration.


Main Features of IS File Formats & Validation Passenger

Time of Sales – NFP final, NFP non-final, and Own Prorate Storage Value Determination & Autobilling Sampling Correspondence Audit Trail

Differences for Cargo Differences for Miscellaneous Bringing It All Together

Member Administration Processing Dashboard Document Storage


File Formats & Validation


File Formats

BilledEntity


BillingEntity

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Settlement Processes

ICH ACH



ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Send files(or enter online)

Receive (or download) invoices

ValidationFormat Conversion

Format Conversion: Billed Entity’s choice of format

does not depend on the billing carrier’s


File Formats – IS-IDEC No longer data exchange file, but rather used to create an invoice and

settlement file Similar to IDEC, with enhancements:

Existing fields made mandatory (source codes, etc) New records added (Rejection Memos, tax breakdowns, etc) New fields added (for e-billing, additional info, etc) Unnecessary records / fields removed (batch total records, etc)

500 byte records (instead of 160 byte) Every carrier will need system enhancements to support IS-IDEC


File Formats – IS-XML New XML format for Integrated Settlement Based on IATA Aviation Invoice Standard, used by IATA InvoiceWorks Identical fields and validation requirements to IS-IDEC Every carrier will need to make system enhancements to support IS-XML

IS-IDEC vs. IS-XML is an IT decision – it is immaterial to the RA department Potential Benefits of IS-XML

IS-XML format is more flexible and thus better than IS-IDEC for variable record structure (like Miscellaneous billings)

Potential Benefits of IS-IDEC Relatively little system development for carriers with a sophisticated IDEC

solution in place already IS-IDEC format is more efficient (processing, storage, and internet

bandwidth) than IS-XML for a fixed record structure


IS-WEB Record Structure Web-based user interface to create and receive invoices and records Identical fields and validation requirements to IS-IDEC and IS-XML

Validation in real-time minimizes possibility of later validation errors

Potential Benefits The web interface is hosted by IATA, so no system development is required by

carriers

Potential Negatives More internet bandwidth will be required than file formats, and the connection will

have to be stable Won’t be as user-friendly as a dedicated, local system

Not an alternative to a Revenue Accounting system


IS-WEB For EverybodyIS-WEB is also used for other web-based services Audit Trail Pax & Cargo Correspondence Online Corrections after validation failure Processing Dashboard Airline profile updates Web Analysis Reports View and print invoices in a standard format Extensive user access controls (your company’s administrator can grant

detailed permissions)


Breakdown Records Breakdown Records have been added where necessary to provide for

detailed, possibly repeating, data and to provide for large amounts of text E.g., a coupon can have 0 or more tax breakdown records, each detailing a

tax type and amount

Examples Coupon Prime Billing breakdown records:

Tax, VAT breakdown Breakdown records for Rejection, Billing, Credit Memos:

Reason Breakdown, Coupon Breakdown (with Tax & VAT)


Example Breakdowns (Pax Rejection Memo)

Rejection Memo(SFI = 21)

Reason Breakdown(SFI = 31)Reason Breakdown

(SFI = 31)

Coupon Breakdown(SFI = 32)Coupon Breakdown

(SFI = 32)Coupon Breakdown(SFI = 32)

Tax Breakdown(SFI = 33)Tax Breakdown

(SFI = 33)Tax Breakdown(SFI = 41)

VAT Breakdown(SFI = xx)VAT Breakdown

(SFI = xx)VAT Breakdown(SFI = 34)


Example Breakdown Invoice

Invoice Header Information Prime Billings (Source Code Summary) 1st Stage Rejections (Source Code Summary) 2nd Stage Rejections (Source Code Summary) 3rd Stage Rejections (Source Code Summary) Billing Memos (Source Code) Credit Memos (Source Code Summary) Invoice Summary Invoice VAT Summary ($100)

Invoice VAT Breakdown ($80) Invoice VAT Breakdown ($20)


Example Breakdown Billing Memos ($100) (Source Code Summary)

Billing Memo #1 ($10) Billing Memo #2 ($50) Billing Memo #3 ($40) VAT Summary ($20)

VAT Breakdown ($5) VAT Breakdown ($5) VAT Breakdown ($5) VAT Breakdown ($5)


Example Breakdown Billing Memo #3 ($40)

Coupon #1 ($10) Coupon #2 ($10) Coupon #3 ($20)

VAT Summary VAT Breakdown (multiple)

Tax Summary Tax Breakdown (multiple)


Validation

BilledEntity


BillingEntity

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ICH ACH



ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Send files(or enter online)

Receive (or download) invoices

ValidationFormat Conversion

Validation: Guarantees links between

records (e.g. 2nd and 1st RMs) Enforces timeframes and

“order” (1st RM -> 2nd RM -> 3rd RM)

Ensures file is properly formed Other validations


Examples of Validation Format Rules

Ensures data types (e.g. numeric/alphanumeric), length, etc as defined Correct Values

e.g. Settlement method cannot be “ACH” if both airlines are only ICH members Mandatory Fields

Source Code, Ticket Issuing Airline, Coupon Number, etc Rejection & Correspondence Timeframes and Order Enforced

1st RM 2nd RM 3rd RM Correspondence Mandatory Breakdown Records Are Present

Tax breakdown records are present if coupon tax is populated and the breakdown record sums match the tax field

Billing entity will be notified of validation results Invoices (and possibly files) failing validation will not go any further


Passenger


Time of Sales – Now (Optional)

ATPCO


BilledAirline

BillingAirline

Pax IDEC File (monthly)Pax IDEC File (monthly)

AIA F&F




engine

GDSsBSPs

Sales RecordsF&F: receives NFP value

All: May receive sales records

Optional Proration,Storage, Switching

Sales Records,NFPs

ICHF12 – (weekly)

F1 – net amounts of invF2 - summary

F3– (weekly)


(weekly)


Time of Sales – With IS

BilledAirline


BillingAirline

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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Sales Records,NFPs, &

Sales Carrier’sOwn Prorates

Sales Records orOwn Prorates Optional Proration (final &

non-final), Storage, Switching


Neutral Fare Prorates – With IS NFP engine will be available to carriers for FIRST & FINAL™ (NFP Final) and non-F&F

(NFP non-final) purposes NFP non-final could minimize rejections without any obligation by the carriers

Own prorate storage and switching will allow the sales carrier to upload prorates, which are then forwarded or made available to the billing carrier


Time of Billing – Now

ATPCO


BilledAirline

BillingAirline

Pax IDEC File (monthly)Pax IDEC File (monthly)

AIA F&F




engine

GDSsBSPs

F&F: receives NFP valueAll: May receive sales records

Pre-IDEC Validationfor F&F NFP values

(updates the PMI)


Submitting Billing Information – With IS

BilledAirline


BillingAirline

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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Billing File / Data(similar to today)

Billing Value Confirmation(Leaves “Original PMI”, updates “Value Confirmation PMI”)



Time of Billing – IS Value Determination

BilledAirline


BillingAirline

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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Usage File

Prorate Values




Time of Billing – IS Auto-Billing

BilledAirline


BillingAirline

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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Usage File

Weekly Invoice Posting File

Daily Revenue Recognition File

No Billing FileFrom Carrier

Billing and Invoice FilesCreated Within IS



Sampling Provisional Invoice (as today with prime coupon billing, but with elements from Forms

A and B) Universe Adjustment (Form C) Digit Evaluation (Forms D and E) Form G (ACH)

Rejection Memos & Correspondence (as today with non-sample but with elements from Forms F and XF)

All via IS-IDEC, IS-XML, and IS-WEB


Pax & Cargo Correspondence

BilledAirline


BillingAirline

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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Enter Correspondence(including attachments)

Receive Correspondence(including attachments)

Validation


Pax & Cargo Correspondence Correspondence can include an “authority to bill” flag which identifies when

the authority to bill has been issued Not tied to settlement periods like transactions in Integrated Settlement –

real-time and similar to e-mail but via IS-WEB interface Validation ensures no “cross-over” – correspondence can only be in reply to

another correspondence (or 3rd-stage RM) and cannot be out-of-order


Audit Trail & Rejection History With operational data being stored:

Future records (e.g. rejections) don’t need supporting documents re-attached IS-WEB can be used to search and take action on previous billings:

Search & browse through all records for which your carrier billed or was billed Drill down through tickets, coupons, tax breakdowns, correspondences, etc View audit trail of linked correspondences, rejections, and prime billings Find outgoing correspondences that haven’t been responded to Go directly to appropriate action (create RM, create correspondence, create

billing memo)


Audit Trail (example view)

Activity Date Record / Supporting Docs

1st Correspondence 1 May $35; “I do not agree with your calculation…”

3rd Rejection 1 Apr $50; Long Explanation.doc

2nd Rejection 1 Mar $100; “See attached”; ticket.jpg

1st Rejection 1 Feb $100; “No coupon in our system”

Prime Billing 1 Jan $100

Create Correspondence


Key Differences forCargo & Misc


Key Differences for Cargo All cargo record types also represented in IS-IDEC, IS-XML, and IS-WEB

The IATA e-freight project will introduce e-electronic formats (structured data) for these supporting documents over time

Before then, carriers can bilaterally decide to use e-electronic formats, or to not transfer supporting documents at all


Key Differences for Miscellaneous IS-IDEC cannot be used for Miscellaneous billings (only IS-XML and IS-WEB)

All Miscellaneous billings are uniquely defined by a charge category and charge code, allowing for routing to the correct person/department, automatic posting, or even automatic reconciliation

Examples:

Charge Category Charge Code

GroundHandling Baggage

GroundHandling Cargo

PartnerAlliance FF Miles


Bringing it Together


Bringing it All Together Member Administration will contain centralized preferences for your

company: User Administration with the ability to create users and roles, customize user

permissions Member Profile to set your own preferences, such as:

Who to contact for ICH alerts, file validation failures, etc Rules as to how IS will operate for your company (apply digital signatures,

allow corrections, etc)

Processing Dashboard will provide a centralized overview of all submitted files and their statuses throughout the Integrated Settlement


Supporting Documents Supporting documents can be attached to most record types (including Pax

Prime Billings, Cargo, Miscellaneous) Two types of supporting documents:

Electronic Presentation - Supporting document that is digital but not in a defined and structured format. The document might be a PDF file or an image that a computer can read but not extract data from.

E-Electronic Document – Supporting document that is in a defined and structured format which can be parsed by a computer. Example formats are IDEC, XML, or CSV.


Supporting Documents – With IS

BilledAirline


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ProrateEngine

IS-WEB

IS-XML

IS-IDEC

Usage File

IS-WEB

IS-XML

IS-IDEC

Batch Transfer

e.g. FTPBatch Transfer

e.g. FTP


Central Repository & Supporting Docs What?

Any type of accepted supporting document (image, PDF, etc)

How long? As long as the data is operationally required

When? Before or after the associated record is uploaded (with “pending attachments”

flag, which allows for notifications if not uploaded)

How? Discussed in more detail during the Breakout Sessions


Benefits & Changes


Key Benefits of IS – Billing Carrier Substantial savings due to:

Reduction in paper, postage and courier fees Reduction in internal paper handling and supply chain efforts No more loss of supporting documents and re-creation of invoices Automation of billing directly from uplifts (e.g. Auto-Billing) Optional à la carte service of “Integrated Settlement”


Key Benefits of IS – Billed CarrierSubstantial savings due to: Reduction in internal paper handling and supply chain efforts

(e.g. registration, and reconciliation of invoices to payment) Automated data Less manual intervention Data quality improvements on IS-IDEC Pax Rejection Memos, Billing and Credit Memo electronically Cargo Original AWB, Rejection and Charge Memo electronically Supporting Documents immediately available in electronic

presentation


Key Benefits of IS Rejection Memo & Correspondence process improvements due to:

Enforcement of RAM rules (RM stage and correspondence) Opportunity to detect duplicate rejections of the same original billing All rejections and correspondence link to previous billings; information and

supporting documents do not have to be re-uploaded Time-limit reduction possibilities for Rejection Memos and Correspondence

Risk management and process improvements due to: Fewer items outstanding for a shorter period of time Future potential time-limit reduction for prime / original billings

Benefits to the environment due to reduction of paper and shipping Alliance objectives complemented by SIS


Airline Changes (where applicable) Change from IDEC to IS-IDEC

500 bytes instead of 160 bytes Follow rules in RAM Some detail records mandatory (e.g. taxes) Other elements mandatory (e.g. Source Code)

Choose and implement other submission formats (IS-XML, IS-WEB) Prepare to scan and upload supporting documents Implement e-billing (possible legal implications)


Next Steps


Next StepsThis Week

Breakout Sessions

Back at Your Office Airline Business Case (on the SIS website) IS Participation Guide (see the breakout session) Internal Planning and Budgeting (based on the IS Participation Guide and

the Migration breakout session)


Thank you.

SIS Website:

www.iata.org/sis

http://www.iata.org/sis