NUCs & Currency Rounding

NUC and Local Currency

International fares are published in National Currency Fare (LCF) which is usually in the national currency of the country of commencement of international transportation (exception USD or EUR countries).

In fare construction it is sometimes necessary to add or compare fares. This process cannot be done by using different currencies. For this purpose, a standard unit for fares has been derived from each of the local currencies. This is called Neutral Unit of Construction or NUC.

To facilitate easier fare construction, fares are published in local currency and the equivalent in NUC. At the outset, all fare construction is done in NUC but at the end of the formula the total sum will be converted into local currency at the NUC conversion factor of the country of commencement of travel. This factor is better known as IATA Rate of Exchange (IROE).

The IROE list is established by the IATA Clearing House on a five-day average ending on the 15th of each month. It changes four times a year and remain frozen for three months period unless there is a major variation in currency value by more than 6% in the intervening period. If this happens, the effectiveness date for IROE changes will take effect the first of the month after the establishment of the new IROE.

FZIEUR100NUC

The Bank Selling Rate (BSR) is used when payment is made in the currency of your agency location, and you use the BSR when you accept your own currency as payment = > payment outside COC in the currency of COT

FZSHKD23000GBP

The Bank Buying Rate (BBR) is used when payment is made in a currency other than that of your agency location and you accept a foreign currency as payment for a ticket = > payment inside COC in other currency then COC

FZBDKK23000EUR

For countries which have adopted the USD as the currency in which its international fares are published the LCF in USD is converted to the national currency at the BBR valid at the date of the transaction, unless otherwise specified in the Source of Bankers Rates of Exchange (e.g. for sales in PH, after converting NUC to USD, the LCF in USD is then converted to PHP – local practice is to use the Airline Conversion Rate = official conversion rate PHP to USD)

IATA Clearing House Rate (ICH) also called IATA Mean RATE (IMR)

If no direct exchange rate exists between two currencies, then the Galileo system automatically makes a calculation involving the IATA Clearing House rate (equivalent to the USD) as a means of making the conversion.

FZARONEUR (display bank buying rate, bank selling rate and IATA clearing house rate between RON and EUR)

Decimal per currency – FBT* or FBT*RO & Rounding currency – FZISG

NUC are not rounded off; NUC is express in two decimal places ignoring any further decimal.

Each local currency has its own rounding unit:

1. Full adjustment – rounding up to the next higher unit (HX): 1EUR (H1) => 1234.30 = 1235.00 // 1234.09 = 1234.00 (as long as the next decimal after the unit is not 0, you have to round up)

2. Half adjustment – round off to the nearest unit (NX): 1USD (N1) => USD120.80 = 121.00 // 120.30 = 120.00 (as long as the next decimal after the unit is greater than half (5), you have to round up)

ALWAYS ROUND UP the local currency fare unless there is an accompanying note that tells you to round off to the nearest unit