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Exhibit 18
World Airways, Inc.
Herndon, Virginia
Ladies and Gentlemen:
We have been furnished with a copy of the Form 10-Q of World Airways, Inc. (the
"Company") for the three and nine months ended September 30, 2000, and have read
the Company's statements contained in Note 2 to the condensed financial
statements included therein. As stated in Note 2, the Company changed its
method of accounting for certain aircraft maintenance costs from the accrual
method of accounting to the direct expense method. Under the new accounting
method, maintenance costs are recognized as expense as maintenance services are
performed and as flight hours are flown for nonrefundable maintenance payments
required by lease agreements. Also, as stated in Note 2, the Company believes
the newly adopted accounting principle is preferable in the circumstances
because the direct expense method is the predominant method used in the airline
industry and there has not been an obligating event prior to the maintenance
services being performed or flight hours being flown. In accordance with your
request, we have reviewed and discussed with officials of the Company the
circumstances and business judgment and planning upon which the decision to make
this change in the method of accounting was based.
We have not audited any financial statements of the Company as of any date or
for any period subsequent to December 31, 1999, nor have we audited the
information set forth in the aforementioned Note 2 to the condensed financial
statements; accordingly, we do not express an opinion concerning the factual
information contained therein.
With regard to the aforementioned accounting change, authoritative criteria have
not been established for evaluating the preferability of one acceptable method
of accounting over another acceptable method. However, for purposes of the
Company's compliance with the requirements of the Securities and Exchange
Commission, we are furnishing this letter.
Based on our review and discussion, with reliance on management's business
judgment and planning, we concur that the newly adopted method of accounting is
preferable in the Company's circumstances.
Very truly yours,
/s/ KPMG LLP
McLean, Virginia
November 10, 2000
