Frontier Airlines 2004 Annual Report Download - page 66

16. VALUATION AND QUALIFYING ACCOUNTS
___________
17. SUBSEQUENT EVENTS
In January 2005, Republic Airline entered into a fixed - fee code - share agreement with Delta to operate 16 ERJ - 170 aircraft through January 2019. The operation of these aircraft is
contingent on Republic Airline obtaining its required certification.
On March 15, 2005, the Company and Wexford Capital LLC, entered into an omnibus investment agreement with US Airways Group, Inc. The agreement includes provisions for the
affirmation of an amended Chautauqua code - share agreement, a potential new jet service agreement with Republic Airline for the operation of ERJ - 170 and ERJ - 190 aircraft, a conditional $125
million dollar equity commitment and up to $110 million in asset related financing. The agreement can be terminated by the Company and Wexford Capital LLC if the Omnibus Order has not
been entered by the Bankruptcy Court by April 20, 2005, and may be terminated by the Company and Wexford Capital LLC or by US Airways Group, Inc. if the closing on the issuance, sale
and purchase of the new common stock of US Airways Group, Inc. is not completed by December 31, 2005.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
There were no disagreements with accountants on accounting and financial disclosure.
ITEM 9A. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the its Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the Company ’ s disclosure controls and procedures. Disclosure controls and procedures are designed to ensure that information required to be disclosed
in the periodic reports filed or submitted under the Securities and Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and
Exchange Commission ’ s rules and forms. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company ’ s disclosure controls and procedures
are effective in alerting them on a timely basis to material information relating to the Company required to be included in the Company ’ s reports filed or submitted under the Exchange Act. There
have been no significant changes in the Company ’ s internal controls or in other factors during the Company ’ s most recent fiscal quarter that could significantly affect these controls subsequent to
the date of the evaluation referenced in the preceding paragraph.
ITEM 9B. OTHER INFORMATION
None
Description
Balance at
Beginning
of Year
Additions
Charged to
Expense
Deductions
Balance at
End
of Year
Allowance for doubtful accounts receivables:
December 31, 2004
$
819
$
3,385(1
)
$
(335)(3
)
$
3,869
December 31, 2003
2,231
637
(2,049)(2
)
819
December 31, 2002
415
1,816(2
)
2,231
Note receivable from Shuttle America:
December 31, 2004
7,013
(7,013)(4
)
December 31, 2003
4,900
2,113
7,013
(1)
In 2004, Chautauqua recorded an allowance for doubtful accounts of $3,200 because of US Airways ’ bankruptcy.
(2)
In 2002, Chautauqua recorded an allowance for doubtful accounts of $1,504 because of US Airways' bankruptcy. Chautauqua wrote off the receivable in 2003.
(3)
Uncollectible accounts written off net of recoveries.
(4)
In 2002, Chautauqua received a note for the sale of spare engines and related parts and advances made to Shuttle America, an affiliated company. During 2003 and 2002, the Company
recorded an allowance for uncollectible accounts of $2,113 and $4,900, respectively. In 2004, the note was sold to Imprimis Investors LLC, one of the members of our majority
stockholder, for the fair value of the underlying collateral, which approximated the net book value of $2,400.
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