SkyWest Airlines 2010 Annual Report Download - page 76

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SKYWEST, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
DECEMBER 31, 2010
(1) Nature of Operations and Summary of Significant Accounting Policies (Continued)
Reclassification
Certain reclassifications have been made to the Company’s December 31, 2009 and 2008
consolidated financial statements to conform to the presentation of the Company’s December 31, 2010
consolidated financial statements.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or
less to be cash equivalents. The Company classified $21.8 million and $10.7 million of cash as restricted
cash as required by the Company’s workers’ compensation policy and classified it accordingly in the
consolidated balance sheets as of December 31, 2010 and 2009, respectively.
Marketable Securities
The Company’s investments in marketable debt and equity securities are deemed by management
to be available for sale and are reported at fair market value with the net unrealized appreciation
(depreciation) reported as a component of accumulated other comprehensive income (loss) in
stockholders’ equity. At the time of sale, any realized appreciation or depreciation, calculated by the
specific identification method, is recognized in other income and expense. The Company’s position in
marketable securities as of December 31, 2010 and 2009 was as follows (in thousands):
2010 2009
Investment Types Cost Market Value Cost Market Value
Commercial paper .......................... $ 5,002 $ 4,998 $ — $ —
Bond and bond funds ........................ 669,786 669,025 647,965 648,498
Asset backed securities ....................... 692 718 1,051 1,062
675,480 674,741 649,016 649,560
Unrealized appreciation (depreciation) ........... (739) — 544 —
Total .................................... 674,741 674,741 $649,560 $649,560
72