US Airways 2004 Annual Report Download - page 100

Table of Contents
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Holdings' Audit Committee has selected and retained KPMG LLP as the Company's independent registered public accounting firm for the fiscal year
ended December 31, 2004.
PricewaterhouseCoopers LLP served as the Company's and AWA's independent registered public accounting firm for the fiscal years ended December 31,
2002 and 2001. On August 21, 2003, the Company dismissed PricewaterhouseCoopers LLP as the Company's and AWA's independent registered public
accounting firm. The Company appointed KPMG as independent registered public accounting firm for the Company and AWA on August 21, 2003. The
decision to change independent auditors was approved by the Company's Audit Committee.
The audit reports of PricewaterhouseCoopers LLP on Holdings' and AWA's consolidated balance sheets as of December 31, 2001 and 2002 and the related
statements of operations, cash flows and stockholders' equity for each of such years did not contain an adverse opinion or disclaimer of opinion, and were not
qualified or modified as to uncertainty, audit scope or accounting principles.
In connection with the audits of the fiscal years ended December 31, 2001 and 2002 and through August 21, 2003, there were no disagreements between
Holdings or AWA and PricewaterhouseCoopers LLP as to any matter of accounting principles or practices, financial statement disclosure, or auditing scope
or procedure, which disagreements, if not resolved to the satisfaction of PricewaterhouseCoopers LLP, would have caused it to make reference to the subject
matter of the disagreement in its reports on the financial statements for such periods within the meaning of Item 304(a)(1)(iv) of Regulation S-K.
During the fiscal years ended December 31, 2001 and 2002 and through August 21, 2003, there were no reportable events (as defined in Item 304(a)(1)(v)
of Regulation S-K).
Holdings and AWA did not consult with KPMG LLP prior to its engagement regarding the application of accounting principles to a specified transaction,
either completed or proposed, the type of audit opinion that might be rendered on the financial statements of Holdings or AWA or any matter that was either
the subject of a disagreement or a reportable event within the meaning of Item 304(a)(1) of Regulation S-K.
ITEM 9A. CONTROLS AND PROCEDURES
(a) Evaluation of Disclosure Controls and Procedures.
The Company's internal control system was designed to provide reasonable assurance to the Company's management and board of directors regarding the
preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations.
Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and
presentation. Our Chief Executive Officer and Chief Financial Officer believe that our disclosure controls and procedures were not effective at the "reasonable
assurance" level as of the end of the period covered by this report since they resulted in a need to restate our financial statements as described below.
(b) Management's Report on Internal Control over Financial Reporting.
Management's Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining effective internal control over Holdings' financial reporting as defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act. Management assessed the effectiveness of Holdings' internal control over financial reporting as of December 31, 2004. In
making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in
Internal Control – Integrated Framework. Based on this assessment, management has concluded that as of December 31, 2004, the Company did not maintain
effective internal control over financial reporting, due to a material weakness associated with the accounting for AWA's fuel hedging program, as described
below.
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