US Airways 2005 Annual Report Download - page 91

Table of Contents
available cash to fund operations, capital expenditures and cash obligations without violating this requirement.
Management believes that cash flow from operating activities, coupled with existing cash balances and financing commitments, will be adequate to fund
the Company's operating and capital needs as well as enable it to maintain compliance with its various debt agreements at least through December 31, 2006.
Other Information
Income Taxes
As of December 31, 2005, US Airways Group has available NOL and tax credit carryforwards for federal income tax purposes of approximately
$1.43 billion and $25 million, respectively. The NOLs expire during the years 2020 through 2026. As of December 31, 2005, US Airways Group also had
capital loss carryforwards for federal income tax purposes of approximately $1 million which expire in 2008.
As of December 31, 2005, AWA has available NOL carryforwards and tax credit carryforwards for federal income tax purposes of approximately
$582 million and $1 million, respectively. The NOLs expire during the years 2020 through 2026. As of December 31, 2005, AWA also had capital loss
carryforwards for federal income tax purposes of approximately $1 million which expire in 2008.
As of December 31, 2005, US Airways had a $786 million federal NOL carryforward with $52 million expiring in 2023, $551 million expiring in 2024,
$183 million expiring in 2025 and $25 million of alternative minimum tax credits which do not expire. As a result of the bankruptcy proceedings, the federal
and state net operating loss carryforwards were reduced by cancellation of debt income of $113 million.
US Airways Group had a change of ownership upon emergence from bankruptcy and its issuance of new common stock. Internal Revenue Code
Section 382 substantially limits the annual usage of remaining tax attributes that were generated prior to the change in ownership. In addition, as a result of
America West Holdings merger with US Airways Group, AWA also experienced an ownership change and AWA's ability to utilize its regular and AMT
NOLs and tax credit carry forwards may be restricted.
Related Party Transactions
Each of US Airways Group, AWA and US Airways have entered into transactions with various members of its board of directors and related entities. See
notes 15, 16 and 11, "Related Party Transactions" in Items 8A, 8B and 8C, respectively, of this report for additional information, which information is
incorporated herein by reference.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements in accordance with accounting principles generally accepted in the United States requires that we
make certain estimates and assumptions that affect the reported amount of assets and liabilities, revenues and expenses, and the disclosure of contingent assets
and liabilities at the date of our financial statements. We believe our estimates and assumptions are reasonable; however, actual results could differ from those
estimates. Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties and potentially result in materially
different results under different assumptions and conditions. We have identified the following critical accounting policies that impact the preparation of our
financial statements. See also the summary of significant accounting policies included in the notes to the financial statements under Items 8A, 8B and 8C of
this Form 10-K for additional discussion of the application of these estimates and other accounting policies.
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