US Airways 2007 Annual Report Download - page 144

Table of Contents
US Airways, Inc.
Notes to Consolidated Financial Statements — (Continued)
(s) Variable Interest Entities
US Airways determined that certain entities with which US Airways has capacity purchase agreements are considered variable
interest entities under Financial Accounting Standards Board ("FASB") Interpretation No. 46 "Consolidation of Variable Interest
Entities," as revised ("FIN 46(R)"). US Airways has determined that it is not the primary beneficiary of any of these variable interest
entities and, accordingly, does not consolidate any of the entities with which it has jet service agreements. See Note 8(d) for further
discussion.
(t) Recent Accounting Pronouncements
In June 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes, an interpretation of FASB
Statement No. 109" ("FIN 48"), which clarifies the accounting for uncertainty in income taxes recognized in a company's financial
statements. The interpretation prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition
and measurement of a tax position taken or expected to be taken in a tax return. The interpretation also provides guidance on
derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. US Airways adopted the
provisions of FIN 48 on January 1, 2007. The implementation of FIN 48 did not have a material impact on the US Airways' consolidated
financial statements.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements." This standard defines fair value, establishes a
framework for measuring fair value in accounting principles generally accepted in the United States of America, and expands disclosure
about fair value measurements. This pronouncement applies to other accounting standards that require or permit fair value measurements.
Accordingly, this statement does not require any new fair value measurement. This statement is effective for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. In December of 2007, the FASB agreed to a one year deferral of
SFAS No. 157's fair value measurement requirements for nonfinancial assets and liabilities that are not required or permitted to be
measured at fair value on a recurring basis. Management is currently evaluating the requirements of SFAS No. 157, but does not expect it
to have a material impact on US Airways' 2008 consolidated financial statements.
Effective December 31, 2006, US Airways adopted the recognition provisions of SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and 132(R)." This
statement requires employers to recognize in their balance sheets the overfunded or underfunded status of defined benefit postretirement
plans, measured as the difference between the fair value of plan assets and the benefit obligation (the projected benefit obligation for
pension plans and the accumulated postretirement benefit obligation for other postretirement plans). The impact on US Airways'
consolidated financial statements of adopting the recognition provisions of SFAS No. 158 was not material. US Airways recognized a
nominal amount of prior changes in the funded status of its postretirement benefit plans through accumulated other comprehensive
income. The adoption of the recognition provisions of SFAS No. 158 had no effect on US Airways' statement of operations for the year
ended December 31, 2006 or for any prior period presented.
SFAS No. 158 also requires plan assets and obligations to be measured as of the employer's balance sheet date. US Airways
currently uses a measurement date of September 30 for its other postretirement benefits. The measurement provisions of this statement
are required to be adopted no later than fiscal years beginning after December 15, 2008. US Airways will adopt the measurement
provisions of this statement in 2008. The impact on US Airways' consolidated financial statements of adoption of the measurement
provisions will not be material.
In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities."
SFAS No. 159 allows entities the option to measure eligible financial instruments at fair value as of specified dates. Such election, which
may be applied on an instrument by instrument basis, is typically irrevocable once elected. SFAS No. 159 is effective for fiscal years
beginning after November 15, 2007. US Airways adopted
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