US Airways 2009 Annual Report Download - page 122

Table of Contents
circumstances indicate that the carrying value may not be recoverable. The following table provides information relating to US Airways'
intangible assets subject to amortization as of December 31, 2009 and 2008 (in millions):
2009 2008
Airport take-off and landing slots $ 452 $ 452
Airport gate leasehold rights 52 52
Accumulated amortization (106) (81)
Total $ 398 $ 423
The intangible assets subject to amortization generally are amortized over 25 years for airport take-off and landing slots and over the
term of the lease for airport gate leasehold rights on a straight-line basis and are included in depreciation and amortization on the
consolidated statements of operations. For the years ended December 31, 2009, 2008 and 2007, US Airways recorded amortization
expense of $25 million, $23 million and $23 million, respectively, related to its intangible assets. US Airways expects to record annual
amortization expense of $24 million in 2010, $21 million in year 2011, $20 million in year 2012, $20 million in year 2013, $20 million in
year 2014 and $293 million thereafter related to these intangible assets.
Indefinite lived assets are not amortized but instead are reviewed for impairment annually and more frequently if events or
circumstances indicate that the asset may be impaired. US Airways had $39 million and $55 million of international route authorities as
of December 31, 2009 and 2008, respectively. As of December 31, 2009 and 2008, US Airways had $30 million of trademarks on its
balance sheets.
US Airways performed the annual impairment test on its international route authorities and trademarks during the fourth quarter of
2009. The fair values of international route authorities were assessed using the market approach. The market approach took into
consideration relevant supply and demand factors at the related airport locations as well as available market sale and lease data. For
trademarks, US Airways utilized a form of the income approach known as the relief-from-royalty method. As a result of US Airways'
annual impairment test on its international route authorities, US Airways recorded a $16 million impairment charge related to the decline
in fair value of certain international routes. US Airways will perform its next annual impairment test on October 1, 2010.
(j) Other Assets
Other assets consist of the following as of December 31, 2009 and 2008 (in millions):
2009 2008
Aircraft leasehold interest, net $ 77 $ 83
Deferred rent 59 46
Deposits 36 40
Debt issuance costs, net 26 19
Long-term investments 9 11
Total other assets $ 207 $ 199
Aircraft leasehold interest, net represents assets established for leasehold interests in aircraft subject to operating leases with rental
rates deemed to be below-market rates in connection with the application of fresh-start reporting for US Airways following its emergence
from bankruptcy in September 2005. These leasehold interests are amortized on a straight-line basis as an increase to aircraft rent expense
over the applicable remaining lease periods. US Airways expects to amortize $6 million per year in 2010 to 2014 and $47 million
thereafter to aircraft rent expense related to these leasehold interests.
(k) Frequent Traveler Program
The Dividend Miles frequent traveler program awards mileage credits to passengers who fly on US Airways and Star Alliance carriers
and certain other partner airlines that participate in US Airways' program. Mileage credits can be redeemed for travel on US Airways or
other participating partner airlines, in which case US Airways pays a fee. US Airways uses the incremental cost method to account for the
portion of the frequent traveler program liability related to mileage credits earned by Dividend Miles members through purchased flights.
The liability for
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