US Postal Service 2012 Annual Report Download - page 94

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2012 Report on Form 10-K United States Postal Service- 93 -
At September 30, 2012, scheduled repayments of debt principal, exclusive of capital leases, is as follows:
Scheduled Debt Principal Repayments - By Fiscal Year
(Dollars in millions)
2013
$
9,500
2014
300
2015
-
2016
300
2017
-
After 2017
4,900
Total Debt $ 15,000
NOTE 5 — PROPERTY AND EQUIPMENT
Property and equipment are recorded at cost less accumulated depreciation, which includes the interest on
borrowings used to pay for the construction of major capital additions. Interest capitalized during the years
ended September 30, 2012 and 2011 was not material.
Deferred gains on sales of property are recognized in income and the sold assets removed from the
accounting records when any lease-backs or other conditions requiring continued Postal Service
involvement in the properties have expired. Deferred gains recognized in income were $79 million in 2012,
$17 million in 2011, and $18 million in 2010.
In September 2011, the Postal Service announced plans to realign its mail processing, delivery, and retail
networks. These plans were further modified in 2012. See Note 2, Liquidity Matters, for details. As a result,
an assessment was performed on both the real estate and equipment associated with the proposed
realignment efforts to determine if any impairment should be recognized. Any facility lacking utility to the
network will be marked for disposal. Once a facility is marked for disposal, determination of impairments, if
any, will be made by management. As of September 30, 2012, these evaluations are ongoing. For the
year ended September 30, 2012, there were no significant impairment charges related to these plans.
Assets classified as held for sale of $111 million as of September 30, 2012, and $58 million as of
September 30, 2011, are included on the Balance Sheets in “Land” and “Buildings”.
Impairment charges of $80 million, $21 million, and $26 million were recorded in 2012, 2011, and 2010,
respectively and are included in the Statement of Operations in “Other.” The majority of the impairment
expenses in 2012 are related to equipment taken out of service as a result of a process improvement.