US Postal Service 2015 Annual Report Download - page 50

2015 Report on Form 10-K United States Postal Service 48
Depreciation and amortization expenses were approximately $1.8 billion, $1.8 billion and $1.9 billion for the years ended
September 30, 2015, 2014 and 2013 respectively, and are included within Other operating expenses in the accompanying
Statements of Operations.
Capitalized software totaled $43 million as of September 30, 2015. No software costs were capitalized in 2014. Because the
software has not yet been put into production, no costs associated with capitalized software were amortized for 2015, 2014
or 2013.
Assets classified as held for sale were approximately $65 million and $97 million as of September 30, 2015, and 2014,
respectively, and are included within both Land and Buildings in the table above. Gains are deferred when the Postal Service
enters into any lease-back arrangements or other contractual obligations requiring continuing Postal Service involvement with
the property. Total deferred gains on the sale of property were $301 million and $370 million as of September 30, 2015, and
2014, respectively. The current portions of deferred gains were $2 million and $69 million as of September 30, 2015, and
2014, respectively, and are included within Other current liabilities in the accompanying Balance Sheets. The noncurrent
portions of deferred gains were $299 million and $301 million as of September 30, 2015, and 2014, respectively, and are
included within Other noncurrent liabilities in the accompanying Balance Sheets.
Gains recognized on assets sold are reported in Other revenue within the accompanying Statements of Operations. Total gains,
including the amortization of deferred gains noted below, were approximately $124 million, $53 million and $107 million for
the years ended September 30, 2015, 2014 and 2013, respectively.
Deferred gains are amortized over the periods during which the Postal Service has continuing involvement with the applicable
properties. The amounts amortized, included within Other revenue in the accompanying Statements of Operations, were $49
million, $8 million and $14 million for the years ended September 30, 2015, 2014 and 2013, respectively. Impairment charges
were $19 million, $62 million and $26 million for the years ended September 30, 2015, 2014 and 2013, respectively, and are
included in Other operating expenses in the accompanying Statements of Operations.
NOTE 6 - PAYABLES, ACCRUED EXPENSES AND DEFERRED REVENUE
Payables and Accrued Expenses
The following table provides details for Payables and accrued expenses from the accompanying Balance Sheets as of
September 30, 2015, and 2014:
(in millions) 2015 2014
Trade payables $ 663 $ 1,042
Foreign countries 498 553
U.S. government 95 89
Other accrued expenses 597 339
Total payables and accrued expenses $ 1,853 $ 2,023
Deferred Revenue–Prepaid Postage
Deferred revenue for postage sales is developed and validated through complex mathematical and statistical sampling methods
for estimating usage, including regression analysis of stamp usage trends. Small differences in inputs can lead to significant
differences in the estimate of the liability. The estimated stamp usage is subtracted from stamp sales with the difference
representing the Postal Service’s obligation to perform future services. That obligation is reduced by recognizing a provision
for postage sold that may never be used, either through loss, damage or stamp-collecting activity.
Metered postage is primarily used by businesses. Deferred revenue related to meters is estimated by monitoring the actual
usage of all postage meters that had postage added during the month preceding the financial measurement date. The information
from the two most recent meter readings is used to derive a deferral percentage, which is applied to all postage meter receipts
for the month.