Notes to Consolidated Financial Statements License Rights Goodwill Investments in Unconsolidated Entities Accounts Receivable Inventory Property, Plant and Equipment Depreciation Assets and Liabilities of Operations Held for Sale Asset Retirement Obligation In accordance with the exchange agreement with AT&T Wireless, U.S. Cellular has deferred the assignment and development of certain licenses for a period of up to five years from the closing date, August 1, 2003. The 21 licenses that have not yet been assigned to U.S. Cellular, with fair value totaling $42.0 million, are included in License rights on the balance sheet. All asset values related to the properties acquired or pending, including license values, were determined using an indepen- dent valuation. See Note 11 – Acquisitions, Divestitures and Exchanges for a discussion of the AT&T Wireless exchange. U.S. Cellular has goodwill as a result of the acquisition of wireless licenses and markets. Included in goodwill is the portion of the purchase price of acquisitions of interests in operating wireless markets that was not assigned to the fair values of the other acquired assets, including wireless licenses. No deferred taxes have been provided on this good- will. U.S. Cellular adopted SFAS No. 142 on January 1, 2002, and no longer amortizes goodwill. Prior to 2002, goodwill was amortized over  40 years. Goodwill is tested for impairment annually. The impairment test consists of a comparison of the implied fair value of the goodwill with its carrying amount. If the carrying amount of goodwill exceeds  the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to that excess. Investments in unconsolidated entities consists of investments where U.S. Cellular holds a less than 50% non-controlling ownership interest. U.S. Cellular follows the equity method of accounting, which recognizes U.S. Cellular’s proportionate share of the income and losses accruing to  it under the terms of its partnership or shareholder agreements, where  U.S. Cellular’s ownership interest equals or exceeds 20% for corporations and 3% to 5% for partnerships and limited liability companies. The cost method of accounting is followed for certain minority interests where U.S. Cellular’s ownership interest is less than 20% for corporations and 3% to 5% for partnerships and limited liability companies, or where  U.S. Cellular does not have the ability to exercise significant influence. Accounts receivable consists of amounts owed by customers for both service provided and equipment sales, by agents for equipment sales, by other wireless carriers whose customers have used U.S. Cellular’s wire- less systems, and by unaffiliated third party partnerships or corporations pursuant to equity distribution declarations. Inventory is stated at the lower of cost or market with cost determined using the first-in, first-out method. U.S. Cellular’s property, plant and equipment is stated at the original cost of construction including capitalized costs of certain taxes, payroll- related expenses and estimated costs to remove the assets in accordance with SFAS No. 143 “Accounting for Asset Retirement Obligations.” Renewals and betterments of units of property are recorded as addi- tions to plant in service. The original cost of depreciable property retired (along with the related accumulated depreciation) is removed from plant in service and, together with removal cost less any salvage real- ized, is charged to depreciation expense. Repairs and renewals of  minor units of property are charged to system operations expense. Depreciation is provided using the straight-line method over the  estimated useful lives of the assets. Deferred Charges Costs of developing new information systems are capitalized in accordance with Statement of Position 98-1, “Accounting for the Cost of Computer Software Developed or Obtained for Internal Use,” (“SOP 98-1”) and amortized over a three- or seven-year period, starting when each new system is placed in service. Other deferred charges primarily represent legal and other charges incurred relating to the preparation of the agreements related to  U.S. Cellular’s various borrowing instruments, and are amortized over the respective financing periods of each instrument. U.S. Cellular accounts for the disposal of long-lived assets in accordance with SFAS No. 144 “Accounting for the Impairment or Disposal of Long- Lived Assets”. When long-lived assets meet the held for sale criteria set forth in SFAS No. 144, the balance sheet reflects the assets and liabili- ties of the properties to be disposed of as assets and liabilities of operations held for sale. The assets and liabilities of operations held for sale are presented separately in the asset and liability sections of the balance sheet. The revenues and expenses of the properties to be dis- posed of are included in operations until the transaction is completed. See Note 9 - Operations Held for Sale for the discussion of the sale  and exchange of long-lived assets. Statement of Financial Accounting Standards (“SFAS”) No. 143 “Accounting for Asset Retirement Obligations” was issued in June 2001, and became effective for U.S. Cellular beginning January 1, 2003. SFAS No. 143 requires entities to record the fair value of a liability for legal obligations associated with an asset retirement in the period in which the obligations are incurred. When the liability is initially recorded, the entity capitalizes the cost of the asset retirement obligation by increas- ing the carrying amount of the related long-lived asset. Over time, the liability is accreted to its present value each period, and the capitalized cost is depreciated over the useful life of the related asset. Upon settlement of the obligations, any difference between the cost to retire an asset and the liability recorded is recognized in the statements of operations as a gain or loss. 48