4. Balance Sheet Accounts and Supplemental Disclosures

Receivables

The components of receivables were as follows (in thousands):

	December 31,
	2013		2012
Billed	$	68,474	$	59,496
Unbilled		514,238		439,372
Retainages due upon contract completion		806		354
Total	$	583,518	$	499,222

Under the terms of the company's Commercial Resupply Services ("CRS") contract with NASA, approximately 25% of the contract value is billable to the customer and collectible only upon the completion of launch and delivery milestones for each of eight CRS contract missions which are currently scheduled to occur through 2016. Unbilled receivables at December 31, 2013 and 2012 included $335 million and $277 million, respectively, pertaining to the CRS contract. which will be collected as launches occur, scheduled through 2016. Since the inception of the CRS contract in December 2008 through December 31, 2013, a total of $1.3 billion of revenues have been recognized on the contract, which has a total contract value of approximately $1.9 billion.

As of December 31, 2013 and 2012, unbilled receivables also included $9.9 million and $8.7 million, respectively, of incentive fees on certain completed satellite contracts that become due incrementally over periods of up to 15 years, subject to the achievement of performance criteria.

Certain satellite contracts require the company to refund a portion of the contract price to the customer if performance criteria, which cover periods of up to 15 years, are not satisfied. As of December 31, 2013, the company could be required to refund up to approximately $16.7 million to customers if certain completed satellites were to fail to satisfy performance criteria. Orbital generally procures insurance policies under which the company believes it would recover satellite incentive fees that are not earned and performance refund obligations.

Excluding the portion of unbilled receivables pertaining to the CRS contract discussed separately above, approximately 93% of unbilled receivables and retainages at December 31, 2013 are due within one year and will be billed on the basis of contract terms and delivery schedules. Approximately 90% and 91% of the company's receivables at December 31, 2013 and 2012, respectively, were related to contracts with the U.S. Government and its agencies or under subcontracts with the U.S. Government's prime contractors. Receivables from non-U.S. customers totaled $14.7 million and $34.1 million at December 31, 2013 and 2012, respectively.

Inventories

As of December 31, 2013 and 2012, inventories were $61.7 million and $61.3 million, respectively. The company's inventory consisted of component parts, raw materials and milestone payments for future delivery of component parts.

Property, Plant and Equipment

Property, plant and equipment consisted of the following (in thousands):

	December 31,
	2013			2012
Land	$	10,656		$	10,656
Buildings and leasehold improvements		88,390			85,803
Furniture, fixtures and equipment		337,737			298,082
Assets under construction		38,030			45,928
Software and other		29,619			33,310
		504,432			473,779
Accumulated depreciation and amortization		(258,372	)		(222,419	)
Total	$	246,060		$	251,360

The company received proceeds of $25.6 million in 2012 in connection with the sale of property and equipment at the Wallops Island Flight Facility to the Commonwealth of Virginia. Depreciation expense for the years ended December 31, 2013, 2012 and 2011 was $40.8 million, $36.6 million and $32.0 million, respectively.

Goodwill and Intangible Assets

The company's goodwill balances by reportable business segment are as follows (in thousands):

	Launch Vehicles				Satellites and Space Systems				Advanced Space Programs				Total
Balance at December 31, 2013		$	10,310			$	51,837			$	9,113			$	71,260

In 2013, the company recorded a $4 million reduction in total goodwill in connection with a purchase price adjustment.

Intangible assets consist of technology assets that were acquired in a 2010 spacecraft business acquisition. As of December 31, 2013 and 2012, the balance of intangible assets was $4.5 million and $5.2 million, respectively, reported in "other non-current assets." Amortization expense was $0.7 million for each of the years ended December 31, 2013, 2012 and 2011.

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following (in thousands):

	December 31,
	2013		2012
Contract related accruals	$	147,689	$	169,146
Employee compensation and benefits related liabilities		78,024		77,241
Accounts payable		50,650		4,037
Other		5,268		6,689
Total	$	281,631	$	257,113

Cash Flow

Cash payments for interest and income taxes were as follows (in thousands):

	Years Ended December 31,
	2013			2012			2011
Interest paid		$	4,040		$	6,733		$	4,158
Income taxes paid			11,480			2,699			2,242

The entire amount of cash disbursed in 2012 in connection with the repayment of certain of the company's long-term notes payable (see Note 6) was classified as repayment of long-term debt in financing activities in the accompanying consolidated statement of cash flows.