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12 | 2005 Annual Report United States Postal Service
A Message from the Audit and Finance Committee
The Audit and Finance Committee assists the Board
of Governors in fulfilling its fiduciary responsibilities.
The Chairman of the Board selects the members of the
Committee for each calendar year. Board Chairman
James C. Miller, Governor Louis J. Giuliano, and I are the
current members of the Committee. The certified public
accounting firm responsible for the independent audit of
Postal Service financial statements, Ernst & Young, LLP,
reports to the Board through the Committee. The Postal
Service Inspector General reports to the Governors and is
represented at all Committee meetings.
The Committee monitors financial performance, debt levels
and cash management on an ongoing basis. When om-
nibus rate changes are required, the Committee monitors
management’s development of rate case filings. Fulfilling
its primary responsibility, oversight of the integrity of Postal
Service financial statements, the Committee periodically
reviews the soundness of internal accounting and control
practices and major financial statement estimates and
accruals.
The Committee met in Washington D.C. four times in
2005. The Committee also held a meeting by confer-
ence telephone call on one occasion. During the year, the
Committee updated its charter; reviewed methodologies
for attributing cost and estimating revenue by class of mail;
discussed issues concerning the integrated financial plan
for 2006; and reviewed the development of the Office of
the Inspector General’s work plan for 2006.
The Committee monitors Postal Service’s financial report-
ing and internal control procedures to ensure compliance
with best corporate practice, promote good governance
and enhance transparency. The Committee was kept
advised of the accelerated production of Postal Service
financial statements to comply with a Federally mandated
submission of the statements to the Office of Management
and Budget by November 18, 2005. This was an area
of major accomplishment in 2005. This enhancement
follows major changes to reporting schedules and formats
initiated in 2004. The Postal Service adopted monthly re-
porting and began SEC-type financial reporting in formats
similar to 8-K, 10-K and 10-Q reports. These improve-
ments in the timeliness and transparency of the Postal
Service financial reports flow directly from specific recom-
mendations of the President’s Commission on the United
States Postal Service. These reports, as well as current
and historical reports on revenues, volumes, costs and
annual financial plans are posted on usps.com, the Postal
Service’s universal access web site. The Postal Service
continues to meet the voluminous reporting requirements
Robert F. Rider
The Audit and Finance
Committee monitors Postal
Service’s financial reporting and
internal control procedures to
ensure compliance with best
corporate practice, promote
good governance and enhance
transparency.