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2004 annual report united states postal service | 15
The฀Committee฀monitors฀the฀Postal฀Service’s฀financial฀reporting฀
and฀internal฀control฀procedures฀to฀ensure฀compliance฀with฀best฀
corporate฀practices,฀promote฀good฀governance฀and฀enhance฀
transparency.฀This฀was฀an฀area฀of฀major฀accomplishment฀in฀
2004.฀This฀year,฀the฀Committee฀oversaw฀the฀completion฀of฀the฀
multiyear฀modernization฀of฀most฀postal฀accounting฀systems.฀As฀
recommended฀by฀the฀Committee฀and฀approved฀by฀the฀Board,฀
the฀Postal฀Service฀began฀the฀process฀of฀voluntary฀adherence฀to฀
those฀provisions฀of฀the฀Sarbanes-Oxley฀Act฀that฀are฀applicable฀
to฀a฀non-publicly฀traded฀company.
To฀facilitate฀comparison฀of฀its฀own฀financials฀with฀those฀of฀
other฀organizations,฀the฀Postal฀Service฀has฀adopted฀monthly฀
reporting฀ in฀ place฀ of฀ its฀ long-standing฀ 28-day฀ accounting฀
period฀ reporting฀ system.฀ Under฀ the฀ guidance฀ of฀ the฀ Audit฀
and฀Finance฀Committee,฀the฀Postal฀Service฀has฀restructured฀
its฀interim฀and฀annual฀financial฀reports.฀The฀Postal฀Service฀
issues฀quarterly฀financial฀reports฀and฀has฀expanded฀both฀the฀
Management฀Discussion฀and฀Analysis฀and฀the฀forward-looking฀
information฀provided฀in฀its฀quarterly฀and฀annual฀reports.฀This฀
Security฀and฀Exchange฀Commission฀(SEC)-type฀reporting฀of฀
information฀is฀similar฀to฀8-K,฀10-K฀and฀10-Q฀reports.฀These฀
improvements฀enhance฀the฀financial฀transparency฀of฀the฀Postal฀
Service฀and฀flow฀directly฀from฀specific฀recommendations฀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฀website.฀
The฀Postal฀Service฀continues฀to฀meet฀the฀voluminous฀report-
ing฀requirements฀of฀the฀Postal฀Rate฀Commission,฀Congress,฀
the฀Government฀Accountability฀ Office,฀the฀federal฀Office฀ of฀
Personnel฀Management฀and฀the฀federal฀Office฀of฀Management฀
and฀Budget.
In฀directing฀the฀conduct฀of฀the฀2004฀financial฀statement฀audit,฀
the฀Committee฀met฀with฀Ernst฀&฀Young฀LLP,฀and฀concurred฀
with฀the฀scope฀and฀materiality฀levels฀they฀established฀in฀their฀
work฀plan฀for฀the฀task.฀The฀Committee฀met฀jointly฀and฀inde-
pendently฀ with฀ Ernst฀ &฀Young฀ LLP,฀ the฀ Inspector฀ General,฀
management฀and฀the฀General฀Counsel฀to฀discuss฀the฀progress฀
of฀the฀audit฀and฀ensure฀independence฀and฀objectivity฀in฀the฀
audit฀programs.
Accordingly,฀ the฀ Committee฀recommended,฀ and฀ the฀Board฀
approved,฀the฀financial฀statements฀for฀2004.
Robert฀F.฀Rider
Chairman,฀Audit฀and฀Finance฀Committee
December฀7,฀2004
a message from the audit and finance committee
To฀facilitate฀comparison฀of฀its฀
own฀financials฀with฀those฀of฀other฀
organizations,฀the฀Postal฀Service฀
has฀adopted฀monthly฀reporting฀in฀
place฀of฀its฀long-standing฀28-day฀
accounting฀period฀reporting฀system.฀
Under฀the฀guidance฀of฀the฀Audit฀
and฀Finance฀Committee,฀the฀Postal฀
Service฀has฀restructured฀its฀interim฀
and฀annual฀financial฀reports.฀