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86 | 2009 Annual Report United States Postal Service
Accounting Standards Codifi cation (ASC). Codifi es au-
thoritative accounting literature and guidance into a single
source and establishes two levels of U.S. Generally Ac-
cepted Accounting Principles, or GAAP – authoritative and
nonauthoritative. ASC is the source of authoritative GAAP.
Accruals. Revenue and expenses that are recorded as they
occur, even though they may not have actually been paid.
Amortize. To reduce the value of an asset through regular
charges to income over time; or to write off expenses by
prorating them over a period of time.
Appropriation. Public funds set aside by Congress for a
specifi c purpose.
Asset. An economic resource that is expected to be of
benefi t in the future.
Cautionary Statements. Statements contained in Man-
agement’s Discussion and Analysis that represent our
best estimate of the trends we know about, the trends
we anticipate and the trends we think are relevant to our
future operations.
Capitalize. To treat an expenditure as an asset; or to com-
pute the present value of a future payment that will be paid
over a period of time.
Contribution. The difference between the revenue from
a class of mail and that class’s volume-variable costs. For
example, if a class of mail has revenue of $1.5 billion and
volume-variable costs of $1 billion, its contribution is $500
million, which means that this class of mail covers its costs
and contributes $500 million to the common costs of all
mail services.
Contingent Liability. A potential liability that is contingent
on a future event.
Delivery Confi rmation. A special service that provides
the date of delivery or attempted delivery for Priority Mail
and Standard Mail parcels, Bound Printed Matter and Li-
brary Mail.
Depreciate. To periodically reduce the estimated value of
an asset over the course of its useful life.
Direct Mail. A form of advertising often employed by busi-
nesses to reach targeted groups of potential customers
by mail.
Enhanced Carrier Route. A subclass of Standard Mail for
mail pieces weighing less than 16 ounces and prepared in
carrier route sequence.
Equity. The difference between the value of all assets less
all liabilities.
Express Mail. The Postal Service’s premium delivery ser-
vice, providing guaranteed overnight delivery for docu-
ments and packages weighing up to 70 pounds. Both
domestic and international services are offered.
First-Class Mail. A class of mail including letters, post-
cards and all matter sealed or otherwise closed against
inspection. This service is required for personal correspon-
dence, handwritten or typewritten letters and bills or state-
ments of account.
Fiscal Year. As used in the fi nancial section of this report,
the Postal Service fi scal year, which is the 12-month pe-
riod during which the Postal Service keeps accounts, be-
ginning Oct. 1 and closing Sept. 30.
Fixed Asset. Any tangible property such as buildings, ma-
chinery and equipment, furniture and leasehold improve-
ments.
Forever Stamp. A stamp that once purchased is good for
mailing one-ounce First-Class letters anytime in the future —
regardless of price changes. It was introduced in 2007.
Generally Accepted Accounting Principles (GAAP).
The rules and procedures of accepted accounting practice
as defi ned by the Financial Accounting Standards Board.
Impaired Asset. When the market value of an economic
resource has been permanently lowered below the record-
ed value of the asset.
GLOSSARY