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2013 Report on Form 10-K United States Postal Service 17
Part II
ITEM 5 — MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Not applicable to the United States Postal Service. As an “independent establishment of the Executive Branch of the
Government of the United States,” we do not issue stock or other securities.
ITEM 6 — SELECTED FINANCIAL DATA
See the Financial History Summary located in Part IV, Item 15 of this Form 10-K.
ITEM 7 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
CAUTIONARY STATEMENTS
Forward-looking statements contained in this report represent our best estimates of known and anticipated trends
believed relevant to future operations. However, actual results may differ significantly from current estimates. Certain
forward-looking statements are included in this report and use such words as “may,” “will,” “could,” “expect,” “believe,”
“plan,” “estimate,” “project,” or other similar terminology. These statements reflect current expectations regarding future
events and operating performance as of the date of this report. These forward-looking statements involve a number of
risks and uncertainties.
The following are some of the factors that could cause actual results to differ materially from those expressed in, or
underlying, forward-looking statements: effectiveness of operating initiatives; rate of electronic diversion; changes in laws
and regulations; costs and delays associated with new regulations imposed by the Postal Regulatory Commission (PRC)
or other regulatory bodies; the amount of required prefunding payments to the Postal Service Retirement Health Benefits
Fund (PSRHBF); success in advertising and promotional efforts; changes in national and local business and economic
conditions, including their impact on consumer and business confidence; labor and other operating costs; oil, fuel, and
other transportation costs; the effects of war and terrorist activities; competition, including pricing and marketing initiatives
and new service offerings by our competitors; consumer preferences or perceptions concerning our service offerings;
spending patterns and demographic trends; availability of qualified personnel; severe weather conditions; labor relations;
effects of legal claims; cost and deployment of capital; fluctuations in interest rates; and changes in applicable accounting
policies and practices. The foregoing list of important factors is not all-inclusive. We have no obligation to publicly update
or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles (U.S. GAAP)
requires management to make significant judgments and estimates to develop certain amounts reflected and disclosed in
the financial statements. In many cases, there are alternative policies or estimation techniques that could be used. We
maintain a thorough process to review the application of accounting policies and to evaluate the appropriateness of the
many estimates that are required to prepare the financial statements. Management discusses the development and
selection of these accounting policies and estimates with the Audit and Finance Committee of the Board. However, even
under optimal circumstances, estimates routinely require adjustment based on changing circumstances and new or better
information.
The three accounting policies that are considered either the most judgmental, or involve the selection or application of
alternative accounting policies, and are material to the financial statements, are those related to the recording of workers’
compensation costs, deferred revenue-prepaid postage, and contingent liabilities.
Workers’ compensation costs are highly sensitive to discount and inflation rates and the length of time recipients are
expected to stay on the compensation rolls. However, the total annual cash payment for claims is relatively stable and
predictable. The workers’ compensation costs reflected on our Statements of Operations are subject to actuarial