US Postal Service 2014 Annual Report Download - page 5

2014 Report on Form 10-K United States Postal Service 1
Part I.
Forward-Looking Statements
From time to time, we make oral and written statements that may constitute “forward-looking statements” rather than historical
facts as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this report
represent 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,” “should,” “expect,” “believe,” “plan,” “estimate,” “project,” “anticipates,” “intends” or other similar
terminology. These statements reflect current expectations regarding future events and operating performance as of the date of
this report.
Important factors that could cause actual results to differ materially from those anticipated in our forward-looking statements
include, but are not limited to, those described under “Risk Factors” set forth in Item 1A of this Annual Report.
We have no obligation to publicly update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
Item 1. Business
General
In accordance with the provisions of the Postal Reorganization Act, the United States Postal Service began operations on July 1,
1971, as an “independent establishment of the executive branch of the Government of the United States” with the mandate to
offer a “fundamental service” to the American people “at fair and reasonable rates.” We fulfill this legal mandate to provide
universal service at a fair price by offering a variety of postal services to our many customers. Within each class of mail service,
prices do not vary unreasonably by customer for the level of service provided.
The Postal Service is governed by an eleven-member Board of Governors (the “Board”), of which nine members are
independent Governors appointed by the President of the United States with the advice and consent of the U.S. Senate, plus the
Postmaster General, who is appointed by the independent members of the Board, and the Deputy Postmaster General, who is
appointed by the independent Governors and the Postmaster General.
The Postal Service’s governing statute is codified in Title 39 of the United States Code. The Postal Accountability and
Enhancement Act of 2006, Public Law 109-435 (“P.L.109-435”) made revisions to the Postal Reorganization Act and
established the Postal Regulatory Commission (“PRC”), endowing it with regulatory and oversight obligations. In addition, the
Postal Service is legally bound by annual Financial Services and General Government Appropriations legislation. In
accordance with the provisions of this bill, the Postal Service is required to maintain a six-day delivery schedule.
As used herein, except as otherwise indicated by the context, the terms “Postal Service,” “USPS,” “we” and “us” are used to
refer to the United States Postal Service. All references to years in this report, unless otherwise stated, refer to fiscal years
beginning October 1 and ending September 30. All references to quarters, unless otherwise stated, refer to fiscal quarters.
Services
P.L.109-435 classifies postal services into two broad categories: Market-Dominant and Competitive “products;” however, the
term “services” is often used in this document for consistency with other descriptions of “services” offered by the Postal
Service. Postal Service management uses the following broad service categories to describe and report on the performance of
the Postal Service:
First-Class Mail — Letters, postcards or any flat advertisement or merchandise destined for either domestic (up to 13
ounces) or international (up to 4 pounds) delivery. First-Class letters include personal correspondence, bills or
statements of account and payments.
Standard Mail — Any item, including advertisements and marketing packages, weighing less than 16 ounces that is
not required to be sent using First-Class Mail. Standard Mail is typically used for direct advertising to multiple