Ernst & Young LLP
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McLean, VA 22102
Tel: (703)7474-1000
www.ey.com
The Board of Governors of the United States Postal Service
We have audited the accompanying balance sheets of the United States Postal Service as of September 30, 2009 and 2008, and the related statements of operations, changes in net (deficiency) capital, and cash flows for each of the three years in the period ended September 30, 2009. These financial statements are the responsibility of the United States Postal Service’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the United States Postal Service’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the United States Postal Service’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the United States Postal Service at September 30, 2009 and 2008, and the results of its operations and its cash flows for each of the three years in the period ended September 30, 2009, in conformity with US generally accepted accounting principles.
As discussed in Note 2 to the financial statements, the United States Postal Service is required to make a $5.5 billion payment on September 30, 2010 pursuant to the 2006 Postal Accountability and Enhancement Act, Public Law 109-435. There is significant uncertainty as to whether the United States Postal Service will have sufficient liquidity to make this payment on September 30, 2010.
In accordance with Government Auditing Standards, we have also issued our report dated November 16, 2009 on our consideration of the United States Postal Service’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.
November 16, 2009
