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Business Mail Acceptance

May 20, 2010

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Business Mail SOX Compliance

Business Mail Entry Vision

Business Mail Acceptance Business Mail Acceptance

3

3 days into the start of SOX testing Acceptance Sites and PVDS sites still have critical

issues Focus Areas

– BMEUs, Associate Offices– DMUs– Induction Sites, NDCs, SCFs, etc

Business Mail SOX Compliance

44

Verification

• Perform initial verification • Perform in-depth verification if necessary• Record results, contact mailer if necessary

Finalize/Clear

• Finalize postage statements • Affix 3607P/ Complete 8017/8125• Move to cleared staging area

Reconciliation

• Perform management concurrence• Print End-of-Day Reconciliation Report• Ensure all mailings are accounted for• Sign End-of-Day Reconciliation Report

Check-in

• Ensure funds on hand and fees paid• Ensure completed postage statements • Check mailing into PostalOne!

Standardized Process for BMEU/ AO

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BMEU Failure Rate Data as of 4/27/2010

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Daily Reconciliation:- The worst performing sub-question is Question B: “Is the final day reconciliation report signed, dated, and annotated for all postage statements not shown in FIN status?”

Daily Reconciliation of Aged Statements:- The worst performing sub-question is Question B: “Is the report of statements older than 7 days printed, dated, signed, and attached to the end-of-day reconciliation report?

Number of Sites Submitted: 954Number of PVDS Sites: 535BMEU Failure Rates

36%

3%

29%

44%41%

2%

16%

0%

10%

20%

30%

40%

50%

MailingChecked-In

Hard CopySigned/Dated

3607P onVerified Mail

DailyReconciliation

Aged StmtReconciliation

PVDSDocuments

PVDS - AlteredPS Form 8125

BMEU/AO Findings

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BMEU/AO Findings

Staging areas not clearly defined Mailings not checked-in upon arrival No initial verifications performed Postage Statements missing mailer signature and total postage 8125s not complete 8125s not finalized or accepted with alterations 8125 verifications not performed at origin Clearance Forms: 3607P not affixed to cleared mail Not completing and signing end of day reconciliation report Aged statements need to be reconciled

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Profile of DMUs

Different Profile of DMUs

Certain DMUs have Special Postage Payment Systems (SPPS)– A SPPS agreement allows us to customize acceptance

procedures for large/ complex mailings• Typically these mailings cannot be weigh-verified

– DMUs can have multiple SPPS types

– SPPS can be managed by Business Mailer Support or Business Mail Entry

Some DMUs do not need SPPS and follow the DM-109 for acceptance/verification

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Profile of DMUs

Acceptance and Verification at DMUs

All DMUs must follow the DM-109 DMUs with SPPS must have

– An agreement on file

– A verification SOP on file• Standardized SOPs• Customized SOPs

– SOP Supersedes DM-109

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Verification

• Perform cursory verification • Perform in-depth verification if necessary• Perform SOP process if necessary•Record results, contact mailer if necessary

Finalize/Clear

• Finalize postage statements • Complete 5111R/ 8017/ 8125• Observe origin entry vehicle loading

Reconciliation

• Perform management concurrence• Print End-of-Day Reconciliation Report• Ensure all mailings are accounted for• Sign End-of-Day Reconciliation Report

Check-in

• Ensure funds on hand and fees paid• Ensure completed postage statements • Check mailing into PostalOne!

Standardized Process for DMU

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Special Postage Payment System (SPPS) Type

Combined Mailings (Value Added Refunds)

(COM, CVAR)

Optional Procedures (OP)

Drop-Ship Management System (DSMS)

Manifest Mailing Systems (MMS)

Copal/Co-tray (Copal)

Postage Due Weight Averaging (PDWA)

One-Pass Finalization (One-Pass)

Alternate Mailing System

eVS

Profile of DMUs

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DMU Failure Rate Data as of 5/4/2010

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SPPS- The worst performing sub-question is: “Are current copies of the SPPS SOP available to the acceptance clerk?”

Daily Reconciliation- The worst performing sub-question is: “Is the final end-of-day reconciliation report signed, dated, and annotated for all postage statements not shown in "FIN" status?”

Number of Sites Submitted: 641Number of SPPS Sites: 427Number of PVDS Sites: 438DMU Failure Rates

29%

14%

4%

23% 23%

12% 11%

26% 28%23%

0%

10%

20%

30%

40%

SPPS

Adequ

ate

Staffin

g

Requi

red

Docum

enta

tion

Post S

tmt C

heck

-In/S

igned

Cleare

d M

ail S

epar

ated

In-D

epth

Ver

ificat

ions

/PBV

Load

ing o

f Mai

l Obs

erv

USPS Veh

icle

Seale

d

Daily R

econ

cilia

tion

Aged

Stmt R

econ

DMU Findings

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Units did not have a Plant Load Agreement Units did not have Agreements/SOPs Units were not familiar with SOP Units did not have appropriate DMU staffing Units did not have clerks present during dispatch USPS vehicles were not sealed Units were not following key Financial Steps

• Check-In, Verification, Clearance, End-of-Day Reconciliation Units accepting unsigned Postage Statements

Critical Fields Not Completed in the 8125 8125s not finalized or accepted with alterations 8125 verifications not performed at origin

DMU Findings

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Review

• Ensure 8125 is complete and accurate

• Ensure 8125 is not altered

• Contact origin to resolve issues

Receive

• Match 8125 against mail

• Contact origin to resolve issues

Record

• Record issues on 8125, eMIR

• Close out appointment in FAST

• Retain 8125s for 1 year

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Standardized Process for Drop-Ship

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PVDS Process Failure Rates

1% 1%

37%

5%

11%12%

11%

0%

10%

20%

30%

40%

Review PSForm 8125

ReceiveLoad

ResolveIssues

FinalizeAppt.

RecordIrregularity

on 8125

FASTCloseout

ReportIrregularity

in eMIR

Internal Site Review Results on Key Financial Controls

PVDS Findings

# of Reviews Submitted: 20,000+Number of PVDS Sites: 474

PVDS Failure Rate Data as of 5/6/2010

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PVDS Findings

Mailer/USPS section of 8125 incomplete 8125 contains undocumented alterations Shipment at wrong location Mismatched container count (Mail versus 8125) Resolution process not followed:

– Origin Office not contacted

– Escalation process not followed

– eMIR not entered Appointment finalization and close out in FAST

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PS Form 8125

Critical fields that must be completed and unaltered

Class of Mail Type of Mail Processing Category Number of Pallets Entry Discounts Claimed Entry Office in the Destination Entry Post Office

Section Origin Post Office Signature of Verifying Employee Round Stamp

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3 days into the start of SOX testing Look for your support in:

– Complete Postage Statements, 8125s and documentation

– Access to Mail for Verification

– Agreements Current

SOX

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Business Mail Entry Vision

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Action Goals Within Control Product and Services Initiative Productivity Improvements Workforce Flexibility Purchasing Saving

Enterprise Action GoalsEnterprise Action Goals

March 2010 Call to Action – Envisioning America’s Future Postal Service

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Productivity Improvements Automate Eliminate

Products and Services Innovate

Work Force Flexibility Consolidate

Action Goals In ControlAction Goals In Control

® Business Mail Entry Vision Business Mail Entry Vision

Automate – Productivity Improvements Streamline Business Mail Entry Streamline Support Activities

Innovate – Products and ServicesEnterprise PaymentExpand/Simplify Induction Visibility: Start-the-Clock

Consolidate Optimize BME Network

Integrate Access and Induction Activities Right Size – Staffing/Scheduling Model

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Streamline Business Mail Entry

Results-based Automated Verifications Assess Key Acceptance and Verification Functions for

Automation, Streamlining, and Gap Solutions eInduction

Unique pallet barcodes are processed through eDoc and FAST appointments

Scanning at induction allows data validation Enables automated, near-real time updates Enables near real-time status updates and automated

reconciliation

Automate Automate

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Streamline Support and Services

Integrated Customer Support/Feedback Develop model for centralized/automated key support

activities Design Customer Self Service features (e.g. Mail piece

Design and Mailing Standards)

Automate Automate

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PostalOne!

ACS

Express Mail

PO Box

Bulk Permit# 123

Postage Due# 95001

Express# 202987

PO Box Rent# 190001

Limited Access

Multiple Touch-points

Multiple Accounts

Multiple Payment Records

USPS Payment Today

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PostalOne!

ACS

Express Mail

PO Box

Online Payment

Create user friendly online application process

Enhance customer experience with online access to account management and information 24/7

Create unified experience across USPS systems

Integration of multiple USPS payment points

Innovate

Enterprise Payment

®Expand/Simplify Induction Visibility

Start-the-Clock

Expand Induction Visibility: Start-the-Clock Origin Entry at the BMEU

Mailing Arrival compared to BMEU CAT Drop-shipment & DMU Verified Mailer Transported

Appointment arrival compared to Plant CET DMU Verified, USPS Transported

Scheduled trip info and CAT recorded in CSA Mail dispatch info provided in the eDOC

Simplify Postage Statement Dates: Start-the-Clock, Payment Date

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Optimize Network

Optimize BMA Network Integrate Access Points (Acceptance and Induction) Leverage Staffing Model to Right-Size acceptance sites

Consolidate Consolidate

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Results-based Automated Verification Deploy Seamless Acceptance

Centralized Account Management and Payment Features Deploy flexible options and universal access features

Integrated Customer Support/Feedback Deploy Centralized Support Functions and Online Services

Optimize Business Mail Acceptance Network Online Business Services

Business Mail Entry Vision Business Mail Entry Vision