Financial Section Part III

Item 11 – Executive compensation

The Postal Service releases information concerning executive compensation to the extent required by the Freedom of Information Act (FOIA), 5 United States Code (U.S.C.) 552. Postal Service regulations implementing the FOIA are located at 39 CFR 265.

Item 12 – Security ownership of certain beneficial owners and management related stockholder matters

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 equity securities.

Item 13 – Certain relationships and related transactions

We enter into significant transactions with other government agencies, as disclosed throughout these financial statements.

Item 14 – Principal accountant fees and services

In 2002, the Board of Governors selected Ernst & Young LLP as its independent auditor to perform external auditing services. The competitively awarded five-year contract, with an option of renewal of up to 36 months, had an estimated value of $11.7 million covering the financial statement audits for fiscal years 2003 - 2007. The enactment of P.L.109-435 expands the scope in work requirements of these audit services; however, we are unable to quantify the estimated additional contract value at this time. As with previous contracts for external audit services, Ernst & Young LLP will not perform consulting work for us for the duration of the contract.