reports, the Central New Jersey District identified high costs in the Opening and Dispatch Activity of one of its processing and distribution centers. Consequently, management determined that the high cost was due to suboptimal scheduling. Staff schedules were subsequently realigned and local management estimates that in the future the plant could save a minimum of 5,000 hours per year.

     The development of a new cost model for bulk mail centers is planned for 2004.

     At the start of 2004, the Postal Service began reporting interim financial results on a calendar month basis. Previously, the Postal Service reported interim financial results on a rolling four-week accounting-period basis. The accounting period consists of two bi-weekly payroll cycles totaling four weeks. Thirteen accounting periods comprise the entire postal fiscal year (PFY), which consists of exactly 52 weeks or 364 days. The Postal Service has always made its annual financial reports on a government fiscal year (GFY) basis. Because the PFY is only 364 days long, the PFY and the 365-day GFY have become increasingly misaligned.

     The conversion to monthly reporting eliminates confusion about the postal fiscal year and will allow comparisons of Postal Service financial results with results of our competitors and customers, and government and other econometric data bases which are most frequently in calendar quarter and monthly formats. This should enhance the transparency of Postal Service financial reporting, consistent with recent General Accounting Office recommendations.

     During 2002, the Postal Service completed a review of all existing information systems and targeted approximately 190 systems that required conversion to monthly reporting. The interim procedures enabled 2003 data to be reported in an accounting period format while also allowing the capture of daily transaction data to create monthly reports. In August 2003, with availability of

the new general ledger system, the Postal Service began to recast 2003 data into monthly reports.

     Approximately 175 systems have been recast in a monthly format with data from 2003 representing a full year of financial history. Due to the business closing process for those applications, the remaining systems were recast in November 2003.

     The Standard Accounting for Retail (SAFR) project was fully deployed in September 2003 with all units reporting revenue on a daily basis. SAFR is a new Postal Service field accounting system that uses commercial-offthe- shelf software packages and best business practices to collect and report revenue activity on a daily basis. Data are available in the Accounting Data Mart within the Postal Enterprise Data Warehouse. SAFR increases management information and enables daily revenue information reporting by postal retail location.

     The Shared Services/Accounting (SS/A) was fully implemented by September 2003. SS/A is a re-engineering of residual field accounting processes of the Postal Service. Using the SAFR system as the cornerstone, field accounting processes have been redesigned and streamlined for efficiency with many resulting policy changes. Work associated with the re-engineered processes will be performed in the Postal Service's three accounting service centers, rather than in 85 districts. Documents will be imaged, eliminating paper and storage. A national accounting help desk will respond to all questions relating to accounting, payroll, and POS ONE. Pilot test sites were brought into SS/A in November 2002, resulting in the closure of the first four district accounting offices. Implementation of SAFR and SS/A projects enabled the establishment of an internal control group in each district. This group evaluates risks, conducts management