We recommended that the Service use a risk-based approach for selecting mailings to receive presort ensure that required presort verifications and supervisory reviews of those verifications are performed and documented; provide supervisors and staff with updated procedures, training, and tools; develop and use valid information for evaluating the adequacy of business mail acceptance controls, procedures, staffing, and training; and develop methodologies for measuring systemwide revenue losses. Scope and Methodology

To determine the actions taken by the Service in response to our 1996 recommendations, we discussed with Service officials changes made to the Service’s business mail acceptance controls and obtained and reviewed program procedures and guidelines for the new process. The results of our work cannot be projected to the Service’s other business mail processing facilities. We reviewed a number of Inspection Service audit reports for the last several years relating to Service business mail operations. In our latest review, we found that the Service had updated business mail acceptance control procedures, provided training designed to help ensure that acceptance work is done correctly, and makes tools available to its employees to help them determine customers’ eligibility for discounted postage rates. Evaluations of Acceptance Controls and Operations

In 1996, we reported that the Service lacked key data needed to assess the adequacy of its business mail acceptance controls and related risks. Conclusions

Since our last review, the Service has changed its business mail acceptance process generally along the lines that we recommended in our 1996 report, and the Service’s business mail acceptance control procedures, overall, appear to have improved. However, the Service still lacked comprehensive information on how well its business mail acceptance controls are working and thus cannot ensure that it is collecting all the revenue due from its business mail operations. Information providing such assurances is not available. Accordingly, we do not believe that the Service has fully addressed our 1996 recommendations that it ensure that required supervisory reviews are performed and that it develop information for evaluating the adequacy of its business mail acceptance controls.
Why GAO Did This Study

Pursuant to a congressional request, GAO provided information on the Postal Service's acceptance controls for business mail, focusing on whether the Service had made the changes GAO recommended previously and whether those changes were working.

What GAO Found

GAO noted that: (1) the Service made changes to its controls over the acceptance of business mail; (2) those changes are generally along the lines that GAO recommended in 1996 and its controls overall appear to have improved; (3) however, the Service lacks information on how well its controls are working Servicewide and thus cannot ensure that it is collecting all the revenue due from its business mail operations; (4) since GAO's 1996 report, the Service has: (a) developed and implemented a risk-based approach for verifying the eligibility of high-risk customers to receive discounted postage rates; (b) made changes to its presort verification, supervisory review, and documentation requirements to help provide more assurance that these functions are performed; (c) changed its business mail acceptance-control procedures and training guidelines to help supervisors and staff perform their tasks properly and made key tools available to help them more accurately determine customers' eligibility for specific postage discounts; (d) developed information sources for managers to use in evaluating business mail acceptance controls, procedures, staffing, and training; and (e) incorporated reviews of its business mail operations into a Servicewide effort to protect revenue and obtain all compensation due for its services and products; (5) on the basis of GAO's evaluation of the Service's new business mail acceptance control process, discussions with Service officials, observations of acceptance procedures at eight business mail facilities, and review of Postal Inspection Service audit reports, GAO believes that the changes the Service made to its business mail procedures and operations help to prevent revenue losses; (6) however, GAO could not determine whether all of these changes are working Servicewide because data needed to make such a determination were not available; (7) neither the results of GAO's work or the work of the Inspection Service that GAO reviewed can be projected to the universe of Service business mail facilities; and (8) however, there is sufficient evidence that the Service has not fully addressed GAO's 1996 recommendations that it ensure that required supervisory reviews are performed and that it develop information for evaluating the adequacy of its business mail acceptance controls.