UPS 2005 Annual Report Download - page 53

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Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Information about market risk can be found in Item 7 of this report under the caption “Market Risk.”
Item 8. Financial Statements and Supplementary Data
Our financial statements are filed together with this report. See the Index to Financial Statements and
Financial Statement Schedules on page F-1 for a list of the financial statements filed together with this report.
Supplementary data appear in Note 18 to our financial statements.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
As of the end of the period covered by this report, management, including our chief executive officer and
chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and
procedures and internal controls over financial reporting. Based upon, and as of the date of the evaluation, our
chief executive officer and chief financial officer concluded that the disclosure controls and procedures and
internal controls over financial reporting were effective to ensure that information required to be disclosed in the
reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when
required.
During 2005, the Supply Chain and Freight segment of our Company migrated significant freight services
transaction volume previously processed by separate operating systems to a single freight operating system
(E2K). The E2K freight operating system was utilized by Menlo Worldwide Forwarding, a company we acquired
in 2004. This migration represents a significant change to the processes and controls for this segment of our
business.
Also during 2005, the Company completed the acquisitions of Overnite Corporation and other entities. The
Company performed due diligence procedures associated with the acquisition of these entities and is in the
process of incorporating the separate financial reporting processes applicable to these entities into the Company’s
internal control structure.
There were no other changes in the Company’s internal controls over financial reporting during the year
ended December 31, 2005 that have materially affected, or are reasonably likely to materially affect, the
Company’s internal control over financial reporting.
See page F-2 for management’s report on internal control over financial reporting.
Item 9B. Other Information
None.
38