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Tax Performance System handbook updates
Summary ETA sent states replacement pages for the Tax Performance System handbook. Changes include reviews of tax-rate manipulation detection, employer reporting, cashiering and field audits. UIPL 29-10 later modified some of the tax-rate manipulation review instructions; ETA still lists this letter as Active, but the current scope of those instructions is unclear.
Document
Federal guidance
Agency
U.S. Department of Labor, Employment and Training Administration (ETA)
Document number
UIPL No. 13-10
Date issued
February 16, 2010
Status
Unknown
ETA lists this letter Active as of 2026-10-24 and its PDF prints “Continuing,” but UIPL No. 29-10 later modified the tax-rate manipulation review instructions supplied here. Current applicability of those instructions is unclear.
Status last verified October 24, 2026
Apply this to your situation
This page explains the general guidance. Ask about your specific situation and see what current federal labor law says, with citations.
About this page: The full text below is the official document from U.S. Department of Labor, Employment and Training Administration (ETA). Ezel adds the plain-English summary and tracks the document's status. The official source linked on this page is authoritative for any reliance.
UIPL13-10acc.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2010/UIPL13-10acc.pdf)
CLASSIFICATION
UI
EMPLOYMENT AND TRAINING ADMINISTRATION
ADVISORY SYSTEM CORRESPONDENCE SYMBOL
OUI DUIO
U.S. DEPARTMENT OF LABOR
Washington, D.C. 20210 DATE
February 16, 2010
ADVISORY: UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 13-10
TO: STATE WORKFORCE AGENCIES
FROM: JANE OATES /s/
Assistant Secretary
SUBJECT: Tax Performance System Handbook Updates
1. Purpose. To provide updated pages for the Unemployment Insurance (UI) Tax Performance
System (TPS) Handbook, ET Handbook No. 407, 4th Edition.
2. References. ET Handbook No. 407, 4th Edition, November 20, 2003; ET Handbook No. 407,
4th Edition, Change 1, December 9, 2004; ET Handbook No. 407, 4th Edition, Change 2, July
31, 2006; ET Handbook No. 407, 4th Edition, Change 3, December 11, 2007; and
Unemployment Insurance Program Letter No. 25-09.
3. Background. TPS is part of the comprehensive UI performance management system “UI
Performs” and ET Handbook No. 407, Edition 4, provides standard instructions for operating
TPS in each state. This advisory transmits a number of modifications, clarifications, and
replacement pages for the Handbook. These changes will take effect January 1, 2010.
4. Handbook Modifications Summary.
• Chapter II, General Procedures.
o A notation was added to advise that TPS reviewers may require data dictionaries
or other specifications from the Information Technology unit in order to identify
and decipher source documents necessary for confirming accuracy of tax
activities.
o References regarding case replacement have been changed to case removal.
o Instructions have been added to explain that a state’s failure to conduct a TPS
review for one or more tax functions will require corrective action and will be
added towards the count of failing tax functions. Therefore, when producing a
State Quality Service Plan for 2011, action must be planned for any tax functions
that were not examined during the calendar year (CY) 2009 TPS review period.
o Footnotes have been added to the Program Review Finding Chart to accommodate
the above changes.
RESCISSIONS EXPIRATION DATE
None Continuing
• Chapter III, Status Determination.
o To ensure that states have procedures to identify and investigate employers that
may be manipulating experience rating systems (i.e., State Unemployment Tax
Act (SUTA) dumping detection activity), questions have been added to the
Systems Review section. TPS reviewers may begin to examine state procedures at
any time during the 2010 CY, however the TPS SUTA dumping detection
questions are presently under review and subject to change.
o Sampling instructions have been changed to include employers that are registered
via telephone.
• Chapter IV, Cashiering.
o Text in sampling instructions has been modified to include references to
electronic and paper documentation.
• Chapter V, Report Delinquency.
o Sampling instructions have been altered to include references to electronic
records.
• Chapter VI, Collections.
o Sampling instructions have been altered to include references to case removal and
to electronic records.
• Chapter VII, Field Audit.
o Sampling period has been changed from three to four quarters to ensure that all
audits are subject to potential TPS review. Due to TPS workload concerns, an
option has been provided of selecting four CY quarters, or selecting the fourth
quarter of the previous CY and the first three quarters of the CY under review.
Should IT programming issues arise, this change may be delayed until the CY
2011 review of audits.
• Chapter VIII, Account Maintenance.
o In the Report Processing section, a correction was made to the numbering of a
Verification Source item.
o Systems Review text in the Report Processing section was changed to add
questions about internal controls which ensure that the agency’s tax system can
accept and process paper and electronically-transmitted employer data accurately
and effectively.
o Systems Review text was also modified to clarify that UI reports do not have to
be sent to all employers, and that paper and electronic systems for capturing
reported contribution and wage information are updated at the start of each filing
period.
o The Acceptance Sampling section was changed to clarify that if employer
payment is received by the TPS review date, the accuracy of payment posting
must be examined. Clarification was added to confirm that the payment can be
applied to any quarter as per the state’s procedures. Examples of acceptable
source documents for confirming accurate posting of employer reports and
payments have been added.
o In the Credits/Refunds and in Debits/Billings Acceptance Sampling sections,
references have been added to electronic source documents.
o In the Experience Rating Acceptance Sample section, an example has been
updated and references added to electronic source documents.
5. OMB Approval. ET Handbook No. 407 has been approved by the Office of Management and
Budget (OMB) in accordance with the Paperwork Reduction Act of 1995, OMB Approval No.
1205-0332, expiration date: June 30, 2012.
6. Action Requested. Administrators are requested to distribute this advisory and the attached
replacement pages to the TPS reviewer(s) and appropriate tax staff. These updates are also
available electronically at: http://wdr.doleta.gov/directives under Employment and Training
Handbooks.
7. Handbook Maintenance. ET Handbook 407, 4th Edition, Change 4 should have the following
pages removed and replaced with the attached pages.
Remove Pages Insert Pages
Chapter II
Pg. 19 R 04/03 and 20 R 04/03 Pg. 19 R 10/09 and 20 R 04/03
Pg. 31 and 32 blank Pg 31 and 32 blank
Pg. 33 R 07/06 and 34 R 04/03 Pg. 33 R 07/06 and 34 R 10/09
Pg. 35 R 07/06 and 36 R 04/03 Pg. 35 R 10/09 and 36 R 04/03
Chapter III
Pg. 47 R 04/03 and 48 blank Pg. 47 R 10/09 and 48 R 10/09
Pg. 63 R 11/07 and 64 R 04/03 Pg. 63 R 10/09 and 64 R 04/03
Chapter IV
Pg. 111 R 11/07 and 112 R 11/07 Pg. 111 R 11/07 and 112 R 10/09
Chapter V
Pg. 61 R 04/03 and 62 R 04/03 Pg. 61 R 10/09 and 62 R 04/03
Chapter VI
Pg. 65 R 11/04 and 66 R 04/03 Pg. 65 R 11/04 and 66 R 10/09
Pg. 67 R 07/06 and 68 R 04/03 Pg. 67 R 10/09 and 68 R 04/03
Chapter VII
Pg. 57 R 04/03 and 58 R 07/06 Pg. 57 R 10/09 and 58 R 10/09
Chapter VIII
Pg. 23 R 04/03 and 24 blank Pg. 23 R 10/09 and 24 blank
Pg. 33 R 04/03 and 34 blank Pg. 33 R 10/09 and 34 blank
Pg. 35 R 04/03 and 36 R 04/03 Pg. 35 R 10/09 and 36 R 04/03
Pg. 55 R 04/03 and 56 R 04/03 Pg. 55 R 10/09 and 56 R 10/09
Pg. 57 R 04/03 and 58 blank Pg. 57 R 10/09 and 58 blank
Pg. 59 R 04/03 and 60 blank Pg. 59 R 10/09 and 60 blank
Pg. 117 R 04/03 and 118 R 04/03 Pg. 117 R 10/09 and 118 R 10/09
Pg. 179 R 04/03 and 180 R 04/03 Pg. 179 R 04/03 and 180 R 10/09
Pg. 181 R 04/03 and 182 R 11/04 Pg. 181 R 10/09 and 182 R 11/04
Pg. 297 R 04/03 and 298 R 04/03 Pg. 297 R 10/09 and 298 R 10/09
8. Inquiries. Address all inquiries to the appropriate Regional Office.
9. Attachment. Replacement pages for Handbook 407, Edition 4, Change 4.
UIPL13-10a1.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2010/UIPL13-10a1.pdf)
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES SYSTEMS REVIEWS
Training Systems Managers and employees responsible for key decisions should possess and
maintain a level of expertise which enables them to accomplish their
assigned duties. Training systems should be sufficient to ensure that
personnel understand and perform their duties properly. (New employees
should have some form of training, and experienced employees also
benefit from refresher courses.)
When reviewing training systems, reviewers must look for formal training
procedures (e.g., the training is conducted using an established schedule
and using set guidelines to make judgments about the quality of work being produced). There
should be procedures for identifying general and specific training needs and for delivering
training as needed.
Recording of Transactions and other significant events are to be recorded and properly
Transactions and classified. The entire life cycle of a transaction or events should be
Events promptly recorded. This includes recording the action which initiated the
transaction(s), recording the transaction(s) that took place and recording
the end result.
Whether systems are manual or automated, audit trails are necessary so
that original information is recorded and retained. Hard copies,
microfiches or imaging of original information can provide audit trails.
For employers filing or reporting electronically, on disk or tape, a copy of the reported
information loaded into the employers’ account/file would be considered an “original”
document and provide an audit trail. Subsequent changes or deletions to the file must also be
recorded. If the reviewer comes across a system which simply overlays new information over
the original, without any apparent provision for an audit trail, the IT unit should be contacted
to locate back up files such as tapes, disc, etc. of the computer program runs. The IT or
Internal Security units should be able to explain how original information is recreated (short of
running every back up tape), and the method used to catalog information so that the reviewer
can be assured he or she is looking at original, versus adjusted, information.
Electronic source data will not have the same appearance as the more-familiar paper document
versions. For the TPS reviewer to understand and identify information when examining a
string of fixed width fields in various data rows, the IT unit may have to provide a data
dictionary, or assist in deciphering record specifications.
II - 19 R 10/09
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES SYSTEMS REVIEWS
Reviewers will determine whether State audit trail requirements
provide for the classification and prompt recording of all significant
events. The reviewer will also need to determine whether records are
readily available to be used as needed for agency operation and
management review.
Execution by Transactions and other significant events are to be executed
Authorized only by persons acting within the scope of their authority. Only
Individuals authorized individuals have access to and accountability for resources
such as employer remittances.
Reviewers will determine whether State requirements provide for the
execution of significant events by only authorized individuals.
Systems to Assure Systems and controls such as monitoring procedures, exception
Execution of Events identifications, checks and balances, reconciliations and edits should
be routine in operational procedures. Automated or manual exercise
of these controls as an integral part of program operations assures
accurate and timely execution of transactions and events.
Reviewers should determine if such program management systems
have been built into the State revenue operation.
Review of Qualified and continuous review is to be provided to ensure
Completed Work that objectives which are material to the proper payments of tax are
achieved. The following tasks are involved:
Systematic review of assigned work on a regular, ongoing basis.
Systematic review to determine whether systems and procedures
are working as intended.
II - 20 R 04/03
State : Figure II-4
Review Period : PROGRAM REVIEW FINDINGS
Sampling
Systems Review Verified Controls for:
Tax Function
Recorded Training Recording Authorized Execution Review of EXCEPTIONS COMPLETE *
Instructions of Events Individuals of Events Work
STATUS DETERMINATION
New
Successor
Inact/Term.
CASHIERING
REPORT DELINQUENCY
COLLECTIONS
FIELD AUDIT
ACCOUNT MAINTENANCE
Contrib Rpt Processing
Contr Contr
Employer Debits/Billings
Reimb Reimb
Employer Credits/Refunds
Employer Charging
Employer Tax Rates
SYSTEMS C = All controls verified as present SAMPLING EXCEPTIONS: S = Size of universe too small SAMPLING COMPLETE: P = Passed
REVIEW: R = Risk, 1 or more controls missing I = Invalid universe or not sampled F/# = Failed/ # of Cases Failing
O = Other control compensated for E = Exemption, tempo (Exp Rate only) F/I = Failed/ Invalid or not sampled
missing control (requires Regional approval) F = Failed due to missing case information F/M = Failed/ Missing case information
W = Waived, tempo (requires Regional approval) N = Not marked complete
U = Undeterminable (Cashiering only)
* = Out of tax unit’s authority
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES ACCEPTANCE SAMPLES S
III. ACCEPTANCE SAMPLING
a. Select Samples
Acceptance Samples are not meant to stand alone. They are to be the means of confirming the
performance of a system whose internal controls have already been assessed by a Systems
Review. If risks have been identified in the Systems Review, the samples will likely verify that
system outputs fail to meet minimum levels of accuracy or completeness. If a system is deemed
to be risk-free, samples of outputs should confirm this fact. For these purposes, it is not
necessary to draw large samples for estimating the defect or error rate. Large samples are costly
and time consuming. Since the purpose of the samples in the TPS Program Review is to verify a
level of performance, much smaller samples can be used.
In assembling files from which samples will be selected, the state must ensure that they are
randomized, or that a randomized algorithm is used before the sample is selected.
Once the Systems Review is complete, draw a sample of 60 cases from each tax function to
confirm that system outputs meet minimum levels of accuracy or completeness (e.g., all
appropriate actions are being taken to resolve delinquent reports, and field audits meet ESM
requirements).
The desired accuracy/completeness level is 98% - that is, 98% of the tax function’s outputs or
work products should be accurate. For a tax unit operating with an underlying accuracy level of
98%, there is an 88% chance that two or fewer errors will be discovered in a sample of 60 cases.
As the tax function's underlying accuracy level increases, there is a proportional increase in the
chances of passing. Conversely, as the tax function's accuracy level decreases, the more cases in
the sample are likely to fail.
The failure of three or more cases is reason to conclude that the exception rate for that function is
at an unacceptable level. As the graph below shows, tax functions with accuracy levels below
98% still have a chance to pass the sample review, but the probability of passing rapidly
decreases as the underlying accuracy level decreases. For instance, if the underlying error is 9%,
there is only an 8% chance of passing the sample.
II - 33 R 07/06
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES ACCEPTANCE SAMPLES S
b. Case Removal or Non Use.
There are three instances where cases may not be used, or case removal may be necessary.
1. The particular case selected should not have been in the universe to be sampled. Note that this
should not occur if, when developing sampling systems, the universe files were properly reviewed.
There may be instances when the universe was not assembled correctly. For example, when
building the universe of Collection cases, an account receivable which had less than $100.00 unpaid
UI tax due, could be inadvertently included. (The universe should consist of $100.00 or more in
unpaid tax.) However, it is important to have some evaluation of each tax function if at all possible.
If cases that should not be in the universe are selected, do not replace them; instead, continue
extracting samples. As long as the sample contains a minimum of 53 valid cases (i.e., cases that
meet the universe definition), two cases can still fail and the results of the Acceptance Sample will
remain consistent with that of 60 case samples. In such instances, the Regional Office needs to
notify the National Office, which will ensure that the SUN system accepts such modification on a
case-by-case basis. If the sample size drops below 53, that tax function cannot be evaluated
The IT section should be alerted in order to make modifications for future sampling efforts. The
reviewer must then advise the Regional Office to ensure that future universes will be sound. Note
must also be included in the Annual Report of the problem as well as corrective action steps taken
to rectify the situation.
II - 34 R 10/09
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES ACCEPTANCE SAMPLES S
A non-evaluated tax function can not be found to have reasonable assurance of quality and will
be counted as a failure. Code the Program Review Findings Chart’s Sampling Exceptions cell
with an “I”. This will generate a failing score in the tax function’s Sampling Complete cell.
The only permissible exceptions for non-sampling are universes that are too small (“S”),
Experience Rate samples not due for a review (“E”), or Federally-approved waivers (“W”).
2. In Collections, any cases selected that had been subject to a TPS review the previous
year, for which no subsequent debt was created, should be removed.
3. The particular case selected cannot be reviewed due to a missing case folder, or other
documentation is missing, such as the microfiche or image of source documents. Sometimes
documents cannot be found in order to make a ruling on the case's accuracy. Records may
have been destroyed through circumstances beyond control (e.g., fire, flood, etc.). The
documents may be misfiled or "checked out" to some other staff member and cannot be found.
In instances of this type removal is allowed for one and only one lost case.
Before removal the reviewer must: Assure (to the extent possible) that the work on the
case was actually done, and make every effort to find the information. Check all possible
places/ persons where the information could be located. Inform the Regional Office of the
removal.
If a second case in the sample is missing then the reviewer cannot reach a conclusion
that there is reasonable assurance of accuracy, and the entire sample will fail. The
failure will count towards the total number of tax functions that have failed TPS quality
review. Code the Program Review Findings Chart’s Sampling Exceptions cell with an “F”.
This will generate a failing score in the tax function’s Sampling Complete cell. Further
details on the finding can be explained in the Annual Report.
While the review may stop at this point, tax managers may wish to continue the review in
order to get an unofficial assessment of how the tax function is faring or to see the extent of
missing documentation.
II - 35 R 10/09
ET HANDBOOK NO. 407 CHAPTER TWO
TAX PERFORMANCE SYSTEM
GENERAL PROCEDURES ACCEPTANCE SAMPLES S
c. Review Samples
Once the sample is selected, each case in it must be reviewed, using the
appropriate sample questionnaire. Each questionnaire contains a series
of questions which must be answered for each case to determine
whether it is correct.
One of the more difficult aspects of rating the cases involves deciding
whether or not a given case is acceptable. For some transactions, the decision is relatively
simple. For example, if a given employer contribution was not credited to the proper account in
the right amount, then the transaction is not acceptable. However, Status Determinations,
Collections, and Field Audits have many more elements in them. Some of those elements may
be incomplete or inaccurate without materially affecting the accuracy of the outcome. In each
function, every effort has been made to identify the essential elements for analysis and to
exclude unnecessary elements.
Any question that the reviewer and State has about materiality of an element should be resolved
with Regional staff as per the earlier Planning for Reviews section.
Note that if a sample case uncovers that something was done in error, but that the error was
subsequently discovered and rectified due to the State's internal controls, the case would not fail.
If, however, the error is rectified due to the employer bringing it to the State's attention, the case
fails.
Appeals When a case appearing in the sample is under appeal, the review procedure should not
be affected when the reason or basis for an appeal or its outcome is not germane
to the purposes of the review. However, the appeal is a structured legal
proceeding. The reviewer should determine if the agency has followed
established procedure up to the point at which the case is being reviewed.
d. Complete the Acceptance Sample Coding Sheet
The answers to the Acceptance Sample Questionnaire questions should be recorded on the
coding sheet for the respective function. The coding sheet allows space to record an answer for
each question on the questionnaire. Most questions are coded Yes or No; however,
some questions on the form provide for "I" (Information Not Available) or "A" (Not Applicable)
which should be used only when appropriate.
II - 36 R 04/03
ET HANDBOOK NO. 407 CHAPTER THREE
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION PROGRAM REVIEW
SYSTEMS REVIEW QUESTIONS
9. If procedures are automated, is a systems check performed every time a program is changed?
Yes ____ No ____
VS: (Question 9) )
10. Does the state have a system in place and operating to detect tax rate manipulation
(i.e., SUTA Dumping)?
Yes____ No ____
If Yes, answer below.
a. Have written procedures or guidelines been developed to document requirements for
identification and investigation of potential rate manipulators?
Yes ____ No ____
VS: Examine operating instructions to confirm rule criteria for SUTA Dumping detection.
(Question 10 a.)______________________________________________________________
b. Does the agency compile a database of employers who indicate an “excessive”
movement of employees from one quarter to the next?
Yes ____ No ____
VS: Examine query documentation for tracking movement of employees, changes in tax rate,
changes to reimbursing status and excess voluntary contributions.
(Question 10 b.) ________________________________________________________________
III - 47 R 10/09
ET HANDBOOK NO. 407 CHAPTER THREE
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION PROGRAM REVIEW
c. Are potential rate manipulators routinely identified and assigned for further
investigation every quarter?
Yes ____ No ____
VS: Locate cases and confirm they have been investigated.
_(Question 10 c.) ______________________________________________________________
11. If any of the preceding evaluative questions are answered "No", does the state have a
substitute or compensating control?
Yes No N/A __
If yes, describe in the Narrative Section following the questions.
VS: __(Question 11) _________________________________________________________
III - 48 R 10/09
ET HANDBOOK NO. 407 CHAPTER THREE
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
If the System is automated, the Reviewer must work closely
with the IT unit to ensure a thorough understanding of what,
when and how the samples should be selected.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
Reviewing Samples Assemble the following information for each of the New
Status Determinations selected for review:
1. Status information in the employer account record.
2. The original source of information and any other
documentation from the state's records. Documentation
can consist of a hard copy registration form, field
auditor's report notations to the file explaining the source,
etc. If the employer registered electronically, the
electronic data screen containing the original registration
information or facsimile of the original data entered by
the employer (or employer’s representative) can be used
as the source document. If the employer registered by
telephone with agency staff transmitting the data directly
into the mainframe, that mainframe data can be used as
the source document. Employer contact information and
identity of agency staff must also be documented.
If the original information is not available, the answer to
question 3a. must be “no.”
Compare all source documents with the information on the
employer's account record, and answer the questions on the
Acceptance Sample Questionnaire.
III - 63 R 10/09
ET HANDBOOK NO. 407 CHAPTER THREE
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples
1. Accuracy of Initial Liability Decision - includes questions to
evaluate if a correct initial decision based on minimum
information was made. (TPS refers to actual rather than
temporary or "pending" accounts). Some States have
procedures which allow an initial liability decision to be
made based on partial information (i.e., a partially completed
contribution return with no other information). These States
should follow up after the initial liability decision to ensure
that information to make an accurate Status Determination
has been obtained. If insufficient time has lapsed for the
information to have been received, the review may end with
question 3. The time period needed to obtain information is
as set by State procedures, but not longer than 3 months, to
avoid a situation where a blocked claim could result. States
which do not have such a procedure are directed to proceed to
question 3.
2. Accuracy of New Employer Determination at Time of
Review - includes questions to evaluate if a correct, decision,
liability date and initial rate have been assigned. Initial rate
means the first rate assigned to the account. I.e., if liability
began five years ago, the rate assigned for the first year of
liability would be the “initial rate”.
III - 64 R 04/03
ET HANDBOOK NO. 407 CHAPTER FOUR
TAX PERFORMANCE SYSTEM
CASHIERING PROGRAM REVIEW
ESTIMATION SAMPLE INSTRUCTIONS
Drawing Conclusions contd.
If the percentage of the total dollar amount deposited within
3 banking days (line 8 of Summary Sheet), is equal to or
greater than the value to pass percentage, then the reviewer
will conclude that 90% of the dollar amount of employer
contribution payments have been deposited timely.
If the percentage of the total dollar amount deposited within
3 banking days is less than the "value-to-pass" percentage,
then the reviewer must conclude that timely deposit of
employer contribution payments cannot be confirmed.
The value to pass figure is lower than the 90% timeliness
standard in order to lessen the probability of “Type I Error”.
Type I Error is the appearance of failure when in fact, the
sample passes.
SAMPLING TABLE
# of Sample Items Value to Pass
375 - 405 87.5%
406 - 441 87.6%
442 - 481 87.7%
482 - 527 87.8%
528 - 579 87.9%
580 - 640 88.0%
IV - 111 R 11/07
ET HANDBOOK NO. 407 CHAPTER FOUR
TAX PERFORMANCE SYSTEM
CASHIERING PROGRAM REVIEW
ESTIMATION SAMPLE INSTRUCTIONS
Drawing Conclusions, contd.
EFT SAMPLING TABLE
% EFT Sample Size Value to Pass
50 – 54.9 400 77.4
55 – 59.9 400 75.1
60 – 64.9 400 72.2
65 – 69.9 300 68.1
70 – 74.9 300 63.2
75 – 79.9 200 55.6
80 – 84.9 200 45.5
85 – 89.9 200 29.1
90 - 100 0 N/A
If the State receives no EFTs, then this conclusion will be
based solely on the outcome of the Estimation Sample. If
EFTs are accepted by the agency, the conclusion will be
based on a combination of the Estimation Sample results
and the EFTs received by the agency. (See Step 11).
For all untimely deposits, the reviewer must provide an
explanation on the Acceptance Sample Explanation Sheet.
Documentation
All electronic and paper documentation gathered to review
samples (which does not include checks) must be kept until
review completion and Regional Office approval of the
Annual Report. This documentation should be maintained,
unless the State is able to recreate the identical information
used in the review.
IV - 112 R 10/09
ET HANDBOOK NO. 407 CHAPTER FIVE
TAX PERFORMANCE SYSTEM
REPORT DELINQUENCY PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures 5. If the system is automated, the Reviewer must
cont. work closely with the IT unit to ensure a thorough
understanding of what, when and how the samples should be
selected.
6. Appendix A describes what action needs to be taken for
sampling both manual and automated systems.
Reviewing Samples Assemble the following information for each of the cases
selected for review:
1. A copy of the original delinquency notice or a
facsimile generated from the electronic data that
created the original delinquency notice (at a minimum
it must include the employer name, account number,
address, and quarter/year delinquent).
2. The electronic or paper account information related to
the report delinquency in the state's employer account
record.
Compare all electronic and paper source documents with the
information in the employer's account record.
To answer question #1 the reviewer will need to know what
cut off date the state used. The reviewer will then compare
the date the employer's wage report was received by the state
against the cut off date to ensure it was properly identified as
delinquent.
V - 61 R 10/09
ET HANDBOOK NO. 407 CHAPTER FIVE
TAX PERFORMANCE SYSTEM
REPORT DELINQUENCY PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples
For purposes of answering question 2b. "suppressed"
refers to a restrictive action taken by the State that
intentionally prevents a normal work flow from being
completed (e.g., not mailing a delinquency notice to an
employer due to a pending appeal, or an employer that is in
bankruptcy and State procedures that do not allow notices to
be mailed).
Drawing Conclusions Using this information, answer the questions on the
Acceptance Sample Questionnaire.
The following questions are evaluative:
1. Proper identification of delinquent employer.
2.a Was the delinquent notice for the correct quarter and
year.
V - 62 R 04/03
ET HANDBOOK NO. 407 CHAPTER SIX
TAX PERFORMANCE SYSTEM
COLLECTIONS PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Purpose/Intent To assure that Accounts Receivable are being managed in
accordance with State's established procedures.
Scope The scope of the review will focus on collection cases of
$100.00 or more which are more than 30 days old. Day 1 of
the 30 day count can begin the day after the account
receivable was established. Do not include accounts
declared legally uncollectible.
Universe The universe for the Collections Acceptance Sample will
include:
1. Accounts that have been established for at least 30
days. (See Note above.)
2. All accounts with $100.00 or more in unpaid UI tax
(or the State's established benchmark figure, if
higher). This universe should be identified between
February 1 and June 30.
3. Select 60 cases, or if universe is small, select the
number of cases based on Table in Appendix A-III
Timing/Frequency The sample will be selected once per calendar year.
The population should be identified any day in the period
between February 1 and June 30 (a single snapshot of the day
selected).
VI – 65 R 11/04
ET HANDBOOK NO. 407 CHAPTER SIX
TAX PERFORMANCE SYSTEM
COLLECTIONS PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures The following steps must be taken to establish the universe
and to select the sample accounts:
1. Identify the universe of all employer account
receivables over 30 days old with tax due in the
amount of 100.00 or more (or the State's established
benchmark, if higher). Rounding up or down is
permitted. The debt (or a portion) should have been
created in the past two calendar years or less. This
universe should be identified between February 1 and
June 30.
2. In order to give the State time to follow its collections
procedures, select the sample of 60 cases six months
after identifying the universe.
3. Any case that was a part of the previous years'
sample, whether passed or failed, must be removed
from the current review. However, if new debt had
been created since the previous year’s snapshot date,
the case can remain in the sample.
4. The review should be completed no later than March
31 of the following year.
If the system is automated, the Reviewer must work closely
with the IT unit to ensure a concise understanding of what,
when and how the samples should be selected.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
VI – 66 R 10/09
ET HANDBOOK NO. 407 CHAPTER SIX
TAX PERFORMANCE SYSTEM
COLLECTIONS PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples Assemble the following information from the employer's account:
1. All electronic and paper information the State has in its possession
relating to the collection history of the selected account including
copies of liens, enforced collection action and other supporting
documents. Electronic information includes data from sources such
as: the employer account file, imaged files, and data in magnetic
media.
2. The employer account information on the State's computer files.
Review actions taken with the preceding 2 calendar years plus current
year only.
Review timeliness of contacts for most recent quarter of liability only.
The “most recent quarter” is the most recent quarter of liability preceding
the “snapshot date” (any day between February 1 and June 30 of the year
under review).
If multiple receivables have been established during the preceding 2
calendar years and current year time frame; review actions taken and
resolutions applied towards the most recently established receivables.
(Up to a maximum of the ten most recently established receivables are to
be reviewed.)
When full payment is received, further review of collection action may
be necessary to see if any enforced collection action was properly
released.
Uncollectible accounts will be reviewed up to the point they are declared
uncollectible, and to determine if they are properly written off.
Accounts in bankruptcy status will be reviewed up to the point where a
claim is filed in bankruptcy court, unless the bankruptcy has already been
discharged or closed. (Question #8)
VI - 67 R 10/09
ET HANDBOOK NO. 407 CHAPTER SIX
TAX PERFORMANCE SYSTEM
COLLECTIONS PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Drawing Conclusions Using this information, answer the questions on the
Acceptance Sample Questionnaire.
The following questions are evaluative:
#1. Is the account correctly classified.
#2. Were successor liability procedures followed.
#3. Were initial written notices sent timely.
#4. Was the employer contacted other than through initial
written notice.
#5. Was an assessment filed properly.
#5a. If yes, was the employer properly notified.
#6. Was a lien(s) filed properly.
#6a. If yes, was the employer properly notified
#7 Were other actions taken properly.
#8. Was a proof of claim filed timely if employer was in
bankruptcy.
#10. Was enforced collection action properly released.
A "NO" answer to any evaluative question must result in
failure of the sampled case.
The following questions are non-evaluative:
#4a. Was telephone contact made after written notice was
mailed.
#4b. Was the employer contacted in person.
#4c. Was the employer contacted by mail.
#4d. Other contacts.
#9. Were any payments received.
VI - 68 R 04/03
ET HANDBOOK NO. 407 CHAPTER SEVEN
TAX PERFORMANCE SYSTEM
FIELD AUDIT PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Purpose/Intent To assess the degree to which completed audits meet the
requirements of the Employment Security Manual.
To assess the accuracy of posting audit results in the State's
employer records.
Scope Due to TPS end-of-year workload concerns, reviewers may
select one of the following options: audits completed in the
four quarters of the calendar year under review, or audits
completed the fourth quarter of the previous calendar year
and first, second, and third quarters of the calendar year
under review.
Universe There is one universe to be identified for the Field Audit
Acceptance Sample:
1. All audits completed on Contributory Employers
during the period selected for TPS review.
2. 60 completed audits will be selected.
Timing/Frequency The samples will be selected once per calendar year.
The population of transactions will be identified after the
end of the fourth or third quarter, depending on the period
selected for TPS review.
VII - 57 R 10/09
ET HANDBOOK NO. 407 CHAPTER SEVEN
TAX PERFORMANCE SYSTEM
FIELD AUDIT PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures The following describes the steps to be taken to build
the universe for the samples:
1. Identify all contributory employers audited during
the period selected for TPS review. These should be
the same employer accounts that are being reported
as Total Audits on the ETA 581.
2. Select a sample of 60 cases.
3. The sample should be selected after the fourth or
third quarter ends, depending on the period selected
for TPS review.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
If the system is automated, the reviewer must work closely
with the IT unit to ensure a thorough understanding of
what, when, and how the samples should be selected.
Reviewing Samples Assemble the following information for each of the
completed audits selected for review.
1. The complete audit report.
2. The supporting documentation containing any
additional information to support the audit
decisions. This could be in paper or electronic
format such as work papers or notations on a
computerized audit program.
VII - 58 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
SYSTEMS REVIEW QUESTIONS
5. *In the opinion of the supervisor or manager, does the training meet the needs of the
Contribution Report processing function? (E.g., are sufficient resources available--training
packages, facilities, staff, etc.)
Yes No __
6. If any of the preceding evaluative questions were answered "No", does the State have a
substitute or compensating control?
Yes No N/A __
If Yes, describe in the Narrative Section following these questions.
VS: (Question 6 )
VIII - 23 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
VIII - 24 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
SYSTEMS REVIEW
Systems to Assure Execution of Events
Built-in reviews should be in place to assure the execution of events such as mailing
contribution reports to employers who are to receive such reports, or updating and testing of
the State’s electronic reporting system in preparation for employer reporting; and accurate
and prompt processing of information received from employers. The review may be
automated (e.g., quarter and year edits, math computation edits) or manual (e.g., pre-audit or
post-audit procedures).
The reviewer must become familiar with the types of built-in checks used by
the State to assure employers are notified of reporting requirements (e.g.,
mailing of contribution reports, notification of requirements, instructions on
electronic reporting procedures), and that all quarterly report and payment
information is processed accurately and promptly when received.
In the narrative section following the questions, explain "Other" responses,
and describe "Compensating Controls". Identify the question being
explained by referencing the number and section.
VIII - 33 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
SYSTEMS REVIEW QUESTIONS
1. Does the state have procedures and/or controls to assure that each system of reporting
contributions and wages (e.g., paper reporting, internet filing, telephone filing, third party
electronic filing) is updated with accurate employer data at the start of each filing period?
Yes ___ No ___
Yes No N/A
a. Does the state reconcile the count of reports that should be mailed to the
number of reports that will be mailed? (E.g., subtract the number of reports
suppressed from printing (electronic and third party filers, seasonal employers)
from the number of active employers and compare that number to the count of
mailed reports.)
Yes No N/A
b * Before mass mailing or before electronic reports are due, does the state
review the data file used to print paper reports and/or used to populate web-
based sites to ensure accuracy and correct record layout? (E.g,, correct quarter,
year, due date)
Yes No N/A
c. Is a small sample of employer accounts from the data file used to print paper
reports and/or used to populate web-based sites reviewed to ensure employer
specific data are accurate? (E.g., correct name, address, pre-printed social
security numbers, tax rate)
VS: (Questions 1a and c )
2. Does the State have systems procedures and/or internal controls to assure accurate
processing of employer contribution reports?
Yes No __
VIII - 35 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
SYSTEMS REVIEW QUESTIONS
2. a. What automated internal controls does the State use to assure that employer
contribution reports are posted accurately:
Yes No
(1) Edit for correct math computation? ...............................................................
(2) Employer account number edit? ....................................................................
(e.g., hash totals, check digits)
(3) Quarter/year edit? ..........................................................................................
(4) Report totals balance with wage detail listing? .............................................
(5) *Other ............................................................................................................
VS: (Question 2 )
3. Does the State have system procedures or internal controls to assure that quarterly
contribution reports are posted promptly to prevent the mailing of delinquent employer
notices or assigning to the field?
Yes No __
4. Does the State have a method for handling system rejects?
Yes No __
VIII - 36 R 04/03
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report Processing PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures cont. Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
If the system is automated, the Reviewer must work closely
with IT staff. A thorough understanding of what the universe
includes and excludes and when the samples are to be
selected is essential.
Reviewing Samples Assemble the following information for the employer's
account: Contribution report, payment, and any additional,
related information.
1. A copy of the originally filed paper or electronic
contribution report or wage detail, and any adjustment
forms affecting the report. Source documents could also
include images; or screen copies or unformatted/ flat
files of electronic reports; or line items of employer’s
allocation in magnetic media/diskettes. (Also see Ch. II-
19 R04/03.)
2. A copy of the payment associated with this quarterly
contribution report. Source documents could include:
check images or cancelled checks; or line items of
employer’s payment on magnetic media/ diskettes; or
employer payment confirmations that are specifically
associated with the sampled employer; or line items or
unformatted/ flat files of payment allocation as noted in
bank deposit records; or copies of ACH deposits from
the state’s depository bank.
3. Any additional paper or electronic information related to
the employer’s account.
The review should be completed as soon as possible after
selecting the sample, and no later than September 30.
VIII - 55 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report Processing PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Drawing Conclusions Using this information, answer the questions on the
Acceptance Sample Questionnaire.
If no report was received by the review date, the only
evaluative question to be answered is:
#2. Identification of the employer as failing to file a
timely report. (NOTE: Use N/A if no report is owed,
e.g,, employer was inactivated/terminated.)
If a report was received, the following questions are
evaluative:
#3a Accuracy of the employer account number.
#3b Accuracy of the quarter and year.
#3c Accuracy of the amount of money remitted.
#3d Accuracy of the total gross and/or taxable wages.
#5 Accuracy of the computation of tax due.
A "No" answer to question 2, 3(a-d), or 5 will mean that the
sampled account was not processed accurately and is not
considered an acceptable case.
If payment was made by the TPS review date, payment
posting accuracy must be examined regardless of whether the
payment accompanied the employer’s report or was submitted
separately. Payment should have been applied to the proper
quarter, based on the state’s procedure.
Of the 60 cases, if three or more are not acceptable, then the
reviewer must conclude that accuracy in the State's
processing of Contribution Reports cannot be confirmed.
For all unacceptable cases, the reviewer must provide an
explanation for the unacceptable case on the Acceptance
Sample Explanation Sheet.
VIII - 56 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report Processing PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Documentation All documentation (which was gathered to review samples)
must be kept until the completion and Regional Office
approval of the TPS Annual Report. Either hard copy
documentation or (in some highly automated systems) the
ability to recreate the identical information used in the review
must be maintained.
VIII - 57 R 10/09
ET HANDBOOK NO. 407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Report processing PROGRAM REVIEW
ACCEPTANCE SAMPLE QUESTIONNAIRE
Identification of Delinquent Employers
1. *Was a Contribution Report received for
the account by the TPS review date? Yes____ No ____
If No, answer question #2, and end review
2. Was the account appropriately identified
as delinquent?
Yes____ No ____ N/A ____
Accuracy and Timeliness of Posting
3. Was the following Contribution Report and payment information posted
accurately:
Yes No
a. the employer account number? ____ ____
b. the quarter and year? ____ ____
c. the amount of money remitted? ____ ____
d. the total gross and/or taxable wages? ____ ____
(Depending on State posting requirements)
4. * Was the Contribution Report processed promptly according to State
policy and procedures?
Yes ___ No ___
Accuracy of Computations
5. Did the State correctly compute the tax
due on the report? Yes ___ No ___
VIII - 59 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Debits/Billings PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
Cont. If the State bills reimbursing employers more
frequently than quarterly, the State should discuss
sampling procedures with the Regional Office
Representative.
In some States, the entire universe of reimbursing
employers may be very small. In these cases, see
Appendix A for number to be reviewed.
If the system is automated, the Reviewer must work closely
with IT. A thorough understanding of what the universe
includes and excludes and when the samples are to be
selected is essential.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
Reviewing the Samples Assemble the following information for the employer's
account:
1. A copy or image of the original debit memorandum/
billing notice or a facsimile generated from the
electronic data that created the original notice, and a
copy or image of any payment history.
2. The original or imaged source documentation of
information in the state’s files that created the debit/
billing e.g., contribution reports, adjustment reports,
benefit charges, rate changes, etc.
VIII – 117 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Debits/Billings PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing the Samples
Cont. 3. The electronic or paper account information related
to the debit/billing in the state’s employer file.
Compare all electronic and paper source documents with
the information on the employer's account record.
The review should be completed within 45 days after the
samples are selected.
Drawing Conclusions Using this information, answer the questions on the
Acceptance Sample Questionnaire.
The following questions on the Acceptance Sample
Questionnaire are evaluative:
#1. Establishing to proper account.
#2. Accuracy of dollar amount and time frame.
#4. Accuracy of the billing notice.
#5. Accurate processing of the debit established.
A "No" answer to 1, 2, 4, or 5 will mean that the sampled
account was not processed accurately and is not an
acceptable case.
An inaccurate penalty or interest assessment will not cause
the case to fail.
VIII – 118 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Credits/Refunds PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
Cont. a. Have an overpayment for any quarter (current or
prior) which was established during the processing
period, and
b. The credit remains outstanding (not refunded or
applied to a debit) at the end of the processing
period.
The processing period is defined as the State time
period during which the quarterly reports and
contributions are processed after the selected
quarter has ended. (e.g., if the 1st quarter is
selected for review, the processing period would
begin April 1 and end approximately June 30. This
definition is for the sole purpose of defining the
time frame from which the universe of credits
established is to be drawn.
States who do not build the universe as credits are
established, or whose automated systems make it
difficult or impossible to locate the targeted credits
may find it necessary to identify the population of
all contributory employers at the beginning of the
processing period and again at the end of the period
and then compare the two populations to isolate
those employers who had a credit balance
established (or increased) during the defined
processing period. These employers constitute the
sampling universe.
VIII - 179 R 04/03
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Credits/Refunds PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
Cont. 3. Select 60 cases, or if universe is small, select the
number of cases based on Table in Appendix A-III
Note: The reviewer will have to investigate
procedures for issuing credits/refunds and then
identify the appropriate sample selection date. (e.g.,
in some States there may be a lag time of 90 - 180
days before refunds are issued, etc. - thus the
sample selection date would be after the 90 - 180
day time lag period.)
If the system is automated, the Reviewer must work closely
with IT. A thorough understanding of what the sample
includes and when it is to be extracted is essential.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
Reviewing the Samples Assemble the following information for each of the cases
selected for review:
1. A copy or image of the original credit memorandum
or a facsimile generated from the electronic data
that created the original notice (or advisement, such
as a line item on the electronic or paper contribution
report); or a copy of the cancelled check if a refund
was issued; or a computer generated listing showing
the employer account number, check amount, mail
date and address.
VIII - 180 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Credits/Refunds PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing the Samples
cont. 2. The original or imaged source documentation of
information in the state's files that created the
credit/refund e.g., contribution reports, remittance,
adjustment reports, wage detail adjustments, rate
changes, etc.
3. The electronic or paper account information related
to the credit/refund in the state’s employer file.
Compare all electronic and paper source documents with
the information on the employer's account record.
The review should be completed within 45 days after the
sample is selected.
Drawing Conclusions Using this information, answer the questions on the
Acceptance Sample Questionnaire.
The following questions are evaluative:
#1. Establishment to proper account.
#2 Accuracy of dollar amount and time frame.
#4. Accuracy of the credit memorandum or refund.
#5. Accurate processing of the established credit.
#6. Credit memorandum/refund issued to correct
address
#7. Accuracy of withholding credit
memorandum/refund
A "No" answer to #1, 2, 4, 5, 6 or 7 will mean that the
sampled account was not processed accurately and is not
considered an acceptable case.
VIII - 181 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Credits/Refunds PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Drawing Conclusions Note that when a credit or refund is due, in excess of
Contd. established tolerance limits, the employer must be given the
opportunity to request a refund, or to apply the credit to
future tax obligations, or to automatically receive a credit or
refund. If the sampled case indicates that the state did not
fulfill this obligation (for instance, no attempt was made to
advise the employer of credit or refund due, or no
credit/refund adjustments were made), question 7 would be
answered “No,” and the case would fail.
Of the 60 cases, if three or more are not acceptable, then the
reviewer must conclude that accuracy in the Credit/Refund
processing function cannot be confirmed.
For all unacceptable cases, the reviewer must provide an
explanation for the unacceptable case on the Acceptance Sample
Explanation Sheet.
Documentation All documentation (gathered to review samples) must be kept
until the completion and Regional Office approval of the Annual
Report. Either hard copy documentation or (in some highly
automated systems) the ability to recreate the identical information
used in the review must be maintained.
VIII - 182 R 11/04
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Tax Rates PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
Cont. E. g., During a 2010 TPS review, in a State which
issues 2010 tax rate notices in January, 2010, a
sample of the 2010 notices issued in January would
be selected and reviewed. For a State which issues
2011 tax rate notices in November, 2010, a sample
of the 2011 notices issued in November, 2010
would be selected and reviewed.
3. Select 60 samples.
The samples will be selected from the universe immediately
after the rate notices are prepared.
If the system is automated, the Reviewer must work closely
with IT. A thorough understanding of what the sample
includes and when it is to be extracted is essential.
Appendix A describes what action needs to be taken for
sampling in both manual and automated systems.
VIII - 297 R 10/09
ET HANDBOOK NO.407 CHAPTER EIGHT
TAX PERFORMANCE SYSTEM
ACCOUNT MAINTENANCE Tax Rates PROGRAM REVIEW
ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples Identify which of the following items are included in the
State's rate computation formula:
a. total benefit charges? _____
b. total benefit wages? _____
c. total taxable wages? _____
d. taxes paid? _____
e. total payroll wages? _____
f. reserve balance? _____
g. other? (describe) _____
Assemble the following information for the employer's
account:
1. Copies of the electronic or paper contribution
reports and any adjustments to these reports used in
the tax rate calculation for the most recent four
quarters of the calculation period (or more
depending on the calculation period). Electronic
source documents could include screen images or
unformatted flat files of electronic reports.
2. The benefit charges used in the tax rate calculation
for the most recent four (or more) quarters of the
calculation period.
3. Electronic or paper information from the employer's
data file used in the tax rate calculation.
4. The State's experience rate factor (e.g., tax table,
schedule, ratio, etc.).
5. Any other factors used by the State to calculate the
employer’s tax rate.
VIII - 298 R 10/09
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