1. U.S. Dept. of Labor’s Tax Performance System
TPS Reviewer Training

2. Let’s begin with an Overview
Welcome to TPS
Welcome
to TPS
Overview
of TPS
Scope of Training:
Overview of TPS
Federal Oversight
Federal Oversight Programs
Design of TPS
Computed Measures
Systems Review of State’s Internal Controls
Sampling of Tax’s Outputs
Assessing Quality
Reporting Data
End - links
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Let’s begin with an Overview

3. Overview
Welcome
to TPS
Overview
of TPS
Federal Oversight
TPS is a performance management tool for States and the Federal government.
TPS Handbook 407 provides a set of instructions for evaluating quality of State UI tax operations.
Design of TPS
Quality Assess.
Reports Data
End
How does this work?

4. Overview Cont.
Welcome
to TPS
Overview of TPS
Federal Oversight
You examine and evaluate your State’s UI tax system and TPS is your tool.
Identify any problem areas:
Weaknesses in State’s system of internal controls
Samples of each tax function’s outputs to check for accuracy
Report this data into web-based system once each year “SUN System”.
Work with State and Regional partners to improve tax operation.
Design of TPS
Quality Assess.
Report Data
End

5. Overview Cont. What is the Federal role?
Welcome to TPS
Overview of TPS
Federal Oversight
What is the Federal role?
Monitor States’ UI tax systems
If problems are discovered, the Regional office works with the State to propose solutions.
Receive a “State Quality Service Plan” for any improvements necessary.
If Corrective Action is needed, monitor to ensure agreed-upon actions
are taken.
Design of TPS
Quality Assess.
Report Data
End
“Inspect what you expect”

6. Overview Cont. Ensure TPS is in place and operating as intended
Welcome to TPS
Overview of TPS
Federal Oversight
Ensure TPS is in place and operating as intended
Once every four years, neighboring States and Region examine a State’s most recent CY TPS findings.
“Federal Team Reviews” are organized and conducted by Regional staff.
Team Reviews promote consistency in application of TPS between States.
Team Reviews facilitate exchange of information and best UI tax practices between States.
Ensures integrity of the TPS program.
Design of TPS
Quality Assess.
Report Data
End

7. Overview Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
Report to Congress via Government Performance and Results Act (GPRA)
Long term, five year plans
For UI Tax, GPRA reports on the timeliness of new employer status determinations.
Example: By 2012, at least 86.7% of new employer status determinations should be completed by the end of the quarter in which the employer became liable.
Quality Assess.
Report Data
End
Now, for more details on Federal oversight.

8. Federal Oversight
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
The US DOL’s oversight system for UI tax, UI benefits and the validation of UI data is called “UI Performs”.
Quality Assess.
Report Data
End
TPS
BAM
BTQ DV

9. Federal Oversight Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
Several years’ of discussions with States and DOL resulted in “UI Performs”.
State performance is measured by TPS, Benefit Accuracy Measure (BAM), Benefit Timeliness & Quality (BTQ), and Data Validation (DV).
TPS is an examination of State tax operations using two aspects of performance: Timeliness and Quality.
BAM is a statistical survey to determine the accuracy of paid and denied UI claims.
BTQ is a quality review that provides an assessment of the adequacy of the State’s fact finding application of law, policy and written nonmonetary determinations.
DV verifies the validity of the reports which are used for assessing performance of the State’s UI program.
Design of TPS
Quality Assess.
Report Data
End

10. Federal Oversight Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
The Department has added emphasis on certain performance measures: “Core Measures”.
Core Measures have been assigned certain “Acceptable Levels of Performance” (ALP).
If scores fall below these levels, corrective action may be necessary.
Note this is separate from the GPRA measures reported to Congress.
Design of TPS
Quality Assess.
Report Data
End

11. Federal Oversight Cont.
Welcome to TPS
Overview of TPS
UI Tax Core Measures
Timeliness
70% or more new employer status determinations must be made timely.
Quality
Less than four out of the thirteen tax functions sampled can fail.
Quality Over Time
No tax function can continue to fail for three successive years.
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Fail
Pass

12. Federal Oversight Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
Core Measures of UI Tax
Design of TPS
Quality Assess.
Tax Timeliness
Tax Quality
Computed Measure Passes?
At least 70% of determinations made within 90 days
Samples Pass?
Three or less fail out of 13 samples
Samples Pass
Over Time?
A sample can not fail 3 successive years
Report Data
End

13. Federal Oversight Cont.
Failure to conduct one or more TPS sample reviews also results in the need for corrective action (unless the universe is too small to sample or a temporary Federal waiver has been granted).
Corrective Action Plans may be necessary if TPS is not conducted according to Federal guidelines as noted in TPS Handbook 407.

14. Federal Oversight Cont.
Welcome to TPS
Federal Oversight Cont.
Overview of TPS
Federal Oversight
The flow of TPS data:
TPS Reviewer
Design of TPS
State Administrator
Quality Assess.
Report Data
Federal Oversight
Regional
Office
National Office
End
Congress
Next, more detail on the design of TPS.

15. Let’s look at this step by step.
Welcome to TPS
Design of TPS
Overview of TPS
Federal Oversight
To measure tax performance, TPS examines the States’ major tax functions.
Two different methodologies used:
Computed Measures
Program Reviews
Systems Reviews
Sampling
At the end of each year, TPS findings and any recommendations are submitted.
Design of TPS
Quality Assess,
Report Data
End
Let’s look at this step by step.

16. TAX FUNCTIONS EXAMINED
Design of TPS Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
TAX FUNCTIONS EXAMINED
STATUS DETERMINATION
New Determinations
Successor Determinations
Inactivation's/ Terminations
CASHIERING
REPORT DELINQUENCY
COLLECTIONS
FIELD AUDIT
ACCOUNT MAINTENANCE
Report Processing
Debits/Bills contributory
Debits/Bills reimbursing
Credits/Refunds
Benefit Charging
Experience Rating
Design of TPS
Every calendar year, TPS evaluates the timeliness and quality of State tax operations.
The TPS reviewer examines 13 major tax functions once per CY.
Experience Rating is only once every four years – see 407 Handbook for details. 1
Quality Assess. 2 3 4
Report Data 5
End 6 7 8 9 10 11 12 13

17. Design of TPS Cont. Several methodologies are used: Computed Measures
Welcome to TPS
Design of TPS Cont.
Overview of TPS
Federal Oversight
Several methodologies are used:
Computed Measures
Program Reviews
Systems Reviews
Sampling
Design of TPS
Quality Assess.
Report Data
End
Next, we will discuss Computed Measures.

18. Design of TPS Cont. Computed Measures Component
Welcome to TPS
Overview of TPS
Federal Oversight
TAX FUNCTIONS
EXAMINED
STATUS
DETERMINATION
-New determinations within 90 days
-New determinations within 180 days
-Successor determinations within 90 days
-Successor determinations within 180 days
CASHIERING
-N/A
REPORT
DELINQUENCY
-Timely reports
- Reports secured within 90 days
-Reports sec. or resolved within 180 days
COLLECTIONS
-Timely payments
-Uncollectible
-Accounts receivable
FIELD AUDIT
-Change in total wages
-Contributory employers audited
- Total wages audited (annualized)
ACCOUNT
MAINTENANCE
Design of TPS
COMPUTED MEASURES
Quality Assess.
Report Data
End

19. Design of TPS Cont. Computed Measures
Welcome to TPS
Overview of TPS
Federal Oversight
Computed Measures
We rely on existing reports that each State automatically submits every quarter.
Data are then computed and show performance in terms of:
Timeliness (Ex: percent of timely determinations)
Numbers (Ex: percent of debt declared un-collectable, percent of employers audited)
Data Validation program, under the
UI Performs umbrella, ensures
Federal definitions are used.
Design of TPS
Quality Assess.
Report Data
End

20. Design of TPS Cont. Computed Measures
Welcome to TPS
Overview of TPS
Federal Oversight
Computed Measures
TPS reviewers have access to automated, “Computed Measures” data via the following link:
Note that the SUN system also provides State-specific data. This will be discussed during “Reporting Data”.
Design of TPS
Quality Assess.
Report Data
End

21. Design of TPS Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
Computed Measures
At the end of the calendar year when evaluating the tax system, the Computed Measures should be factored into the mix.
This will be demonstrated later in the presentation.
Also, see examples of Computed Measures in Annual Reports in the Links page at the end of this tutorial.
In addition to the Computed Measures’ data, on tax timeliness, information about tax quality is needed.
Next, we will discuss TPS’ Program Reviews.
Design of TPS
Quality Assess.
Report Data
End

22. Design of TPS Cont. Program Reviews
Welcome to TPS
Overview of TPS
Federal Oversight
TAX FUNCTIONS
EXAMINED
Systems Reviews
Examination of Internal controls which ensure:
Samples
To confirm that internal controls are working - examination of:
STATUS
DETERMINATION
-Accuracy of new determinations
-Accuracy of successor determins
-Accuracy of inactive determinations
-New determinations
-Successor determinations
-Inactive determinations
CASHIERING
Timeliness of remittance processing
Employer remittances
REPORT DELINQUENCY
Accurate id of delinquent employers
Take actions to secure/resolve rpt del
Accounts w/ delinquent reports
COLLECTIONS
-Take actions to manage acts recv
-Accounts receivable
FIELD AUDIT
-Ensure audits meet requirements
-Completed audits
ACCOUNT MAINTNANCE
-Accuracy of contrib.rpt processing
-Accuracy of billings
-Accuracy of credits/refunds
-Accuracy of benefit charging
-Accuracy of experience rating
-Active contributory accounts
-Contrib./reimb. Accounts receivable
-Accounts payable credits/refunds
-Accounts due benefit charges
-Employer experience ratings
Program Review
Design of TPS
Quality Assess.
Report Data
End

23. Design of TPS Cont. Program Reviews
Welcome to TPS
Design of TPS Cont. Program Reviews
Overview of TPS
Federal Oversight
Design of TPS
Program Reviews provide context –
a look at the UI tax system as a whole
Program Reviews consist of:
Systems Reviews
Sampling
Quality Assess.
Report Data
End

24. Design of TPS Cont. Program Reviews: Systems Reviews
Welcome to TPS
Overview of TPS
Federal Oversight
Systems Reviews are conducted once every four years unless the State has made system changes or problems have been discovered.
They are the most time-consuming of TPS activities
For each tax function, TPS conducts a thorough examination of the function’s Internal Controls & Quality Assurance systems.
These controls are supposed to be in place, working together to ensure that the tax operation is producing accurate outputs.
If controls are missing, the tax function is deemed to be “at risk”.
Design of TPS
Quality Assess.
Report Data
End

25. Design of TPS Cont. Program Reviews: Systems Reviews
Welcome to TPS
Overview of TPS
Federal Oversight
Major Internal Controls:
Design of TPS
Handbooks
For instance, does the status function have adequate and up-to-date handbooks and recorded instructions for staff to do its job?
Training
Does the collections unit provide training on the collections tools available to them?
Quality Assess.
Report Data
End

26. Design of TPS Cont. Program Reviews: Systems Reviews
Welcome to TPS
Overview of TPS
Federal Oversight
Major Internal Controls:
Design of TPS
Supervisory Review
Is the completed work of the Refunds/Credit staff subject to
review by supervisors or others
from time to time?
Audit Trail
Are field auditors required to examine employer source documents when examining payroll records and do the auditors provide documentation that this has been done?
Quality Assess.
Report Data
End

27. Design of TPS Cont. Program Reviews: Systems Reviews
Welcome to TPS
Overview of TPS
Federal Oversight
Major Internal Controls:
Authorized Individuals
Does the State’s cashiering operation only allow certain individuals access to employer remittances?
Checks & Balances
Does the report delinquency unit have tracking systems to follow up when employers promise to submit
delinquent reports?
Design of TPS
Quality Assess.
Report Data
End
After a review of each tax function controls,
small samples are examined.

28. Design of TPS Cont. Program Reviews: Sampling
Welcome to TPS
Overview of TPS
Federal Oversight
Small Samples reviewed 1 x year, to ensure internal controls are working as intended.
Reviews examine the work each tax
unit did during the CY under review.
State IT unit should be building the universe from which each sample will be selected.
At specific times during the year, samples should be automatically extracted for review.
Design of TPS
Quality Assess.
Report Data
End

29. Design of TPS Cont. Program Reviews: Sampling
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
Each of the tax functions’ universes should have 60 samples extracted (Exception of Cashiering).
TPS reviewer should ensure that this is taking place!
Out of 60, if 3 or more cases fail, the tax function does not have “reasonable assurance of quality”.
With such a small sample, it is a rough guide (just a warning flag).
If there is disagreement about the sample’s findings
A second sample can be extracted.
If an actual error rate is needed– see Handbook 407 on Expanded Sample.
Quality Assess.
Report Data
End

30. Design of TPS Cont. Program Reviews: Sampling
Welcome to TPS
Overview of TPS
Federal Oversight
A Quick Run Through:
Status Determinations
All new, successor and inactivation determinations that have been made during the CY.
Examine 60 each for accuracy.
Cashiering
Employer checks sent for the 2nd q of CY.
Sample 500 checks for timeliness of deposit.
Report Delinquency
Employers whose 1st q reports are delinquent.
Examine 60 a few months later for actions taken.
Design of TPS
Quality Assess.
Report Data
End

31. Design of TPS Cont. Program Reviews: Sampling
Welcome to TPS
Overview of TPS
Federal Oversight
A Quick Run Through Cont. :
Collections
A one-day snapshot of active receivables.
Review 60 a few months later for collections actions taken.
Field Audits
All audits completed 1, 2 and 3rd q of CY.
Review 60 for adherence to auditing requirements.
Account Maintenance
Contribution Reports
A one day snapshot of active employers for the 1st q.
Review 60 at the end of the quarter for accuracy in processing.
Design of TPS
Quality Assess.
Report Data
End

32. Design of TPS Cont. Program Reviews: Sampling
Welcome to TPS
Overview of TPS
Federal Oversight
A Quick Run Through Cont. :
Debits/Bills
Select one quarter and identify all contributing & reimbursing employers who owe money.
Look at 60 contributions and 60 reimbursements - were the debits/bills processed correctly?
Credits/Refunds
Select one quarter and identify employers who are owed money.
Look at 60 - were the credits or refunds established properly?
Benefit Charges
Identify all employers who have been charged for UI benefits.
Review 60 charges to ensure accuracy.
Experience Ratings
Identify employers who are to receive experience rate notices.
Examine 60 employer accounts to confirm accuracy of rates.
Design of TPS
Quality Assess.
Report Data
End

33. Quality Assessment
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
Each sample will either pass a quality review or fail.
There should be a correlation between a sample that passes and “no risk”, found in that tax function’s set of internal controls.
Ex: Benefit Charge unit has controls in place = sample passes.
If a sample fails, it could be related to problems (“risks”) in the tax function controls.
Ex: Status unit has outdated manuals and little training = failed sample.
Quality Assess.
Report Data
End

34. Quality Assessment Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
Program Reviews
Possible Outcomes
Design of TPS
Systems Reviews
Samples
Consistency?
No Risk Found
Sample Passes
Consistency
Sample Fails
Inconsistency
Risk Found
Quality Assess.
Report Data
End

35. Quality Assessment Cont.
Welcome to TPS
Overview of TPS
When CY has ended, you produce an Annual Report by end of May
Report identifies strengths and weaknesses
SR findings – are there problems in State’s system of internal controls?
Sampling – have samples failed test of accuracy?
Computed Measures – are tax systems operating timely?
Recommendations for improvement
Goes to State administrator
State and RO discuss problems and
plans for improvement
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End

36. Quality Assessment Cont.
Welcome to TPS
Overview of TPS
Federal Oversight
You have spent months and months
evaluating State’s tax operations.
As you come to conclusions, keep the
tax units appraised – no surprises at
end of year.
National Office needs TPS data
Data entry into SUN by March 31 of each year
CY 1 enter data by March 31 of CY 2.
Here is what the TPS Web Application Menu looks like
Design of TPS
Quality Assess.
Report Data
End

37. Report Data TPS Web Applications Menu
Welcome to TPS
Report Data TPS Web Applications Menu
Overview of TPS
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Place-holder
Selecting the “Computed Measures” option will lead to these screens….

38. Report Data Cont. Computed Measures Path
Welcome to TPS
Report Data Cont. Computed Measures Path
Overview of TPS
Federal Oversight
Design of TPS
The states’ scores will be displayed.
Quality Assess.
Report Data
Selecting the Computed Measures options will lead you to these screens.
End
Or the actual data the state has entered will be displayed.
Select the Report Type and Year.
Then, Select either:
Measures,
Database Display
Formulas.
Or the formulas will be displayed.…

39. Report Data Cont. Sampling Path
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Select the Sampling option and it will lead you to these screens.
Select a year and then enter your sampling data.

40. Report Data Cont. Systems Review Path
Welcome to TPS
Report Data Cont. Systems Review Path
Overview of TPS
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Select the Systems Review option and it will lead you to this menu.
Select a year and enter your sampling data.

41. Report Data Cont. ET 581Contribution Report Path
Welcome to TPS
Overview of TPS
Federal Oversight
Design of TPS
Quality Assess.
Report Data
End
Select a Year and Quarter and you will see the states’ 581 Report.
Select the 581 option and it will lead to this screen.

42. End This concludes the TPS training presentation
Welcome to TPS
Overview of TPS
Federal Oversight
This concludes the TPS training presentation
A list of links follows
Design of TPS
Quality Assess.
Report Data
End
For further assistance , don’t hesitate to use the Contact List link to call your Regional and National Office colleagues!

43. Links TPS Universe and Sampling Details
Welcome to TPS
Links
Overview of TPS
Federal Oversight
TPS Universe and Sampling Details
TPS Small Universes and Sample Sizes
TPS Guide to Writing an Annual Report
TPS and Tax Contacts List
Design of TPS
Quality Assess.
Report Data
End