Tax Performance System

CHAPTER III

STATUS DETERMINATION
COMPONENTS

INTRODUCTION
COMPUTED MEASURES
PROGRAM REVIEW

INTRODUCTION

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

INTRODUCTION

The Status function identifies employers liable for unemployment insurance (UI) coverage and
assists them in their effort to comply with State UI Laws and written policies. This is the
initial process in the tax operation. The major tasks within the function are:
Identify potential employers subject to the law
Determine Status (e.g., new, successor, non-subject)
Assign account numbers
Notify employers of their liability and initial rate
Inactivate/terminate employer accounts
Process and record all coverage information
(Account Maintenance)
Handle liability appeals as appropriate

PRIMARY OBJECTIVE
The primary objective of the Status function is to identify and register employers in a timely and
accurate manner. To accomplish this, the State will need to meet several sub objectives:

1.

Determine employer Status in a timely fashion (Timeliness)

2.

Determine and record employer Status and tax rate correctly (Accuracy)

III - 1

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

INTRODUCTION

Timeliness

To assess the effectiveness in producing timely Status Determinations,
Computed Measures will be generated based on data routinely reported.
These data elements will be converted into four indicators by the TPS ADP
system. These indicators will measure from the end of the quarter in which
liability occurred.

Accuracy

To determine whether accurate determinations are being made, a Program
Review will be conducted to ascertain the existence of necessary internal
controls and to determine whether or not such controls are functioning
properly.

REVIEW METHODOLOGIES
Computed Measures
Computed Measures will provide indicators to measure timeliness of New and Successor Status
Determinations. These measures will be generated on data elements reported by States through
routine quarterly reports. There are four indicators which will be used to measure timeliness of
Status Determinations.
1.

Percentage of newly established accounts made within 90 days

2.

Percentage of newly established accounts made within 180 days

3.

Percentage of successor accounts made within 90 days

4.

Percentage of successor accounts made within 180 days

III - 2

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

INTRODUCTION

REVIEW METHODOLOGIES
Program Review
The Program Review to be conducted for Status has two components: a Systems Review section
and an Acceptance Sample section composed of three samples.
The Systems Review covers the following topics:
Recorded Information and Instructions
Training
Recording of Transactions and Events
Systems to Assure Execution of Events
Review of Completed Work
The Systems Review will be used to identify the internal controls and quality assurance systems
necessary for an effective Status Determination operation, and to verify that the State has such
controls in place.
The Acceptance Samples examine the following:
New Employer Determinations
Successor Determinations
Inactivations/Terminations
Three Acceptance Samples of completed Status Determinations will be examined to confirm that the
State's system of controls is ensuring accurate Status Determinations. The Acceptance Samples will
validate the effectiveness of the State's internal controls and confirm that accurate Status
Determinations are being made and posted to the employer account record.

III - 3

R 04/03

COMPUTED MEASURES

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

COMPUTED MEASURES

COMPUTED MEASURES
Computed Measures will provide indicators for timeliness of New and Successor Status
Determinations. These measures will be generated based on data elements reported by States
through routine quarterly reports. The State TPS reviewer must ensure that the State captures these
data elements as defined so that the TPS ADP system can produce output reports based on these data
elements.
Some States accumulate the data elements required for Status computed measures through ADP
records. Other States keep manual records. Either way it is important that accurate records be kept
from the beginning. Data elements needed to calculate Status timeliness indicators will be extracted
from the routine Form ETA 581 reports which are transmitted from States to the National Office
electronically. Appendix B explains the technical process for gathering this information.

Status Determination Indicators
The four indicators to measure timeliness of Status Determinations are described below.
1.

Percentage of Status Determinations of newly established accounts made within 90
days from the last day of the quarter in which the business first became liable.

2.

Percentage of Status Determinations of newly established accounts made within 180
days from the last day of the quarter in which the business first became liable.

3.

Percentage of Status Determinations of successor accounts made within 90 days from
last day of the quarter in which the business became a successor.

4.

Percentage of Status Determinations of successor accounts made within 180 days
from last day of the quarter in which the business became a successor.

III - 7

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

COMPUTED MEASURES

COMPUTED MEASURES

Indicator 1 - Percentage of 90 day New Employer Status Determinations.
Rationale. This indicator reflects the percent of Status Determinations made during the 90
day time period from the last day of the quarter in which a new business becomes liable.
The end of the quarter was set for the indicator to promote consistency in measuring time
lapse (the old time lapse was from the date the employer became liable and because of
differences in their laws, the States did not count from the same date).
90 days is also important because of the need to have employer wage records in the State
files for benefit payment purposes. Finally, undue delay in setting up an account can result
in a loss of revenue.
Formula
# determinations made within 90 days (581 Item 15)
total # New Status Determinations (581 Item 14)
Example:
700 timely new determinations
1000 total new determinations

= 70%

Indicator 2 - Percentage of 180 day New Employer Status Determinations.
Rationale. This indicator reflects the percent of Status Determinations made during the 180
day time period from the end of quarter in which a new business becomes liable. The 180
day timeliness indicator is governed by the need for additional time and incentive to make
determinations which have passed the due date for the 90 day indicator. This indicator
encourages States to use all available methods to identify and register those employers
whose registration could not be completed within the 90 day period.

III - 8

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

COMPUTED MEASURES

COMPUTED MEASURES

Formula
# determinations made within 180 days (581 Item 16)
total # New Status Determinations (581 Item 14)
Example:
900 timely new determinations
1000 total new determinations

= 90%

Indicator 3 - Percentage of 90 day Successor Status Determinations.
Rationale. This indicator reflects the percent of Status Determinations made during the 90
day time period from the last day of the quarter in which the business becomes liable as a
successor. The rationale is the same as for indicator 1.
Formula
# succ. determinations made within 90 days ((581 Item 18)
total # Successor Status Determinations (581 Item 17)
Example:
700 timely successor determinations = 70%
1000 total successor determinations

III - 9

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

COMPUTED MEASURES

COMPUTED MEASURES

Indicator 4 -Percentage of 180 day Successor Status Determinations.
Rationale. This indicator reflects the percent of Status Determinations made during the 180
day time period from the last day of the quarter in which the business becomes liable as a
successor. The rationale is the same as for indicator 2.

Formula
# succ. determinations made within 180 days (581 Item 19)
total # Successor Status Determinations (581 Item 17)
Example:
900 timely successor determinations = 90%
1000 total successor determinations

Data Elements
The numbers of new and successor determinations made within 90 and 180 days of the end of
quarter in which liability occurs are reported on Form ETA 581. TPS requires the number of new
and successor determinations made within 90 and 180 days from the end of the quarter of liability
rather than the "time lapse" formerly reported. It is important to count the exact number of days
since not all quarters have exactly 90 days. The "determination date counted to" should be the date
the Status information is input into the States automated system. See above examples.

III - 10

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

COMPUTED MEASURES

COMPUTED MEASURES

Drawing Conclusions
If an analysis of the results of these measures does not show high percentages of timely
determinations or an improving trend, the TPS Reviewer should examine the findings of the Systems
Review to ascertain whether problems causing delays are controllable within the State or are caused
by external factors.
Findings or trends from computed measures should be considered with Systems Review and
Acceptance Sample findings in evaluating the effectiveness of the State's operation and be included
in the Annual Report.

III - 11

R 04/03

PROGRAM REVIEW
COMPONENTS
SYSTEMS REVIEW
ACCEPTANCE SAMPLES

SYSTEMS REVIEW

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM

CHAPTER THREE

STATUS DETERMINATION

PROGRAM REVIEW

SYSTEMS REVIEW INTERVIEW SHEET
Function

Reviewer

Persons Interviewed
Date

Name:

Documents Reviewed
Title:

Title:

III - 17

Form#:

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW

Recorded Information and Instructions
For Status Determination, recorded information and instructions should include requirements
for unemployment insurance coverage and procedures for processing information to establish,
suspend, terminate, reactivate and maintain accounts.

The reviewer should examine recorded instructions available to the staff and
compare procedures to the laws and written policies of the State to determine
if the recorded information and instructions are current, accurate, and
complete. The reviewer should also observe the Status Determination
process and talk with employees to learn whether or not the recorded
instructions are available to staff.

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. If there are no recorded
instructions, describe in the narrative how the staff becomes aware of the
proper procedures to perform the tasks of the Status Determination function.

III - 19

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

1.

Does the State have recorded information and instructions to assist employees performing
Status functions in each major category in accordance with State laws and written policies?
Yes No
a.
b.
c.

2.

New Determinations ..................................................................................................
Successor Determinations..........................................................................................
Inactivations/Terminations ........................................................................................

If yes, for each major Status category, are all the recorded information and instructions:
New Succ. Inact.
Acct. essor Term.

a.
b.
c.
d.

(Indicate Yes or No for Each Category)
Current? .....................................................................................................................
Accurate? ...................................................................................................................
Complete? ..................................................................................................................
Readily available to staff?..........................................................................................

VS:(Questions 1 and 2)

III - 21

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

3.

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 these questions.
VS:(Question 3)

III - 22

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW NARRATIVE

Question
Number

Explanation of "N/A" and "Compensating Controls"
(when deemed necessary)

Question
Number

Answers to "If yes, describe" and "Other":

III - 23

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW

Training
New employees need to learn the requirements for unemployment insurance coverage and the
procedures for processing Status information to establish, suspend, terminate, reactivate and
maintain accounts. Experienced employees benefit from periodic refresher courses and need
additional training when changes occur, and when quality defects or a significant number of
errors appear in a particular area.

The reviewer should become familiar with the methods and procedures
the State uses to identify and meet training needs of employees involved
in determining the liability of subject employers.

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. If there are no training
programs, describe how the staff know the laws, rules, written policies
and proper procedures to perform Status functions.

III - 25

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

1.

Does the State have methods or procedures to provide training for newly hired employees?
Yes

No __

*If yes, identify the type of training:
Yes No
a.
b.
c.
d.
e.

*Formal Classroom Training .........................................................................
*On the Job Training?....................................................................................
*One-on-One Training? .................................................................................
*Individual Self-guided Training?.................................................................
*Other?...........................................................................................................

Describe the type and frequency of training in the narrative.

2.

Does the State have methods or procedures to provide refresher training for experienced
employees?
Yes

No __

*If yes, identify the type of training:
Yes No
a.
b.
c.
d.
e.

*Formal Classroom (e.g., refresher courses)? ...............................................
*On the Job Training?....................................................................................
*One-on-One Training? .................................................................................
*Individual Self-guided Training?.................................................................
*Other?...........................................................................................................

Describe the type and frequency of training in the narrative.

III - 27

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

3.

Does the State provide training when there are:

a.
b.
c.
d.
e.

4.

Yes No N/A
State law changes? .....................................................................................................
Policy/procedure changes? ........................................................................................
Needs identified from review of finished work
(e.g., supervision, quality assurance review? ............................................................
Hardware/software changes? .....................................................................................
*Other ........................................................................................................................

Does the State have processes (e.g., back-up training or organizational flexibility) to assure
that staff absences will not disrupt operations?
Yes

No __

If yes, describe in the narrative.

VS:(Questions 1 - 4)

III - 28

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

5.

*In the opinion of the supervisor or manager, does the training meet the needs of the Status
function? (e.g., Are sufficient resources available--training packages, facilities, staff, etc.)
Yes

6.

No __

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

III - 29

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

III - 30

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW NARRATIVE

Question
Number

Explanation of "N/A" and "Compensating Controls"
(when deemed necessary)

Question
Number

Answers to "If yes, describe" and "Other":

III - 31

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW

Recording of Transactions and Events

The Status function should have procedures and controls to assure that Status Determinations
are recorded and that the source information is readily available for examination. Whether the
State system is manual or automated, an audit trail should lead from the data recorded in the
employer account record to the Status source document upon which the determination was
based.

A Status source document is the information basis from which a Status
Determination is made. It can consist of a registration form, Status
change form, blocked claim report, appeal finding, letter from the
employer or whatever documentation the State has accepted as the
information source.
The reviewer should become familiar with the various types of Status
Determinations which require an audit trail leading to the supporting
documentation.
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. If the State does not
maintain source documents or an audit trail, describe how it assures that
correct Status Determinations have been made.

III - 33

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS
1.

Does the State have procedures to assure that Status Determinations can be traced to their
source (even if the source is via electronic media)?
Yes
No __

2.

Can the following items be identified through the audit trail for New Employer
Determinations:
Yes No
a.
b.
c.
d.

e.

3.

Employer or employer representative who
notified State of liability change? ..............................................................................
State employee who recorded or authorized the
determination? ...........................................................................................................
Type of determination (new)?....................................................................................
Date of Status Determination? (either the date
decision is made, mailed or put into the ADP
system) .......................................................................................................................
The supporting documentation for the
determination? ...........................................................................................................

Can the following items be identified through the audit trail for Successor Employer
Determinations:

a.
b.
c.
d.

e.

Yes No
Employer or employer representative who
notified State of change?............................................................................................
State employee who recorded or authorized the
determination? ...........................................................................................................
Type of determination (successor)? ...........................................................................
Date of Status Determination? (either the date
decision is made, mailed or put into the ADP
system) .......................................................................................................................
The supporting documentation for the
determination? ...........................................................................................................

III - 35

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

4.

Can the following items be identified through the audit trail for Inactivation/Termination
Determinations:

a.
b.

c.

Yes No
Type of determination (inactivation/termination)?....................................................
Date of Status Determination? (either the date
decision is made, mailed or put into the ADP
system) .......................................................................................................................
The supporting documentation for the
determination? ...........................................................................................................

VS:(Questions 1 - 4)

5.

Is a source document required to make a Status Determination for:

a.
b.
c.

Yes No
New Determinations? ................................................................................................
Successor Determinations? ........................................................................................
Inactivations/Terminations?.......................................................................................

VS:(Question 5)

III - 36

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

6.

*Which of the following are acceptable as source documents for Status Determinations?
Enter "Y" for yes, "N" for no or "A" for not applicable.
New Succ- Inact./
Acct. essor Term.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.

7.

*Registration form? ...................................................................................................
*Status change form?.................................................................................................
*Correspondence from employer?.............................................................................
*Field audit report?....................................................................................................
*Contribution report, remittance?..............................................................................
*Notes of telephone conversation? ............................................................................
*Blocked claims report? ............................................................................................
*Appeals findings? ....................................................................................................
*Electronic media?.......................................................................................................
*Other? ………………………………………………………………………………

Are original and amended information sources, including electronic source documentation,
retained and accessible for State use for:

a.
b.
c.

Yes No
New Determinations? ................................................................................................
Successor Determinations? ........................................................................................
Inactivations/Terminations?.......................................................................................

VS:(Question 7)

III - 37

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

8.

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 8)

III - 38

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW NARRATIVE

Question
Number

Explanation of "N/A" and "Compensating Controls"
(when deemed necessary)

Question
Number

Answers to "If yes, describe" and "Other":

III - 39

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW

Systems to Assure Execution of Events
For Status Determination, controls should be built in to assure that new employers are
assigned correct, initial new employer rates and that successor accounts are assigned correct
initial rates according to the State's successorship and transfer of experience laws and
regulations. A follow-up system to maintain control of work in progress assures that all Status
documents received by the State are acted upon in a timely manner.

The reviewer should become familiar with built in systems and automated
or manual controls which assure accurate and timely execution of Status
Determinations.
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. If the State does not
have internal controls or safeguards, describe how it assures the
correctness of Status Determinations, initial rate assignments and posting
of Status information.

III - 41

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

1.

Does the State have systems procedures or internal controls to minimize the possibility of
setting up duplicate accounts for the same employer?
Yes
No __

VS: (Question 1

2.

)

Does the State have system procedures or internal controls to assure that all Status
documents are acted upon by:
Yes

3.

No

a.

Tracking documents? .................................................................................................

b.

Following up potentially liable
determinations? ..........................................................................................................

c.

*Other?.......................................................................................................................

*Does the State have written procedures to allow Status Determinations to be made with less
than complete information?
Yes

III - 43

No __

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

If yes, does the State:
a.

Have system procedures or internal controls to assure that there is a follow up on all
items for which all information has not been received?
Yes

VS:(Question 2 and 3a.

4.

No __
)

Does the State have system procedures or internal controls to assure that written Status
Determinations and initial rates are issued to:

a.
b.

Yes No
New employers?.........................................................................................................
Successor employers? ................................................................................................

VS:(Question 4

)

III - 44

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

5.

Is there a built-in edit or manual review to assure that the correct initial rate is assigned to
new employers?
Yes

No __

If yes, describe

6.

Is there a built-in edit or manual review to assure that correct initial rates are assigned to
successor employers according to the State law and written policy?
Yes

No __

If yes, describe

VS:(Questions 5 and 6

)

III - 45

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

7.

Is the information from Status Determinations and other material changes to the employer
records verified for accuracy (e.g., Is information on the employer record compared to
source documents to assure accurate posting of Status Determinations, address changes,
etc.)?
Yes

VS: (Question 7

8.

)

Does the state have a quarterly procedure to inactivate employer accounts if the employers
have not reported wages for eight consecutive quarters (or less than eight if state procedures
require less), or have filed a “no wage” report?

Yes
VS:

No __

(Question 8

No __
)

*a. If yes, is the procedure automated?
Yes

III - 46

No __

R 11/07

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS
9. If procedures are automated, is a systems check performed every time a program is changed?
Yes __ No __

10.

Does the State have a system in place to detect tax rate manipulation (i.e., SUTA Dumping)?

Yes __ No __

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:

(Questions 9 & 10

)

III - 47

R 04/03

III - 48

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW NARRATIVE

Question
Number

Explanation of "N/A" and "Compensating Controls"
(when deemed necessary)

Question
Number

Answers to "If yes, describe" and "Other":

III - 49

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW

Review of Completed Work
For the Status function, the State should be conducting systematic reviews of Status
Determinations made and initial rates assigned. The information received and the action
taken should be checked against the information recorded in the employer's account.

A review of completed work should be done on a regular basis for all staff
members involved in processing documents for the employer's account.
This review may be done on an individual basis for each staff member, or
by sampling work done throughout the entire unit. The following
questions are designed to determine how these reviews are conducted.
The reviewer should become familiar with the kind of review program the
State uses to assess the work performed by the Status function.
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. If there is no review
performed, describe how the State has reasonable assurance that correct
decisions are being made.

III - 51

R 04/03

For all staff members involved in processing Status documents, are the following components subject to some form of systematic review?
For Yes answers, enter a "Y" in the appropriate column(s). If there are no reviews, answer "N" in column 6 which is evaluative.
Type of review
Component

*1
Supv

*2
Peer

*3
QR
Qual.Rev

*4
Support
Clerical

*5
Other

6
Review
Conducted
Y/N

New Determinations
a.

Accuracy of determinations

b.

Accuracy of initial rate assignment

c.

Accuracy of posting employer information

d.

Prompt completion of determinations

Successor Determinations
e.

Accuracy of determinations

f.

Accuracy of initial successor rate assignment

g.

Accuracy of posting information

h.

Prompt completion of determinations

Inactivation/Termination Determinations
i.

Accuracy of determinations

j.

Accuracy of posting

VS: (Question 6)

*Informational

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

7.

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 these questions.
VS: (Question 7)

III - 55

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW NARRATIVE

Question
Number

Explanation of "N/A" and "Compensating Controls"
(when deemed necessary)

Question
Number

Answers to "If yes, describe" and "Other":

III - 56

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

SYSTEMS REVIEW QUESTIONS

Additional Controls
1.

*Does the State have internal controls or quality assurance systems in the Status function
which this review failed to identify?
Yes

No __

Yes

No __

If yes, describe below:
2.

*Are there any exemplary practices for the Status function?

If yes, describe below:

III - 57

R 04/03

ACCEPTANCE SAMPLES

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

NEW EMPLOYER STATUS DETERMINATIONS
Purpose/Intent

To confirm that the state's internal controls ensure accurate
determinations by examining completed New Employer
Status Determinations.
To determine that correct, initial rates are being assigned to
new employers.
To evaluate whether the state follows its procedures to obtain
any necessary additional information.
To assess the accuracy of posting Status information to the
employers' account records.

Scope

The scope of the review will focus on all new and reactivated
Status Determinations made during the selected calendar
year. (Accounts which are reactivated only to make
corrections, do not meet the definition of "reactivation" and
should not be included.)

Universe

The universe to be identified for the New Employer Status
Determinations Acceptance Sample will include:
1.

All Status Determinations for New and Reactivated
Employers, (e.g., employing units initially meeting
the definition of "employer" in the state
unemployment compensation law or previously
terminated employing units which again meet the
definition of employer) made during one complete
calendar year. Exclude temporary or "pending"
accounts, or accounts that have not met a liability
provision of the state’s law.

2.

60 cases will be selected from this universe.

III - 61

R11/04

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Timing/Frequency

The sample will be selected once per calendar year.
The universe can be identified immediately following the end
of the calendar year.

Sampling Procedures

The following steps must be taken to establish the universe and select
the sample accounts:
1.

Identify all New Employer Status Determinations
(including Reactivations) made during the calendar
year selected for the review.

2.

Select 60 sample cases after identifying the universe.

3.

If a case should not have been in the New Employer
universe to begin with, follow the Case Replacement
instructions in Chapter II of this Handbook.
However, some accounts in the sample may later have
been redetermined to be successorships, or the new
account may later have been terminated, or
redetermined not to be liable after all. Such cases can
remain in the universe. Subject to review, however,
are the decision, tax rate and posting of the new
determination. Subsequent decisions such as
successorship, or to terminate are not part of the
review. If errors are found in the subsequent
decisions, they should be noted in the Annual Report,
but the case will focus on the new employer
determination.

III - 62

R11/04

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
If the System is automated, the Reviewer must work closely
with the ADP 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 registration form,
field auditor's report notations to the file explaining
the source, etc.
If the employer registered
electronically, or entered data directly into the state’s
automated system, the electronic data screen
containing the original registration information
entered by the employer (or employer’s
representative) can be used as the source document. If
the original source of 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 11/07

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

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
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples
Cont.
3. Accuracy of Posting - includes questions to evaluate if the
Status Determination was posted correctly in accordance with
State requirements. The reviewer must use some discretion in
this section to avoid penalizing a case which may contain
slight typographical errors that have little or no material
effect on the employer’s account. Such findings should be
noted in the Annual Report, but should not fail the case.

Drawing Conclusions

All questions are evaluative except 1, the first part of 2, and 4 f.
correct posting of “Other” information. A "No" answer to any
evaluative question means that the case is not considered
acceptable.
If the completed review of 60 cases includes three or more
unacceptable cases, then the reviewer must conclude that
accuracy in the Status function was not confirmed.
For all unacceptable cases, the reviewer must provide an
explanation on the Acceptance Sample Explanation Sheet for
each unacceptable case.

Documentation

All source 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.

III - 65

R 04/03

III - 66

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

Accuracy of Initial Liability Decision

1.

*Do State procedures permit setting up active accounts with less than complete information?
Yes

No __

If “Yes”, answer question 2. If “No”, go to question 3.

2.

*Was the case under review set up with less than complete status information?
Yes

No __

If “Yes”, answer questions 2a., and 2b. If “No”, go to question 3.

a.

Based upon the information available at the time the account was set up, was a
correct liability decision made?
Yes

b.

No __

Is there evidence that the State tried to obtain the necessary additional information?

Yes __ No __

III - 67

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

NOTE: If, at the time of the review, the liability decision was made with less than complete
information, and there has not been sufficient time to obtain necessary additional
information, answer question 3 based on the evidence available when the initial liability
decision was made. If question 3a is answered “No”, do not answer the rest of the
Questionnaire.

Accuracy of New Employer Determination at Time of Review

3.

At the time of the review:
a. Is there sufficient documentation to support a liability decision?
Yes __ No __
b. Was the correct liability decision made?
Yes __ No __
c. Was the liability date established within the correct quarter?
Yes __ No __
d. Was the correct tax rate assigned?
Yes __ No __ NA __

NOTE: Answer question 3d as “NA” if the account is a reimbursable account.

III - 68

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

4.

At the time of the review, indicate whether the following account information was
correctly posted.
a. Employer name?

Yes

No __

b. Employer mailing address?

Yes __ No __

c. Liability date?

Yes __ No __

d. Type of organization?

Yes __ No __ NA __ INA __

e. Initial tax rate?

Yes __ No __

f. *Other ____________________________

Yes __ No __ NA __

NOTE Typographical errors such as the spelling of the employer’s name should not
result in a “No” answer, so long as it does not impact the proper administration of the
account.

III - 69

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

III - 70

R 04/03

TAX PERFORMANCE SYSTEM

Status Sample Coding Sheet
New Employers Checklist

State: ___________

Case
Number

Employer
Identification
Number

Period Covered: ____________
Date: ___________
Reviewer:____________________
Sample Type:
Acceptance
Expanded

1

2

2a

2b

3a

3b

Questions 2a, 2b, 3a, 3b, 3c, 3d, 4a, 4b, 4c, 4d, and 4e are evaluative.

3c

3d

4a

4b

4c

Total Acceptable ___ of ___

4d

4e

4f

Pass/Fail
Y/N

Page __ of ___

TAX PERFORMANCE SYSTEM

Status - Sample Explanation Sheet
New Employers Checklist
State: _____________________ Period Covered: _______________ Date: _______________ Reviewer: _______________
Sample Type:
Case
Number

Employer
Identification Number

Acceptance

Expanded
Explanation

Page _____ of _____

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

SUCCESSOR EMPLOYER STATUS DETERMINATIONS
Purpose/Intent

To confirm that the State's internal controls ensure accurate
determinations by examining completed Successor
Employer Status Determinations.
To determine that correct initial successor rates are being
assigned to employers according to the State's
successorship laws and written policies.
To evaluate whether the State follows its procedures to
obtain any necessary additional information.
To assess the accuracy of posting Status information to the
successor employers' account records.

Scope

The scope of the review will focus on all Successor Status
Determinations made during the selected calendar year.

Universe

The universe to be identified for the Successor Employer
Status Determinations Acceptance Sample will include:

III - 75

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Universe cont.

Timing/Frequency

1.

All accounts which during one calendar year are
determined to be successors according to State laws
and regulations (an employing unit which has
acquired the organization, trade, or business in
whole or in part, of another employer, declared
subject as of the day on which it meets the
requirement of the State employment compensation
law for a successorship).

2.

Both first time and existing employers. Some
States do not require the transfer of experience to
successor accounts. Such an account may be
assigned a new employer rate even if it is
determined to be a successor.

3.

Various types of successorships permitted by State
law and written policy (e.g., mandatory, optional,
total or partial).

4.

60 cases will be selected from this universe.

The sample will be selected once per calendar year.

The universe can be identified immediately following the
end of the calendar year.

III - 76

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Sampling Procedures

The following steps must be taken to establish the universe
and select the sample accounts:
1.

Identify all Successor Status Determinations made
during the calendar year selected for the review.

2.

Select 60 sample cases after identifying the
universe.

NOTE: Sometimes an account is selected in the successor
sample which was set up based on less than complete
information. If it is discovered when the State follows its
investigative procedures that the account should have been
a "new" employer, continue to review it with this
questionnaire and consider the case acceptable.

III - 77

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS
Sampling Procedures
If the system is automated, the reviewer must work
cont.
closely with the ADP 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
successor Status Determinations selected for review:
1.

Status information in the employer account record.

2.

The original source of information and any other
documentation from State's records. Documentation
can consist of a registration form, successor and or
predecessor application form, field auditor's report,
notations to the file explaining the source, etc. If the
employer reported electronically, or entered data
directly into the state’s automated system, the
electronic data screen containing the original
successorship information entered by the employer
(or employer’s representative) can be used as the
source document. If the original source of
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.
Using this information, answer the questions in the
Acceptance Sample Questionnaire.
NOTE: If the account has been terminated by the time of
the TPS review, the Successor Employer Status
Determination, rate assignment and posting should be the
basis for answering the questions.

III - 78

R 11/07

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples
cont.
1.

Accuracy of Initial Liability Decision – includes
questions to evaluate if a correct initial decision
based on minimum information was made (actual
rather than temporary or pending accounts).
Sometimes State procedures allow an initial liability
decision to be made based on partial information
(i.e., a partially completed contribution return). The
State should follow up 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.

2.

Accuracy of Successor Employer Determination at
Time of Review - Questions evaluate if State is
following its law provisions with regard to the
initial rate first assigned to successors. Some States
require that successors who are first time employers
be assigned the predecessor's rate. In this instance it
may be necessary to determine which predecessor
rate was in effect at the time the successor was
determined to be an employer. In States that
require immediate transfer of experience and
recalculation of the rate, it may be necessary to
review the components of the rate calculation to
ascertain that the correct initial rate was assigned.
It is the initial successor rate that should be
examined, not any subsequent rates that may have
been assigned. For example, if the successor has
been assigned an initial rate in Year 1, and then
another rate in Year 2, the reviewer should examine
year 1’s rate only.

III - 79

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Drawing Conclusions

For the Successor Acceptance Sample all questions are evaluative
except 1, the first part of 2, and 4f. Posting of “Other”
information.
A "No" answer to any evaluative question indicates that the
Status Determination was not accurate or the rate was not
correctly assigned. This means that the case is not
considered acceptable.
If the completed review of 60 cases includes three or
more unacceptable cases, then the reviewer must conclude
that accuracy in this function was not confirmed.
If the completed review of 60 cases includes three or more
unacceptable cases, the reviewer must conclude that
accuracy in the Status Successor Account Maintenance
function was not confirmed.
For all unacceptable cases, the reviewer must provide an
explanation for the unacceptable case on the Acceptance
Sample Explanation Sheet.

Documentation

All source 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 must be
maintained.

III - 80

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE
Accuracy of Initial Successor Liability Decision

1.

*Do State procedures permit setting up successor accounts with less than complete
information?
Yes

No __

If “Yes”, answer question 2. If “No”, go to question 3.

2.

*Was the case under review set up with less than complete status information?
Yes

No __

If “Yes”, answer questions 2a., and 2b. If “No”, go to question 3.

a.

Based upon the information available at the time the account was set up, was a
correct successor liability decision made?
Yes

No __

b. Is there evidence that the State tried to obtain the necessary additional information?

Yes __ No

III - 81

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

NOTE: If, at the time of the review, the successor liability decision was made with less than
complete information, and there has not been sufficient time to obtain necessary additional
information, answer question 3 based on the evidence available when the initial successor
liability decision was made. If question 3a is answered “No”, do not answer the rest of the
Questionnaire.

Accuracy of Successor Determination at Time of Review

3.

At the time of the review:
a. Is there sufficient documentation to support a successor liability decision?
Yes __ No __
b. Was the correct successor liability decision made?
Yes __ No __

c. Was the successor liability date established within the correct quarter?

Yes __ No __
d. Was the correct tax rate assigned?
Yes __ No __ NA __
NOTE: Answer question 3d as “NA” if the account is a reimbursable account.

III - 82

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

4. At the time of the review, indicate whether the following successor account information was
correctly posted.
a. Employer name?

Yes

No __

b. Employer mailing address?

Yes __ No __

c. Liability date?

Yes __ No __

d. Type of organization?

Yes __ No __ NA __ INA __

e. Initial successor tax rate?

Yes __ No __

f. *Other ____________________________

Yes __ No __ NA __

NOTE Typographical errors such as the spelling of the employer’s name should not
result in a “No” answer, so long as it does not impact the proper administration of the
account.

III - 83

R 04/03

AX PERFORMANCE SYSTEM

Status Sample Coding Sheet
Successor Checklist
State: ___________

Case
Number

Employer
Identification
Number

Period Covered: ____________
Date: ___________
Reviewer:____________________
Sample Type:
Acceptance
Expanded

1

2

2a

2b

3a

3b

Questions 2a, 2b, 3a, 3b, 3c, 3d, 4a, 4b, 4c, 4d, and 4e are evaluative.

3c

3d

4a

4b

4c

Total Acceptable ___ of ___

4d

4e

4f

Pass/Fail
Y/N

Page __ of ___

TAX PERFORMANCE SYSTEM

Status - Sample Explanation Sheet
Successor Checklist
State: _____________________ Period Covered: _______________ Date: _______________ Reviewer: _______________
Sample Type:
Case
Number

Employer
Identification Number

Acceptance

Expanded
Explanation

Page _____ of _____

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

INACTIVATED/TERMINATED STATUS DETERMINATIONS
Purpose/Intent

To confirm that the State's internal controls ensure accurate
determinations by examining completed
Inactivated/Terminated Status Determinations.
To evaluate whether the State follows its procedures to
obtain any necessary additional information.
To assess the accuracy of posting Status information to the
employers' account records.

Scope

The scope of the review will focus on all Inactivated and
Terminated Status Determinations made during the selected
calendar year.

Universe

The universe to be identified for the Inactivated and
Terminated Employer Status Determinations Acceptance
Sample will include:
1.

All Status Determinations for inactivated and
terminated employers. Inactivated employing units
have been granted permission to suspend filing of
quarterly reports, whereas terminated employing
units have been granted termination of coverage by
reason of not meeting the State's definition of
employer. If State law permits both types of
determinations, the population from which the
sample is selected should include both.

III - 89

R04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Timing/Frequency

The sample will be selected once per calendar year.
The universe can be identified immediately following the
end of the calendar year.

Sampling Procedures

The following steps must be taken to establish the universe
and select the sample accounts:
1.

Identify all Inactivated or Terminated
Determinations made during the calendar year
selected for the review.

2.

Select 60 sample cases.

The review can be completed any time after the cases are
selected.
If the System is automated, the Reviewer must work
closely with the ADP 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.

III - 90

R04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS
Reviewing Samples
Assemble the following information for each of the
Inactivated or Terminated 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 letter or Status
change form from an employer, a list or an
automated code which indicates that State law or
policy permits the inactivation or termination of
accounts after a certain number of quarters in which
no wages were reported, etc.
If the employer provided inactivation information
electronically, or entered data directly into the
state’s automated system, the electronic data screen
containing the original inactivation information
entered by the employer (or employer’s
representative) can be used as the source document.
If the original source of information is not available,
the answer to question 3a. must be “no”.

Compare all source documents with the information in the
employer's account record.
Using this information, answer the questions on the
Acceptance Sample Questionnaire.
NOTE: If the account has been reactivated by the time of the TPS
review, the Terminated Employer Status Determination, and
posting should be the basis for answering the questions.

III - 91

R 11/07

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE INSTRUCTIONS

Drawing Conclusions

All the questions are evaluative, except 1, the first part of 2, and
4b. Posting of “Other” information.
A "No" answer to either of these questions indicates that
the Status Determination was not accurate. This means
that the case is not considered acceptable.
If the completed review of 60 cases includes three or more
unacceptable cases, then the reviewer must conclude that
accuracy in the Status Inactivated/Terminated function was
not confirmed.
For all unacceptable cases, the reviewer must provide an
explanation on the Acceptance Sample Explanation Sheet
for each unacceptable case.

Documentation

All source 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.

III - 92

R04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

Accuracy of Inactivated/Terminated Determination

1.

*Do State procedures permit inactivating accounts with less than complete information?
Yes

No __

If “Yes”, answer question 2. If “No”, go to question 3.

2.

*Was the case under review inactivated with less than complete status information?
Yes

No __

If “Yes”, answer questions 2a., and 2b. If “No”, go to question 3.

a.

Based upon the information available at the time the account was inactivated, was a
correct inactivation decision made?
Yes

b.

No __

Is there evidence that the State tried to obtain the necessary additional information?

Yes __ No

III - 93

R 04/03

ET HANDBOOK NO. 407
TAX PERFORMANCE SYSTEM
STATUS DETERMINATION

CHAPTER THREE

PROGRAM REVIEW

ACCEPTANCE SAMPLE QUESTIONNAIRE

NOTE: If, at the time of the review, the inactivation decision was made with less than
complete information, and there has not been sufficient time to obtain necessary additional
information, answer question 3 based on the evidence available when the initial inactivation
decision was made. If question 3a is answered “No”, do not answer the rest of the
Questionnaire.

Accuracy of Inactivation Determination at Time of Review

3. At the time of the review:
a. Is there sufficient documentation to support an inactivation decision?
Yes __ No __
(Statutory inactivation/termination after the required number of quarters lapse with no
reported wages is sufficient documentation to support a determination.)

b. Was the correct inactivation decision made?
Yes __ No __

4. At the time of the review, indicate whether the following account information was correctly
posted.
a. Last date of liability (last point in time when
employer is expected to file contribution returns)?
b. *Other ____________________________

III - 94

Yes

No __

Yes __ No __ NA __

R 04/03

TAX PERFORMANCE SYSTEM

Status Sample Coding Sheet
Inactivated/Terminated Checklist
State: ___________

Case
Number

Period Covered: ____________
Date: ___________
Reviewer:____________________
Sample Type:
Acceptance
Expanded
Employer
Identification
Number

1

2

Questions 2a, 2b, 3a, 3b, 3c, 3d, and 4a are evaluative.

2a

2b

3a

3b

4a

Total Acceptable ___ of ___

4b

Pass/Fail
Y/N

Page __ of ___

TAX PERFORMANCE SYSTEM

Status - Sample Explanation Sheet
Inactivations/Terminations Checklist

State: _____________________ Period Covered: _______________ Date: _______________ Reviewer: _______________
Sample Type:
Case
Number

Employer
Identification Number

Acceptance

Expanded
Explanation

Page _____ of _____

III - 98

R12/00