Status Determinations - General Overview The purpose of Status Determination Sampling is to: Confirm that the State’s internal controls are producing accurate determinations. Determine that correct initial rates are being assigned to new and successor employers. Evaluate whether the State follows its procedures to obtain any necessary additional information. Assess the accuracy of posting status information. There are three types of Status Determinations under review: New/Reactivated Employer Determinations Successor Employer Determinations Inactivation/Termination Determinations The timeliness of New/Reactivated Status Determinations (90 days and 180 days) and the accuracy of New/Reactivated Determinations are Tier I measures. While the TPS Acceptance Sampling review uses three cases as the measure for sample failure, the State Quality Service Plan (SQSP) allows up to six failure cases as the measure before a Corrective Action Plan (CAP) will be required. (Link to Welcome & Intro Training Module) Universe Building The different universe are built for Status Determinations: New/Reactivated, Successor Determinations and Inactivation/Terminations. Scope - New/Reactivated Employers: All New and Reactivated employer status determination made during the calendar year. The determinations included in the universe must meet the definition of new employer as defined in State law and regulation.  It is the status determination that puts the employer in the universe.  Employer accounts that have been reactivated from a previous inactivation/termination are included. Universe building hints: If an employer is first determined to be “new,” later determined to be a “successor,” and yet later “terminated” within the same calendar year, the employer will be in all three universes! Exclude temporary or pending accounts or accounts which have been “reactivated” just to make a correction to the existing data. Identify an external validation source for the universe count.  Example:  universe count for Status Determinations - New/Reactivated Employers should match the count of New Status Determinations on the ETA 581 report (cell #14) for the calendar year. Scope - Successor Employers: All successor determinations made during the calendar year.  (Includes first time and existing employers.) Universe building hints: The determinations included in the universe must meet the definition of successor employer as defined in State law and regulation. If an employer had been determined as a new employer in the review year, but later determined to be a successor employer, the employer account should remain in the new determinations universe and should also be in the successor determinations universe. Identify an external validation source for the universe count.  Example:  universe count for Status Determinations - Successor Employers should match the count of Successor Status Determinations on the ETA 581 report (cell #17) for the calendar year. Scope - Inactivations/Terminations: All inactivations and/or terminations of employer accounts made during the calendar year. Universe building hints: The determinations included in the universe must meet the definition of inactivated/terminated employer as defined in State law and regulation. “Inactivation” is defined as granting permission to suspend filing of a quarterly report. “Termination” is defined as the entity no longer meeting the State’s definition of an employer. If the State law permits both types of determinations, then both belong in the universe. Identify an external validation source for the universe count.  Example:  universe count for Status Determinations - Inactivated/Terminated Employers should match the count of Inactivation/Termination Status Determinations on the ETA 581 report (cell #20) for the calendar year. Sample Extraction Acceptance Sample Timing: A Sample of 60* New, Succesor, and Intactivation cases can be extracted as soon as the calendar year under review ends. (*Sample size depends on universal count.) Click here to see a time line. Sample Evaluation When evaluating Status Determination cases, keep these things in mind: Each Status Determination sample case is reviewed for two distinct aspects of quality - accuracy of the decision (Section A) and accuracy of the posting (Section B). Within Section A, some questions apply to the accuracy of the liability decision when the initial decision was made while others apply to the accuracy of information at the time of review. Acceptance Sample questions within Section B apply to status information at the time of review. When answering posting questions within Section B, the reviewer should not revisit the accuracy of the decision evaluated in Section A.  For example: if an analyst codes a status report with inaccurate data and the inaccurate data is posted as coded, the posting question would pass. Section B allows for the additional entry of any required element the State deems to be material data.  The TPS Reviewer should be sure that any item added to the posting requirements is an element essential to proper payment of current and future tax revenues and/or Federal and State operations. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Status Determinations: Chapter II - General Procedures Chapter III - Status Determinations Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Status Determinations has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Cashiering - General Overview The purpose of Cashiering Estimation Sampling is to: Measure the timeliness in which contribution payments are deposited into the State’s clearing account. The sampling methodology for Cashiering differs from the other tax functions.  Instead of Acceptance Sampling, the TPS Reviewer will conduct Estimation Sampling.   Methodologies for Estimation Sampling To allow for the wide variety of “peak” mail cycles within the States, two methods of Estimation Sampling are provided for the Cashiering Review: The first methodology is described in ET Handbook 407 - Chapter Four.  Instructions for the second method, Alternative Estimation Sampling Methodology, are provided in DOL FM 44-97 dated June 19, 1997.  The timeliness of deposits to the clearing account will be a Tier I measure.  However, a measurement benchmark has yet to be determined. Universe Building Scope - All contribution payments received during the “peak” or “bulk” mail cycle for second quarter reports (typically, reports and payments will be due on or around July 31).  A sample size goal of 500 payments will be selected. Universe building hints: Determine the “peak or bulk” mail cycle time frame for pulling sample items by reviewing historical information about mail receipt from the Cashiering Unit and/or the mail room. Notify Regional Office of the days selected for sampling, provide information to support the selection, and include an estimate of the percentage of total dollar amount that will be received during the selected period. Consult Estimation Sampling instructions in ET Handbook 407 - Chapter IV and determine if the “Check Interval Method” or “Mail Tray Method” is more appropriate for the State review. If mail is pre-sorted for special handling prior to opening the envelopes, see special instructions in ET Handbook 407 - Appendix A - III. If contribution payments are sent via Electronic Fund Transfer (EFT), consult ET Handbook 407 - Chapter IV for special instructions. If contribution payments are mailed to a Lockbox operation, consult ET Handbook 407 - Chapter IV for special instructions. Sample Extraction On each of the review days selected in the sampling time frame, the TPS reviewer (or designee) will go to the area where the mail is received, opened, and transferred to mail trays. Use the chosen sampling technique (check interval or mail tray) for selecting the samples.  Note: It is more important to maintain a consistent sampling technique than it is to pull exactly 500 items.  Once the sampling technique is established, do not alter it. Record information about each selected sample on sample coding sheets. (Link to TPS Cashiering Sample Coding Sheet - ET Handbook 407 - IV) Return the payment to approximately the same spot from which is was removed.  There should be nothing that would indicate which payments are selected as part of the review. Click here for a time line. Sample Evaluation When evaluating Cashiering cases, keep these things in mind: Allow a reasonable time frame between the selection of samples and the evaluation of timeliness to allow for the deposit of monies and posting of information to the employers’ files. Record sufficient information about the sample case to ensure tracking the payment.  Information such as the employer’s name, DBA, or FUTA number may helpful if the State UI account number has been noted improperly on the check or not yet assigned. Identify and use the most accurate record to determine the date that selected payments were deposited.  For example: The reviewer would not use the dates on a deposit slip as this only indicates the date the deposit was created or batched.  The best source would be the courier or bank receipt which actually indicates the date the deposit was received at the bank. Count only banking days between receipt and deposit (do not include weekend or holidays). Payments received one day and deposited the next day are considered to be deposited within one day, regardless of the TIME of day received or the TIME of day deposited. Transfer cashiering summary results from the sample coding sheet to the TPS Cashiering Summary Sheet.   Links to ET Handbook 407 - click on any of the following choices to view Estimation Sampling information related to Cashiering: Chapter II - General Procedures Chapter IV - Cashiering Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Estimation Sampling for Cashiering has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Report Delinquency - General Overview The purpose of Report Delinquency Sampling is to: Determine if the State accurately identifies employer accounts delinquent in filing required report. Assure that delinquent employers are notified properly. Determine if the State takes appropriate action to resolve report delinquencies. Universe Building Scope - All employers whose report delinquency for the first calendar quarter of the TPS review year is identified once the State has passed it’s delinquency cut-off date (typically around May 15). Universe building hints: Include both reimbursing and contributory employers. Include only first quarter delinquencies.  Do not include prior quarter delinquencies. Identify the universe once the delinquency cut-off date has passed and prior to the mailing of first quarter delinquency notices. Try to identify an external validation source for universe count - Example:  universe count for Report Delinquency should closely match the count of first quarter delinquency notices issued to employers during delinquent control run. Sample Extraction Acceptance Sample Timing: A sample of 60* Report Delinquency cases should not be selected until the fourth quarter (Nov.-Dec.) of the TPS review year.  This will allow time for delinquent control actions to occur on first quarter report delinquencies. (*Sample size depends on universe count) Click here to see a time line Sample Evaluation  When evaluating Report Delinquency cases, remember the State’s cut-off date for timely received reports. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Report Delinquency: Chapter II - General Procedures Chapter V - Report Delinquency Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Report Delinquency has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Collections - General Overview The purpose of Collections Sampling is to: Assure that Accounts Receivable are being managed in accordance with the State’s established procedures. Universe Building Scope: All contributory accounts with $100.00 or more in unpaid UI tax.  Tax due must be at least 30 days old.  The universe should be identified on any single day between February 1 and June 30. Universe building hints If the State’s established benchmark figure for initiating collection activity is higher than $100.00 in unpaid UI tax, the higher benchmark figure may be used for universe building. The State should set a limit as to the age of accounts receivables identified for the universe.  For example: if the State does not actively pursue debts after five years, then the universe should consist of cases at least 30 days old but not older than five years. The Collections universe is the only universe that is pre-sorted.  Employers within the universe file should be sorted by ascending dollar amount to ensure a representative sample of accounts receivable when samples are selected. Sample Extraction Acceptance Sample Timing: A sample of 60* Collection cases should not be selected until six months after the universe is identified (between August 1 and December 30).  This will allow time for collection activities to occur on newer collection cases.  (*Sample size depends on universe count) Click here to see a time line. Sample Evaluation When evaluating Collections cases, keep these things in mind: Review collection actions taken within the current year and preceding two calendar years only. Review the timeliness of contacts for the most recent quarter of liability only. Uncollectible accounts are reviewed up to the point they are declared uncollectible and reviewed to determine if they are properly written off. Accounts in bankruptcy status are reviewed up to the point where a claim is filed in bankruptcy court, unless the bankruptcy is already discharged or closed. Any case that was a part of the previous year’s sample and failed must be replaced for the current review. Within the Collections review, the State’s established collection procedures are the primary control in determining whether the case fails or passes the review.  Reviewers should also be prepared to evaluate and make recommendations on the effectiveness of the State’s policies and procedures. Collection actions that are required by the State but are not within the parameters of the TPS Acceptance Sample questions should not fail a case (i.e., if evaluative questions in 1-10 pass, question 11 must be answered yes). Question #5 - The “assessment” referred to in this question must meet the definition of Assessment (Collection) contained in ET Handbook 407 - Appendix C - Glossary.  ( ET Handbook 407 - Appendix C - Glossary - C - 3) Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Collections: Chapter II - General Procedures Chapter VI - Collections Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Collections has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Field Audits - General Overview The purpose of Field Audit Sampling is to: Assess the degree to which completed audits meet the requirements of the Employment Security Manual. Assess the accuracy of posting audit results in the State’s employer records. Of all the TPS Acceptance Sampling reviews, Field Audit is the only sampling that is evaluated on a point basis.  Each question is given a value from 5 to 25 points.  In order to pass the review, each case must receive a score of 80 points or better.  As in all other Acceptance Sample reviews, if three or more cases fail, then the sample fails.   Universe Building Scope: All contributory employer audits completed in the first, second, and third quarters of the calendar year. Universe building hints: Audits contained in the universe must meet the definition of a field audit as noted in the Employment Security Manual. The universe count for Field Audits should match the count of audits on the ETA 581 report (cell #47) for the first 3 quarters of the calendar year. Sample Extraction Acceptance Sample Timing: Sample of 60* audits should be extracted after the third quarter of the TPS review year.  (*Sample size depends on universe count) Click here for a time line Sample Evaluation When evaluating Field Audit cases, keep these things in mind:   Audit findings should be throughly documented and conclusions fully and clearly explained.   This is particularly important because audits may be used to help decide an employer’s liability for unemployment insurance contributions, such as in a coverage hearing, and the auditor may not always be available for clarification of the audit findings and conclusions.  Therefore, it is important that auditors carefully document and clearly explain audit findings and conclusions so that the audit may “stand alone” in such situations and be self-explanatory.  This is also of great value to a TPS reviewer as it makes a review of an audit much easier. Before proceeding with the Acceptance Sample review, each case should be reviewed for the pass/fail question, “Was this assignment correctly identified as an audit in conformity with ETA audit policy as defined in the ESM?” Question #4 - Source documents used to perform payroll testing must be the record of an initial activity or transaction (i.e.,  time cards, check stubs, cash disbursement journal, etc.).  Availability of records should be well documented within each audit. Question #4 - In the reconciliation of total payroll to total reported wages, if the reported payroll is found to match the information posted on the State system, the auditor is not required to compare the data to the employer’s copy of the UI contribution report.  If, however, information from audited source documents does not match information posted on the State agency’s records, the audit work papers must reflect what was recorded on the employer’s copy of the wage report. Question #5 - The vast majority of employer misreporting can be traced to misclassifying employees as non-employees or “contract labor” and to “hidden wages” (payments found in employer records that appear to be payment for something other than remuneration for services).  This question is designed to determine if the auditor throughly searched all appropriate and available employer records for misclassified employees and/or hidden wages and properly documented audit findings and conclusions. Question #5a - There are four record types required to be examined by the auditor in the search for misclassified workers and hidden wages.  At least one record of each type must be examined and the findings documented in the audit, if such record is maintained by the employer.  If such record is not maintained, that fact must be explained in the audit report.  All records deemed essential or necessary to conduct the audit, including a detailed general ledger, must be examined if they are maintained by the employer. Question #6 - Most audits must cover a minimum of four (4) consecutive quarters of liability.  Exceptions to this rule may be found in the Employment Security Manual (ESM) Section 3675. State procedures may require the organization of audit work papers.  The reviewer should not be concerned with the order or format as long as all Acceptance Sample questions are addressed somewhere within the audit. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Field Audits: Chapter II - General Procedures Chapter VII - Field Audit Appendix A - Sampling Specifications Appendix C - Glossary Appendix E - Employment Security Manual - Field Audit Appendix E - Audit Report Example Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Field Audits has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Contribution Report Processing - General Overview The purpose of Contribution Report Processing Sampling is to: Assure that the contribution report processing function is accurately processing the quarterly contribution reports. Confirm that the State maintains accurate quarterly contribution information. Determine that employers who do not file timely are being properly identified. Universe Building Scope - All contributory employers who are active on the date the universe is identified.  The universe should be identified on any single day after January 31 and prior to March 31. Universe building hints: Exclude reimbursable employers. Try to identify an external validation source for the universe count.  Example: if the universe is identified at the end of the first quarter, the universe count for Contribution Report Processing should closely match the count of contributory employers on the ETA 581 report (cell #1) for the first quarter of the calendar year. Sample Extraction Acceptance Sample Timing: Sample of 60* Contribution Report Processing cases should be extracted on a single day between May 1 and June 30.  The reviewer should ensure that the selection date allows sufficient time for processing of first quarter contribution reports.  (*Sample size depends on universe count) Click here for a timeline. Sample Evaluation When evaluating Contribution Report Processing cases, keep these things in mind: Focus only on the first quarter report if the employer submits reports for more than one quarter. If Question No. 2 must be answered, the use of N/A is only appropriate if no report was due. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Contribution Report Processing: Chapter II - General Procedures Chapter VIII - Account Maintenance - Contribution Report Processing Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Contribution Report Processing has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Debits/Billings - General Overview The purpose of Debits/Billings Sampling is to: Assure accuracy in the establishment of employer underpayments (debits). Assure  the State maintains employer debit (accounts receivable) information accurately and timely. Assure that the State accurately issues debit memorandums or billing notices to employers for underpayments of UI contributions due. There are two types of Debits/Billings under review: Contributory Employers and Reimbursing Employers Universe Building - Contributory Employers Scope - Contributory Employers:  The sampling universe should include all contributory employers with debits, established during the selected quarterly report processing period, that remain unpaid at the end of the processing period. The TPS reviewer may select the processing period for either the first, second, or third quarter. Universe building hints - Contributory Employers: The quarterly report processing period is defined as beginning the first day of the calendar quarter following the selected quarter and ending on the cut off date the State uses to identify delinquent employer reports.  For example: if the second quarter is selected for review, the processing period would begin July 1 and end approximately August 20. The debit may relate to any quarter, but must have been established during the processing period for the quarter selected. Ensure that the debit includes UI tax.  The debit may also include interest and penalty, but the universe should exclude accounts with only interest and penalty or other State taxes due. Exclude any contributory employers with debits established and cleared during the processing period or debits below the State’s tolerance level (amounts for which the State does not issue a billing statement). Click here to see a time line Universe Building - Reimbursing Employers Scope - Reimbursing: All reimbursing employers who have debits for benefits paid during the selected time period which remain unpaid at the end of the processing period.  The reviewer will select the processing period for reimbursable debits based on the established billing cycle for benefit charges (monthly, quarterly, or annually). Universe building hints - Reimbursing Employers: The processing period is defined as beginning with the debits initially established on the benefit charge statement or the initial request for payment and concluding at the end of the established time period allowed for payment ( i.e., the point at which the reimbursable debit becomes past due). Ensure the debit includes UI contributions.  The debit may also include interest and penalty, but the universe should exclude accounts with only interest and penalty or other State contributions due. Exclude reimbursing employers who paid their charges within the “grace period.” Click here to see a time line Sample Extraction Acceptance Sample Timing: Sample of 60* Debits/Billings (contributory and reimbursing) should be extracted immediately after the processing period identified for each universe.  (*Sample size depends on universe count) Sample Evaluation When evaluating Debits/Billings cases, keep these things in mind: While the debit is for unpaid UI contributions, it may also include associated penalty and interest which must be verified for accuracy as well.  Errors in interest and penalty calculations would cause a sample case to fail. Only the accuracy of the debts relating to the quarter processing period under review need be verified.  If a bill also contains carryover debts relating to prior processing periods, the accuracy of those additional debts need not be verified.  For example, the third quarter processing period is under review.  The employer is issued a bill for an underpayment related to the third quarter.  However, the bill also lists a carryover debt related to a prior processing period.  The reviewer is only required to verify the accuracy of the third quarter debt. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Debits/Billings: Chapter II - General Procedures Chapter VIII - Account Maintenance - Debt/Billings Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Debits/Billings has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Credits/Refunds - General Overview The purpose of Credits/Refunds Sampling is to: Assure accuracy in the establishment of employer overpayments (credits/refunds). Assure that the State maintains employer overpayment (credit/refund) information accurately and timely. Assure that the State accurately issues credit memorandums and/or refunds to employers for overpayments. Universe Building Scope - All contributory employers who have overpayments (credits) established during the quarterly report processing period which remain outstanding (not liquidated through refund or application to a liability) at the end of the processing period.  The reviewer may select the processing period for either the first, second, or third quarter. Universe building hints: The quarterly report processing period is defined as beginning the first day of the calendar quarter following the selected quarter and ending on the cut off date the State uses to identify delinquent employer reports.  For example: if the first quarter is selected for review, the processing period would begin April 1 and end approximately May 20. The overpayment (credit) may relate to any quarter, but must have been established during the processing period for the quarter selected. Exclude any contributory employers with credits established and cleared during the processing period or credits within the State’s tolerance level (amounts for which the State does not issue a credit memorandum). Exclude all reimbursing employers. Ensure the universe data captured includes the “targeted” credit amount, or some other data indicator, to help identify the credit memorandum targeted for review. Sample Extraction Acceptance Sample Timing: Sample of 60* Credits/Refunds should be extracted after the processing period identified.  The reviewer will identify an appropriate selection date which allows time for the refund process to occur.  In some states, there may be a lag time of 90 - 180 days before refunds are issued.  (*Sample size depends on universe count) Click here to see a time line. Sample Evaluation When evaluating Credits/Refunds cases, keep these things in mind: While the credit is for overpaid UI contributions, it may also include associated penalty and interest which should also be verified as accurate. Only the accuracy of credits relating to the quarter under review need be verified.  If a credit memo also contains credits relating to quarters not under review, the accuracy of those additional credits need not be verified.  For example, the quarter under review is the third quarter and the employer is issued a credit memo for an overpayment made during the third quarter.  However, the credit memo also lists a carryover credit from a prior quarter.  The reviewer is only required to verify the accuracy of the third quarter credit. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Credits/Refunds: Chapter II - General Procedures Chapter VIII - Account Maintenance - Credit/Refunds Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Credits/Refunds has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Benefit Charging - General Overview The purpose of Benefit Charging Sampling is to: Assure accuracy of benefit charges posted to employer accounts. Assure that the State accurately maintains all data used to determine benefit charges for an employer's account. Assure that the State accurately issues benefit charge statements to employers. Universe Building Scope- All employers with benefit charges or credits posted to their account during a designated time period.  The reviewer will select the time period for the benefit charging review based on the established cycle for benefit charge statements (monthly, quarterly, or annually). Universe building hints: Universe includes contributory, reimbursing, and CWC charging - excludes federal (UCFE) and military (UCX) charging. Ensure the captured universe data includes the type of charging (contributory, reimbursing, or CWC) and any other necessary data indicators. Try to identify an external validation source for the universe count - Example: the universe count for Benefit Charging should match the count of charge statements produced during the selected cycle. Sample Extraction Acceptance Sample Timing: Sample of 60* Benefit Charging cases should be extracted immediately after the benefit charge statements are produced for the selected time period.  (*Sample size depends on universe count). Click here to see a time line. Sample Evaluation When evaluating Benefit Charging cases, keep this in mind: Although the wording of Benefit Charging Acceptance Sample Question #1 may lead the reviewer to believe that it pertains to the accuracy of the benefit charge decision, that is not the case.  TPS does not revisit the merits of the claim to verify if accurate decisions were made to pay/not pay the claimant and charge/not charge the employer's account.  The reviewer only needs to verify that if a decision was made to debit (or credit) the employer's account, that is what was reflected on the charge statement provided to the employer.  The reviewer must obtain copies of the documentation pertaining to a final decision to debit or credit the employer's account for the claimant's benefits and verify that the decision is accurately reflected on the charge statement. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Benefit Charging: Chapter II - General Procedures Chapter VIII - Account Maintenance - Benefit Charging Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Benefit Charging has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen. Tax Rates - General Overview The purpose of Tax Rates Sampling is to: Assure accuracy of the computation of employer’s tax rate. Assure that the State accurately maintains all data used in the computation of the employer’s tax data. Sampling Exemption While all other categories of Acceptance Sampling and Estimation Sampling must be performed every review year, sampling for Tax Rates has been given a conditional exemption. There will not be a requirement to review a sample of Tax Rate activity if the previous year’s sample of Tax Rates, Contribution Report Processing, and Benefit Charging passed the TPS review.  As long as the Contribution Report Processing and Benefit Charging samples continue to pass review, the next examination of Tax Rates can take place at any time during the next four calendar years, as agreed upon by the State and Regional Team Leader. Universe Building Scope - Include all active, experience rated, contributory employers issued tax rate notices during the TPS review year.  The reviewer will determine the universe identification date depending on the date annual tax rate statements are issued. Universe building hints: The appropriate date on which the universe can be identified depends on the availability of all State factors required to calculate the rates.  Rate notices issued during the TPS calendar year under review may be for the current year or the following year. Exclude all reimbursing employers, non-experience rated contributory employers, and inactive employers. Try to identify an external validation source for the universe count.  Example: the universe count for Tax Rates should equal the count of annual rate statements produced for experience rated employers. Sample Extraction Acceptance Sample Timing:  Sample of 60* Tax Rates cases should be extracted immediately after the annual tax rate statements are produced.  (*Sample size depends on universe count.) Click here to see a time line Sample Evaluation When evaluating Tax Rates cases, keep these things in mind: Acceptance Sample Question No. 1 verifies the accuracy of the computations involving employer specific items (e.g., wages, benefits, etc.). Acceptance Sample Question No. 2 verifies the accuracy of the experience rate factor involving State specific items (e.g., tax table, schedule, ratio, etc.). Acceptance Sample Question No. 3 verifies the accuracy of any solvency surtax charge the State may use. The TPS reviewer should save the calculator tapes used to verify tax rate calculations as part of the reviewer’s documentation. Links to ET Handbook 407 - click on any of the following choices to view Acceptance Sampling information related to Tax Rates: Chapter II - General Procedures Chapter VIII - Account Maintenance - Tax Rates Appendix A - Sampling Specifications Appendix C - Glossary Appendix F - Data Entry User’s Guide Conclusion Now that Acceptance Sampling for Tax Rates has been explained, continue working through this tutorial for more details.  Click here to link back to the Acceptance Sampling navigational screen.