Wisconsin - University of Colorado Boulder



Wisconsin

What types of audits does the DOR do? (such as in-state, out-of-state, corporation, individual, large companies, small companies or a mix of these)

Our Bureau does audits of all types of entities, including individuals, both in and out-of-state.  We administer individual income, corporation franchise/income, sales/use, excise, and miscellaneous business taxes and fees.

What level auditors do you have and typically how many of each? (managers, senior auditors, staff auditors)

Historical Staffing Data (FY2009)

Office Auditors (Revenue Auditor, Revenue Auditor 3, Revenue Auditor 4, and Revenue Auditor 5) - 93.8

Field Auditors - Large Case (Revenue Field Auditor 6-8) - 49.3

Field Auditors - District (Revenue Field Auditor and Revenue Field Auditor 3-5) - 85.8

Revenue Agents & Tax Reps - 19

Support Staff - 27.2

Technology / Analysts - 3

Supervisors / Managers - 24

Total Staffing - 302.1

Vacancies - 46.85

Total FTE - 348.95

Can you please explain the audit assignment process (is it performance based or seniority based, do the auditors have a say in which audit they get, does it differ for in state and out of state audits)?

Audits are generally selected centrally by a group of auditors in our Audit Technical Services Unit.  Assignments are distributed based on location and experience.  As an auditor progresses in the classification, more difficult cases are assigned.  Auditors and supervisors may self select audits but the assignment still goes through our Audit Technical Services Section for a determination of whether the assignment is appropriate.  Out of state audits are generally more complex and handled by large case auditors, although more senior district auditors may volunteer to do out-of-state audits.

Are the auditors and managers happy with the current assignment process in place?

Auditors are satisfied with the process although in allowing self selection there is some concern between large case and district auditors of encroachment.  That is why it is important there is a central clearinghouse for all assignments.  The quality of audits has not always been the best although is improving with more selection based on queries to our data warehouse.

Do the auditors specialize in specific areas and types of businesses or do they work all over?

Office auditors generally specialize in one of the three major tax types (individual, corporation and pass-through, sales/use).  The excise taxes are handled by a separate section. Field Auditors must audit for all tax types we administer (except excise tax).  Some auditors may focus in certain industries because of expertise in past audits.  Excise tax field auditors audit for all excise tax types (motor fuel, alcohol beverage, and cigarette/tobacco).

What is the typical in state and out of state travel time per year per agent?

We do not collect historical travel time data.

Can you please explain your performance review system?

Each year, auditors and their supervisor discuss goals for the coming year (number of audits to complete, complexity of audits, and other assignments).  The performance of the auditor is then evaluated each July.  In addition to the number of audits completed, performance is also measured by grades they received for audits turned in (complexity, completeness of workpapers, understanding of issues, etc.), feed back from taxpayers that were audited, and work on other projects.  We do look at revenue change - total of assessments and refunds, although it has no significant impact on performance ratings.

Auditors under union contracts are rated satisfactory or unsatisfactory.  Those rated unsatisfactory are generally placed on some type of performance improvement plan.  Outside of the general rating process, section chiefs and/or the bureau director communicate by letter acknowledging those with more than satisfactory performance and those who need to improve or face an unsatisfactory rating in the future.

Do you feel the performance review system is effective and is it being followed?

Yes.

What types of incentives do you give agents to perform at their highest level?

Our union contracts prohibit discretionary compensation awards based on merit.  Non-monetary incentives include semi-annual customer service and innovation awards, more out-of-state travel if desired, inclusion of special project teams, invitations to meet with upper management, letters of commendation, etc.

What benefits do you offer when recruiting new agents such as a set pay scale or promotion and other benefits to stay competitive with public accounting firms?

See the attachment from our last major recruitment in 2008.

What type of training do you offer (on the job, in a class room, additional training every year)?

All of the above.  Class room training for office auditors is approximately three months spread out over the first year.  Class room training for field auditors is approximately six months.  Job shadowing is part of the field audit curriculum.  New auditors once assigned to the field will audit with an experienced auditor for four-six audits.  Auditor conferences are held at least once each year for training and many of the units have quarterly or semi-annual training days.

Would it be all right if a team member or I contact you in the future?

Yes.

COMPARISON OF OFFICE AUDIT AND FIELD AUDIT POSITIONS

Starting Date: July 6, 2009 Starting Salary: $40,590

| |OFFICE POSITIONS |FIELD POSITIONS |

|Pay Progression |Receive a $2,500 increase every twelve months for two |Receive a $2,500 increase every twelve months for two |

| |periods, subject to the pay range 07-03 minimum. |periods, subject to the pay range 07-03 minimum. Eligible for|

| |Eligible for reclassification to Revenue Auditor 3 |reclassification to Revenue Field Auditor 4 after 24 months. |

| |after 4 years. All information contingent on |All information contingent on contract. |

| |contract. | |

|CPA add-on |$1,040 per year |$1,040 per year |

|Skill development add-on |Not available |Four annual add-ons are available at $2,080 a year. Minimum |

| | |time required to earn the four add-ons are 2, 4, 7 and 10 |

| | |years. |

|Flexible work hours |Available after training period. |Available after training period. |

|Length of probation |Eighteen months |Two years |

|Length of classroom |Six Weeks |Six months. This time includes some on-the-job training in |

|training | |the field. |

|Location of classroom training |Madison |Madison |

|Taxes trained in |Individual income tax (some positions will be trained |Individual income tax, corporation income/franchise tax, |

| |in corporation income/franchise tax or sales/use tax).|sales/use tax. |

|Type of contact with taxpayers the auditor |Primarily correspondence, then telephone contact to a |Primarily face-to-face contact at taxpayer locations. |

|will have |lesser extent, and some face-to-face conference. | |

|Amount of travel |Virtually none |Primarily local travel driving to and from taxpayer |

| | |locations, more travel is available, if desired. |

|Advancement opportunities |Within the Revenue Auditor series, you can advance |Within the district field auditor series, you can advance |

| |from a Revenue Auditor to a Revenue Auditor 3. You can|from a Revenue Field Auditor to a Revenue Field Auditor 4 & |

| |also advance to Revenue Auditor 4 and Revenue Field |5. Transfer to the Large Case Unit is also available, where |

| |Auditor positions |you can advance to a Revenue Field Auditor 6 and 7. |

|Office the auditor will be permanently |Madison and possibly others |Milwaukee, Green Bay, Madison, and possibly others |

|assigned to | | |

Texas

What types of audits does the DOR do? (such as in state, out

 of state, corporation, individual, large companies, small

 companies or a mix of these)

THE COMPTROLLER OF PUBLIC ACCOUNTS AUDITS TAXES ADMINISTERS A LARGE VARIETY OF TAXES AND WE AUDIT CORPORATIONS, PARTNERSHIPS, AND SOLEPROPRIETORS IN STATE AND OUT OF STATE.  

   

 What level auditors do you have and typically how many of

 each? (managers, senior auditors, staff auditors)

OUR AUDITOR LEVELS ARE

AUDITOR I                      61

AUDITOR II                     33

AUDITOR III                    50

AUDITOR IV                     177

AUDITOR V                      150

AUDITOR VI                     65

AN AUDITOR I IS A NEW HIRE.

   

 Can you please explain the audit assignment process (is it

 performance based or seniority based, do the auditors have a

 say in which audit they get, does it differ for in state and

 out of state audits)?

AUDITOR ARE MATCHED TO AN AUDITOR WITH THE EXPERIENCE LEVEL TO COMPLETETHEM.  MANAGEMENT ASSIGNS ADUITS. WHEN POSSIBLE, AUDITORS ARE GIVENASSIGNMENTS CLOSE TO THEIR RESIDENCE.  

   

 Are the auditors and managers happy with the current

 assignment process in place?

   

THE PROCESS WORKS WELL.

 Do the auditors specialize in specific areas and types of

 businesses or do they work all over?

MOST AUDITORS DO LIMITED SALES AND USE TAX AUDITS.  THERE ARE

APPROXIMATELY 25 AUDITORS THAT ARE DEDICATED TO FRANCHISE TAX, A DOZENTHAT DO IFTA TAX, AND PROBABLY AN EQUAL NUMBER THAT DO MOTOR FUELS ANDMIXED BEVERAGE.  EIGHT AUDITORS DO INSURANCE TAX AUDITS.

   

 What is the typical in state and out of state travel time per

 year per agent?

THE AVERAGE AUDITOR SPENDS 25 TO 35 PERCENT OF THEIR TIME TRAVELING.

   

 Can you please explain your performance review system?

   

THE DIVISION HAS CORE AND AUDIT COMPETENCIES WITH ESTABLISHED STANDARDSFOR EACH AUDITOR LEVEL.  THESE ARE USED TO GRADE THE INDIVIDUAL AUDITOR'S PERFORMANCE.  PERFORMANCE APPRAISELS ARE PROVIDED ANNUALLY INADDITION TO A SEMI-ANNUAL INTERIM APPRAISAL.  AUDITOR Is ARE EVALUATEDMORE FREQUENTLY TO MONITOR THEIR PROGRESS.

TO ASSURE UNIFORMITY AND JUSTIFICATION OF THE RATINGS GIVEN, THE

ASSISTANT MANAGER OF AUDIT DIVISION READS ALL OF THEAPPRAISALS.

 Do you feel the performance review system is effective and is

 it being followed?

YES

   

 What types of incentives do you give agents to perform at

 their highest level?

EMPLOYEE REWARDS ARE BASED ON EXCEPTIONAL PERFORMANCE BASED ON TRAININGSCORES AND EVALUATIONS.  BEING RECLASSED FROM ONE AUDITOR LEVEL TOANOTHER REQUIRES A MINIMUM AMOUNT OF TIME AT THE PREVIOUS LEVEL. MERITSARE SALARY INCREASES BASED ON EXPEPTIONAL PERFORANCE BETWEENRECLASSIFICATION OPPORTUNITIES.

Auditor I - 6 months 12 months

Auditor II 6 months 9 months 15 months

Auditor III 9 months 12 months 18 months

Auditor IV

Merit

Merit 12 months 15 months 24 months*

Auditor V

Merit

Merit 12 months 18 months 36 months*

Auditor VI

* IN ORDER TO BE ELIGILBE FOR THE PROMOTION TO AN AUDITOR V OR VI, ANAUDITOR MUST REACH A BENCHMARK SALARY.

AUDITORS MAY ALSO BE AWARDED ADDITIONAL LEAVE TIME BASED ON EXCEPTIONALPERFORMANCE IN LIEU OF MONEY.

THE COMPTROLLER PROMOTES AN eDAY FOR EMPLOYEES.  THE OFFICE MANAGEMENTSPROMOTES SOCIAL COMMITTEES THAT PROMOTES ACTIVITIES AMONG THE AUDITSTAFF.

 What benefits do you offer when recruiting new agents such as

 a set pay scale or promotion and other benefits to stay

 competitive with public accounting firms?

   

THE COMPTROLLER'S OFFICE PROVIDES A DEFINED BEGINNING SALARY AND MEDICALAND RETIREMENT BENEFITS.

 What type of training do you offer (on the job, in a class

 room, additional training every year)?

THE TECHNICAL TRAINING IS PROVIDED UNDER THE AEGIS OF THE AUDIT DIVISIONTRAINING GROUP.  A NEW HIRE UNDERGOES 15 WEEKS OF BASIC AUDIT TRAINING(BAT) BEFORE PERFOMING AND ON THE JOB TRAINING BEFORE PERFORMING HIS/HEROWN AUDITS.  THE 15 WEEKS CONTAIN TWO WEEKS IN THE OFFICE AND ONE WEEKCOMPRISED OF CLASSROOM TRAINING WITH LIMITED FIELD EXPERIENCE.  BATCONTAINS THREEGRADED CASE STUDIES AND ONE COMPREHENSIVE PRACTICALS.

THREE MONTHS AFTER BAT COMPLETION, THE AUDITORS ATTENDS A WEEK OFINTERMEDIATE I, THREE MONTHS LATER IT'S INTERMEDIATE II, AND THREEMONTHS LATER ADVANCED AUDIT.  FOLLOWING THESE MANDATORY CLASSES THEAUDITOR CONTINUES TO BE TRAINED IN A VARIETY OF AREAS.  A LISTING OFCLASSES WITH A BRIEF DESCRIPTION IS ATTACHED.

   

 Would it be all right if a team member or I contact you in

 the future?

   

YES.  YOU HAVE MY EMAIL AND PHONE NUMBER.

   

CLASS LIST

MANDATORY TRAINING

Basic Audit Training is a five week training course designed to furnish newly hired field auditors with the knowledge necessary to conduct quality sales tax audits – 32 hours.

Basic Audit Training I – AUDIT0062– Week I covers the agency introduction, taxpayer communications, and audit process and verification. Required for new hires --32 hours.

Basic Audit Training II – AUDIT0063 – Week II covers rules applicable to manufactures, tangible personal property, and local tax. Required for new hires -- 32 hours.

Basic Audit Training III – AUDIT0064 – Week III covers rules related to contractors, taxable services, and local taxes. Required for new hires – 32 hours.

Basic Audit Training IV – AUDIT0065 – Week IV covers Audit finalization, taxpayer communications, & rules on agriculture, and imports/exports. A comprehensive sales tax practical is administered during the week. Required for new hires – 32 hours.

Basic Audit Training V – AUDIT0066 – Week V covers food rules and is focused on sampling guidelines and procedures used in audit situations. Required for new hires -- 32 hours

Intermediate Audit I – AUDIT0315 – Through case studies and classroom activities, the auditors will increase their knowledge of the CAMS-PC program, refunds, taxpayer/consultant relations, and additional audit related topics. Required for auditors six months after hiring – 32 hours.

Intermediate Audit II– AUDIT0072 – Through class exercises, auditors will enhance their working knowledge of sampling procedures, sample evaluations, and convenience store audit procedures. Required nine months after hiring. -- 32 hours

Advanced Audit – AUDIT0113 – A follow up to Intermediate Audit I & II, this class increases the auditors knowledge of current, complex sales tax law, rules, and division policies through interactions with subject matter experts. Class topics includes a tax policy presentation, Access, refunds, bankruptcy, and franchise tax. Required 18 months after hiring. -- 32 hours

OPTIONAL TRAINING

Access/Excel – AUDIT0286 – The course is evenly split to provide a comprehensive course in ACCESS and expand the auditors’ knowledge of the more powerful features of EXCEL. -- 32 hours

Administrative Update – AUDIT0277 -- This class addresses job skills and updates policy and procedure information useful to administrative personnel. 32 hours

Advanced Sampling -- AUDIT0125 – Using case studies and exercises, auditors learn sample selection, projection of sample results, sample evaluations, and computer assisted auditing. 32 hours

Audit Select Workshop – AUDIT0268 – This group meeting is designed as an open forum to discuss problems, successes, and experiences with the audit select system. 24 hours

Audit Update – AUDIT0060-- This course provides taxability, policy, audit procedures, and computer updates. In addition to a tax policy presentations, the class includes lessons on refunds, bankruptcy, insolvency, Access, and CAMS-PC. Sales tax auditors with at least two years experience would benefit from taking this class each biennium. 32 hour

Basic CAMS-Mainframe Program Training – AUDIT0131 – Students will learn the basic concepts and guidelines of computer-assisted auditing, how to read mainframe-based data, how to complete CAMS forms for working with a CAS, and will complete several audits using the mainframe program. 32 hours

CAMS-Mainframe Update – AUDIT0295 – A refresher course for those who have not recently either attended Basic CAMS-Mainframe or worked on a CAMS-Mainframe Audit. A review of concepts and guidelines, including forms, data review and manipulation, and audit completion. 16 hours

CAMS-PC Program Training – AUDIT0274 – Students will learn the basic concepts and guidelines of computer-assisted auditing and how to format PC-based data for program use. Students will complete several audits using the CAMS-PC program. 16 hours

CATS – AUDIT0310 – This introductory class is designed to train Divisional staff on the CATS audit documentation software.

Cigarette Tax – AUDIT0188 – This class provides training on auditing cigarette and other tobacco products. 32 hours

Cigarette/Tobacco Update – AUDIT0267 – A follow up to Basic Cigarette and Tobacco class to assure uniform application of the tobacco decision. 32 hours

Enterprise Zone – AUDIT0352 – The class provides an opportunity for subject matter experts and audit staff to exchange information and experiences encountered in audit/refund situations. 24 hours.

Franchise Tax Basic – AUDIT0148 – This class provides the students with: a history of franchise tax; overview of franchise tax auditing techniques; and details of audit planning. 32 hours

Franchise Tax Update – AUDIT0342 – Provides training on legislative statute changes, process changes and other updated materials to auditors assigned to franchise tax. 32 hours

Grocery store – AUDIT0278 – An introduction to auditing procedures for grocery and convenience stores. The class includes examples of the purchase ratio method, auditing with alternative records, and the scanner method of auditing. 24 hours.

Basic IFTA – AUDIT 0291 – The class will introduce auditors to IFTA tax, IFTA auditing procedures, and the IFTA computer program. 24 hours

IFTA Update – AUDIT0317 – A course to update IFTA auditors on new software and legislative changes that apply to the IFTA auditing function. 32 hours

In-Office Trainers’ Meeting – AUDIT0336 – An interactive meeting between in-office and BAT trainers. Discussions include training issues, in-office lessons and exercises, and successful techniques used by various offices. – 24 hours

Basic Insurance – AUDIT0356 – This class covers the statutes, rules, policies, and procedures required to perform and insurance tax audit. 24 hours

Insurance Update – AUDIT0192 – Insurance auditors are provided with the most current information on insurance statutes, auditing procedures, policies, and software. 24 hours

Local Revenue Basic – AUDIT0171 – An introductory class to teach auditors how to examining city and county records for state courts costs fees and fines. 32 hours

Local Revenue Update – AUDIT0200 – This is an update course for auditors currently performing local revenue tax audits. Information covered includes recent changes in statutes, policies, and computer software. 32 hours

MACMAN – MACMAN0215– This class is designed to improve the effectiveness of the management staff. 32 hours

Mixed Beverage Basic – AUDIT0178 – Training to teach personnel to audit TABC Receipts tax. This includes learning the laws and rules for this tax code. 32 hours

Mixed Beverage Update – AUDIT0227 – An update course for auditors currently mixed beverage tax audits. Information covered includes recent changes in statutes, policies, and computer software. 16 hours

Basic Motor Fuels – AUDIT0303 – During this course the auditor should develop an understanding of the motor fuels law with emphasis on the subchapters concerning diesel and gasoline. Auditing procedures for interstate truckers, distributors, and suppliers are addressed. 32 hours

Advanced Motor Fuels – AUDIT0253 – To provide updated information on the implementation of changes in the motor fuels tax laws. 32 hours

Motor Vehicle – AUDIT0017 – Provides a working knowledge of motor vehicle sales, rental, and use tax laws in order so auditors will be able to perform quality motor vehicle tax audits. 32 hours

Motor Vehicle Workshop – AUDIT0299 – The class is designed to provide a format for an exchange of the latest motor vehicle audit information. 16 hours

Oil & Gas Exploration & Production (sales tax) –AUDIT0351 – The class provides information on the sales and use tax ramification of oil and gas exploration and production. 32 hours

Oil and Gas Basic – AUDIT0067 – This class provides a practical application of crude oil and natural gas tax laws, rules, audit policies and procedures to enable participants to perform quality oil and gas tax audits. 32 hours

Oil and Gas Workshop – AUDIT0304 – Experienced oil and gas auditors meet to review the latest statute, auditing procedures, and tax policy changes. Usually there is a field trip to a plant so the auditors will have practical knowledge of the industry. 32 hours

PC Coordinator – AUDIT0263 – This meeting of the PC Coordinators is to share information on the systems and software changes. 32 hours

Petrochemical Workshop – AUDIT0279 -- A three-day workshop that addresses petrochemical issues. 24 hours

Basic Refunds – AUDIT0220 – This class is provides training on current refund procedures. The purpose is to promote consistency and uniform treatment of taxpayers through out the division. 32 hours

Refund Update – AUDIT0297 – This class, a follow up to Basic Refunds, provides the latest information related to refunds. 24 hours

Skills Refresher – AUDIT0275 -- A weeklong class for auditor of all levels that includes information on reviewing internal controls, the tax reconciliation, BART, nexus, research techniques, and write-up. 32 hours

Staff Development – AUDIT0319 – This course provides information and tools for personal development. Specific lessons are not available at this time. 32 hours

Taxable Services – AUDIT0239 – Tax policy provides this course on statute, current hearings, rules, and policies that relate to taxable services. Some of the services discussed include real property repair and remodeling, real property, credit reporting, information, data processing, internet, and insurance services. 24 hours

Telecommunications – AUDIT0251 – This class provides training to audit personnel on the various taxes imposed and collect by the telecommunications industry. 32 hours

Telecommunication Update – AUDIT0344 – A workshop for experienced telecommunication auditors to promote uniform treatment of audit issues. 8 hours

Basic Unclaimed Property – AUDIT0204 – Auditors learn a basic understanding of the Treasury statutes pertaining to the auditing of companies for the purpose of recovering unclaimed property to be transmitted to the state for safe keeping. 32 hours

Unclaimed Property Update – AUDIT0208 – Experienced unclaimed property auditors are updated on changes in the unclaimed property statues, audit procedures, and audit documentation along with a review of various audit tools to increase effectiveness. 32 hours

Washington

1.         What types of audits does the DOR do? (such as in state, out of state,   corporation, individual, large companies, small companies or a mix of these)

The Washington State Department of Revenue only audits business, since we do not have an income tax in Washington.  We have 289 employees in the Audit division.  In our core auditing function we have 17 in state managers who supervise 188 auditors and 5 out of state managers who supervise 42 auditors and 10 contract auditors.  Our headquarters functions include a tax discovery/research unit (9), audit program support unit (6); Computer Assisted Audit Program unit (6) and a review/quality control unit (11).

            We audit sole proprietors to fortune 100 companies.

2.         What level auditors do you have and typically how many of each? (Managers, senior auditors, staff auditors)

            Managers: 32

            Senior Auditor: 83 (37 of these are based out of state)

            Staff Auditors: 148

            Our typical in-state audit staff has one manager, 2 senior auditors and 9 staff auditors

            Our typical out-of-state audit staff has one manager, 7 senior auditors and 1 staff auditor and 2 contractors

3.         Can you please explain the audit assignment process (is it performance based or seniority based, do the auditors have a say in which audit they get, does it differ for in state and out of state audits)?

Accounts are either assigned from headquarters or selected by the manager.   Audits are then assigned by the manager, based on the ability of the auditor.  The auditor could ask for an audit in a specific industry but not a specific taxpayer.  This process ensures that all auditors get a chance to develop and gain experience with all types of business.

4.         Are the auditors and managers happy with the current assignment process in place?

            Yes

5.         Do the auditors specialize in specific areas and types of businesses or do they work all over?

            Our auditors are generalist but some do specialize in specific industries due to the complex nature of the accounts. 

6.         What is the typical in state and out of state travel time per year per agent?  

            An in state auditor typically has minimal travel with the exception of those based in the eastern part of Washington 

            An out of state auditor has a significant amount of travel.  These auditors are based in cities across the US and can cover a large area.  

7.         Can you please explain your performance review system?  

Goals are set at the beginning of the year and the auditor is kept up to date on there progress on a monthly basis.  Each auditor is reviewed every year as to the number and quality of audits completed with weight being given to those auditors who undertake very large and complex audits.  Most of our employees are also conducting other non-audit tasks, such as speaking engagements and other educational efforts.  All employees are also evaluated on their conduct and general performance as a state employee.   

8.         Do you feel the performance review system is effective and is it being followed?

Auditors are aware of their performance expectations and thus know what they have to achieve.  Management has placed a high priority on completing 100% of all employees’ evaluations each year.

9.         What types of incentives do you give agents to perform at their highest level?

            We do not have an incentive program.

10.       What benefits do you offer when recruiting new agents such as a set pay scale or promotion and other benefits to stay competitive with public accounting firms?  

We hire most of our auditors as a Revenue Auditor 1.  After two years they can promote to a Revenue Auditor 2 based on passing an exam and their performance.

11.       What type of training do you offer (on the job, in a class room, additional training every year)?

When an auditor is hired they are given 3 weeks of tax law and computer training, followed by on the job training and other formal classroom training throughout their career.  After that they have a training plan that explains what training is required and within what timeframe.  The training plan was created so that auditors would know what training is necessary for them to advance in the auditor series.

 Wyoming

Torrence,

First of all, I should clarify that we (The Wyoming Department of Audit) are a separate department from the Wyoming Department of Revenue, Wyoming Department of Transportation and the Secretary of State.  This is unusual compared to the other states.  In most states, the audit function is in the Department of Revenue.  Our Division (Excise Tax) conducts audits for the Department of Revenue, the Department of Transportation and the Secretary of State.

What types of audits does the DOR do? (such as in state, out of state, corporation, individual, large companies, small companies or a mix ofthese)

For the Department of Revenue, we audit in state and out of state companies for sales taxes and cigarette taxes whether they are large or small.  We also audit individuals for sales taxes.  For the Department of Transportation, we audit fuel taxes, IFTA (International Fuel Tax Agreement) and IRP (International Registration Plan).   

 

What level auditors do you have and typically how many of each?

(managers, senior auditors, staff auditors)

I’m the administrator and along with me I have 3 managers, 1 admin person and 16 auditors broken down as 3 principal auditors, 5 senior auditors and 8 auditor II positions.

Can you please explain the audit assignment process (is it performance based or seniority based, do the auditors have a say in which audit they get, does it differ for in state and out of state audits)?

We do have one out of state auditor in Houston, Texas.  He audits many of the large oil companies which are audited cyclically.  I doesn’t make a difference whether the audits are in state or out of state when assigning audits.  Typically we assign the difficult audits to the most experienced auditors.  For the most part, the auditors have a say in the audits they are assigned.  Risk assessment plays a big part in what audits are assigned.  Also, the auditors may have spin-off audits from audits they have done.  When you are conducting an audit on a company, you may find other companies that are either buying or selling to the company you are auditing.  If these other companies are in non-compliance with the tax laws, they become a spin-off audit which means they will be added to the audit list.

Are the auditors and managers happy with the current assignment process in place?

I think so for the most part.  We are always looking for better ways of doing risk assessment.

Do the auditors specialize in specific areas and types of businesses or do they work all over?

We have 4 auditors that specialize in the IFTA/IRP area, 1 auditor that mainly conducts fuel tax and cigarette audits but also conducts sales/use tax audits and the rest of auditors conduct sales/use tax audits.  All of these auditors conduct Secretary of State audits corporate tax audits.

What is the typical in state and out of state travel time per year per agent?

Since we stationed an auditor in Houston our travel out of state is less.  We probably travel 60 to 70 percent of the time in state and the rest of the time out of state.  Our auditors are out of the office around 50 % of the time.

Can you please explain your performance review system?

If you are talking about personnel appraisals, we do a mid-year review and an annual appraisal where 9 standard are rated along with whatever goals and work activities were established at the beginning of the appraisal year. 

Do you feel the performance review system is effective and is it being followed?

I think the personnel, for the most part, do their best to follow the review system.  There are always exceptions.  I think it could be more effective.  I think it’s too generic now.  We used to have 22 standards and now we have 9.  We have a lot of subjects compressed into 9 standards.  It makes it harder, in my opinion, to go into depth on someone’s appraisal.

What types of incentives do you give agents to perform at their highest level? 

We try to pay them a competitive wage and promote them when there are opportunities.  We are at the legislature mercy when it comes to pay raises.  The last few years the legislature has been fair with the raises.  There are no bonuses.

 

What benefits do you offer when recruiting new agents such as a set pay scale or promotion and other benefits to stay competitive with public accounting firms? 

One of the benefits is health care and a very good retirement package.  We do try to make our salaries competitive with outside firms.  Most of the time promotions are available when a person has reach that level.

What type of training do you offer (on the job, in a class room, additional training every year)?

We offer on the job training and class room training.  There are times when we can make use of training on a national basis.

Would it be all right if a team member or I contact you in the future?

Yes.

Strategic Plan

Excise Tax Division – Department of Audit

Quality of Life Result:

Wyoming’s voluntary tax and fee collection process is enhanced through fair and impartial compliance audits which protect the public interest and preserve our prosperous economy.

Agency:

Wyoming Department of Audit, Excise Tax Division.

Contribution to Wyoming Quality of Life:

The Excise Tax Division contributes to Wyoming’s prosperous economy through compliance auditing. These audits increase state revenue by exposing unpaid or underpaid taxes and fees. The audit process also increases tax law compliance by providing an onsite educational opportunity for the taxpayers.

Basic Facts:

The Excise Tax Division has 21full time equivalent employees with a total biennial budget of 4 million dollars in general funds.

Our division provides audit support for three state agencies:

1. The Department of Revenue (DOR): i.e.: Sales/Use Tax (S/U), Lodging and Cigarettes

2. The Department of Transportation (DOT): i.e.: Fuel Tax, Rental Car Surcharge, International Fuel Tax Agreement (IFTA) and International Registration Plan (IRP)

3. Secretary of State (SOS): i.e.: Corporate fees

By providing audit support for these state agencies, we help maintain an equal playing field for Wyoming businesses. We are responsible for a licensed audit population of over 251,000 and over 500,000 individuals throughout the State of Wyoming and the international jurisdictions (US States/Canadian Provinces).

Performance Measures:

1. Compliance Ratio – Audit Assessments vs. Taxes Remitted to DOR with Returns

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2. Audit Cost to Audit Assessment Ratios

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3. Percentage of Mandated IFTA, IRP Audits Completed

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4. Ratio risk-based audits done vs. number of risk based licenses

(Not graphed as the ratio is under 1 % so that a graph will not increase understanding)

Story Behind The Performance:

1. The Excise Tax Division monitors the taxes assessed through audits and compares the audited taxes to the amount of taxes paid to the administrative agencies by periodic tax returns.

DOR audits have shown a higher compliance ratio for licensed taxpayers versus those who are unlicensed. Audits have shown most large sales companies are compliant when remitting sales tax for their sales but are not nearly as compliant when remitting taxes to their vendors on purchases. Audits have shown non-licensed companies have few sales where taxes are due but the tax remitted on their purchases reveals a rate of compliance below 50%.

DOT IFTA and IRP audits have had a much lower compliance ratio over the last two years. We have been auditing our largest carriers requiring more audit hours with fewer audits completed.

DOT fuel tax audits have shown fuel taxes are generally collected and remitted for sales of fuel purchased and delivered within the State of Wyoming. Loads of fuels purchased outside of Wyoming and brought into Wyoming by truck or rail car have shown a good compliance rate.

SOS audits compare the financial assets reported yearly by a company to the Secretary of State with the assets of the company shown on their balance sheet or similar record. These audits have shown a high compliance rate.

2. The division compares the cost of performing audits (auditor hours, travel costs, and other expenses) to the corresponding audit assessments. This comparison reveals a positive assessment to cost ratio. This comparison has consistently validated an average recovery ratio exceeding $4 assessed to every $1 spent.

3. The division consistently monitors and attempts to stay within the mandated 3% audit requirement of both the IFTA and IRP audit programs. The baseline of 3% is based on an overall average using a total of four years for IFTA and five years for IRP. The actual number of audits often exceeds the mandated rate to insure the minimum 3% average for the peer review period required in the IFTA agreement and the IRP plan.

4. The division compares the number of risk-based audits performed to the number of licensed applicants. These risk-based audits are performed based upon probabilities of errors occurring. The risk is determined utilizing a risk analysis model identifying high-risk industries. Currently the division audits less than 1% of the licensed vendors within the state each year.

What Do You Propose To Do To Improve Performance In The Next 2 Years?

1. Increase audit focus on high-risk business sectors with low compliance percentages. The division needs to increase the audit coverage of non-licensed and non-compliant taxpayers in order to assure the compliant taxpayers of a fair and equal business atmosphere. Keeping a flexible approach will allow us to change our audit focus quickly in response to changing business trends and circumstances.

2. Maintain the division’s focus on technology to keep pace with changes in the business community. To accomplish this, the division will continue to provide technical training, improve sampling techniques and update computer hardware and software. The increased use of sampling techniques will allow the division to engage more audits while reducing audit costs.

3. Our movement to a paperless file system, combined with SharePoint web based file management, will allow 24/7 remote access to our audit data by our auditors. This allows “real time” updates and supervisory reviews to audit data.

4. With the switch to SharePoint, by DOR and DOA, we will be able to process audit information faster and more efficiently.

5. A current IFTA ballot (to be voted on in 2009) will increase the cyclical audit compliance review period from four years to five. If passed by the membership, this would allow the IFTA and IRP programs to mirror each other’s peer review requirements and do joint reviews saving the division time and money.

Appendix A: Link to budget:

Provide detail on priorities identified above showing the current or proposed budget.

Seventy-six percent (76%) of the total division staff is dedicated to performing audits. Twenty-four percent (24%) of the total staff is administrative. Auditors are expected to spend at least eighty percent (80%) of their time performing audits.

Twenty-five percent (25%) of the division’s audit staff is dedicated to mandated audits, with $554,969 of the total annual division budget of $2,219,875 committed to mandated audits.

Seventy-five percent (75%) of the division’s audit staff is dedicated to risk based audits, with $1,664,906 of the total annual division budget of $2,219,875 committed to risk based audits.

West Virginia

What types of audits does the DOR do? (such as in state, out of state, corporation, individual, large companies, small companies or a mix of these)  All types; desk audits, in-state, out-of-state, corporation, individual, large companies, small companies or a mix of these. 

What level auditors do you have and typically how many of each? (managers, senior auditors, staff auditors)

 2 tax and revenue managers, 6 tax unit supervisors II, 7 tax and revenue auditor 1, 9 tax and revenue auditor 2, and 31 tax and revenue auditor 3.

Can you please explain the audit assignment process (is it performance based or seniority based, do the auditors have a say in which audit they get, does it differ for in state and out of state audits)?

Senior auditors are assigned the larger more complex audits.  The auditors have NO say in which audit they get.  Out of state auditors are assign on the basis of who is next to go out of state and are they capable (experienced enough to conduct the audit).  In-state audits are assigned to a tax unit supervisor 2 by geographical area and the supervisors assigns the audits based on the experience of the auditor and complexity of the audit (large or small company).

 

Are the auditors and managers happy with the current assignment process in place?  Yes

Do the auditors specialize in specific areas and types of businesses or do they work all over?

General they work all types of audits and all over.  We have tax unit supervisors with 6 to 10 auditors which cover a certain geographical area of the state plus conduct out-of-state audits.  We do have an excise unit with auditors stationed through out the state and they conduct only excise tax audits (bingo, raffle, cigarette, soft drink, motor fuel, IFTA, and IRP tax audits).

What is the typical in-state and out-of-state travel time per year per agent? Each auditor generally travels about 10 hours a week for in-state audits and for out-of-state 2 weeks a year. Travel time is 240 hours per year. In-state travel time is per auditor 224 hours and 16 hours out-of-state.  Note that we only capture actual travel time to and from a location.  The time spent conducting the audit is not travel.  

Can you please explain your performance review system?  We evaluate on the anniversary of the employee hire date.  Along with the employee we set goals for the year.  But there is a minimum amount of audits to be conducted per evaluation year depending on the auditor level (auditor 1, 2, or 3).  Then the employee is evaluated mid year for a progress towards their goals.  Then the final review is conducted at the end of the year and is score4d and a copy is given to the employee, supervisor, and a copy to Personnel Division.  The evaluation forms are standard for the entire Tax Department and have been designed by the Personnel Division.

:                                                                                                 Tax and Revenue Auditor I:      150

                                                                                                   Tax and Revenue Auditor II:      175

                                                                                                 Tax and Revenue Auditor III:     200

 

 

Do you feel the performance review system is effective and is it being followed?  Yes and Yes.  We require the supervisors to perform the evaluations and we track when they are due and send reminders if they aren't conducted timely.  Employees with a poor evaluation will not be selected for promotion.

 

What types of incentives do you give agents to perform at their highest level?  Employees with a poor evaluation will not be selected for promotion if their performance is very low, the employee will need to follow an improvement plan designed for them by their supervisor.  Failure to follow the plan or improve may lead to dismissal.

 

What benefits do you offer when recruiting new agents such as a set pay scale or promotion and other benefits to stay competitive with public accounting firms?  Our pay scale is set by the Department of Personnel and is based on pay grade.  All newly hired auditors begin at the same salary around $25K.  They have a chance to be promoted to an auditor 2 and then to an auditor 3.  We offer good benefits such as 13 paid holidays a year and new hire accrue 5 hours of vacation leave per pay period (2 weeks) and 6 hours of sick leave per pay period.  The vacation hours increase based on tenure and at the highest is 8 hours per pay period.  Also we reimburse travel (per mile driven for in-state and air line ticket for out-of-state), have a per diem meal allowance for over night stays, pay miscellaneous travel expenses such as parking and portage, also we reimburse for internet connection at their homes.

 

What type of training do you offer (on the job, in a class room, additional training every year)? We have 1 week in-house training on using the various computer software and then the auditors train with a tax auditor 3 on the job

 

Would it be all right if a team member or I contact you in the future?  Yes preferred by e-mail.

 

South Dakota

What types of audits does the DOR do? (such as in state, out of state,

corporation, individual, large companies, small companies or a mix of

these) We will audit any business that is licensed to operate in our

state.  We will travel anywhere in the continental US to conduct the

audits.

What level auditors do you have and typically how many of each?

(managers, senior auditors, staff auditors) We have entry level auditors

and Senior Auditors.  It takes 4 years of ojt before you can be

considered for Sr Auditor status.  We have 4 supervisors over the 45

staff.

Can you please explain the audit assignment process (is it performance

based or seniority based, do the auditors have a say in which audit they

get, does it differ for in state and out of state audits)?  Audits that

are selected for audit are put into a pool that auditors can select

from.  Newer staff must have their selections approved by their

supervisor.  We have some staff that are considered state wide experts

and they are usually granted first choice on businesses that fall within

their expertise.  The balance of the staff can select from the pool or

from audits that they identify as being of value.

Are the auditors and managers happy with the current assignment process

in place?  Some staff would like to have 100% of their audits assigned,

we usually expect the staff to select about 75% of their core audits

from the pool and the other 25% from research they perform or from leads

they find.

Do the auditors specialize in specific areas and types of businesses or

do they work all over?  Some staff are considered state wide experts on

certain fields.  Telecom, ag and ag processing, mining and oil

exploration, cash audits and large scale contractors are some areas that

we have identified as areas of expertise.

What is the typical in state and out of state travel time per year per

agent?  When we go on a fly trip, the staff is required to schedule

enough audits in the area to keep them busy for a 2 week period.  We

stay over the weekend.  When driving out of state they are allowed to

schedule for 1 week at a time.

Can you please explain your performance review system?  We currently

have a generalized process that is conducted on a yearly basis with

input from the supervisor and an area for the staff to answer 5 input

questions selected by the supervisor.

Do you feel the performance review system is effective and is it being

followed?  We are in the process of updating the review system to be

more specific to the actual tasks performed and better defining the

expectations for each task.

What types of incentives do you give agents to perform at their highest

level?  We stress professionalism, allow some flexibility to scheduling

for the top performers.  

What benefits do you offer when recruiting new agents such as a set pay

scale or promotion and other benefits to stay competitive with public

accounting firms?  We are not able to stay competitive with public jobs.

We have focused on hiring staff with little or nor post college

experience and train them.

What type of training do you offer (on the job, in a class room,

additional training every year)?  We have 2 weeks of class room training

where the staff learn the laws, & regs and how they apply, 1 week of

procedures training and then the balance of the first 6 months is OJT.

Would it be all right if a team member or I contact you in the future?

Yes.

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