5.13.1  Embedded Quality Administrative Guidelines

Manual Transmittal

July 22, 2011

Purpose

(1) Changes have been made throughout the section to reflect the implementation of Embedded Quality in Collection Advisory and Insolvency operations..

Material Changes

(1) Several sections have been updated to provide information on IRM sections and other references relevant to Advisory and Insolvency

(2) Paragraph 5.13.1.5.3 has been updated to provide for annual consistency reviews in CFf territories.

(3) Section 5.13.1.6 reflects two added responsibilities for the NQRS review sites (use of the Issues Log and required concurrence from Policy and EQ prior to implementation of attribute changes).

(4) IRM 5.13.1.10.1(2) is updated to reflect procedures for ICS History-Only cases.

(5) A note is added to 5.13.1.10.1.1 to provide for substitution for non-reviewable OIC cases.

(6) 5.13.1.10.1.2 is a new section added as direction for Advisory case selection.

(7) 5.13.1.10.1.3 is a new section added as direction for Insolvency case selection.

(8) 5.13.1.10.2 has been updated to provide instructions for case transmittal of Advisory cases.

(9) Editorial changes have been made throughout.

Effect on Other Documents

This IRM revises IRM 5.13.1 dated September 1, 2007.

Audience

The intended audience is SB/SE Collection personnel and National Quality Review System (NQRS) reviewers.

Effective Date

(07-22-2011)

Scott Reisher
Acting Director, Collection Policy
Small Business/Self-Employed

5.13.1.1  (07-02-2011)
General

  1. This chapter provides background information, procedures, and guidelines for Embedded Quality (EQ), the Embedded Quality Review System (EQRS), and the National Review Quality System (NQRS).

    1. IRM 5.13.1 contains background information and general guidelines, and outlines the respective roles of each segment of the Collection organization as it relates to the administration of the EQRS and NQRS systems. It contains sampling procedures to be used in preparing and providing closed Collection Field, Offer in Compromise (OIC), Advisory, and Insolvency cases for NQRS review.

    2. IRM 5.13.2 contains guidelines for NQRS reviewers and managers to use when reviewing Collection Field function (CFf) cases.

    3. IRM 5.13.4 contains guidelines for NQRS reviewers and managers to use when reviewing Collection Offer-in-Compromise (OIC) cases.

    4. IRM 5.13.6 contains guidelines for NQRS reviewers and managers to use when reviewing Insolvency cases.

    5. IRM 5.13.7 contains guidelines for NQRS reviewers and managers to use when reviewing Advisory cases.

  2. EQ is comprised of two distinct systems. Collection managers use EQRS to complete all case reviews for revenue officers, advisors, bankruptcy specialists and OIC specialists. The system provides a structured context for evaluating employee performance and a reports utility for performance documentation. In this capacity, EQRS replaces various macros and paper-based review systems.

  3. NQRS replaces the Collection Quality Management System (CQMS). NQRS reviewers provide independent collection review information from which management may draw inferences regarding overall case quality for a given operational segment.

  4. Under EQ, Collection managers use the same quality attributes for employee case reviews that the NQRS staff uses to assess organizational quality. As cases are rated based on identical attributes under both EQRS and NQRS, it is important that all users apply the review guidelines as consistently as possible. Additional guidance for using EQ attributes is contained in Job Aids for each occupational category. Copies can be accessed electronically on the EQ website at http://mysbse.web.irs.gov/mgrsact/eq/default.aspx.

5.13.1.2  (09-07-2007)
Changes to NQRS

  1. NQRS is part of an integrated service-wide system of balanced performance measures that includes Customer Satisfaction, Employee Satisfaction, and Business Results.

  2. The NQRS process was developed as a practical method of supporting Balanced Measures objectives. Performance is evaluated using attributes that identify actions that move cases toward closure through appropriate and timely case activity. The attributes provide a link between individual performance and organizational goals and are used by both managers and NQRS reviewers to assess significant case actions.

5.13.1.3  (07-02-2011)
NQRS Reviews Are Not For Evaluation of Individual Performance

  1. NQRS is not a substitute for first-line managerial review responsibilities. It is a tool for executive and senior managers to use in determining strengths and weaknesses in the quality of work performed in Collection operations.

  2. NQRS is designed to monitor crucial aspects of organizational performance. The quality of completed Collection case work is an important business result contributing to a balanced system of measures. Closed Collection case files are reviewed to measure organizational performance in five key EQ categories:

    • Customer Accuracy,

    • Regulatory Accuracy,

    • Procedural Accuracy,

    • Professionalism, and

    • Timeliness

  3. Quality review results are statistically valid and reliable measurements of the overall quality of casework completed by CFf/OIC only at the National or Area level. Advisory and Insolvency results are statistically valid and reliable only at the National level. Results stratified to any lower organizational segment are not statistically reliable measurements of the quality of case work at those levels. Management should view such stratifications as indicators and rely on them only to the extent that they are confirmed by other reliable management measures of quality. Area, Territory, and Headquarters management should use quality review findings to help identify problems that require organizational changes in such areas as procedures, organization, and training.

5.13.1.4  (07-02-2011)
Scope of NQRS Reviews

  1. NQRS reviews are performed on most types of cases closed by CFf, OIC, and Insolvency activities as well as certain types of work performed by the Advisory function.

  2. Case types include

    • combo (bal due and del ret),

    • bal due,

    • del ret,

    • FTD alerts,

    • cases closed to Insolvency from the field,

    • Other Investigations (OI),

    • Offer-in-Compromise (OIC) cases,

    • Chapter 7, 11, 12, and 13 Bankruptcy cases worked in Insolvency,

    • Notice of Federal Tax Lien (NFTL) discharges, subordinations, and withdrawals, and

    • Trust Fund Recovery Penalty (TFRP)/Control Point Monitoring (CPM), TFRP processing and TFRP Appeal cases worked in Advisory.

  3. In addition to the mandatory review items, additional operational review items may be added at the request of National, Area, or territory managers to measure adherence to new procedures or other areas of concern. Findings in connection with optional reviews will not be reflected in regular NQRS reports, but will be transmitted to the requesting organization in a manner defined at the time of the request.

  4. Requests for additional discretionary items must be made in writing through the Office of Advisory, Insolvency, and Quality (AIQ), which will consult with review site management to determine how the requested item(s) might be added consistent with IRM 1.5.2 and review staffing constraints.

5.13.1.5  (09-07-2007)
Functional Responsibilities

  1. This subsection outlines functional responsibilities for Headquarters and Area offices.

5.13.1.5.1  (09-07-2007)
Headquarters Office

  1. The Collection Planning and Analysis (P&A) Office is primarily responsible for:

    1. reviewing and monitoring the accuracy of manager attribute ratings relative to the EQ Job Aids,

    2. establishing and maintaining the consistency review process,

    3. coordinating the issues resolution process with Area coordinators and other stakeholders,

    4. developing and delivering EQ training,

    5. updating and maintaining the EQ web site and providing support to users,

    6. analyzing NQRS data to drive organizational improvement,

    7. completing annual requests to SB/SE Research for calculation of the sample size,

    8. ensuring consistency of the EQ Job Aids and training materials with the IRM and other guidelines,

    9. maintaining EQRS system functionality, including processing of requests for process changes and system updates, and

    10. conducting EQRS management briefings in cooperation with AIQ.

  2. The Collection Policy Office is primarily responsible for:

    1. monitoring EQ Job Aids and training materials for consistency with the IRM and other guidelines,

    2. resolving inconsistencies in IRM interpretation,

    3. maintaining IRM 5.13, and

    4. responding to policy issues raised by field and NQRS staff.

  3. The Collection Advisory, Insolvency, and Quality (AIQ) Office is primarily responsible for:

    1. facilitating NQRS review of closed cases in accordance with Headquarters guidelines,

    2. ensuring that the sample of closed cases is provided to the NQRS site as scheduled, and

    3. conducting EQ management briefings in cooperation with P&A.

5.13.1.5.2  (09-07-2007)
Area Office Responsibility

  1. The Area office is responsible for:

    1. assuring that NQRS data are used as measures of organizational quality and not to evaluate individual employees,

    2. analyzing NQRS results, determining the factors that influence them, and providing a consistent means of addressing quality improvement goals (e.g., periodic training on problem areas or renewed emphasis on the use of correct procedural guidelines), and

    3. ensuring that Territory Managers correctly use the consistency review process outlined in IRM 5.13.1.5.3 and required in IRM 1.4.50.2.2(3).

5.13.1.5.3  (07-02-2011)
Territory Office Responsibility

  1. Field and Offer-in-Compromise territory managers will conduct EQ consistency reviews annually. The frequency of Advisory and Insolvency consistency reviews will be established by the Director of Advisory, Insolvency and Quality (AIQ). The primary purpose of these reviews is to promote consistent application of the EQ attributes.

  2. The territory manager will provide group managers with a sanitized case for review. Each manager will then independently rate the revenue officer performance for each of the applicable EQ attributes and enter the ratings in the EQ training database. P&A will provide detailed instructions on the use of the EQ training data base to avoid corruption of EQ production data by cases selected for consistency reviews.

  3. The territory manager will compile the ratings using the EQ reports function and meet with the group managers to discuss any areas of inconsistency in the attribute ratings. See IRM 1.4.50.2.2(3).

5.13.1.6  (07-02-2011)
NQRS Review Site Responsibilities

  1. Management of the NQRS review site is responsible for:

    1. providing input during the attribute development process,

    2. ensuring that NQRS reviewers understand and adhere to NQRS program changes,

    3. coordinating with Headquarters Office on the development of attributes and requirements for specialty reviews,

    4. providing a quarterly report of all specialty reviews completed with an accounting of time and resources expended,

    5. monitoring volumes of cases provided for NQRS review and identifying shortages,

    6. contacting the responsible function to determine the reason for any shortages and assisting in resolution,

    7. providing a regular systemic approach to measurement and monitoring of review consistency,

    8. ensuring the accuracy of all information input during NQRS reviews and correcting header information as necessary,

    9. utilizing the EQ Issues Log to submit all concerns regarding attribute interpretation, and

    10. securing approval/concurrence from Collection Policy and the EQ Program Office via the Issues Log prior to implementing any changes in attribute interpretation.

  2. NQRS reviewers are responsible for:

    1. reviewing cases using the appropriate EQ Job Aid,

    2. timely and accurate input of header and review data, and

    3. elevation of potential conflicts in the IRM and the Job Aid to their manager.

5.13.1.7  (09-07-2007)
NQRS Case Reviews

  1. As the designated measure of organizational Collection quality, NQRS reviews are an integral component of the service-wide Balanced Measures effort. This is the highest priority for all NQRS staff members.

  2. NQRS managers should make every effort to ensure that reviews are performed timely and accurately and that review standards are applied consistently. Managers will conduct consistency reviews at least quarterly to promote accuracy. Results of these reviews should be maintained and periodically evaluated. If problems with certain review items persist, they should be reported to Headquarters for an analysis and discussion of potential issues raised. If the cause is determined to be a lack of clarity in the required review procedures, Headquarters will work with site management to explain or revise the procedure. No changes to review procedures should be made without concurrence by Headquarters. Headquarters will provide updated review procedures to the field and NQRS sites.

  3. NQRS review data should be entered to the NQRS system as the review is being completed to promote reliability. Published standards must be followed by reviewers so quality review customers will know how closed cases are evaluated. If a potential problem with an EQ attribute is identified, it should be submitted to Headquarters via the EQ Issues Log. This will ensure that all EQ users have access to the information.

5.13.1.8  (09-07-2007)
Reporting NQRS Results

  1. Information from completed NQRS reviews will be compiled electronically and available on the EQ web site. This will comprise the official record of NQRS results.

  2. The design and format of NQRS reports will be determined by P&A. Levels of access to NQRS reports and data will be defined by headquarters based on established guidelines.

5.13.1.9  (09-07-2007)
NQRS Audit Trail

  1. The review site(s) will maintain an inventory control system. This will facilitate an orderly flow of case files and supporting documents between Collection Case Processing (CCP), the review site, and the reviewer.

  2. After review, each paper case subjected to review will be annotated or stamped "QR" (Quality Reviewed) at the upper right hand corner of the case. Following the annotation or stamp the reviewer will enter the date of review. Closed Integrated Collection System (ICS) cases will have an electronic notation that the case was accessed for NQRS review.

  3. All closed paper case files and associated ICS paper files that have been reviewed will be returned weekly with a transmittal slip to CCP for appropriate disposition.
    Caution: Closed Collection/OIC case files should remain intact after they leave the revenue officer's possession. Dismantling, purging, or discarding documents from closed cases could negatively affect an individual employee's case if legal actions are brought against them.

5.13.1.10  (09-07-2007)
NQRS Sampling

  1. For the NQRS review to provide statistically reliable measurements, case samples must be consistently provided to the NQRS site on a regular schedule. The number of cases selected will be determined annually by P&A in consultation with SBSE Research.

5.13.1.10.1  (07-02-2011)
Field Case Sample Selection

  1. ICS provides a systemic program to electronically select cases for review.

  2. The ICS system generates the sampling list on a weekly basis for each Area. The list is reviewed at the NQRS site to determine which cases can be reviewed without the case file. These cases are identified as "ICS Case History Only" reviews. A list of the remaining cases is sent to CCP for retrieval of the paper case file.

  3. ICS will randomly select closed CFf cases from each Area. These may be selected from any of the disposition types below. No specific number of cases is required from any category:

    1. Full Pay (Status 12)

    2. Adjustment - Form 3870 (status 12 or 53)

    3. Installment Agreement - Form 433D or 2159 (status 60)

    4. Currently Not Collectible - Form 53 (status 53)

    5. Federal Tax Deposit (FTD) Alerts

    6. Delinquent Return (del ret) cases

    7. Field cases closed to Insolvency

  4. Do not choose cases that are considered "non-reviewable " for NQRS purposes. These are:

    1. files with no case history or the history reflects no case actions,

    2. a bal due case that is in status 26,

    3. cases in which the revenue officer took no action to resolve the case (for example, a case closed as CNC based on a prior CNC),

    4. the later of the date of approval or last history entry is six months or more from the review date, or

    5. the case was paid in full via a manually monitored installment agreement that concluded more than twelve months prior to the review date.

5.13.1.10.1.1  (07-02-2011)
OIC Case Selection

  1. The Automated Offer-in-Compromise system (AOIC) randomly selects closed OIC cases weekly. Each offer group should access AOIC each Monday and forward all closed cases reflected on the sampling list to the NQRS site. The closed cases may be selected from any of the disposition types below. No specific number of cases is required from any category:

    1. Acceptance (01)

    2. Rejection (05)

    3. Withdrawal (06)

    4. Return (10)

  2. Do not choose cases that are considered "non-reviewable " for NQRS purposes. These are:

    1. any case resolved by Appeals,

    2. cases closed over ninety days prior,

    3. open cases,

    4. offers returned to taxpayers prior to assignment to an offer specialist,

    5. offers terminated due to taxpayer demise, or

    6. offers on an existing offer.

    Note:

    If such a case is selected as part of the weekly sample, substitute a randomly selected case from the remaining population of that week's closed cases.

  3. The AOIC system electronically generates a weekly list of closed cases for review from each Area. The list is accessible by both the Area liaison and the responsible NQRS site. The Area liaison will ensure that the associated paper documents are sent to the applicable NQRS site by overnight traceable mail.

5.13.1.10.1.2  (07-02-2011)
Advisory Case Selection

  1. ICS generates a sample listing at the end of each reporting month. Through ICS each group must select its Territory NQRS sample monthly. Any deviation from the established selection process must be approved by the EQ Program Manager in advance.

5.13.1.10.1.3  (07-02-2011)
Insolvency Case Selection

  1. The Automated Insolvency System (AIS) generates three reports for the NQRS manager to identify cases for the sample. These are

    1. "NQRS Chap 13 Confirmed" for Chapter 13 Confirmed cases,

    2. "NQRS Closed" for Chapter 7 and 11 cases, and

    3. "Ch 7 over 25K" for Chapter 7 No-Asset cases.
      Each report requires a distinct sampling process.

  2. For Chapter 13 cases, select cases from the population no more than three months prior, using the skip rate from the current sampling plan. If this method generates an insufficient sample, use a skip rate of 1.

  3. For Chapter 11 cases, select cases from the population no more than six months prior, using the skip rate from the current sampling plan. If this method generates an insufficient sample, use a skip rate of 1.

  4. For Chapter 7 asset cases, select cases from the population no more than three months prior, using the skip rate from the current sampling plan. If this method generates an insufficient sample, use a skip rate of 1.

  5. For Chapter 7 no-asset cases, select cases from the population no more than twelve months prior, using the skip rate from the current sampling plan. Review potential case samples to ensure that Field insolvency has completed work on the case. Select a case for review if Insolvency has made a determination (whether prior or subsequent to discharge) to close the case.

  6. For all reports, choose a sample that represents a fair distribution among the Insolvency territories. Any deviation from the established selection process must be approved by the EQ Program Manager in advance.

5.13.1.10.2  (07-02-2011)
Case Transmittal

  1. Cases selected for review should be transmitted to their respective review site, except for Insolvency cases which are reviewed online and CFf cases identified as "ICS Case History Only" reviews.

    Note:

    Closed case files should remain intact after they leave the employee's possession. Dismantling, purging, or discarding documents from a case file could negatively affect an employee's case if legal actions are brought against them.

  2. CCP selects the weekly CFf sample. They prepare and ship the cases directly to NQRS. See IRM 5.4.13.9.5.

  3. OIC groups will forward all closed cases on the sampling list to the appropriate NQRS site. Prepare a separate Form 3210 (Document Transmittal) to attach to the closed cases for each review site. Include the full paper case file, a copy of the case history, back-up documents, and the original OIC administrative file. See IRM 5.8 for a description of required documentation on accepted OICs.

  4. Advisory territories will forward all closed cases on the sampling list to the appropriate NQRS site. Prepare a separate Form 3210 to attach to the closed cases for each review site. Include the full paper case file, a copy of the case history, back-up documents, and ant taxpayer correspondence.


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