4.1.21 LMSB Planning and Monitoring


  1. This section addresses the planning and monitoring of LMSB return inventories and the compliance workplan.

  2. The plan is used to communicate LMSB operating priorities and compliance objectives. The plan details the allocation of resources needed to achieve these priorities and objectives.

  3. The monitoring of the plan by Industry PSPs and LMSB Operation Support determines if the plan is being accomplished and/or what items need attention.


  1. This section of the manual addresses the following planning items:

    • Strategic Examination Planning Process

    • LMSB Compliance Plan

    • Coordinated Industry Case Examination Plan

Strategic Examination Planning Process

  1. The strategic planning process establishes the long-term direction of an organization with a vision of the future and a set of goals and objectives. The process of strategic planning enables alignment between IRSs functional requirements and the IRS strategic plan, the strategic plan of each Operating Division, and the agencys institutional capabilities.

  2. Strategic Planning generally takes a one to three year look at the goals and objectives of LMSB. The planning process is broken into three phases:

    1. Strategic Assessment
      The purpose of the Strategic Assessment phase is to broadly assess each of the four major taxpayer segments (LMSB, SB/SE, WI and TEGE) and the IRS infrastructure. Data from both external and internal environmental scans are collected by the Operating Divisions year round. External or environmental scans focus on customer needs and trends while internal scans focus on IRS performance management data.

    2. Strategy & Program Plan
      In the Strategy and Program Planning phase, the Operating Division prepares its Strategy and Program Plan (SPP), which provides a road map for the Operating Division to execute its strategies and programs. The Program Plan focuses on goal setting to achieve the plan, resources needed to execute the plan, progress measurement, and evaluation of the productivity of current activities.

    3. Business Action Plan
      Each Operating Division is responsible for collaborating with its organization components to translate its SPP into business and action plans that articulate what tactical actions, applied resources, and performance milestones need to be implemented.

  3. Strategic Planning in Management in Finance is responsible for preparing the Strategy and Program Plan.

LMSB Compliance Plan

  1. The annual LMSB Compliance Plan is developed as a draft at LMSB headquarters, Operations Support, and is a cooperative product of the entire LMSB organization. The plan matches available resources and operational priorities (short term/long term) to communicate the service and compliance objectives LMSB is expected to achieve. Tax return closures and DESYs are forecasted for the fiscal year by activity code. Each office within LMSB contributes to the development of the annual plan with overall coordination responsibility residing in the office of Planning Analysis and Support (PAS).

  2. LMSB Operations Support headquarters staff is responsible for developing a draft plan that, at a minimum, provides for a primary resource allocation of LMSBs program priorities. These primary resource allocations are referred to as front end loaded programs, and time is planned and assigned to these programs first.

  3. The draft plan is presented to the Industry PSPs. The Industries examination workplan is developed from the draft plan considering goals established by LMSB Senior Management.

  4. The Industry Examination workplan is developed using a variety of factors that include:

    • Full Time Equivalent (FTE) availability considering projected attrition and initiative hires.

    • Training time and returns based on the training plan

    • Front-end loaded programs.

    • Activity code mix for return delivery.

    • Rates for each activity code

    • Cycle time.

    • In process inventory

    • Current Industry plan and current plan accomplishments.

  5. The Industry PSP Analyst must be able to allocate the staff years and returns reflected on the Industry Plan to each respective Director of Field Operations and Territory Manager for feedback.

  6. After the detailed Industry plan is developed, it is submitted to Headquarters Operation Support to be combined with other Industries into an LMSB plan.

  7. The plan is then reviewed to see if the LMSB management goals and strategic initiatives are represented in the overall plan. Development of a final plan requires clear communication and partnering between Industries and LMSB Headquarters staff.

  8. LMSB is exploring new approaches to ensure compliance. Current ways of doing business will be retired as more comprehensive approaches are developed and implemented. The planning process will evolve to reflect these changes.

Front End Loaded Planning Time
  1. The planned direct examination staff years (DESYs) and the number of return closures are front end loaded into the plan. These resources are allocated, after consideration of work in process, prior to committing resources available to other compliance initiatives.

  2. The planned direct examination staff years (DESYs) and the number of case closures are front loaded into the plan. The objectives and time allocated may change from fiscal year to fiscal year. Examples of front end loaded time are as follows:

    • Abusive Tax Avoidance Transactions (ATAT)

    • Coordinated Industry Case (CIC) time

    • Compliance Assurance Process (CAP) time

    • Joint Committee

    • National Research Program (NRP)

    • Protection of Revenue Base (PRB)

    • Compliance Initiative Projects

    • Outreach Programs

Coordinated Industry Case (CIC) Examination Plan
  1. The Coordinated Industry Case (CIC) plan, due to the size and complexity of the taxpayers included in the CIC program, as well as the resources needed to manage it, is front-end loaded.

  2. Detailed information about each CIC examination expected to be in process during the next fiscal year is needed for the plan. This includes starting and ending dates, tax years to be included, revenue agents and field specialists and planned cycle time.

  3. The CIC planning starts with the Team Managers. The team managers have the following responsibilities:

    • Determining the Audit Plan and obtaining appropriate taxpayer input.

    • Determining the cases and tax years that need to be examined and the extent of the examination.

    • Projecting staffing needs including field specialists for each case.

    • Providing/Inputting all examination details into the CIC Plan Database and IBMIS (Issue Based Management System).

  4. Currently, to assist in the Industry PSPs development of the CIC plan, a CIC Plan database maintained by LMSB Operations Support is used. The following information is input into the CIC database.

    • Case Name

    • Cycle information

    • Industry of case

    • Case type

    • Start date

    • Cycle type

    • Audit site zip code

    • Team Manager name and group number

    • Industry, DFO, territory, POD city and state

    • Team member name

    • Member type TC, RA, Specialist type;

    • Planned staff days (estimated total staff days to be applied by team members);

    • Assisted cases If entries are for a case that is being examined as part of a Key Case (enter the name and TIN of Key Case).


      Guidance for changes to items input to this database is provided by the Headquarters Staff on an annual basis.

  5. For Fiscal Year 2008 and beyond, LMSB will begin to make use of the data in IBMIS Fiscal Year Planning Module in developing the plan for those compliance activities reported on that system.


  1. The Operations Support Unit of PAS is responsible for monitoring the LMSB Compliance Plan. Industry PSPs are responsible for monitoring the performance of their Industry. PSPs work with both Planning, Analysis and Support (PAS) to monitor Industry Performance and maintain the accuracy of IRS Information systems.

  2. The Industry PSP and Operations Support Staff are primarily responsible for monitoring the following:

    • Inventory levels

    • Return and dollar accomplishments

    • Staff Year Delivery


    Other areas of responsibilities would include monitoring of Balanced Measures such as cycle time.

  3. The following tools are available to assist the PSP and Operations Support in monitoring:

    • AIMS Table 37

    • Other Tables Generated at the Detroit Computing Center

    • Examination Returns Control System (ERCS)

    • The AIMS Centralized Information System (ACIS)

    • Performance Measurement Reports

    • IBMIS

AIMS Table 37

  1. Table 37, Examination Program Monitoring, is a summary report of Audit Information Management System (AIMS) and Summary Examination Time Transmission System (SETTS) information. Table 37 is generated by the Detroit Computing Center (DCC) at the conclusion of each AIMS/SETTS accounting period, referred to as reporting cycles. These reporting cycles are either 4 or 5 weeks in duration.

  2. The Audit Information Management System (AIMS) provides the inventory and accomplishment information reflected on Table 37. The AIMS database includes various information on all returns open for examination, as well as returns closed (status 90). Closed cases are retained on the AIMS base for a minimum of 2 cycles and a maximum of 14 cycles.

  3. The various references available for specific information regarding the use and maintenance of AIMS include the following:

    • IRM 4.4 AIMS/Processing Handbook

    • SB/SE AIMS Website

    • Document 6036, Examination Division Reporting System Codes Booklet

    • Document 6209, IRS Processing Codes and Information

  4. The Summary Examination Time Transmission System (SETTS) accumulates time charges by examiners via the Examination Returns Control System (ERCS). Employee Records on ERCS contain information on each employee such as AIMS Assignee Code, grade, position code, and employee status. Examiners keep track of how they expend their time on an ERCS input document (Form 4502) utilizing various Activity Codes for both Direct and Indirect Examination activities.

  5. The various references available for the specific information regarding the use and maintenance of SETTS include the following:

    • IRM 4.9 Examination Technical Time Reporting System and Procedures.

    • SB/SE AIMS Website SB/SE AIMS Website

    • Document 6036, Examination Division Reporting System Codes Booklet

    • Document 6209, IRS Processing Codes and Information

  6. Within LMSB, Table 37 is generated at the Operating Division, Industry/Field Specialist and DFO/Specialty levels: AIMS and SETTS data are sorted by the first 6 positions of the AIMS Assignee Code (AAC) to generate Table 37 at each of these respective levels.

  7. Table 37 is generated within a few days after the reporting cycle. This table is the first information available to the industries and headquarters staff that provides information on accomplishments.

  8. The information on Table 37 can be used to monitor the following items

    • Inventory

    • Accomplishment of Units/Returns

    • Accomplishment of Staff Years

  9. In order to allow the official system of records (AIMS) to be as accurate as possible, there is an extension of the correction capability for two additional reporting cycles (October and November) after the close of the fiscal year. As such, the Fiscal Year End Tables are produced at DCC three times and are labeled as follows:

    1. At the end of the September cycle, the 1st FY Preliminary Tables are produced

    2. At the end of the October cycle, the 2nd Preliminary Tables are produced.

    3. At the end of the November cycle, the Final Fiscal Year Tables are produced.

Other Tables Generated at the Detroit Computing Center

  1. Internal and external customers rely upon the accuracy of our AIMS and SETTS databases. Examination accomplishment statistics are included in the Internal Revenue Service Data Book and are used in formulating data for the Presidential Budget submitted to Congress. In addition, many decisions regarding hiring, funding and the allocation of resources are based on this data. Inaccuracies can lead to incorrect performance information being disseminated to IRS management as well as to sources outside the Service (e.g., GAO, TIGTA, etc.).

  2. Management has a responsibility to maintain the database as accurately as possible and ensure stakeholders are provided with the best statistics available in order to allow the most informed decisions possible to be made.

  3. The following AIMS Tables were specifically designed to help identify reasons for any increase or decrease to Table 37 and to help monitor tax returns that have significant impact on Examinations accomplishment statistics:

    • Table 10.1B Monitors IC accomplishments with examination results of $100,000 or greater and all delete records of $50,000 or greater.

    • Table 15 Monitors all Coordinated Industry Case (CIC) accomplishments.

    • Table 16 Monitors all accomplishment records with a whipsaw indicator

  4. See IRM 4.4.27, AIMS/Processing Handbook, Reports for additional information regarding Tables 10.1B. 15 and 16

Examination Returns Control System (ERCS)

  1. The Examination Returns Control System is an inventory management and time tracking tool that uses interactive menu-driven programs to request, assign, reassign, update, close, and charge time to returns under examination.

  2. In addition to returns that are controlled on AIMS, ERCS should also be used to control work that is not controlled on AIMS, such as preparer/promoter penalties, Taxpayer Advocate cases, certain non-return Direct Examination Codes (referred to as Non-AIMS DET items), etc..


    Refer to IRM 4.71, Examination Control System Handbook

The AIMS Centralized Information System (ACIS)

  1. The AIMS Centralized Information System (A-CIS) was developed as a monitoring tool for use with the following databases:

    • AIMS Open Case Database

    • AIMS Closed Case Database (Long Closings)

    • AIMS Non-examined Database (Short Closings)

    • SETTS Database


      These databases contain all source data used in the preparation of Table 37 as well as other AIMS Tables and Reports discussed in this lesson.

  2. A-CIS is comprised of four Microsoft Access programs that allow the user to connect to these database files via a file server called LMSB/SERCIS. A complete A-CIS User Guide is also available on the LMSB/SERCIS file server, as are the program files for each of the four Access programs.


    SERCIS stands for South East Region Centralized Information System, which was later changed to A-CIS.

  3. As mentioned previously, both internal and external customers rely upon our AIMS and SETTS data for various reasons. As such, all levels of management have a responsibility to maintain the databases as accurately as possible. The PSP Analysts responsibility includes the following:

    • Ensure that an annual IVL certification is conducted for all LMSB groups (and re-certification after 6 months if error rate was above 5%).

    • Ensure groups understand the importance of reviewing time input prior to transmission of the SETTS file.

    • Follow-up on closed case database outliers each month as follows: CIC Audit Results <$300 Million, CIC RBP<$300 Million, CIC Total Time<20,000 Hours, IC Audit Results<$50 Million, IC RBP<$50 Million, IC Total Time<3,000 Hours

    • Periodically interrogate the AIMS and SETTS data by running various queries against the data that will identify potential errors (e.g. High dollar results with low hours; Position Codes appropriate for the organization; the CIC indicator, etc.). Ensure the timely correction of any errors that are identified.


      The AIMS Open/Closed/Non-Examined and SETTS databases are available via LMSBs Issue Based Management Information System (IBMIS) which was implemented in FY 2006. IBMIS uses Business Objects software rather than Microsoft Access.

Performance Management Reports

  1. Planning, Analysis and Support (PAS) provides all levels of LMSB management with various assessments of operational effectiveness. The Performance Management Team gathers data from a variety of sources (including AIMS, SETTS and ERCS) and provides various reports used to monitor the performance of LMSB.

Balanced Measures Reports
  1. The monthly LMSB Balanced Measures Scorecard uses survey, Quality Assurance, AIMS and SETTS data to reflect the current status of LMSB balanced measures, and indicates how close we are to our target for each. It defines what each measure encompasses, and summarizes the operational area of emphasis for the fiscal year. The report also contains an introductory section on how to use the report as well as key observations related to the performance of each measure. The report is produced at the LMSB, Industry and DFO levels.

  2. The Industry PSP uses the Balanced Measures Scorecard to monitor the performance of their Industry. The balanced measure reports are used to monitor the following:

    • Cycle Time

    • Accomplishments

    • Coordinated Industry Case (CIC) Coverage

    • Tax Shelter open and closed inventory

    • Fraud returns


      These reports provide detailed data for both the Industry and Coordinated Industry Case Programs