BIR Planning, Performance Monitoring and Evaluation System

1998 REVENUE MEMORANDUM ORDER NO. 20-98 SUBJECT : BIR Planning, Performance Monitoring and Evaluation System TO : All Deputy Commissioners, Assistant Commissioners, Regional Directors, RDC Heads, Division Chiefs, Revenue District Officers and Others Concerned I. OBJECTIVES This Order is issued to: 1. Present the BIR institutional performance measures and the corresponding target for 1998; 2. Provide direction in the preparation of the annual Performance Contract and annual Operational Plan which shall be the basis of the monitoring and evaluation of performance of BIR offices; and 3. Prescribe the policies and procedures for monitoring and evaluating the performance of BIR offices vis-a-vis the institutional performance measures. LibLex II. DEFINITION OF TERMS 1. Tax Collected (TC) refers to revenues collected from voluntary payments, enforcement and delinquent accounts expressed in peso amount. 2. Taxpayer Base Index (TBI) * refers to the percentage number of taxpayers covered (registered or captured in the database) by a Regional/District Office to the number of taxpaying population in the respective area. 3. Customer Satisfaction Index (CSI) indicates the level of satisfaction of taxpayers/stakeholders (BIR Offices) with the overall delivery of BIR services (i.e. distribution of BIR forms and tax information materials, customer relations, etc./provision of policy directions and support, provision of necessary equipment and supplies, etc.) expressed as follows: 1 - Excellent 2 - Good 3 - Satisfactory 4 - Fair 5 - Poor 4. Process Vitality Index (PVI) refers to the measurement of the improvement maturity of a process expressed in percentage points which correspond to the process maturity stage existing in an office. There are five (5) stages, with the corresponding points, to wit: Stage 1 - Definition (10) - issuance of Revenue Memorandum Orders (RMOs) to define and implement processes in BIR offices Organization - assignment of personnel and setting up of necessary mechanisms in an office to implement processes defined in RMOs issued Stage 2 - Measurement (20) - Institutionalization of measures/mechanisms (i.e. maintenance of logbooks, monitoring forms, etc.) to monitor and evaluate compliance of concerned personnel/offices with the RMOs issued in Stage 1 Stage 3 - Improvement (20) - revision of RMOs to improve existing procedures defined in Stage 1 based on recommendations made by concerned BIR offices Stage 4 - Consistent improvement (30) - revision of RMOs to continually improve existing procedures based on recommendations made by concerned BIR offices Stage 5 - Benchmarking (20) - comparison of BIR processes with international standards 5. Tax Cost Index (TCI) * refers to the ratio of total expenditures incurred by an office over total tax collected for a period expressed in peso amount. dctai 6. Training Index (TI) refers to the percent of training conducted/attended vis-a-vis the scheduled and/or required training. 7. Employee Satisfaction Index (ESI) indicates the level of satisfaction of BIR employees with the overall delivery of necessary support services vital to the effective and efficient performance of their functions and responsibilities (i.e. provision of facilities and equipment, scholarships, incentives, etc.) expressed as follows: 1 - Excellent 2 - Good 3 - Satisfactory 4 - Fair 5 - Poor 8. Information Quality Index (IQI) refers to the measurement of the timeliness and accuracy of information delivered to BIR internal and external stakeholders expressed in percentage points as follows: If information: Is delivered behind schedule 30 Is delivered on time 40 Is delivered ahead of schedule 50 and Has more than 10% error 30 Has 10% error or less 40 Has no error 50 III. POLICIES In order to attain the objectives of this Order, the following policies shall be observed: A. In order to ensure the attainment of the Bureau's strategic directions, as laid down and agreed upon during the series of planning workshops conducted in 1996, performance measurement, at the institutional and unit levels had been defined in a manner that is: i) traceable assignable to relevant organizational units and to employees of said units; ii) results based performance are measurable in terms of the results achieved and not by the effort exerted or activities completed; and iii) means based means-related activities or programs to facilitate the achievement of results are clearly defined and measured. B. At the institutional level, eight (8) performance measures (defined in Part II of this Order) classified as results-related and means-related had been identified which are consistent with the Bureau's Performance Goals. Said institutional measures are the following: Institutional Measure Performance Goal Supported Results-Related 1. Tax Collected Increased collection 2. Taxpayer Base Index Increased collection Broadened taxpayer base 3. Customer Satisfaction Index Increased taxpayers'/stakeholders' (BIR Offices) satisfaction Means-Related 4. Process Vitality Index Improved processes 5. Tax Cost Index Improved processes World class working environment 6. Training Index Well trained and respected workforce 7. Employee Satisfaction Index Improved processes Well trained and respected workforce World class working environment 8. Information Quality Index Improved processes C. For the year 1998, the following target has been prescribed per institutional performance measure which indicate the minimum required result expected to be attained by BIR offices: Institutional Performance Measure 1998 Target 1. Tax Collected Collect the allocated goal 2. Taxpayer Base Index (TBI) Increase the number of registered taxpayers as follows: For business taxpayers - 10% increase over last year For compensation income earners - 10% increase over last year 3. Customer Satisfaction Index Attain a CSI of 3 - Satisfactory (as (CSI) indicated in Part II of the RMO) 4. Process Vitality Index (PVI) Attain a PVI of 30% for 1st half, 1998 - reach Stage 1 - Definition/Organization for all applicable processes per office for 2nd half, 1998 - reach Stage 2 - Measurement for all applicable processes per office (as defined in Part II of the RMO) 5. Tax Cost Index (TCI) (to be specified in the RMC to be prepared by the Financial Service) 6. Training Index (TI) Conduct 100% of scheduled training (as specified in the Training Calendar prepared by the Human Resource Devt. Svc.) Attend, 100% of required trainings (as determined in RSOs issued by the Human Resource Devt. Svc.) 7. Employee Satisfaction Index Attain an ESI of 3 - Satisfactory (as (ESI) indicated in Part II of the RMO) 8. Information Quality Index (IQI) Attain an IQI of 80% D. In order to formulate plans for the year, all BIR Offices shall prepare an annual Performance Contact and an annual Operational Plan based on the targets prescribed per institutional performance measure. The annual Performance Contract (format and sample in Annex A) shall contain the commitments (as quantified) of the head of an office to attain the annual target set per institutional performance measure. The annual Operational Plan (format and sample shown in Annex B), on the other hand, indicates the major activities planned to be undertaken by an office in order to attain its annual target (as specified in the Performance Contract) per applicable institutional performance measure. Said documents shall be used as basis in the accomplishment reporting and annual performance evaluation of BIR offices. E. In order to monitor and evaluate the performance of BIR offices, accomplishment reporting shall be done through the preparation of Performance Report and Activity Report (refer to Annex C1 and Annex C2 for the formats and samples). The Performance Report, as consolidated by the Planning Division, shall indicate the status of accomplishment of the Bureau's annual target per institutional performance measure. The Activity Report, on the other hand, shall specify the major activities and/or special projects undertaken by BIR offices per applicable institutional performance measure, which shall be reported monthly to the respective Revenue Service/Regional Office/Revenue Data Center. The Performance Report of specified BIR offices shall be submitted on a monthly and semestral basis as follows: Institutional Performance Measures To Be Reported On A Monthly Basis 1. Tax Collected (TC) to be reported in terms of the amount of tax collected for the period, classified into collection from voluntary payments, enforcement and delinquent accounts (for RDOs) 2. Taxpayer Base Index (TBI) to be reported in terms of the number of registered taxpayers, classified per type of taxpayer (for RDOs) 3. Tax Cost Index (TCI) to be reported in terms of the total expenditures incurred by Regional District Offices for a period (for Finance Division in Regional Offices) to be reported in terms of the total expenditures incurred by Revenue Data Center (RDC) offices for a period (for Finance Division in the RDCs) to be reported in terms of the total expenditures incurred by National Office Divisions and Revenue Services for a period (for Accounting Division in the National Office) 4. Training Index (TI) to be reported in terms of the number of trainings conducted (planned vs. actual) per type of training (for Training Division in the National Office) to be reported in terms of the number of participants (planned vs. actual) per type of training specified in RSOs issued (for all BIR Offices, specially the Training Division in the National Office and HRMU in Regional Offices) prcd 5. Information Quality Index (IQI) to be reported in terms of the timeliness and accuracy of information reports submitted by concerned BIR offices expressed in percentage points, as specified in Part II of the RMO (for Regional Directors, RDC Heads and Assistant Commissioners) Institutional Performance Measures To Be Reported On A Semestral Basis 1. Customer Satisfaction Index (CSI) to be reported in terms of the level of satisfaction of taxpayers/stakeholders (BIR offices) determined through surveys to be administered by the Survey and Analysis Division (for the Policy and Planning Service) 2. Employee Satisfaction Index (ESI) to be reported in terms of the level of satisfaction of BIR employees determined through surveys to be administered by the Survey and Analysis Division (for the Policy and Planning Service) 3. Process Vitality Index (PVI) to be reported in terms of: a. Drafting/issuance of RMO to define a process (for National Office) b. Assignment of personnel and setting up of necessary mechanisms to implement a process defined in the RMO (for BIR field offices and concerned NO divisions) c. Institutionalization of measures/mechanisms to monitor and evaluate compliance of concerned personnel/offices with the RMOs issued (for all BIR offices) d. Submission of recommendation to concerned Assistant Commissioners regarding possible enhancements in the procedures specified in RMOs issued to define a process (for BIR field offices and concerned NO divisions) e. Revision of RMOs to improve/consistently improve existing procedures based on recommendations made by BIR field offices and concerned NO divisions (for National Office) F. In order to evaluate the performance of BIR offices insofar as attainment of the annual target per applicable institutional performance measure is concerned, the following offices/officials are designated to prepare an Annual Performance Report vis-a-vis the institutional performance measures indicated hereunder: Institutional Performance Measure Office/Official To Prepare Report Tax Collected Collection Service Taxpayer Base Index Taxpayer Assistance Service Customer Satisfaction Index Policy and Planning Service Process Vitality Index All Revenue Services and Revenue Data Centers Tax Cost Index Financial Service Training Index Human Resource Devt. Service Employee Satisfaction Index Policy and Planning Service Information Quality Index All Regional Directors, RDC Heads and Assistant Commissioners Based on the Annual Performance Reports prepared, the Overall Grade of BIR offices shall be computed by the Planning Division by taking into account each office's distribution of weight per institutional performance measure that will be approved by the BIR Management Committee (MANCOM). IV. PROCEDURES Hereunder are the procedures to be followed relative to the Bureau's planning, performance monitoring and evaluation system. A. Revenue District Officers and Division Chiefs 1. Prepare the annual Performance Contract (using the format in Annex A) as follows: i) Indicate in the first column of the format in Annex A the applicable * institutional performance measures. ii) Refer to Annex C1 for the specific information/data to be indicated per applicable institutional performance measure. iii) Indicate in the second column of the format in Annex A the annual target for all applicable institutional performance measures (per information indicated in Annex C1). iv) Distribute the annual targets on a monthly basis (where applicable) in the corresponding columns specified in the format in Annex A. v) Submit the Performance Contract prepared, as follows: Submitted To Due Date Original Copy Respective Regional Not later than Director/RDC February 9, 1998 Head/Asst. Commissioner Duplicate Copy Chief, Planning Not later than Division February 9, 1998 Triplicate Copy - (file copy) 2. Prepare the annual Operational Plan (using the format in Annex B) as follows: i) Indicate in the first column of the format in Annex B, the major activities planned to be undertaken by the office in order to attain the annual target per applicable institutional performance measure (IPM). ii) For each activity specified in the first column of the format in Annex B, indicate the corresponding time frame (i.e. by end of January 1998, every 5 th day of the month, etc.) and the responsible office/official in charge of the activity/project. iii) Submit the Operational Plan prepared as follows: Submitted To Due Date Original Copy Respective Regional Not later than Director/RDC February 9, 1998 Head/Asst. Commissioner Duplicate Copy Chief, Planning Not later than Division February 9, 1998 Triplicate Copy - (file copy) 3. Prepare, monthly, a Performance Report (per specified * institutional performance measure) and an Activity Report using the formats shown in Annexes C1 and C2. Said reports shall be submitted as follows: Performance Report Submitted To Due Date Original Copy Respective Regional Not later than the 4th Director/RDC day of each month Head/Asst. Commissioner Duplicate Copy Chief, Planning Not later than the 4th Division day of each month Triplicate Copy Office specified to Not later than the 4th (segregated by IPM) monitor performance * day of each month Quadruplicate - (file copy) Activity Report Submitted To Due Date Original Copy Respective Regional Not later than the 4th Director/RDC day of each month Head/Asst. Commissioner Duplicate Copy - (file copy) B. Regional Directors 1. Consolidate the Performance Contract (using format in Annex A) and the Operational Plan (using format in Annex B) prepared by the respective RDOs/Division Chiefs into the Regional Director's own Performance Contract and Operational Plan and submit as follows: Submitted To Due Date Original Copy DCIR, Operations Not later than Group February 12, 1998 Duplicate Copy Chief, Planning Not later than Division February 12, 1998 Triplicate Copy - (file copy) 2. Prepare the monthly Performance Report for the Information Quality Index (using the format in Annex C1) and submit the same to the Chief, Planning Division not later than the seventh day of each month . Consolidate, monthly (using format in Annex C2), the Activity Reports prepared by the respective RDOs/Division Chiefs and submit as follows: Submitted To Due Date Original Copy DCIR, Operations Not later than the 7th Group day of each month Duplicate Copy Chief, Planning Not later than the 7th Division day of each month Triplicate Copy - (file copy) C. Revenue Data Center (RDC) Heads 1. Consolidate the Performance Contract (using format in Annex A) and the Operational Plan (using format in Annex B) prepared by the respective Division Chiefs into the RDC Head's own Performance Contract and Operational Plan and submit as follows: Submitted To Due Date Original Copy DCIR, Information Not later than Systems Group February 12, 1998 Duplicate Copy Chief, Planning Not later than Division February 12, 1998 Triplicate Copy - (file copy) 2. Prepare the monthly Performance Report for the Information Quality Index (using the format in Annex C1) and submit the same to the Chief, Planning Division not later than the seventh day of each month . LLjur 3. Consolidate, monthly (using format in Annex C2), the Activity Reports prepared by the respective Division Chiefs and submit as follows: Submitted To Due Date Original Copy DCIR, Information Not later than the 7th Systems Group day of each month Duplicate Copy Chief, Planning Not later than the 7th Division day of each month Triplicate Copy - (file copy) D. Assistant Commissioners 1. Consolidate the Performance Contract (using format in Annex A) and the Operational Plan (using format in Annex B) prepared by the respective Division Chiefs into the Assistant Commissioner's own Performance Contract and Operational Plan and submit as follows: Submitted To Due Date Original Copy Respective DCIR Not later than February 12, 1998 Duplicate Copy Chief, Planning Not later than Division February 12, 1998 Triplicate Copy - (file copy) 2. Prepare the Performance Report per assigned institutional performance measure(s) (i.e. IQI, CSI, PVI, ESI) using the format in Annex C1 and submit the same to the Chief, Planning Division not later than the seventh day of the month . 3. Consolidate, monthly (using format in Annex C2), the Activity Reports prepared by the respective Division Chiefs and submit as follows: Submitted To Due Date Original Copy Respective DCIR Not later than the 7th day of each month Duplicate Copy Chief, Planning Not later than the 7th Division day of each month Triplicate Copy - (file copy) 4. Prepare the Annual Performance Report on the assigned institutional performance measure(s) specified in Part III-F of this Order and submit as follows: Submitted To Due Date Original Copy Commissioner Not later than end of January every year Duplicate Copy Respective DCIR Not later than end of January every year Triplicate Copy Chief, Planning Not later than end of Division January every year Quadruplicate Copy - (file copy) A sample of an Annual Performance Report is shown in Annex D. E. Deputy Commissioners Consolidate the Performance Contract (using format in Annex A) submitted by the Regional Directors (for DCIR, Operations Group only) and the respective Assistant Commissioners into the Deputy Commissioner's own Performance Contract and submit the same to the Commissioner not later than February 18 , 1998 . F. Chief , Planning Division 1. Consolidate the Performance Contract and the Operational Plan prepared by all BIR offices and submit as follows, after review by the ACIR, Policy and Planning Service: Submitted To Due Date Original Copy BIR Management Not later than Committee February 27, 1998 Duplicate Copy Concerned Offices * Not later than (Segregated by IPM) February 27, 1998 Triplicate Copy - (file copy) 2. Integrate the Performance Reports and the Activity Reports submitted by concerned BIR offices into a Monthly BIR Accomplishment Report, for submission to the Secretary of Finance, through channels, not later than the fifteenth day of each month . 3. Prepare, monthly, a status report on the attainment of target per institutional performance measure and submit the same to the BIR Management Committee not later than the 20 th day of each month . prLL 4. Compute the Overall Grade of all BIR offices by following the procedures presented hereunder: a. Multiply the weights (to be approved by MANCOM) to the percentage attainment ** of targets indicated in the Annual Performance Reports prepared by concerned offices (specified in Part III-F of this Order) in order to compute the Weighted Grade per applicable institutional performance measure. b. Add the computed Weighted Grades to come up with the Overall Grade of an office. The Grading Sheet shown in Annex E shall be used for this purpose. 5. Prepare a summary report containing the Overall Grade of all BIR offices and submit the same to the BIR Management Committee not later than end of February every year . V. REPEALING CLAUSE This Order supersedes Revenue Memorandum Order No. 38-95 and portions of Revenue Memorandum Order No. 65-97 pertaining to Operations Audit and all other issuances or portions thereof inconsistent herewith. VI. EFFECTIVITY This Order takes effect immediately and shall apply to the 1998 performance of BIR offices. LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue ANNEX A 1998 PERFORMANCE CONTRACT ANNEX B 1998 OPERATIONAL PLAN ANNEX C1 PERFORMANCE REPORT FOR THE MONTH OF APRIL, 1998 ANNEX C2 ACTIVITY REPORT FOR THE MONTH OF MARCH, 1998 ANNEX D ANNUAL PERFORMANCE REPORT ANNEX E GRADING SHEET ANNEX F BIR OFFICES TO BE MONITORED PER INSTITUTIONAL PERFORMANCE MEASURE Footnotes * For 1998, TBI shall be measured in terms of the percentage increase in the number of registered taxpayers compared to previous year's number. * TCI = Total Expenditures Total Tax Collected/P100 * Refer to Annex F (2 nd column). * Refer to Annex F. * Specified in Part III-F of the Order. ** Percentage Attainment = Actual Annual Accomplishment x 100 Annual Target