Evaluation of Performance of Revenue Examiners, Supervisors and Revenue District Officers

November 22, 1976 REVENUE MEMORANDUM ORDER NO. 46-76 TO : All Revenue Regional Directors, Revenue District Officers, Chiefs of Assessment Branches and all others concerned SUBJECT : Evaluation of Performance of Revenue Examiners, Supervisors and Revenue District Officers I. Purposes : This Revenue Memorandum Order is hereby promulgated for the purpose of encouraging maximum performance from field personnel in the Revenue Regions and to provide more accurate and realistic standards to be used as a basis for evaluating performance and/or measuring efficiency of Revenue Examiners, Supervisors and Revenue District Officers. II. Guidelines : Since it is performance that is being evaluated, all activities in which field personnel are regularly engaged in, as well as special campaigns and/or assignments, shall be considered in measuring performance and efficiency. Other factors like punctuality and attendance, attitudes, decorum, discipline, etc., which affect accomplishments shall also be given corresponding weights in judging personnel performance. Motivation to encourage better performance and sanctions that would discourage haphazard or desultory jobs or performance below par must be provided for. Measure of performance is goal-oriented. Evaluation is to be made semestrally to coincide with the giving of performance ratings. III. Procedure : With these guidelines in mind, the following procedure in evaluating performance shall be followed by all concerned. aisa dc A. Performance evaluation of field personnel in the Revenue Regions shall be based on the following: 1. Assessment Function: a. Number of Cases Finished 10 points b. Assessments per investigation 15 points c. Collections per investigation 15 points d. Quality of investigations 10 points ________ Total 50 points 2. Collection Function: a. Number of Cases Closed 8 points b. Amount Collected 12 points ________ Total 20 points 3. Special Campaigns 10 points 4. Other Factors: a. Punctuality and Attendance 4 points b. Cooperation and job attitude 3 points c. Public relations, general 3 points appearance, etc. _______ Total 10 points 5. Bonus 10 points _________ Total Number of Points 100 === B. Determination of Points Earned: 1. Assessment Function: a. Number of Cases Finished (1) At the beginning of the semester, determine the number of returns available for investigation as follows: (a) Ascertain the prior and current year's returns classified as to "A", "B", "C", both taxable and exempt available to the Revenue District Office. (b) Segregate the returns of taxpayers who are also subject to percentage taxes. (c) Determine the total number of returns to be investigated and reported by the district for the semester taking into consideration the number, quality and tax potential of the returns available and the number of examiners in the district. This will be the goal of the Revenue District. (d) The Revenue District Officer in consultation with the Group Supervisors, shall divide the goal as to number of returns to be finished, among the examiners in each group in the district. The allocation of goals to the individual examiners shall take into consideration the classification of returns as well as individual differences of examiners, considering capabilities, educational preparation and experience. Thus, the goal of the individual examiners may not necessarily be equal. (e) The total number of returns determined as the goal of all examiners assigned in a group shall constitute the group goal, for which the group supervisor shall be responsible. (f) The Revenue District Officer, upon approval by the Regional Director, may ascertain his goal and that of his examiners on a monthly basis or make adjustments monthly as the need arises. However, the pre-determined estimated goal for the whole period may not be subject to adjustments to a lower figure. (g) The equivalent points earned by the examiner shall be measured as follows: Those who make the goal will be given the equivalent of 7 points. If they achieve: 20% more than the goal, they are credited with 8 points; 40% over the goal, they are credited with 9 points; 60% more than the goal, they are credited with 10 points. If the number of cases investigated and reported by the examiner is below the goal set, then he will be given the following number of points: 10% below the goal 6 points; 20% below the goal 5 points; 30% below the goal 4 points; 40% below the goal 3 points; 50% below the goal 2 points; 60% below the goal 1 points; and Above 60% below the minimum 0. b. Assessment and Collection per investigation: (1) At the beginning of the year and of the semester, assessment and collection goals shall be determined as follows: (a) The Central Office shall determine the regional goal from enforcement or from investigations, by kind of tax, considering the revenue potential of each revenue regional office. (b) The Regional Director shall allocate equitably the regional goal among the revenue district offices in the region, also considering the revenue potential of each district. (c) The Regional Director in consultation with the respective Revenue District Officers shall apportion the enforcement goal into the assessment and collection goals. (d) The Revenue District Officer in consultation with the respective Group Supervisors shall equitably allocate the district goal among the examines therein, taking into consideration the returns allotted to the examiner and also his capabilities, educational preparation and experience. (e) The total assessment and collection goals of all examiners in the group shall be the group goal, for which the Group Supervisor shall be responsible. (f) The Revenue District Officer, upon approval by the Regional Director may set the goal on a month-to-month basis, provided there is a pre-determination of the total goal for the semester and for the year. (g) The equivalent points earned by the examiner shall be measured as follows: Assessment and Collection: (15 points for assessment; 15 points for collection) When the examiner makes: The Goal, he earns 12 points; 20% above the goal, he earns 13 points; 40% above the goal, he earns 14 points; 60% above the goal he earns 15 points; 10% below the goal, he earns 11 points; 20% below the goal, he earns 10 points; 30% below the goal he earns 9 points; 40% below the goal he earns 8 points; 50% below the goal he earns 6 points; 60% below the goal he earns 4 points; 70% below the goal he earns 2 points; 80% below the goal he earns 1 point; and 90% or more below the goal, he gets 0. c. Quality of Investigations : The standard to be used in evaluating quality shall be the percentage of increase of deficiency taxes assessed or collected over the tax due per return. The determination of points earned shall be based on the average percentage on all returns investigated for the period. (1) Until revised, the following guidelines shall be used: (a) For the revenue districts within the Metro Manila Area, the goal for income tax shall be 20% of the tax due per return; and for business taxes, 10% of the tax due per return. (b) For the revenue districts outside the Metro Manila Area, the goal for income tax shall be 25% of the tax due per return and for business tax, 10% of the tax due per return. (2) The points earned shall be computed in the same manner as with the number of cases in paragraph III B-1a (1) (g) above. d. An assessment or collection shall be credited to the examiner only after the Revenue District Officer has endorsed the corresponding report. 2. Collection Function: a. Number of Cases Closed (1) The Revenue District Officer, subject to the approval of the Regional Director, shall determine the number of collection cases (delinquent accounts), to be closed by the District for the six-month period. (2) In consultation with Group Supervisors, the Revenue District Officer shall equally allocate the collection cases to each examiner in the district. (3) The total number of cases to be closed by all the examiners in the group shall constitute the group goal for which the supervisor shall be responsible. (4) The points earned by the examiner shall be computed as follows: When the examiner makes: 40% over the Goal, he earns 8 points; 20% over the Goal, he earns 7 points; The Goal, he earns 6 points; 10% below the Goal, he earns 5 points 20% below the Goal, he earns 4 points; 30% below the Goal, he earns 3 points; 40% below the Goal, he earns 2 points; 50% below the Goal, he earns 1 point; More than 50% below the Goal, he gets 0. b. Amount Collected The basis for computing the points earned by him shall be the percentage of actual collections compared to the total amount collectible as shown in the dockets assigned to him during the period. In computing the percentage the basis shall be the final amount assessed or demanded, disregarding additional amounts computed because of late payment. The equivalent weights in points follow: When the revenue examiner collects: 92% to 100% of the total amount, he earns 12 points; 82% to 91% of the total amount, he earns 11 points; 72% to 81% of the total amount, he earns 10 points; 62% to 71% of the total amount, he earns 9 points; 52% to 61% of the total amount, he earns 8 points; 42% to 51% of the total amount, he earns 7 points; 32% to 41% of the total amount, he earns 6 points; 22% to 31% of the total amount, he earns 5 points; 12% to 21% of the total amount, he earns 4 points; 6% to 11% of the total amount, he earns 3 points; 3% to 5% of the total amount, he earns 2 points; 1% to 2% of the total amount, he earns 1 point; and When he collects nothing, he gets 0 3. Special Campaigns : The Revenue district Officer shall initiate special campaigns to increase revenue collections, like campaigns for issuance of sales invoices, proper recording of actual transactions, tax information drive, etc. While tax campaigns may not directly produce substantial actual collections, they are the means to increase voluntary compliance an the part of taxpayers. The realistic gauge or standard to measure accomplishments on all the tax campaigns conceived along these areas cannot be formulated. The Revenue District Officer, upon initiating such a campaign, shall also formulate standards of measuring accomplishments. such campaigns, procedures to be followed, the standard for measuring accomplishment shall be passed upon and approved by the Regional Director. 4. Other Factors a. Punctuality and Attendance (1) Perfect Attendance 4 points (2) Average of 4 monthly absences and/or tardiness 3 points (3) Average of 5 monthly absences and/or tardiness 2 points (4) Average of 6 monthly absences and/or tardiness 1 point (5) Average of more than 6 monthly absences and/or tardiness 0 In the determination of the number of points an examiner has earned for the rating period, the Revenue District Officer shall be given the discretion to exclude absences due to a reasonable cause like actual illness of the fieldman himself or of the immediate members of his family requiring his personal presence, and provided that the office is duly informed of the absence. b. Cooperation and job attitude and c. Public relations, general appearances, etc. are factors which would be measured by the collective judgment of the supervisor and the Revenue District Officer. 5. Bonus 10 points a. Bonus points are given for outstanding achievements like the development of a good fraud case or outstanding accomplishments in special campaigns initiated by the Central Office for a nation-wide application or involvement. b. Other meritorious accomplishments of fieldmen like doubling or tripling goals may be given bonus points. c. The following procedure shall be followed in giving bonus points: (1) The Group Supervisor shall initiated the recommendation to give any of his examiners bonus points. The recommendation shall cite specific achievements of the examiner to justify the giving of bonus points. The Group Supervisor may recommend the number of bonus points to be given. (2) The Revenue District Officer must fully concur with the recommendation of the Group Supervisor. (3) The Regional Director as Chairman, with the Assistant Regional Director and the Chief of the Assessment Branch as members, shall constitute the Evaluation Committee which shall pass upon and either approve, modify, or reject the recommendation. 6. Demerits: a. Demerits in the form of reducing the number of points earned by not more than 5 points shall be made under any of the following circumstances: (1) Substantial reductions in recommended assessments, except when the reduction was due to interpretation of legal issues without precedents, or when an assessment was arbitrarily recommended because of non-cooperation of a taxpayer. In the latter case, the records should show the steps the examiner took to secure the taxpayer's cooperation for presentation of his records. Also, the records should attest full compliance with existing procedures. (2) Repeated non-compliance with reporting requirements and other deficiencies in the reports found during review, duly approved by the Regional Director. (3) Failure to make deficiency assessments on facts very apparent in the return, or for failure to verify doubtful items found in the return or financial statements which may give rise to a deficiency tax. b. Like the granting of bonus points, demerits shall be passed upon by the Evaluation Committee. c. Demerits shall be initiated by the Revenue District Officer or any official passing upon the correctness of records of investigation based on authentic records of such deficiencies or reducing in recommended assessments. The report being rendered by the Assessment Branch, attached as Annex "C" should always be referred to and attached to any recommendation for a demerit. When the recommendation for a demerit is initiated by official other than the Revenue District Officer, the latter shall sit with the evaluation committee when the recommendation for a demerit on any of his examiners is passed upon. The recommending official shall be inhibited from taking part in the evaluation. IV. Evaluation of Performance of Supervisory Officials A. Group Supervisors The performance of a Group Supervisor shall be evaluated on the basis of the total performance of all the examiners in his group in all aspects. His performance rating shall be computed in the same manner as that of individual examiners. The only difference is that the basis of computing the number of points earned by the Group Supervisors would be the comparison between the total of the actual accomplishments of the examiners in his group and the group goal. B. Revenue District Officers In the same manner that the performance of Group Supervisors is evaluated on the basis of the accomplishments of the examiners in his group, the evaluation of the performance of Revenue District Officer shall be based on the totality of the performance of all examiners in the district. C. For both the Group Supervisors and the Revenue District Officers, evaluation of their supervisory function would take the place of bonus points as follows: (1) Administrative Ability 5 points (2) Timeliness of submission of Administrative reports 5 points _______ Total 10 points V. Forms to be Used: The forms attached as annexes were devised to make the collation of the statistics needed in evaluating performance more systematic. cdt A. Record of Investigation (Annex "A") This form shall be accomplished by the revenue examiner monthly and submitted to the Assessment Branch in the Region within 10 days after the end of the month. It shall be the responsibility of the Group Supervisor to collect the copies of this report from his examiners and to submit the same to the Revenue District Officer three days before the reports are required to be received in the Assessment Branch. The Revenue District Officer shall transmit the reports (in duplicate) to the Assessment Branch whether or not all examiners have complied with the requirement, on the tenth day after the end of the month. The names of the examiners whose reports are not included in the transmittal should also be submitted. B. Record of Examiner's Reports Approved and Assessed (Annex "B") This is a monthly report to be accomplished in triplicate in the Assessment Branch. The original copy is to be submitted to the Regional Director, the duplicate to the respective Revenue District Officers and the triplicate shall be kept on file in the Assessment Branch. The report should reach the Revenue District Officer within the next month following that for which the report was submitted. The % column indicates the percentage of the deficiency tax over the tax due per return. C. Monthly Summary of Reporting Deficiencies (Annex "C") this form shows the deficiencies of reports rendered by individual examiners. The Assessment Branch shall prepare the report in triplicate the original shall be forwarded to the Regional Director, the duplicate to the Revenue District Office concerned and the triplicate shall remain on file with the Branch. D. Revenue Examiner's Rating Sheet (Annex "D") This form shall be accomplished by the Group Supervisor or Revenue District Officer for every revenue examiner for every evaluation period. The Group Supervisor shall evaluate the performance of the revenue examiner in his group and shall be concurred in by the Revenue District Officer. E. Group Supervisor's Rating Sheet Annex "E " This form should be accomplished by the Revenue District Officer for every Group Supervisor for every evaluation period. The Revenue District Officer shall evaluate the performance of the Group Supervisor and shall be concurred in by the Regional Director. F. Revenue District Officer's Rating Sheet (Annex "F") In the same manner that the performance of revenue examiners are evaluated on the Revenue Examiner's Rating Sheet so shall the Revenue District Officers on the form marked as Annex "F". G. Summary Sheet (Annex "G") The evaluation of Revenue Examiners and Supervisors shall be summarized in the Summary Sheets (Annex "G") by the Revenue District Officer. This form shall be prepared in three copies, the original to be submitted to the Revenue Service Chief (Assessment), the duplicate to the Regional Director and the triplicate shall remain in the files of the Revenue District Officer. H. Record of Submission and Processing of Reports (Annex "H") The purpose of this form is to control the submission and processing of reports. It will show not only the quality of reports submitted but mainly the progress made in processing such report from the time it is submitted to the time the same is assessed. Delay can be readily traced by just referring to the form. The form shall be attached by the examiner to every report he submits. Items 1 to 8 shall be filled in by the examiner. The date action is completed in various stages of processing the report shall be indicated in the appropriate column by the official or employee concerned. VI. Miscellaneous Provisions: A. As provided under Revenue Memorandum Order No. 57-75, two examiners shall be assigned to investigate taxpayers who are also subject to business taxes. However, the Revenue District Officer may assign only one examiner for small or simple cases. B. Where two examiners have been assigned to investigate a taxpayer, one for income tax and the other for business taxes, both examiners shall be equally credited with the deficiency assessments recommended or collected in both income and business taxes. C. Where there are no supervisors in any Revenue District Office, the functions allocated to him shall be performed by the Revenue District Officer. VII. Repealing Provisions : All Memoranda, Orders, circulars or portions thereof which are inconsistent herewith are hereby repealed. VIII. Effectivity : This Order takes effect immediately. EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3 ANNEX"A" ANNEX"B" ANNEX"C" ANNEX"D" ANNEX"E" ANNEX"F" ANNEX"G" ANNEX "H" RECORD OF SUBMISSION AND PROCESSING OF REPORT OF INVESTIGATION 1. _______________ 2. _______________ 3. _______________ Examiner RDO No./OAS Supervisor 4. __________ 5. __________ 6. __________ 7. __________ 8. Deficiency Tax Reported: [] To be assessed [] Collected 9. ________________________________________________________________ AMOUNT COMPROMISE Kind of Tax Basic Tax Surcharge Interest Total Nature of Violation Amount Total Total PROCESSING DATES Office/Person Action Taken on Report First Second Final Action Action Action Examiner Submitted to Supervisor Supervisor Returned to Examiner Forward to RDO Revenue District Officer Returned to Supervisor Informal Conference Signed with Concurrence Receiving/Releasing Clerk Forwarded to Assessment Branch Receiving/Releasing Clerk Received Assessment Branch Assignment Clerk Assigned to Reviewer Reviewer Received Docket Returned to RDO Notice of Preliminary Assessment Review Completed & Released Chief, Audit Review Unit Receives Docket Release Docket Chief, Review & Evaluation Release Docket Asst. Chief, Ass. Branch Release Docket Chief, Ass. Br. Signed Recommendation Chief, Ass. Unit Receives Docket Proving Completed Assessment Notice Released Chief, Ass. Br. Assess Notice Initialed Releasing Clerk Release Docket to Assistant Regional Director Regional Director's Office Received Docket Reports & Assessment Notices Signed Clerk Returned to Assessment Branch Assessment Branch Receiving and Releasing Clerk Released Assessment Notice to Administrative Branch