The Internal Revenue Service Has Made Substantial Progress
Toward Recording Calls as Part of the Quality Assurance Monitoring of its
Toll-Free Telephone Assistance
January
2003
Reference
Number: 2003-30-043
This report has cleared the Treasury
Inspector General for Tax Administration disclosure review process and
information determined to be restricted from public release has been redacted
from this document.
January
16, 2003
MEMORANDUM FOR
COMMISSIONER, WAGE AND INVESTMENT DIVISION
COMMISSIONER, SMALL
BUSINESS/SELF-EMPLOYED DIVISION
FROM: Gordon C. Milbourn III /s/ Gordon C.
Milbourn III
Acting Deputy Inspector
General for Audit
SUBJECT: Final Audit Report – The Internal Revenue
Service Has Made Substantial Progress Towards Recording Calls as Part of the
Quality Assurance Monitoring of its Toll-Free Telephone Assistance (Audit # 200230024)
This
report presents the results of our review of the Internal Revenue Service’s
(IRS) efforts to implement call recording as part of the quality assurance
monitoring of its toll-free telephone assistance. In Fiscal Year 2002, Customer
Service Representatives (CSR) answered approximately 42 million calls from
taxpayers. The IRS has a significant business need to monitor a
sample of incoming calls to determine the quality of telephone services it
provides. The monitoring method
currently used by the IRS involves having the CSR’s manager or an independent
IRS employee, assigned to a quality review function, remotely listen to the
call as it takes place. However, a previous audit raised concerns with the
statistical validity of the existing quality monitoring system and
suggested that an automated call recording system would be one way of achieving
random call selection. The IRS responded
that it was aggressively pursuing the technology to implement call recording.
In summary, the IRS has
taken significant actions to achieve the capability to record calls to its
toll-free telephone system and, at the time
we completed our review, was targeting an implementation date of September 30,
2003. The IRS’ preliminary plans call
for the installation of a call recording system that can capture both the voice
and screen (i.e., computer files accessed by the CSRs) data. The
actions already taken by the IRS include:
appointing a project manager and team members to establish the system
requirements, conducting a market survey of potential vendors, budgeting nearly
$10 million for call recording over a 2-year period, entering into a Letter of
Understanding with the National Treasury Employees Union that monitored
telephone calls will also be recorded, and obtaining guidance on the legal
requirements for recording calls. On November 22,
2002, the IRS’ Executive Steering Committee approved completion of the first
project milestone and commencement of the next two milestones.
While significant work
remains to be done, the planned implementation of call recording by the 2004
Filing Season will provide the IRS with an important opportunity for improving
the effectiveness and efficiency of its quality assurance process and, in turn,
for improving the quality of the customer’s experience when calling the IRS for
assistance. In the interim, the close
involvement of senior IRS management will be critical for ensuring that the
business requirements for the call recording system are properly developed, milestone dates are being met, and any unforeseen problems
are promptly identified and resolved.
Since
we are making no recommendations, a response to this report was not
required. Please contact me at (202)
622-6510 if you have questions or Parker F. Pearson, Acting Assistant Inspector
General for Audit (Small Business and Corporate Programs), at (410) 962-9637.
Appendix I – Detailed Objective, Scope, and Methodology
Appendix II – Major Contributors to This Report
Appendix III – Report Distribution List
The Internal Revenue Service (IRS)
provides several toll-free telephone numbers that taxpayers can call to
ask tax law questions, order tax forms,
and discuss various tax account issues.
In Fiscal Year (FY) 2002, the IRS answered more than 107 million
incoming calls to its toll-free telephone lines. The IRS used automated services (i.e., recorded information) to
answer approximately 65 million of these calls. Customer Service Representatives (CSR) answered the remaining 42
million calls.
The IRS has a significant business
need to monitor a sample of incoming calls to determine the quality of
telephone services that its CSRs provide to millions of taxpayers each
year. The primary monitoring method currently
used by the IRS involves an independent IRS employee assigned to a quality
review function to remotely listen to the call as it takes place. A centralized quality review staff remotely
monitors a sample of calls to measure accuracy rates on an IRS-wide basis. In addition, managers at each call site are
required to sample calls to evaluate the performance of individual CSRs.
In February 2002, the Treasury Inspector General for Tax
Administration (TIGTA) reported that certain weaknesses in the IRS’ design and
implementation of its sampling strategy for monitoring calls may bias the
accuracy of the results. We recommended
that the IRS develop a system to ensure random call selection for measuring the
accuracy of tax law assistance, and suggested that an automated call recording
system would be one way to accomplish this.
In their response, IRS management agreed that automated call recording
is the best way of achieving random call selection and stated that, while they
did not currently have the technological ability to implement it, they were
aggressively pursuing it.
In the private-sector call
center industry, call recording is an accepted and increasingly popular quality
assurance monitoring practice. Some
state government agencies also record incoming calls, and other state agencies
are in various stages of planning to record calls.
This review was performed to determine the status of the
IRS’ efforts to implement automated call recording on its toll-free telephone
system. To perform this audit, we
interviewed Customer Account Services staff from the Small Business/Self-Employed (SB/SE) and Wage and Investment (W&I)
Divisions in Oakland, California, and Atlanta, Georgia,
respectively. In addition, we reviewed
documentation provided to us by the IRS regarding its efforts to date to
implement automated call recording. We
performed the audit in accordance with Government
Auditing Standards between September and December 2002. Detailed information on our audit objective,
scope, and methodology is presented in Appendix I. Major contributors to the report are listed in Appendix II.
As early as 1997,
the IRS began exploring the legal implications of recording telephone calls for
quality assurance purposes. The office
of Chief Counsel subsequently advised IRS management that it was permissible
for the IRS to record calls provided that certain actions were taken. These included ensuring that Federal
Communications Commission (FCC) requirements on obtaining consent were
followed, existing IRS rules were waived or revised to allow recording, and the
recorded information was safeguarded the same as tax return information. Subsequently, the IRS Commissioner deferred
taking any action on the call recording initiative because he felt that it was
not a good time for the IRS to state that it was recording calls.
In May 2001, the IRS
Commissioner directed IRS management to move forward with call recording and
suggested that the W&I and SB/SE Divisions work together to
determine the feasibility of call recording and develop a proposal.
Currently, the W&I Division has the lead in this effort. The project office contains members from
the:
·
W&I and
SB/SE Divisions’ Customer Account Services organizations.
The IRS’ preliminary plans call for the installation of a call recording
system that can capture both the voice and screen (i.e., computer files
accessed by the CSRs) data. The IRS’
Improvement Project Plan (IPP) states that call recording will enable it to
more efficiently and effectively review telephone calls, develop and evaluate
employees, and improve the quality of service provided to its customers. Some of the specific potential benefits of
call recording that were identified by the IRS include:
At the time we
completed our review, the IRS was targeting the implementation of call
recording by September 30, 2003. The
actions already taken by the IRS include:
·
Appointing a
project manager and team members representing stakeholders to establish the
system requirements.
The first phase of
the proposed Business Systems Plan for recording monitored calls (Milestone I)
was approved as completed by the Executive Steering Committee on
November 22, 2002. In addition, the
Committee approved commencement of the next two milestones that include
developing requirements, building a business case, writing the Project
Management Plan and writing the Disaster Recovery Plan.
The call recording system that will be procured will be
modular in design to allow for future enhancements that are currently not
funded. For example, initially a sample
of calls will be recorded, but the system will allow for expansion to record
more calls. The initial system will be
used by both the current centralized quality review staff and by managers for
individual employee monitoring.
While significant work remains to be done, the planned
implementation of call recording by the 2004 Filing Season will provide the IRS
with an important opportunity for improving the effectiveness and efficiency of
its quality assurance process and, in turn, for improving the quality of the
customer’s experience when calling the IRS for assistance. In the interim, the close involvement of
senior IRS management will be critical for ensuring that the business requirements
for the call recording system are properly developed, milestone
dates are being met, and any unforeseen problems are promptly identified and
resolved.
Appendix I
Detailed Objective, Scope, and Methodology
The overall audit
objective was to determine the status of the Internal Revenue Service’s
(IRS) efforts to implement automated call recording on its toll-free telephone
system.
To accomplish this
objective, we:
I.
Interviewed
key executives, managers, and analysts from the Customer Account Services
functions of the Small Business/Self-Employed and Wage and Investment
Divisions, and:
A.
Determined why the IRS does not currently record telephone
calls of its toll-free telephone system.
B.
Determined why the IRS does not currently provide a recorded
announcement informing customers that their calls may be monitored for quality
assurance purposes.
C.
Identified any plans the IRS has for the future recording of
toll-free telephone calls.
D.
Determined what concerns the IRS has about recording toll-free
telephone calls.
E.
Determined what benefits the IRS believes it could derive from
recording toll-free telephone calls.
F.
Identified research the IRS has done into the possibility of
recording toll-free telephone calls.
II.
Reviewed the IRS’ current contract with the National Treasury
Employees Union to identify any barriers or prohibitions to the recording of
toll-free telephone calls.
III.
Researched Incoming Calls Management Institute materials and
other call center literature available on the Internet to identify industry
best practices, industry studies, and research papers regarding the benefits
and barriers to recording incoming calls for quality assurance purposes.
IV.
Surveyed federal and state agencies to determine those
that use, or plan to use, call recording technology for quality monitoring.
V.
Reviewed work done by the IRS in consulting with the
office of the IRS Privacy Advocate; reviewed applicable federal and state
statutes to determine the legal implications of recording incoming calls; and
researched the Internet for legal and business interpretations of these
statutes.
VI.
Placed test calls to the various toll-free numbers
provided by the IRS to determine if an announcement was provided to callers
that the call may be monitored.
VII.
Researched IRS publications that advertise many of the
IRS’ toll-free numbers to determine if they contained a notice that calls to
the IRS may be monitored.
VIII.
Reviewed prior General Accounting Office and Treasury
Inspector General for Tax Administration audit reports on the IRS’ quality
assurance monitoring process for the toll-free telephone system.
IX.
Placed test calls to the toll-free numbers provided by
other Federal agencies to determine if an announcement was provided to callers
that the call may be monitored.
Appendix II
Major Contributors to This Report
Parker F. Pearson, Acting Assistant
Inspector General for Audit (Small Business and Corporate Programs)
Philip Shropshire, Director
William
E. Stewart, Audit Manager
Theodore J. Lierl, Senior
Auditor
Karen
J. Stafford, Senior Auditor
Gregory
W. Holdeman, Auditor
Una
K. Smith, Auditor
Appendix III
Acting
Commissioner N:C
Deputy
Commissioner, Small Business/Self-Employed Division S
Deputy
Commissioner, Wage and Investment Division
W
Director, Customer
Account Services, Small Business/Self-Employed Division S:CAS
Director,
Customer Account Services, Wage and Investment Division W:CAS
Chief
Counsel CC
National
Taxpayer Advocate TA
Director,
Legislative Affairs CL:LA
Director,
Office of Program Evaluation and Risk Analysis
N:ADC:R:O
Office of
Management Controls N:CFO:F:M
Audit
Liaisons:
Commissioner, Small
Business/Self-Employed Division S
Commissioner, Wage and Investment Division W
Director,
Customer Account Services, Small Business/Self-Employed Division S:CAS
Director, Customer Account Services,
Wage and Investment Division W:CAS