Peer Review Compliance Guide

Transcription

1 International Registration Plan, Inc. Peer Review Compliance Guide Guidelines for the Conduct of Peer Reviews of Member Jurisdiction s IRP Administration and Audit Operations Effective July 1, Wilson Blvd, Suite 400, Arlington, VA Tel (703) Fax (703)

2 Program Introduction TABLE OF CONTENTS Section I Administrative Review Procedures Preliminary Review Primary Review Section II Audit Review Procedures Preliminary Review Primary Review Attachment 1 Preliminary Review Questionnaire Attachment 2 Documentation Checklist Attachment 3 Frequency of Audits Matrix Attachment 4 Transmittal & Information Worksheet Attachment 5 Account Samples Selected Worksheet Attachment 6 Audit Work Paper Examination Attachment 7 Worksheet for Compliance with Section 1015 Attachment 8 Action Plan Attachment 9 Follow-up Peer Review Procedures Attachment 10 Limited Scope Peer Review Procedures

3 PROGRAM INTRODUCTION General Information 1. This Peer Review Compliance Guide has been prepared to assist in the conduct of peer reviews of jurisdictions participating in the International Registration Plan ( IRP ). The purpose of the peer reviews is to ensure that jurisdictions are complying with the provisions of the IRP. The peer review process also lends to the sharing of ideas among the jurisdictions and helps to identify areas within the International Registration Plan with Official Commentary (Plan) and Audit Procedures Manual (Manual) where further clarification is needed. 2. This guide provides direction for the review of the two major program areas of the member jurisdictions under IRP Administration and Audit. Section I contains the suggested procedures to use during the review of a jurisdiction's IRP administration program followed by the specified Plan references. Section II contains the suggested procedures to use during the review of a jurisdiction s IRP audit program, followed by the Plan and Manual references. The attachments to the Compliance Guide illustrate the specific forms, worksheets, etc., available to the peer review team when performing and documenting the review. 3. Variations may be encountered while using this guide to review the IRP administration and audit programs in the Member Jurisdictions. The use of this guide will ensure that all Member Jurisdictions are evaluated on the same criteria during a peer review. The peer review team may be required to perform additional and/or alternate procedures in order to determine a jurisdiction s compliance with the Plan and Manual. Also, note that remote review and on-site review procedures and timeline may be slightly different to account for more time to review documents or the jurisdiction s system. The working papers should document the use of additional or alternative procedures. For review procedures that are not applicable to a jurisdiction, the reason for non-applicability should be noted in the working papers. Peer Review Schedule 4. IRP Member Jurisdictions are reviewed once within a five-year peer review cycle. The peer review period begins with the earliest un-reviewed calendar year and ends with the most recently completed calendar year. 5. When a jurisdiction is found to be out of compliance with any section of the Plan and/or Manual, they will be required to participate in a follow-up review within one year from the date of the peer review. The purpose of the follow-up review is to determine if the jurisdiction has corrected the areas of non-compliance. The committee and staff liaison will continue working with the jurisdiction during the one-year period to assist the jurisdiction with achieving full compliance by the date of the follow-up review. 6. The peer review schedule is managed by the staff liaison and is approved annually by the IRP Board of Directors.

4 Preliminary Review On-site Review 7. Once the schedule of reviews has been determined and approved by the IRP Board of Directors, the staff liaison assigns the committee members to their respective reviews for the following year and notifies the jurisdictions to be reviewed of their placement on the peer review schedule. 8. Within 120 days of the scheduled peer review, the staff liaison sends a letter to the jurisdiction s contact person identifying information that will be required prior to and during the peer review (attachments 1, 2 and 3). Failure of a jurisdiction to respond timely with the requested information may cause a delay in the peer review process and/or result in noncompliance findings. The staff liaison sends copies of the information submitted by the jurisdiction to the review team. 9. Prior to the review of any documents, the review team will sign a confidentiality statement regarding all the registrant information included in the documents reviewed during the peer review process. The review team discusses the status of incoming documents from the jurisdiction (90 days prior to the scheduled review) and examines the information submitted by the jurisdiction being reviewed and conducts a preliminary review according to the preliminary review procedures for the administrative and audit programs (sections I and II, attachment 4). The review team makes contact with the jurisdiction and identifies any missing documents and reports any concerns with the report formats (60 days prior to scheduled review). If account/audit selections have been made, lists(s) are provided to the jurisdiction. If account/audit selections have not been made, the review team will provide the jurisdiction a date in which the selections will be sent to the jurisdiction. Information submitted for the preliminary review may require additional examination. 10. The review team may research website and online information prior to the scheduled review. 11. The review team obtains missing documents and reports from the jurisdiction, identifies new or additional contacts if necessary, and discusses any preliminary concerns with the staff liaison (30 days prior to the scheduled review). 12. The review team begins the Compliance Guide review 3-30 days prior to the scheduled Peer review. For on-site reviews, the staff liaison, along with IRP, Inc. s travel agent, coordinates the review team s air travel and secures all hotel accommodations. For remote reviews, the staff liaison schedules the conference calls necessary to complete the review for all jurisdiction contacts and review team members. 13. Each review begins at approximately 9 a.m. on the first day, continues through the jurisdiction s normal business hours, and concludes no later than 1 p.m. on the following day. If possible, at the conclusion of the first day, the staff liaison provides the jurisdiction with an estimated time for the closing conference the following day. 14. The review begins with an opening conference, at which time introductions are made and the jurisdiction s staff and the review team discuss any areas of concern identified in the preliminary review, along with explaining the review process and answering any questions. The information required for the peer review shall be available to the review team at this time.

5 Remote Review Follow-up Review 15. The opening conference may be followed by a tour of the jurisdiction s IRP facilities, at which time the review team may ask questions of the jurisdiction s IRP staff. 16. The administrative review consists of the review of a random selection of registrant accounts and an interview with the jurisdiction s IRP staff (section I, attachment 5). The jurisdiction s IRP administrative contact or qualified designee shall be available throughout the review to assist and/or answer questions related to the review. 17. The audit review consists of the examination of pre-selected registrant audit files and interviews with the IRP audit staff (section II, attachment 6). An IRP audit contact or qualified designee shall be available throughout the review to assist and/or answer questions related to the review. 18. As early as possible the final day, the review team and staff liaison begin preparing a preliminary report, which includes all findings of compliance/non-compliance, and confirms with the jurisdiction the time for the closing conference. 19. Copies of the preliminary report and supporting documentation are prepared for all attendees at the closing conference. The review team discusses the findings with the jurisdiction during the closing conference, which may include verbal suggestions for the jurisdiction to consider. The jurisdiction s IRP staff is encouraged to ask questions of any findings. 20. The review begins with an opening conference call, at which time introductions are made and the jurisdiction s staff and the review team discuss any areas of concern identified in the preliminary review, or if additional information is needed. The review process is explained and questions are addressed. 21. The administrative review consists of the review of a random selection of registrant accounts and possible phone interviews with the jurisdiction s IRP staff (section I, attachment 5). The jurisdiction s IRP administrative contact or qualified designee shall be available throughout the review to assist and/or answer questions related to the review. 22. The audit review consists of the examination of pre-selected registrant audit files and phone interviews with the IRP audit staff (section II, attachment 6). An IRP audit contact or qualified designee shall be available throughout the review to assist and/or answer questions related to the review. 23. On the final day, the review team and staff liaison prepares a preliminary report, which includes all findings of compliance/non-compliance, and confirms with the jurisdiction the time for the closing conference. 24. The preliminary report and supporting documentation are provided at the closing conference. The review team discusses the findings with the jurisdiction, which may include verbal suggestions for the jurisdiction to consider. The jurisdiction s IRP staff is encouraged to ask questions.

6 25. Following the completion of a peer review, the jurisdiction has 30 days to respond in writing to the findings. After 30 days, the preliminary report becomes final and the report and jurisdiction s response are posted on the IRP, Inc. website. 26. At the end of the jurisdiction s 30 day response period, the IRP, Inc. staff liaison shall forward to the jurisdiction the peer review final report; an action plan will also be provided, if necessary (see #24). 27. A jurisdiction found out of compliance with any area(s) of the Plan and/or Manual is subject to a follow-up review within one year of the peer review, as indicated in the action plan. This follow-up review is conducted with the full committee via conference call. 28. The action plan will provide information to the jurisdiction regarding the documentation required to be submitted for the follow-up review. The action plan also provides the date of the follow-up. The requested information and documentation will be used by the Committee to determine compliance in those areas of the Plan and Manual where the jurisdiction was found out of compliance. The staff liaison forwards copies of the information provided by the jurisdiction to the committee members for review prior to the conference call. 29. After the follow-up conference call, if the Committee determines the jurisdiction has not taken corrective action to come into compliance with the Plan and/or Manual, the staff liaison shall inform the jurisdiction. Unless corrective action is taken within the time frame specified by the Committee, the jurisdiction will be placed on the agenda of the next Dispute Resolution Committee meeting. The jurisdiction is encouraged to continue resolving the areas of non-compliance and to submit documentation supporting their efforts prior to the specified deadline(s). The staff liaison shall notify the jurisdiction of the date/time of the next meeting of the Dispute Resolution Committee. 30. If, at any time prior to the Dispute Resolution Committee meeting, the jurisdiction submits evidence demonstrating compliance with the Plan and/or Manual, the Peer Review Committee may reassess the information and make a recommendation of compliance to the Dispute Resolution Committee.

7 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRELIMINARY REVIEW JURISDICTION NAME: PEER REVIEW DATE: PEER REVIEW PERIOD: REVIEWER COMMENTS /INITIALS (FOR COMPLETED STEPS) OR N/A (FOR STEPS NOT COMPLETED) The purpose of the administrative review procedures is to ensure a uniform process for evaluating the administrative methodologies and processes employed by IRP member jurisdictions. In the Completed column, please comment on or initial steps as they are completed, and indicate N/A if a step could not be completed. Any significant comments or findings should be documented in the review log. Findings of non-compliance and sections in compliance but requiring additional explanation are to be documented in the peer review final report and the review log. PRELIMINARY REVIEW PROCEDURES: Article II Definitions: Review the jurisdiction s laws, instructions or information manual to ensure application of the following definitions is consistent with the definition in the Plan. Apportionable Vehicle Base Jurisdiction Established Place of Business Estimated Distance Residence Reporting Period Total Distance Rental Fleet IRP 320 DISTANCE ESTIMATES BY BASE JURISDICTIONS - Spot check transmittals and recaps received from the jurisdiction to identify possible patterns of unreasonable distance (i.e., extremely low estimates for high-fee jurisdictions and high estimates for low-fee jurisdictions, or identical estimated distance percentages calculated for multiple new accounts).

8 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRELIMINARY REVIEW JURISDICTION NAME: PEER REVIEW DATE: PEER REVIEW PERIOD: IRP 710 REGISTRATION IN BASE OF CARRIER Review the jurisdiction s procedures, laws, instructions or information manual to ensure the combined distance is required when registered according to Sections 700 and 705. REVIEWER COMMENTS /INITIALS (FOR COMPLETED STEPS) OR N/A (FOR STEPS NOT COMPLETED) IRP 1205 FEE CHANGES Staff liaison shall determine if the jurisdiction had a fee change within the review period and shall verify that the jurisdiction notified IRP, Inc. of the fee change in the appropriate standard format as approved by the IRP, Inc. Board of Directors. Effective date of fee Date notice of fee change received by IRP, Inc. Fee change notification was in proper format IRP 1215 FEE TRANSMITTALS Identify the jurisdiction s transmittal period. Using information provided by the jurisdiction being reviewed, along with verification from other member jurisdictions, review the prior 12 calendar months to ensure the jurisdiction transmitted funds and required information to the non-clearinghouse member jurisdictions within 30 days of the close of its transmittal period. If the jurisdiction is a member of the IRP Clearinghouse, verify the appropriate apportionable fees and information is transmitted to the Clearinghouse within 30 days following the close of the transmittal period FEE TEST - Review the most recently completed IRP fee test results to identify any inconsistencies with the jurisdiction s calculation of fees BOARD ACTION-RAISING OF ISSUES Review all Governing Board, Dispute Resolution Committee and IRP, Inc. Board decisions. Select those that affect the jurisdiction.

9 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Jurisdiction: Review Period: to Reviewer: Review Dates: to Jurisdiction Questionnaire Review for any unique responses or inconsistencies with Plan requirements. Final Reports Review previous Final Report(s) for this jurisdiction and check for continual or reoccurring issues. Article I, Section 115, Effect of the Plan on Other Agreements Ask if the jurisdiction has agreements or procedures in place that supersede the Plan. Article II, Definitions In Out Review the jurisdiction s laws, instructions and information manual to ensure the following definitions are listed and consistent with the current Plan definition: Apportionable Fee Apportionable Vehicle (If the jurisdiction s system allows the entry of one IRP jurisdiction, randomly select five accounts and check that at least two member jurisdictions are listed) Base Jurisdiction Established Place of Business Estimated Distance Rental Fleet Reporting Period (Randomly select five accounts and verify the reporting period is used consistently) Residence Restricted Plates (Review the list of restricted license plates for the jurisdiction. Verify the plates correctly reflect the criteria established in the definition.) Total Distance

10 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article III, Section 305, Selection of Base Jurisdiction In Out Verify the jurisdiction's procedures for selection of Base Jurisdiction (Established Place of Business and Residency). Review the jurisdiction s list of accounts with business addresses to ensure there are physical addresses listed (no post office boxes). Review the jurisdiction's list of accounts to ensure no business addresses indicate other IRP jurisdictions. Review the list of accounts with business addresses in the base jurisdiction. If multiple accounts list identical addresses, randomly select up to three accounts to ensure the registrants meet the requirements. Select five new accounts (qualified under residency) to ensure the jurisdiction requires registrants to meet at least three of the nine qualifiers for the determination of the base jurisdiction: (i) driver s license; (ii) incorporated or a foreign corporation (Sec. of State filing); (iii) principal owner is a resident; (iv) federal income tax returns; (v) personal income tax returns; (vi) real estate or property taxes; (vii) utility bills; (viii) Vehicle titled; (ix) other factors. Article III, Section 315, Application Process In Out Review the application documents to ensure all information elements required by the Plan are indicated. The registrant lists the actual distance operated during the preceding year. Estimated distance being used is reasonable and explanations of estimates are provided. Article III, 320, Distance Estimates by Base Jurisdiction In Out Verify the jurisdiction s estimated distance chart is based on the required methodology and is updated at least once every three years. Spot check transmittals to identify patterns of unreasonable distance (i.e., extremely low estimates for high-fee jurisdictions, high estimates for low-fee jurisdictions, identical or rounded estimated distance or percentages calculated for multiple new accounts).

11 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article IV, Section 400, Calculation of Apportionable Fees In Out Verify the jurisdiction s process for calculating apportionable fees pursuant to Section 405 or 415. If any fee test discrepancies are noted in the preliminary review, verify if and how the discrepancies have been corrected or addressed. Verify the jurisdiction s process for calculating apportionable fees pursuant to Section 405 or 415 and is multiplied by the total apportionable fees required under the law of the member jurisdictions for full registration of the vehicles in the fleet for the registration year, or the unexpired portion of the registration year, as the case may be. Article IV, Section 405, Calculation of Apportionment Percentage In Out Identify the jurisdiction s application process (with an emphasis on distance reporting and estimated distance) to ensure there are proper procedures for reviewing and rejecting estimated distance. Verify the jurisdiction s procedures for permitting first year estimates. Identify possible patterns of unreasonable distance such as low estimates for jurisdictions other than the base jurisdiction or identical estimated distances for multiple jurisdictions. Randomly select five accounts from a list of renewal applications and verify that any second and subsequentyear estimates are computed over 100% unless the estimates are for operations that began after the reporting period. Select five renewal applications with supplements containing eliminated jurisdictions. Examine the percentage calculations to determine whether the distances have been eliminated from the total distance (ensure the distances of reduced operations are not calculated within the 100%). Examine any supplements in the applications to determine if the eliminated jurisdictions have been added back and if the actual distance was used for the minimum estimate, the fees were calculated over 100% for the added jurisdiction. Randomly select ten new accounts (identify different types of accounts, i.e., long haul and regional carriers, private carriers, household goods carriers), and review the accounts to determine if the registrant: Stated the estimated distance to be traveled in each jurisdiction. Justified the estimated distance. Denoted any estimated distance from the jurisdiction s estimated distance chart. Used the preceding year s actual distance unless the estimates are being used in accordance with 405(d), less than 90 days in the reporting period.

12 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article IV, Section 410, No Minimum Registration Fee In Out Verify there are no minimum fees except base jurisdiction statutory fees. Article IV, Section 415, Additional Jurisdictions In Out Verify the procedures for adding jurisdictions after the beginning of the registration year. Verify the percentage calculated is over 100% for jurisdictions added after the beginning of the registration year. Verify the apportionment percentage previously determined for any other member jurisdiction is not altered. Article IV, Section 420, New Fleets In Out Review the jurisdiction s procedures for establishing a new fleet. Review the process for ensuring the reporting of actual distance when the Fleet is composed entirely or primarily of vehicles over which the applicant exercised control during the reporting period. Article IV, Section 425, Additional Vehicles In Out Select five accounts with multiple supplements and confirm the distance percentage on the original supplement is unchanged with the addition of new supplements. Verify fees are calculated from the first day of the month. If jurisdiction statues provide for a different calculation method, obtain a copy of enabling statute. Article IV, Section 430, Fleet Consolidation In Out Review the jurisdiction s procedures for fleet consolidations and ensure they comply with the provisions of Section 420. Ensure that when a registrant combines two or more existing fleets of its apportioned vehicles, the actual distance from all the vehicles in the resulting fleet are used in determining the apportionable fees. Article IV, Section 435, Refunds and Credits In Out Identify the procedures used for added/deleted vehicles or vehicle transfer supplemental transactions. Ensure that the apportionable fees for the remainder of the registration is available for transfer to a replacement vehicle or subject to the law of the jurisdiction, may be credited or refunded to the registrant. Article IV, Section 440, Credit for Replacement Vehicles In Out Identify the procedures used for added/deleted vehicles or vehicle transfer supplemental transactions. Ensure that the jurisdiction allows a registrant to transfer the registration of vehicle withdrawn from a fleet to a replacement vehicle in accordance with the jurisdictions transfer requirements.

13 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article IV, Section 445, Foreign Exchange In Out Verify the method used by the jurisdiction in calculating Canadian fees: If the jurisdiction uses the exchange rate for transmittal of U.S./Canadian funds, verify the jurisdictions procedures to ensure the proper rate is consistently being used and the appropriate fees are being calculated. If the jurisdiction is billing in the other member jurisdiction s units of currency, visually examine five U.S. applications listing Canadian jurisdictions or five Canadian applications listing U.S. jurisdictions for verification that fees are being billed in the appropriate dollars and that fees are being properly deposited into two separate bank accounts. Article V, Section 505, Cancellation of Registration In Out Verify the jurisdiction s procedures to cancel, suspend or revoke apportioned registration if the registration was granted erroneously, or if the Registrant fails to pay any apportionable fees. Article V, Section 510, Operation Under Plan Registration In Out Verify that apportioned vehicles shall be deemed fully registered for any type of movement or operations (ensure that base and foreign apportioned vehicles can travel both interjurisdictionally and intrajurisdictionally in its jurisdiction. Article V, Section 530, Unladen Vehicle Registration (Hunter's Permits) In Out Request a copy of the jurisdiction s Unladen Weight Permit. Ensure the weight is limited to unladen weight and that the jurisdiction honors those issued by other IRP jurisdictions. Article VI, Section 600, Credentials for Apportioned Registration In Out Visually inspect an apportioned license plate to ensure it displays "apportioned," "APP" or "PRP" and the jurisdiction name. Determine if the jurisdiction issues Cab Cards by electronic means and if so, verify the jurisdiction provides a means by which law enforcement can verify the validity of the Cab Card.

14 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article VI, Section 610, Contents of the Cab Card In Out Obtain copies of registration cab cards from five sample applications that include both U.S. and Canadian jurisdictions and verify each registration card appropriately identifies the vehicle for which it is issued as follows: Lists the jurisdictions in which the vehicle is apportioned. Lists the weight, or other qualifying information for which the vehicle is registered according to the application (pounds should be listed for U.S. jurisdictions, kilograms should be listed for Canadian jurisdictions and axles should be listed for Quebec). Verify the card contains all the information as required in Section 610: Date the vehicle was registered, date of issuance or effective date of registration Expiration date of the cab card and enforcement date if a grace period applies Vehicle model year, make & VIN Plate number Equipment number Registrant name and address Account number Comment: Verify the jurisdiction s procedures for issuing apportioned credentials and ensure apportioned credentials are not issued until the registrant has paid all apportionable fees due or past due. Article VI, Section 605, Display of Registration Credentials In Out Verify the jurisdiction s procedures for the display of registration renewal credentials. Ensure that registrants are allowed to display both the new base plate and Cab Card as soon as they are issued. However, verify that registrants are required to carry the previously-issued Cab Card until the new registration year begins. Article VI, Section 620, Temporary Evidence of Apportioned Registration In Out If the jurisdiction issues temporary evidence of apportioned registration pending the issuance of Credentials, verify: The temporary evidence identifies the member jurisdictions for which the vehicle has been registered, the vehicle weight or other qualifying information (axles for Quebec). The temporary evidence specifies the effective date and has an expiration date that is not later than 60 days following the effective date. The temporary evidence can be verified by law enforcement (if issued electronically). The jurisdiction recognizes temporary evidence of apportioned registration issued by other member jurisdictions. Article VII, Section 705, Registration in Base of Service Representative In Out Obtain samples of Household Goods Carrier files to verify the jurisdiction lists both the Service Representative name and that of the carrier as lessee, with the apportionment of fees according to the records of the carrier.

15 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article VII, Section 710, Registration in Base of Carrier In Out Review the jurisdiction s procedures, laws, instructions or information manual to ensure the combined distance is required when registered according to Sections 700 and 705. Obtain samples of Household Goods Carrier files to verify the jurisdiction lists the Carrier as the registrant and the Service representative as Lessor. Article VIII, Motor Bus Apportionment, Section 805, Determination of Distance In Out Verify how the jurisdiction defines Motor Bus. Obtain procedures for bus registration in the jurisdiction s laws, instructions or information manual to ensure both options for determination of distance are offered. (Note: Charter buses do not apply to Section 805.) Comment: Article IX, Section 900, Base Jurisdiction for Rental Fleet In Out Inquire whether the jurisdiction: Allows the registration of rental fleets. Has rental fleets registered. Requires an established place of business if the rental agreement is for more than 60 days. Requires distance in the jurisdiction when the rental agreement is more than 60 days Article IX, Section 905, Rental Passenger Cars In Out Determine what department or agency within the jurisdiction handles allocation registration (ensure the department or agency provides samples of revenue reports filed by rental car agencies). If handled by the IRP section, verify whether the jurisdiction calculates the percentages correctly. Article IX, Section 910, Rental Utility Trailers In Out Determine what department or agency within the jurisdiction handles allocation registration (ensure the department or agency provides samples of revenue reports filed by rental utility trailer agencies). If handled by the IRP section, verify whether the jurisdiction calculates the percentages correctly. Verify the jurisdiction correctly calculates the trailers rented in the preceding year.

16 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article IX, Section 915, One-Way Vehicle In Out Determine what department or agency within the jurisdiction handles allocation registration (ensure that the department or agency provides samples of revenue reports filed by rental truck agencies, and verify from these samples that allocation percentages are calculated correctly). If there is evidence of one-way rental vehicle fleets based in the jurisdiction, randomly select three to five applications of one-way rental vehicle fleets and verify the vehicles are allocated to member jurisdictions in proportion to the mileage operated in each member jurisdiction by the rental fleet. Article X, Section 1065, Netting of Audit Adjustments In Out Verify the jurisdiction has procedures in place to properly collect and refund audit adjustments. Ensure that the collection of any underpayment is transmitted within 30 days following the transmittal period during which such payment was received. Article X, Section 1070, Audit Transmittals In Out Determine whether the jurisdiction is netting its audit adjustments as defined in the Plan to both Clearinghouse and non-clearinghouse member jurisdictions. Determine which department within the jurisdiction is responsible for preparing audit transmittals. Determine who is responsible for sending audit reports to the jurisdictions. Determine the jurisdiction s procedures and timeframe for transmitting audit reports. Obtain from the peer review auditor five audit reports with transmittal activity in which fees were adjusted as a result of audit, and additional fees were due to/from other jurisdictions. From the listing of audit transmittal reports selected, verify the reports include: Each audited registrant s name and account number. The registration year or years audited. Each registrant s adjusted fees due to or from the jurisdiction. The total of adjusted fees transmitted or due. Article XII, Section 1200, Cooperative Agreement In Out Document the jurisdiction s procedures used to cooperate and assist other jurisdictions with applications with delinquent or outstanding fees. Ask for any correspondence received by the jurisdiction from other jurisdictions requesting help. Verify there have been no problems with the jurisdiction assisting other member jurisdictions in the collection of fees due if one of the jurisdiction s registrants fails to pay fees.

17 SECTION I ADMINISTRATIVE REVIEW PROCEDURES PRIMARY REVIEW Article XII, Section 1205, Fee Changes (verified by IRP, Inc. Peer Review Coordinator) In Out Determine if the jurisdiction had a fee change within the review period and that the jurisdiction notified IRP, Inc. of the fee change in the appropriate format as approved by the IRP, Inc. Board of Directors. Note the effective date of the change, the date submitted to IRP, Inc. and that it was formatted correctly. Verify the jurisdiction implemented other jurisdictions fee changes and collected proper fees due by the effective date. If the jurisdiction failed to implement a fee change by the effective date, verify the jurisdiction performed the appropriate re-bill and/or credit adjustment caused by the time delay. Article XII, Section 1210, Timely Collection of Apportionable Fees In Out Verify the jurisdiction has procedures for suspending the registration of a registrant that has failed to pay all apportionable fees due within 90 calendar days of issuance. Article XII, Section 1215, Fee Transmittals In Out Review the prior 12 calendar months to ensure the jurisdiction transmitted funds and required information to the non-clearinghouse member jurisdictions within 30 days of the close of its transmittal period. If the jurisdiction is a member of the IRP Clearinghouse, verify the appropriate apportionable fees and information is transmitted to the Clearinghouse within 30 days following the close of the transmittal period. Interview the jurisdiction on its transmittal practices. If the jurisdiction is not transmitting the fees within the allotted time period, compare the sample transactions documented by the reviewer in the preliminary review with the transaction and transmittal information supplied by the jurisdiction (dates of checks, dates of postmarks, dates received). The reviewer shall ensure the jurisdiction s transmittals, or supporting documentation contains the information identified in Section 1215 and the transmittals include all the information necessary for the receiving jurisdiction to verify the funds received. If the jurisdiction consecutively dates their transmittals, ensure the dates are within the range for the time period covered. If the jurisdiction is a member of the IRP Clearinghouse, ensure the jurisdiction is in good standing and all fees and information are being transmitted to the Clearinghouse within the appropriate time frame. Article XII, Section 1225, Fee Test In Out Verify the jurisdiction completed the annual Fee Test and provided the results to the Repository within the allotted time frame. Ensure that any discrepancies have been corrected or addressed. Review the most recently completed IRP fee test results to identify any inconsistencies with the jurisdiction's calculation of fees. Article XIV, Section 1400, Board Action-Raising of Issues (verified by IRP, Inc Peer Review Coordinator)

18 SECTION II AUDIT REVIEW PROCEDURES PRELIMINARY REVIEW JURISDICTION NAME: PEER REVIEW DATE: PEER REVIEW PERIOD: REVIEWER COMMENTS/ INITIALS (FOR COMPLETED STEPS) OR N/A (FOR STEPS NOT COMPLETED) The purpose of the audit review procedures is to ensure a uniform process of evaluating the audit methodologies and processes employed by IRP member jurisdictions. In the Completed column, please initial steps as they are completed, and indicate N/A if a step could not be completed. Any significant comments or findings should be documented on the Review Log. Findings of non-compliance, and sections which are in compliance but require additional explanation, are to be documented in the Peer Review Final Report, and the Review Log. PRELIMINARY REVIEW PROCEDURES: Contact the jurisdiction s audit personnel to determine who will be the primary contact during the review, and also to determine where the audit review will take place. Audit contact Location of Review Obtain the final report, and audit review documentation, of the jurisdiction's most recently completed Peer Review (if applicable). Note any findings of noncompliance, or items that were in compliance but required explanation, to determine if any findings still exist or have been corrected. (IRP 1025) Obtain the Annual Report of IRP Audit Activity forms (APM Appendix A) completed each of the calendar years under review by the jurisdiction being reviewed. Determine whether the total number of audits listed meets or exceeds the 3% yearly average requirement (attachment 3). If the jurisdiction conducts Records Reviews, determine the number of reviews conducted each of the calendar years under review and ensure no more than 25% of the audit requirement (per year) is satisfied by those reviews (3 reviews may be substituted for 1 audit) (IRP 1055) Check with reviewer s audit personnel to determine if the jurisdiction has

19 SECTION II AUDIT REVIEW PROCEDURES PRELIMINARY REVIEW JURISDICTION NAME: PEER REVIEW DATE: PEER REVIEW PERIOD: sent audit findings during a period of three to six months prior to the review visit. REVIEWER COMMENTS/ INITIALS (FOR COMPLETED STEPS) OR N/A (FOR STEPS NOT COMPLETED) Determine if the information being sent would allow a proper decision to be made by a foreign jurisdiction. (APM 201) Obtain and review the jurisdictional personnel hiring guidelines, organizational chart, and procedural flowcharts (if available). (APM 201) Select a sample of audits from the jurisdiction s audit list. It is up to the review auditor to determine a sample selection method. Once the population size is determined, at least half of the audits to be sampled shall be from the final calendar year of the review period, and the remaining audits shall be randomly selected from the two calendar years preceding the final calendar year. The initial sample size can be reduced or expanded based on auditor judgment; if reduction or expansion occurs, document this on the Peer Review Log. (APM 205) Review the standardized audit program submitted by the jurisdiction. (APM 204) Review the jurisdiction s organizational chart to determine if possible organization impairments to auditor independence may exist. (APM 1220) Verify whether annual audit reports have been filed for the period covered by the compliance review. Examine the annual reports to determine whether the reports were filed timely and accurately.

20 Jurisdiction: XXX Review Date: XXX Review Period: The base jurisdiction shall perform a number of audits equivalent to at least an average of 3% of the number of IRP fleets renewed for each year of the peer review period. One audit will reflect the records examined for one fleet for the respective preceding year. Three record reviews will be equivalent to one audit Required Renewed Reported Verified Audited % Audited Per Audits Per Fleets Calendar Year Audited Fleets Fleets Calendar Year Calendar Year Previous Calendar Year Appendix A International Registration Plan Compliance with Section (1015) 1025, Frequency of Audits Record Reviews Annual Report Annual Report Annual Report Annual Report Schedule of Completed Audits Col 5 / Col 2 Col 2 * 3% #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0 Totals - 0 #DIV/0! 0 0 Excess / (Deficit) 0 0 Summary: Verified Audited Fleets 0 Record Reviews 0 Audited Fleets 0 Regarding record reviews, the audit reviewer must remember that for 2013, reviews can account for no more than 25% of 1.5% of the audit requirement since the language is not effective until July. If the jurisdiction's 3% requirement is 150, records reviews that year can only be used to replace 25% of 75 audits, not 25% of 150. Note, cite in ( ) is pre 07/01/ of 1 Attachment 3 - Frequency of Audits Matrix

21 Explanation: New operations - all estimated distance - are not subject to audit; therefore, only renewed fleets can be audited; the renewed fleets for one year determine the 3% requirement for the following year (i.e., year 1 renewed fleets x 3% = year 2 audit requirement). Note: The Annual Report of Audit Activity is due by March 1st of each year and is titled for the year it is filed (i.e., 2012 Report is due by March 1, 2012; however it reflects the jurisdiction's 2011 data). Columns 1 & 3 reference the years being reported; therefore, the data will be found on the following year's Report Form (i.e., 2011 renewed fleets and audits will be reflected on the 2012 Annual Report). Completing the Matrix: 1) Enter the initial year of the review period in column 3 (the balance will populate automatically, as will column 1). 2) For the year in (1), look at the annual report from the successive year and pull the number of renewed fleets (2) detailed on that form; the renewals will reflect the year in (1) - DO NOT PULL THE REPORTED AUDITS (4) FROM THAT FORM. 3) From the next year's report (1), you will pull the reported audits to finish the first line (4) and the renewed fleets (2) for the next line. Continue in this fashion until the matrix is completed. NOTE: Since the audit review only goes through the most recently completed calendar year, for those reviews conducted prior to July each year, you will generally have to rely on the list of completed audits provided by the jurisdiction for the final year. Considering that data has not yet been reported, your entry will be limited to the verified column (5). 4) Enter the verified audited fleets (5) after you have reviewed the jurisdiction's completed audit list for the review period. 2 of 1 Attachment 3 - Frequency of Audits Matrix

22 Jurisdiction: XXX Peer Review Date: XXX Peer Review Period: AUDITORS & AUDITING STANDARDS Cite AUDITOR QUALIFICATIONS AND RESPONSIBILITIES Comments 301 Jurisdiction auditors meet the qualifications of the jurisdiction's personnel guidelines. 201 Auditors have adequate technical training and proficiency. ADEQUATE PLANNING AND SUPERVISION 204(a) 204(b) Jurisdiction's audit and audit support staffs are properly trained in audit planning and audit procedures. Supervisory follow-up and review of the auditor's procedures exists. AUDITOR ORGANIZATIONAL INDEPENDENCE 205(a) 205(b) The auditor must be free from personal and external impairments to independence. The auditors are without bias with respect to a licensee under audit. In order to maintain independence, auditors should not be involved with the processing of IRP applications. GENERAL AUDITING STANDARDS 302(a) 202(a) 202(b) 302(d) 303(b) All licensees are given equal consideration; no preferential treatment is given. Due professional care is exercised in performing an audit and in preparing an audit report. The Audit program adopted by the jurisdiction is uniform and thorough to ensure accuracy. Any discrepancies in total dstance reported for member jurisdictions are reported by the base jurisdiction per a complete audit of the registration for the member jurisdictions, and the necessary adjustments are made. Auditors conduct themselves in a manner which promotes cooperation and good relations. Auditors are allowed to discuss any discrepancies with a licensee. 303( c) Auditors are able to make preliminary recommendations to a licensee The base jurisdiction requires registrants to maintain records to substantiate information on the apportioned application The base jurisdiction requires that registrants preserve the records for a period of three years after the close of the registration year. Such records shall be made available for audit. 401 Review policies and procedures pertaining to the adequacy of the distance accounting system maintained by the registrant Review policies and procedures pertaining to a registrant s failure to preserve or maintain records. When inadequate, credits are denied and/or a full fee assessment is applied for the base Determine how audits are counted, and verify other numbers on the annual audit report. Document if by fleet, account, etc The base jurisdiction provided pertinent information to participating jurisdictions concerning the registrant selected for audit in accordance with Section Request and examine the jurisdiction s reexamination correspondence, if any. Verify that affected member jurisdictions were properly notified. Page 1 Attachment 6A - Audit Workpaper Examination

23 Jurisdiction: XXX Peer Review Date: XXX Peer Review Period: AUDITORS, AUDITING STANDARDS & RECORD REVIEWS AUDITOR QUALIFICATIONS AND RESPONSIBILITIES Comments 301(a) 301(b) 302(a) 302(b) Jurisdiction auditors meet the qualifications of the jurisdiction's personnel guidelines. Internal and/or external training opportunities are provided to the audit staff. All licensees and member jurisdictions are given equal consideration; no preferential treatment is given. Auditors conduct themselves in a manner which promotes cooperation and good relations. GENERAL AUDITING STANDARDS 201 Auditors exercise due professional care and have adequate technical training and proficiency. 203(a) 203b Audits are adequately planned. The audit function includes supervisory review, which is documented in the audit file. 204 The auditor and organization must be free from personal, external and organizational impairments to independence. Auditors should not be involved with the processing of IRP applications. 1000(a) The base jurisdiction requires that registrants preserve the records for a period of three years after the close of the registration year. Such records shall be made available for audit. 1005(a) 1005(b) Review policies and procedures pertaining to the adequacy of the distance accounting system maintained by the registrant. Records 1) contain the kind of information needed and 2) substantially cover the fleet's operations. Records may be produced through any means and retained in any format or medium accessible by the base jurisdiction The base jurisdiction provides the registrant with information that supports what types of information constitutes adequate records 1015 Indaquate records prompt the graduated assessment: 1st offense = 20% for all jurisdictions; 2nd = 50%; 3rd + = 100%. 1020(b) Audits are conducted on behalf of all member jurisdictions, and the base makes assessments and collections based on its audits Determine how audits are counted, and verify other numbers on the annual audit report. Document if by fleet, account, etc 1055 The base jurisdiction provided pertinent information to the member jurisdictions concerning the registrant selected for audit Request and examine the jurisdiction s reexamination correspondence, if any. Verify that affected member jurisdictions were properly notified. COMMUNICATIONS 404(a)(ii) 404(c) Auditors are able to make recommendations to a licensee. Auditors are allowed to discuss any discrepancies with a licensee. RECORDS REVIEWS 701 Reflect no fee adjustments 702(a)(i) Comply with Articles 2 and 3 of the Manual 702(a)(ii) Documents the distance accounting system, items in source documents and source used to determine distances 702(a)(iii) Documents/assesses internal controls 702(a)(iv) Determines/documents adequacy of records, identifying specific deficiencies 702(a)(v) Results in a written report to the registrant citing specific deficiencies 702(a)(vi) Documents all contacts with the registrant 702(a)(vii) Retained in accordance with prevailing audit retention requirements 702 If conducted by personnel who are processing applications, all other provisions of the Manual are met. 1 of 1 Attachment 6A - Audit Workpaper Examination

24 Jurisdiction: XXX Name: Review Period: Acct#: Reviewer(s): XX Fleet#: Vehicles: Assess Reg Yr: Cite Plan/APM Requirement Yes / No / Comments Yes / No / Comments 802(a) 802(a)(i) 802(a)(ii) 802(a)(iii) 802(a)(iv) 802(a)(v) 802(a)(vi) 802(a)(vii) 802(a)(viii) 802(a)(ix) 802(a)(x) 802(b) 803(a) 803(b) 803(b)(i) 803(b)(ii) 803(b)(iii) 803(b)(iv) 803(b)(v) 803(b)(vi) 803(b)(vii) 803(b)(viii) 803(b)(ix) 803(b)(x) (a) 802(a) 803(a) A copy of the Registrant Audit Report is kept in the audit file. Registrant Audit Report contains at least the following information: Name and address of registrant. Account number and fleet number. Registration years audited. Distance traveled & percent as originally filed. Distance traveled & percent as a result of audit. Amount of percent factor change. Net fees due (or credit) for each Member Jurisdiction. Remarks, recommendation and findings, including a description of the type records audited and audit techniques employed. Identification of any vehicles removed from the fleet which have full plate fees assessed in the audit. Date the audit report was issued and the name of the auditor. The Registrant Audit Report contains enough information, including detailed schedules, to allow the Registrant to verify any adjustments made. A copy of the Interjurisdictional Audit Report is kept in the audit file. Interjurisdictional Audit Report contains at least the following information: Name of base jurisdiction. Name and address of registrant. Account number. Registration years audited. Number of vehicles apportioned. Reported distance traveled, distance percentage, and fees by jurisdiction. Audited distance traveled, distance percentage, and fees by jurisdiction. A brief narrative of the audit procedures, findings and any other necessary information. Date the audit report was issued and the name of the auditor. Contains a statement on whether the registrant s distance accounting system is adequate or inadequate; if inadequate, the reason why is to be noted. Upon completion of the audit, the registrant and the jurisdictions were provided with a copy of the audit report and afforded the specified review period 30 days for the registrant and 45-days for the jurisdictions. The file includes evidence that timely notification was given to the affected jurisdictions. Page 1 of 3 Attachment 6B - Audit Workpaper Examination Pre 7/2013