TEI monitors implementation of CEP-QIP changes.

TEI Monitors Implementation of CEP-QIP Changes

For more than a year, the Internal Revenue Service has been studying its Coordinated Examination Program, with a view toward revamping the program to facilitate more timely and efficient audits of large corporations. As the principal association of corporate tax executives, Tax Executives Institute has long been concerned about proposed changes in the CEP program, especially as they relate to the role of ligitating counsel in audits and the independence of the Appeal Division. TEI's most recent submission on the program - which addressed certain proposed changes developed by an IRS quality improvement (QIP) team - was published in the July-August 1990 issue of The Tax Executive.

IRS Approves CEP Changes

On July 30, 1990, the IRS's Executive Committee approved a series of changes in the CEP program. Specifically, the IRS leadership approved a decision paper calling for the creation of a National Policy Board, the establishment of a program of legal and technical assistance to the field, and the adoption of procedures to improve functional coordination among Examination, Appeals, and Counsel. The decision paper endorsed "the idea of pre-conference meeting[s] of Examination and Counsel with Appeals," stating that "Appeals will have continuing discussion with Examination when new arguments or developments arise."

With respect to the role of Counsel, the decision paper states: "Due to the complexity of the issues arising in CEP cases and the need for prompt legal and technical assistance, Counsel will provide that assistance from the start of each CEP Examination."

Meeting with

Commissioner Goldberg

On August 7, 1990, representatives of TEI met with IRS Commissioner Fred T. Goldberg, Jr. and Senior Deputy Commissioner Michael J. Murphy to discuss several items, including the CEP-QIP changes. TEI's delegation was headed by 1989-1990 TEI President William M. Burk of CPC International Inc. and included 1989-1990 Senior Vice President (and current President) Michael J. Bernard of Mobil Corporation and Neil P. Wissing of Weyerhaeuser Company, who is a member of the Institute's Executive Committee. TEI Executive Director Thomas P. Kerester and TEI Tax Counsel Timothy J. McCormally also attended the meeting.

During the meeting, TEI expressed its continuing concerns about the involvement of Counsel in the audit process and the independence of Appeals. TEI questioned whether the proposed changes would...