IFTA / IRP 2010 Annual Audit Workshop Breakout Session # 1 – Part 2

1. IFTA / IRP 2010 Annual Audit WorkshopBreakout Session # 1 – Part 2 • Distance – It’s a Long, Long Road; Auditing That Newfangled GPS. • Gene Hall (VA) • Derrick Rumph (AR) • Drake Israel (IL)

2. The carrier has the option of using onboard recording devices. These devices are not required by either IRP or IFTA. If the carrier chooses to use one of these devices, the recording system would have to meet the record keeping requirements of both IFTA and IRP.

3. On board recording devices Global positioning systems (GPS)

4. When you run into an electronic system there are several things you need to know about it. a) What does the driver do to activate it? b) Are there any reviews or checks by office staff? c) How does the information get into the system? At what point? Reviews or checks before entry? d) Does their system do any automated checks? e) If odometers are entered, does the system check odometer total distance to jurisdiction total distance?

5. Would you accept records if kept electronically by registrant/licensee? The main thing to remember is what information do you need to test distance? You should ask as many questions about the software and procedures in order to fully understand them.

6. Have you conducted a GPS audit? What questions do you ask about the carriers system?

7. *P600 ELECTRONIC DATA RECORDING SYSTEMS *P610 OPTIONAL USE FOR FUEL TAX REPORTING On-board recording devices, vehicle tracking systems, or other electronic data recording systems may be used (at the option of the carrier) in lieu of or in addition to handwritten trip reports for tax reporting. Other equipment monitoring devices that transmit data or may be interrogated as to vehicle location or travel may be used to supplement or verify handwritten or electronically-generated trip reports. Any device or electronic system used in conjunction with a device shall meet the requirements stated in this Section. On-board recording or vehicle tracking devices may be used in conjunction with manual systems or in conjunction with computer systems.

8. P620 DEVICES USED WITH MANUAL SYSTEMS All recording devices must meet the requirements stated in IFTA Procedures Manual Section P640 and P660. When the device is to be used alone, printed reports must be produced which replace handwritten trip reports. The printed trip reports shall be retained for audit. Vehicle and fleet summaries which show miles and kilometers by jurisdiction must then be prepared manually.

9. P630 DEVICES USED WITH COMPUTER SYSTEMS The entire system must meet the requirements stated in IFTA Procedures Manual Sections P640, P650, and P660. If the printed trip reports will not be retained for audit, the system must have the capability of producing, upon request, the reports indicated in IFTA Procedures Manual Section P640. When the computer system is designed to produce printed trip reports, vehicle and fleet summaries which show miles and kilometers by jurisdiction must also be prepared.

10. *P640 DATA COLLECTION REQUIREMENTS To obtain the information needed to verify fleet distance and to prepare the "Individual Vehicle Distance Record”, the device must collect the following data on each trip. .100 Required Trip Data .005 Date of Trip (starting and ending); .010 Trip origin and destination (location code is acceptable); .015 Routes of travel or latitude/longitude positions used in lieu thereof (may be waived by base jurisdiction). If latitude/longitude positions are used, they must be accompanied by the name of the nearest town, intersection or cross street. If attitude/longitude positions are used, jurisdiction crossing points must be calculated or identified;

11. P640 Continued .020 Beginning and ending odometer or hubodometer reading of the trip (may be waived by base jurisdiction); .025 Total trip distance; .030 Distance by jurisdiction; .035 Power unit number or vehicle identification number; .040 Vehicle fleet number; and .045 Registrant's name.

12. What is an “Exception report”? 650..400 Exception Reports Exceptions that identify all edited data, omissions of required data (see IFTA Procedures Manual Section P640), system failures, noncontiguous life-to-date odometer readings, travel to noncontiguous jurisdictions, and trips where the location of the beginning trip is not the location of the previous trip must be identified.

13. IRP/APM ARTICLE 500 ON-BOARD RECORDING DEVICES • 501. On-Board Recording Devices • (a) On-board recording devices may, at the option of the Registrant, be used in lieu of or in addition to handwritten trip reports for purposes of apportioned registration record-keeping. If a Registrant exercises this option, any device or electronic system used in conjunction with a device shall meet the requirements identified in this Manual. Other equipment monitoring devices, such as those which transmit or may be interrogated as to Power Unit location or travel, may (at the option of the Registrant) be used to supplement or verify handwritten or electronically-generated trip reports. • (b) All recording devices used to generate trip reports or used in conjunction with manual systems must meet the requirements shown in Sections 504 and 505. When the on-board recording device is used in conjunction with an electronic computer system and reports are prepared on the basis of data downloaded from the recording device, the overall system must meet the requirements of Sections 504, 505, and 506.

14. 502. Use of On-Board Recording Device Only • When the device is to be used alone, printed reports must be produced which replace handwritten trip reports. The printed trip reports shall be retained for Audit. Power Unit and Fleet summaries which show In-Jurisdiction Distance must then be prepared.

15. 503. Use of On-Board Recording Device in Conjunction with an Electronic Computer System • (a) When the computer system is designed to produce printed trip reports, Power Unit and Fleet summaries which show In-Jurisdiction Distance must also be prepared. • (b) When the printed trip reports will not be retained for Audit, the system must have the capability of producing, upon request, the reports indicated in Section 506.

16. 504. Minimum Device Requirements • (a) The Registrant must obtain a certificate from the manufacturer certifying that the design of the on-board recording device has been sufficiently tested to meet the requirements of this provision. • (b) The on-board recording device and associated support systems must be, to the maximum extent, practicable and tamperproof and must not permit altering of the information collected. Editing of copies of the original information collected will be allowed, but all editing must be identified, and both the edited and original data must be recorded and retained. • (c) The on-board recording device shall warn the driver visually and/or audibly that the device has ceased to function. • (d) The device must time and date stamp all data recorded.

17. 504 Continued • (e) The device must not allow data to be overwritten before the data has been extracted. The device shall warn the driver visually and/or audibly that the device’s memory is full and can no longer record data. • (f) The device must automatically update a life-to-date odometer when the Power Unit is placed in motion, or the operator must enter the current Power Unit odometer reading when the on-board recording device is connected to the Power Unit. • (g) The device must provide a method for the driver to confirm that driver-entered data is correct (e.g. a visual display of the entered data that can be reviewed and edited by the driver before the data is finally stored).

18. IRP 505. Data Collection (a) To obtain the information needed to verify fleet distance and to prepare the Individual Vehicle Distance Record (IVDR), the device must collect the following data on each trip: 1. Date of trip (starting and ending); 2. Trip origin and destination (location code is acceptable); 3. Route of travel (may be waived by base jurisdiction); 4. Beginning and ending odometer or hubodometer reading of the trip (may be waived by base jurisdiction); 5. Total trip distance traveled; 6. Distance traveled by jurisdiction; 7. Power unit number or vehicle identification number.

19. (b) The Base Jurisdiction may waive either item (3) or (4) above, but may not waiveboth items (3) and (4). • Also, the device may include, at the discretion of the Base Jurisdiction, the following additional information: • (i) Fleet number; • (ii) Registrant’s name; • (iii) Vehicle identification numbers; • (iv) Driver ID or name; and • (v) Intermediate trip stops.

20. 506. Capability of System to Produce Reports • Generally speaking, the reports referred to in this section are not prepared by the on-board recording device. Instead, these reports are prepared using an electronic computer system which accepts data from the on-board recording device. The system shall be able to produce the following reports: • (i) For each trip, an Individual Vehicle Distance Record (IVDR) report that includes the information required in Section 505 (Note: This report may be more than one page.); • (ii) A report that indicates when the on-board recording device was last calibrated and the calibration method used;

21. 506 Continued • (iii) An exception report(s) that identifies all edited data, omissions of required data (see Section 505), system failures, non-continuous life-to-date odometer readings, travel to noncontiguous states, and trips where the location of the beginning trip is not the location of the previous trip; • (iv) A monthly, quarterly, and annual summary of trips by unit number showing total In-Jurisdiction Distance; and • (v) Monthly, quarterly, and annual trip summaries by Fleet showing the number of total In-Jurisdiction Distance.

22. 507. Registrant Responsibility • (a) It is the Registrant’s responsibility to recalibrate the on-board recording device when tire size changes, the Power Unit drive-train is modified, or any modifications are made to the Power Unit which affect the accuracy of the on-board recording device. The device must be maintained and recalibrated in accordance with the manufacturer’s specifications. A record of recalibrations must be retained for the record retention period. • (b) It is the Registrant’s responsibility to ensure their drivers are trained in the use of the computer system. Drivers shall be required to note any failure of the on-board recording device and prepare manual trip reports of all subsequent trip information until the device is again operational.

23. 507 Continued • (c) It is the Registrant’s responsibility to maintain a second copy (back-up copy) of the electronic files, either electronically or in paper form, for the Audit retention period. • (d) At the discretion of the Base Jurisdiction, Registrants may submit Operational Records for Audit to the Base Jurisdiction through electronic data transfer. • (e) It is the Registrant’s responsibility to ensure the entire record-keeping system meets the requirements of the Plan. It is suggested that the Registrant contact the Base Jurisdiction for verification of Audit compliance prior to implementation.

24. Questions to ask. 1.  What type of GPS system do you have? 2. How often does the GPS send a signal? (transmitsa ping) Are all pings recorded? If not, why not? 3. What information is the GPS recording? (i.e. date, location points, odometer reading, fuel stops, when the engine is turned off, some sort of “event”, etc.) 4. If your GPS system records odometer readings, at what points are the odometer readings being captured? 5. How does your GPS system calculate miles?

25. 6. Do you use other computer software in addition to your GPS that calculates miles and or fuel? If so, what type of software do you use and what is its function? 7. Can the following reports be generated? _____ Fleet mileage summaries listing total miles and juris. miles per unit and for the entire fleet? _____ Unit mileage summaries listing total miles and juris. miles. _____ Total and jurisdictional miles per trip. _____ Routes of travel (detail of GPS location points) by trip. List any other reports generated by the GPS system that would be useful for a mileage and fuel audit.

26. 8.What reports do you use to prepare your IFTA returns? 9.What reports do you use to prepare your IRP renewals? 10. How long are you retaining your printed GPS reports? 11. How long are you able to retrieve printed and non-printed reports? 12. Are you able to generate and print exception reports? (See Section P650.400 IFTA Procedures Manual) 13. Is the GPS information being edited? Why would someone edit the GPS information? What specifically is being edited? 14. Can the driver defeat or tamper with the GPS system?

27. 15.Does your GPS system rely on the truck’s battery for power? 16. How would you know if the truck was being towed (moving but not accruing miles)? 17. Are you alerted when the GPS system is not receiving a signal from a unit or if there is a problem with the signal? 18. What is your procedure or policy of recording mileage information if the GPS system were to malfunction? 19. Do you have units that are not equipped with the GPS? Please provide a listing of units, (by unit number) without GPS. 20. If you operate units without GPS, what records are being kept for these units?

28. Has the technology of G.P.S matured to the point where its fully dependable to accurately capture all vehicle activity? Has the technology and computer software able to capture a trucks signal and produce the reports that the IFTA and IRP require? Are we moving from the old geological Lat, Long “ping” every 30 minute systems, to real time monitoring via a road map system? Will makers like Tom-Tom, Garmin, and Magellan take the place of the traditional “hand prepared” driver source documents on-board the trucks we audit? Is G.P.S systems more accurate than driver recorded odometer readings and routes of travel? More accurate than PC-Miler or Promiles mapping software?

29. Do you trust it? How do you test a G.P.S system? The carrier your about to audit does not have driver prepared source documents. No unit odometers, routes of travel or beginning and ending destinations. They did however, maintain their bills of laden for the audit scope and their last 6 months of D.O.T. logs which have odometer readings recorded on them. The owner, states he uses his G.P.S. computer printouts which records routes of travel, captured by their 5 minute “ping” G.P.S. They use their G.P.S.reports with ProMiles to report his IFTA returns, and IRP renewal. How would you handle this type of situation?

30. A)Tell the carrier that since he did not have his G.P.S. checked and given a wavier from using driver source documents, that you will be back in 1 year to check for compliance. (Get a pencil and paper and start recording the requirements of the IFTA and IRP). B) Trust the G.P.S and accept the reports? C) Apply a reduction in MPG’s to cover what you don’t know for sure? D) Apply a 4.0-MPG adjustment and 100% fees to cover what you don’t know for sure? E) Use the last 6 months of D.O.T. logs and bill of laden to check against the G.P.S. system. F) Roll your eyes and laugh hysterically as you mumble to the owner that “You’ll send a bill”…………………. Then leave………..

31. Has your jurisdiction granted a GPS wavier?