Computer Capacity:
IRS Must Better Estimate Its Computer Resource Needs
IMTEC-87-5BR: Published: Nov 3, 1986. Publicly Released: Nov 14, 1986.
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Pursuant to a congressional request, GAO: (1) determined the status and progress of the Internal Revenue Service's (IRS) Capacity Enhancement for the Processing System (CEPS) procurement; and (2) analyzed the need for and timing of CEPS, which IRS designed to upgrade or replace its large mainframe computers.
IRS believed that, with CEPS, its existing mainframe computers would have sufficient capacity to process taxpayer information and update computer files beyond 1989. IRS later decided to postpone upgrading and identified a series of initiatives which it felt would extend the existing mainframe computers' usefulness. GAO found that the Department of the Treasury endorsed the IRS decision to abandon CEPS in favor of: (1) adopting the initiatives; and (2) combining the procurement strategy of CEPS with the planned Tax System Redesign (TSR). GAO believes that: (1) the existing mainframes will have the capacity to handle IRS tax processing work loads through at least mid-1991, assuming that no large unexpected increase in work loads occurs and IRS effectively carries out its planned initiatives; (2) the IRS initiative to constrain annual work-load growth to 8 or 10 percent could be difficult to achieve because IRS plans to install new equipment and introduce new on-line applications that could increase demand for tax account information; and (3) if IRS does not successfully implement its initiatives, it could experience capacity problems at its larger service centers as early as mid-1988. GAO also believes that: (1) without a work-load analysis and a continuing analysis of current system utilization, IRS will not have adequate assurance that its initiatives are working and could unexpectedly find itself short of computer capacity when it implements TSR; and (2) such an unexpected shortage could have a devastating impact on operations, as was evidenced in the 1985 tax filing year.
Recommendations for Executive Action
Status: Closed - Implemented
Comments: IRS hired a private consulting firm to help determine the relationship between physical work load and computer work load. IRS regularly studies its work loads processed on its mainframes.
Recommendation: Because of the importance of the mainframe computers to IRS ability to accomplish its mission and the need for continued improvement in its investment decisions on these critical computer resources, the Commissioner of Internal Revenue should develop and maintain comprehensive work-load data for current and planned automatic data processing (ADP) requirements.
Agency Affected: Department of the Treasury: Internal Revenue Service
Status: Closed - Implemented
Comments: IRS analyzes computer utilization during the tax processing season. This analysis will be conducted annually. It will be used to develop baseline capacity requirements and to project future capacity needs. As IRS quantities benefits from its initiatives, they will be incorporated into the analysis.
Recommendation: Because of the importance of the mainframe computers to IRS ability to accomplish its mission and the need for continued improvement in its investment decisions on these critical computer resources, the Commissioner of Internal Revenue should monitor the performance of the installed mainframe computers to provide a baseline for determining whether the initiatives actually extend the useful life of the existing mainframes and for evaluating alternatives for meeting future ADP requirements.
Agency Affected: Department of the Treasury: Internal Revenue Service
Status: Closed - Implemented
Comments: IRS analyzes daily and weekend processing capacity requirements. This analysis will be conducted after each tax filing season on an ongoing basis. Further, the results of an IRS study to better define the relationship between tax returns and computer utilization will be incorporated into this analysis as they become available.
Recommendation: Because of the importance of the mainframe computers to IRS ability to accomplish its mission and the need for continued improvement in its investment decisions on these critical computer resources, the Commissioner of Internal Revenue should analyze the impact of the various work loads on the utilization of the mainframe computers to effectively estimate and plan for future IRS ADP requirements.
Agency Affected: Department of the Treasury: Internal Revenue Service
Status: Closed - Implemented
Comments: IRS provided formal testimony to the Subcommittee on February 23, 1988, and has subsequently met with the Subcommittee staff. IRS intends to continue to report to the Subcommittee staff on its progress in extending the useful life of its current system until it implements the redesigned system.
Recommendation: Because of the importance of the mainframe computers to IRS ability to accomplish its mission and the need for continued improvement in its investment decisions on these critical computer resources, the Commissioner of Internal Revenue should report to the House Committee on Ways and Means, Oversight Subcommittee, any significant deviations or delays in the achievement of the initiatives or any other factors that may jeopardize IRS' ability to extend the useful life of its mainframes through 1991.
Agency Affected: Department of the Treasury: Internal Revenue Service
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