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Highlights

The Internal Revenue Service (IRS) collects the revenues that fund the federal government and issues billions of dollars in refunds. Consequently, IRS's ability to demonstrate agility and speed in restoring its functions after a disruption is vital to the government and the economy. GAO (1) identified the definition and attributes of organizational resilience; (2) examined the extent to which these attributes are exhibited within IRS; and (3) reviewed the challenges and opportunities faced by the IRS in becoming more resilient. GAO gathered and analyzed the attributes of resilience based on discussions with academic and practitioner experts in the field. GAO then reviewed IRS human capital and emergency preparedness policies and strategic plans, observed campus operations and emergency working group meetings, and interviewed officials from headquarters and each of the four business units.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Internal Revenue Service To improve the resilience of IRS operations, the Commissioner of the Internal Revenue Service should direct direct the appropriate officials to establish a plan to conduct a limited number of functional or full-scale exercises to include IRS leadership and emergency personnel. These tests and exercises should be followed by an evaluation of their costs and benefits. Based on the evaluations, IRS emergency plans should be revised to reflect the degree to which the tests should be replicated more broadly.
Closed - Implemented
As of February 2011, the IRS completed its planned functional exercises and one full-scale exercise. The IRS also completed a cost-benefit analysis of the exercises.
Internal Revenue Service To improve the resilience of IRS operations, the Commissioner of the Internal Revenue Service should direct the appropriate officials to establish plans for the inclusion of some degree of stressful circumstances in the routine evacuation and shelter-in-place drills in which all IRS employees participate.
Closed - Implemented
IRS developed a multi-year test and exercise strategy plan in August 2009, which includes a requirement that tests of the Occupant Emergency Plan and the Shelter in Place Plan be designed to be challenging to the participants and include stressful circumstances.
Internal Revenue Service To improve the resilience of IRS operations, the Commissioner of the Internal Revenue Service should direct the appropriate officials to modify test and exercise standards to include involvement of external stakeholders.
Closed - Implemented
IRS modified its test and exercise strategy in August 2009 to include external stakeholders, as appropriate.

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