TRUCKING GUIDE

BEST AUDIT GUIDE IN TRUCKING INDUSTRY

We wrote an article in the past about 5 Steps to Find Issues in your Fleet Before the DOT.

Well, the 5 steps should all be “read this incredible audit guide” which covers everything you need to know about how  carriers are selected for an audit, how to survive an audit, how to fix mistakes found in an audit, and how to upgrade from a conditional or unsatisfactory rating after an audit. 

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DOT AUDITS

WHAT TO KNOW

01 THE BASICS

What Are CSA Scores and how are they calculated?

CSA scores are a system used by the Federal Motor Carrier Safety Administration (FMCSA) to identify high-risk motor carriers.

Your CSA scores are based on multiple factors called Behavioral Analysis and Safety Improvement Categories or “BASIC” categories. Roadside inspection violations, as well as investigation results, fall under 1 of 7 categories, including:

  1. Unsafe driving – moving and parking violations, such as speeding, improper lane changes, no seatbelt, cell phone/handheld device use, improper parking, etc.
  2. Crash indicator – DOT reportable crashes (injury, towaway or fatality)
  3. Hours of Service (HOS) compliance – falsifying your record-of-duty status, inadequate paperwork for ELD, driving, on-duty and rest break violations
  4. Vehicle maintenance – mechanical issues and not making required repairs
  5. Controlled substance/alcohol – driving under the influence
  6. Hazardous materials compliance – unsafe or incorrect handling and/or documentation of hazardous materials, including improper or inadequate placards
  7. Driver fitness – Unfit to drive due to physical health or lack of training (sickness, no medical card, driving a vehicle you are not qualified to drive (i.e.- tanker with no ‘N’ endorsement, etc.)

Data collected over the last 24 month from crash reports, roadside inspections, and DOT interventions are used to calculate a carrier score. The more recent events are weighted more heavily.

Each time you get a violation, depending on the category and severity of the violation, points are added to your CSA scores, and range from 1 to 10 (less to more severe).

The “safety scale percentages” (CSA scores) in each category are compared to other motor carriers with similar registration information and range from 0 to 100 percent. You want your percentage or CSA score to be as low as possible. For example, a 5% score in “vehicle maintenance” means that your company is safer than 95% of motor carriers on the road.

The FMCSA’s Safety Management System (SMS) website makes all data available and is updated on a monthly basis. 

To check the full details of your CSA scores, you will need your DOT number and your DOT pin number. This allows you to see “ALERTS,” which are a determining factor of FMCSA audit selections and are issued when a percentage score is over the limit for what the FMCSA considers safe.

How can I lower my CSA scores?

You can improve on your CSA scores by putting a system in place to check the BASICs regularly. Determine what categories you need improvement in and put training in place to improve in those particular areas.

Roadside inspections with no violations also cause your scores to lower faster. Violations will reduce in “severity” after 6 months, 13 months, and then are removed from your CSA record completely after 2 years.

If your CSA score is low, you can maintain it by hiring drivers with good PSP scores (the FMCSA pre-employment screening program, includes MVR information and all CSA violations a driver has had for 3 years), providing adequate on-board and recurring training, internal inspections, regular preventative vehicle maintenance, using an ELD solution to avoid maintenance violation, and consequences to drivers who receive violations.

02 HOW CARRIERS SELECTED

Understanding the CSA Intervention Process and the Importance of Warning Letters.

FMCSA will monitor your safety performance and compliance through its SMS. If you do not improve, they may investigate your company further.

A motor carrier is considered high-risk based on many sources of information, and when they are, the FMCSA wants to understand why.

They seek this understanding through the intervention process.

The CSA intervention process evaluates why safety problems occur, recommends remedies, encourages corrective action, and when necessary, invokes strong penalties for carriers failing to comply.

Let’s dive into the entire process and learn how to be proactive when dealing with the FMCSA.

What is the CSA intervention process?

The FMCSA has three categories of intervention when dealing with a potentially high-risk carrier: Early Contact, Investigation, and Follow-On.

Early Contact

Early Contact usually happens in the form of warning letters or a targeted roadside inspection.

Warning letters alert safety performance and compliance problems to motor carriers early on. If they do not improve their safety metrics after this warning, they may face Offsite or Onsite Investigations.

Targeted Roadside Inspections are usually prompted based on poor safety data scores that are pulled as they approach the scales and can be conducted at a permanent or temporary roadside inspection location.

Investigation

Investigationis the hands-on analysis used to identify safety performance and compliance problems. There are three types of investigations:

  1. Offsite InvestigationA safety investigator requests copies of documents from a carrier and reviews the documents remotely, to identify specific safety performance and compliance problems.
  2. Onsite Focused InvestigationA safety investigator focuses on specific safety performance and compliance problems at the carrier’s place of business and may interview employees and perform vehicle inspections.
  3. Onsite Comprehensive InvestigationA safety investigator reviews the entire safety operation at a carrier’s place of business and may interview employees and perform vehicle inspections.

Follow-On

Lastly,the Follow-Oncategoryhas four consequences based on a motor carriers investigation result.

  1. Cooperative Safety Plan (CSP): A voluntary plan a carrier may implement with the help of SIs to address safety problems. This plan may be used alone or with a Notice of Violation (NOV), but it cannot replace a Notice of Claim (NOC).
  2. Notice of Violation (NOV): A formal notice that violations are severe enough to warrant formal action, but not civil penalties. To avoid further intervention from FMCSA, the carrier must take corrective action and provide evidence of it, or contest the violations.
  3. Notice of Claim (NOC): A formal notice that violations are severe enough to warrant assessment and civil penalties.
  4. Operation Out of Service Order (OOSO): An order requiring the carrier to immediately cease all motor vehicle operations.

Exceeding a BASICs Intervention Threshold will trigger a warning letter

Motor carriers must take warning letters seriously as they are the first step in the intervention process.

The FMCSA sends warning letters when safety performance data indicates they are not complying with safety regulations.

These letters identify which Behavior Analysis and Safety Improvement Categories (BASICs) have higher than average safety compliance problems and outlines possible consequences if these problems are not fixed.

The BASIC “intervention thresholds” were established because they are strong indicators of future crash risk and exceeding them can put you on FMCSA’s priority lists which can later result in fines and violations.

The seven Behavior Analysis and Safety Improvement Categories are:

  1. Unsafe Driving: Speeding, reckless driving, improper lane change, inattention, or failure to use seatbelts
  2. Hours of Service (HOS) Compliance
  3. Crash Indicator: History of crash involvement
  4. Driver fitness: Invalid license, medically unfit to operate a CMV
  5. Controlled substances/alcohol
  6. Vehicle maintenance: Failure to make required repairs
  7. Hazardous (HAZMAT) materials compliance: Leaking containers, improper packaging and/or placarding

In Aug 2021, Unsafe Driving intervention threshold was 65% for general carriers, 60% for hazmat, and 50% for passenger carriers.

If a carrier has one or more Acute and/or Critical Violations related to this BASIC, their percentile may increase at or above the intervention threshold.

In Aug 2021, Unsafe Driving intervention threshold was 65% for general carriers, 60% for hazmat, and 50% for passenger carriers.

What should you do if you receive a warning letter from the FMCSA?

If you do receive a warning letter, it is your chance to improve your safety performance and compliance without further intervention from the FMCSA.

Read the letter carefully as it:

  • Identifies your company’s specific safety performance and compliance problems
  • Explains how to access your safety record, and
  • Outlines the consequences if you do not improve

Motor carriers then need to develop and execute strategies that will make their operations compliant with the safety regulations outlined.

If you do not create a plan now, a future audit investigation may require you to create a Safety Management Plan (SMP) to address corrective action in the key areas of violation.

03 HOW TO SURVIVE AUDIT

Preparing For A Comprehensive FMCSA Safety Audit.

A safety audit or compliance review is an examination of a motor carrier’s records in all categories of safety compliance by a safety investigator from the FMCSA.

While there are many different types of audits a carrier can face, the mindset and procedures are similar when preparing for any audit and the best defense is knowledge about what happens in an audit.

Generally, carriers only have about 2 weeks to prepare for an audit. However, following audit preparation best practices and staying organized on a regular basis will prevent any last minute scrambling.

All carriers will inevitably be subject to some type of audit, so it is never too early to prepare, and going above and beyond the DOT compliance requirements will only make this process smoother.

Impressing the DOT auditor and keeping them in a good mood throughout the audit goes a long way.

There are 9 steps of a comprehensive compliance review, which are:

  1. Opening Interview
  2. Driver Qualification Files
  3. Hours of Service
  4. Drug and Alcohol
  5. Maintenance
  6. Financial Responsibility
  7. Accident Review
  8. HAZMAT, if applicable
  9. Close Out Review

While all recent files must be made available for the auditor to review, they will only look at a sampling of the files and look for the commonly missed items.

However, they will likely start by reviewing drivers that have a red flag violation on file and look closely at every area that has had a previous violation on record. 

This is where paying attention to details can mean the difference between passing and failing an audit.

Below are common issues inspectors look for in each step of the compliance review.

Driver Qualification (DQ) Files

When it comes to DQ files, the most common items missing are:

  • the annual motor vehicle record,
  • a list of violations from the drivers, and
  • a record of the annual driver review

Hours of Service (HOS)

For hours of service, auditors will request all supporting documents, such as bills of lading, fuel receipts, weight tickets, lodging, and more.

If carriers withhold any supporting documents, the violation is weighted the same as having a false log. This is a common area where non-compliant carriers think they can hide information that could prove hours of service violations, but inspectors know what to look for.

Drug and Alcohol

The most common documents missing from drug and alcohol files are:

  • pre-employment test results for each driver
  • reasonable suspicion testing results

Another common issue are carries diluting the random drug testing pool by having non-CDL drivers in a CDL-only pool. While this may be an innocent mistake, this reduces the chances of required drivers being randomly selected for a drug test.

Maintenance

There are five areas in a maintenance review, which are:

  • annual inspections
  • preventative maintenance schedule
  • random or repair maintenance
  • daily vehicle inspection reports
  • DOT roadside inspections

The auditor will look for any vehicle that was operating with an out-of-service maintenance condition by comparing when a maintenance issue came up and when the repair was fixed.

Best practices when preparing for a DOT audit

Now that you understand the common violations found in an FMCSA safety audit, how can you prevent these violations from happening to you?

There are 8 best practices every carrier should prioritize:

  1. Maintain good record-keeping procedures – keep all documentation current and accurate
  2. Good company policies – Focus on hiring, work, and discipline
  3. Proof of consistent Hours of Service – monitoring, auditing, and corrective actions for logbook violations
  4. Maintain good vehicle maintenance records  – DVIR, annual inspections, and preventative maintenance
  5. DO NOT wait until the last minute to get files ready
  6. Establish a voluntary “Cooperative Safety Plan” – file it with the FMCSA to address any underlying issues that have or could potentially lead to safety issues and improve its performance
  7. Conduct Mock DOT audits – Third-party experts can go through the audit process to identify issues that need correcting
  8. Act quickly to fix any problems discovered – Pay special attention to high-risk issues

04 FIX AUDITOR MISTAKES

Why Carriers and Drivers Need Help When Challenging Violations With The DataQ Process.

In 2019, FMCSA data shows that nearly half of the 54,000 DataQs were filed for inspections/crashes assigned to the wrong carrier or driver (for example, duplicate records in the system).

If you notice incorrect information in your PSP report or the CSA Safety Measurement System (SMS), the DataQ process is there to help companies and drivers fight and remove these records that could be keeping your scores or insurance rates high.

FMCSA says thousands of incorrect information-type DataQs are corrected each year. Just imagine how many incorrect data is left unchecked and hurting your CSA scores right now.  

Why You Need Help With The DataQ System And Process

Violation challenges are the number one reason owner-operators utilize the DataQ system, but they are the least-successful category of challenge where only 39% were successfully changed, according to the FMCSA.

The problem with the DataQ process is that navigating the system can be challenging and dealing with state departments’ decisions that are often complex or end up as a single judgment call by the original inspecting officer can be frustrating.

Oftentimes, getting the DOT officer to admit they were wrong is half the battle, but it may take multiple appeals by the carrier to get an in-depth review.

Navigating the system itself can be one challenge, but the most common hurdle is gathering enough evidence to make a convincing case.

Before starting a DataQ process, challengers should make sure they have the officer’s report number for the record being challenged, a police accident report, and any other required or relevant evidence for the case.

Even with clear evidence, fixing errors in the system can be difficult and time consuming when a filing gets rejected.

That whole time, which can take months, the violation is in the CSA score system and damaging your CSA score, insurance rates, and ability to do business.

For crash-related information, only 43% of driver challenges were overturned while carrier service providers, like CNS, have nearly a 60% success rate.

While larger fleets may be able to afford hiring a compliance expert to manage the DataQ process, using a third party to organize a DataQ challenge, review your CSA scores, pull PSP reports, or manage compliance reviews will help you make sure your records are fair and accurate.

What can CNS do for me in the DataQ system?

Actively managing your safety measurement system (SMS) scores and PSP reports is crucial to the success of Motor Carriers.

As compliance experts, CNS staff are basically doing law enforcement’s job to prove they made a mistake.

We have built great rapport with the FMCSA challenging DataQ’s and have the experience and expertise to determine what can and cannot be challenged.

Our DOT Compliance Specialists are well-versed in the FMCSA rules and regulations, as well as what an officer is required to note on their report.

When filing a challenge, CNS can help you use language that shows intent to be thoughtful, clear, and concise in describing what the error is believed to be.

Whether you would like our DOT Specialists to challenge one DataQ or conduct a monthly analysis of all roadside violations to potentially challenge, we have a cost-effective solution for your company.

We can:

  • Request copies of an Inspection Report
  • Contest incorrect, multiple-listed, or missing IEP/shipper information
  • Contest citations with associated violation
  • Contest violations assigned to wrong motor carrier or driver
  • Identify issues, such as crash duplicates, missing records, or crash reports containing incorrect information
  • Establish a crash preventability program

Call one of our DOT Compliance Specialists at 888.260.9448 to discuss your options.

05 UPGRADE AFTER AUDIT

Conditional Rating? Keep Getting Brokers Loads by Providing Proof of Corrective Action.

If you were recently audited and received a conditional or unsatisfactory rating, you will have immediate and long-term consequences beyond the fines from the FMCSA.

Conditional carriers can immediately see less work from brokers, or even be restricted from future loads, while more long-term effects are higher rates for insurance at renewal and new driver prospects may completely avoid applying for a job with your company.

For these reasons, it is crucial to create a corrective action plan (CAP) before your new DOT safety rating goes into effect 60 days after the rating downgrade letter. As long as you have a CAP and show brokers proof of the CAP, you can still get broker loads.

If you already have a conditional and are requesting a safety rating upgrade, just remember that it can take up to 4 months before your corrective action plan is reviewed and upgraded due to your state process, internal staffing issues, etc.

What happens if a carrier fails a safety audit?

If a carrier fails a safety audit, the FMCSA will provide the carrier written documentation detailing the violations that caused the carrier to fail and the requirements for developing a corrective action plan (CAP).

According to Harry Sanders, retired from the FMCSA, “I think the biggest concern from most carriers that went through an audit and failed was the uncertainty of submitting a CAP and if it was acceptable and changed the rating from fail to pass.”

The CAP must explain the actions the carrier will take to address the violations identified. This is the information brokers want to see to make sure you are being a responsible carrier.

These corrective action plans are complicated and take a lot of work to be completed.

This is where CNS can come in and help you create this plan.

  • First, we look at the compliance review from the audit to understand the violations and the documentation that will be required to submit for proof that violations have been corrected.
  • Then, we create a Corrective Action Plan compiled of new systems, processes and procedures that will be implemented within your operation to fix safety and compliance exposures. 
  • Documents and files relative to critical and acute violations will be audited and reviewed by a CNS specialist before submitting, working to ensure that you will get upgraded on the first try. 
  • Once, we are ready to submit, we will send the Safety Rating Upgrade request and Corrective Action Plan to your state and service center to be entered into their queue for review by an FMCSA analyst.
  • Following the submission, your specialist from CNS will correspond with the FMCSA analyst on final determination and guidance on any additional information requested by analyst. 

CNS is very well-versed in safety and compliance laws and our experienced representatives know what information is crucial and imperative to accomplish a safety rating increase.

How can carriers get loads with a conditional rating or keep working with the same brokers?

We work with all types of brokers to provide ongoing documentation to keep you running loads until you are officially upgraded. 

A few examples of brokers or freight forwards we work with include Coyote, JB Hunt, and CH Robinson.

Contact CNS immediately to represent you in the negotiation process to reduce your penalty and get you a re-payment plan, interest free.

IFTA AUDITS

WHAT TO KNOW

01 THE BASICS

What is IFTA?

Fuel tax recordkeeping and reporting mistakes can bring on an IFTA audit.

The International Fuel Tax Agreement (IFTA) is a multi-jurisdictional fuel tax agreement that simplifies the reporting of fuel taxes by interjurisdictional motor carriers.

In other words, IFTA is a program to collect and distribute fuel tax revenue between states and provinces based upon where the fuel was used, helping carriers by consolidating reporting requirements through the carrier’s home state.

A “qualified motor vehicle” means a motor vehicle used, designed or maintained for transportation of persons or property and:

  • Has two axles and a gross vehicle weight or registered gross vehicle weight exceeding 26,000 pounds, or
  • Has three or more axles regardless of weight, or
  • Is used in combination, when the weight of such combination exceeds 26,000 pounds gross vehicle or registered gross vehicle weight

Under IFTA, motor carriers register with their home state, and receive credentials, which allow them to travel through other IFTA member jurisdictions.

Carriers then file a single quarterly fuel tax return with a single payment to their home state that covers all of their travel in other IFTA member jurisdictions.

The home state then processes the IFTA tax return and forwards funds to each jurisdiction or requests funds for net fuel taxes, so you don’t have to.

IFTA filing record keeping requirements

IFTA members are responsible for:

  • Maintaining Distance Records
  • Maintaining Fuel Records
  • Trip Permits
  • Monthly / Quarterly Summaries
  • Supporting Information for IVDRs (Individual Vehicle Distance Records)
  • Lessor Responsibility
  • Program Compliance Reviews, and
  • Records Retention

Recordkeeping requirements include:

  • An accurate breakdown of your mileage:
    • by date
    • by unit
    • by state along with routes used
    • odometer readings, and
    • beginning and ending trip locations
  • Fuel receipts must contain all the following:
    • State where fuel was purchased
    • Fuel vendor name and address
    • Date
    • Type of fuel
    • Unit Number
    • Number of gallons purchased

IFTA members are required to preserve the records upon which the quarterly tax return is based for four years from the return due date or filing date, whichever is later, plus any time period included as a result of waivers or jeopardy assessments.

02 HOW CARRIERS SELECTED

What is an IFTA Audit?

Each IFTA jurisdiction is required to audit 3% of its accounts and can come from random selection or reporting errors.

An audit program is therefore an important and essential compliance measure and ensures that proper revenues are being collected by each jurisdiction.

When your fleet is selected for an IFTA audit, the process will generally look like this:

  1. Receive a notification letter that your fleet will be subject to an audit
  2. Within 30 days of receiving the letter, the auditor assigned to your fleet will reach out you
  3. The auditor asks for preliminary information about your fleet to get context for the audit
  4. You then share the records used for your IFTA reports (fuel receipts, fuel card statements and mileage summaries)
  5. Once this information is compiled and shared, the auditor will have an initial visit with your organization.
  6. Once the audit is complete, you will have 30 days to respond:
    • No action if no discrepancies are found
    • Accept the results and make a payment
    • Challenge the results if you disagree by preparing records that disprove the results

03 HOW TO SURVIVE AUDIT

10 common IFTA mistakes or reoccurring problems with fuel taxes.

Before submitting your quarterly report, check your numbers to make sure there are no data entry errors or inaccurate trip records.

When auditors process fuel taxes, they often come across these ten issues:

  1. Filing IFTA report late or forgetting to report, which will:
    • lead to a fine of $50 or 10 percent of the net tax liability, whichever is greater, and
    • potentially result in an audit
  2. Multiple amended returns signal potential audit risk
  3. Estimating fuel calculations
  4. Not reporting every mile, including personal or unloading miles
  5. Impossible miles per gallon (MPG), which is expected to fall between 5 to 10 MPG for trucks and remain relatively the same each reporting period
  6. Bad GPS data
    • improper state geofencing
    • odometer readings put into the GPS don’t match the odometer on the vehicle
    • longitude and latitude for every ping is not recorded to the fourth decimal point
  7. Insufficient GPS information coming through
  8. GPS pings are not set to the correct intervals of less than five minutes
  9. Broken GPS hardware: once it’s broken the data normally can’t be retrieved
  10. Poor fuel tax reporting: faded, unorganized fuel receipts or fuel purchase pre-authorization slips that cannot be read

If you can resolve these common fuel tax issues, you will be well-prepared for an IFTA audit!

Other important tips:

  • You can request a time extension to pull the required information needing in the audit
  • Auditors may request access to all fleet vehicles, but you can request to provide access to a sample of your vehicles
  • Auditors may want to see original driver records, even if your fleet uses a recording software
  • Auditors have access to more information than you realize, like dates bridges were out of service. So, don’t use routes of travel to estimate your mileage, your records may come up short.

Keep your record-keeping accurate with CNS

Fuel tax compliance and management can be difficult, time-consuming, and costly with more and more DOT Audits and IFTA Audits, penalties are exceeding millions of dollars.

We can handle Fuel Tax Permitting and Fuel Tax Compliance for a single owner-operator or fleet of 500 trucks.

The fuel tax service at CNS stands out because it offers carriers these benefits:

  • Compiled and filed IFTA tax returns
  • Compiled and filed Mileage tax returns for KY, NM, NY and OR
  • Detailed Fuel Tax Reports
  • Paper driver trip reports, or “paperless” (GPS) data management
  • Access to you own online portal
  • Online back up for fuel receipts and trip permits
  • Fuel Tax Training
  • Tax reduction strategies
  • and more

The thought of an audit should not scare you if you are prepared. Use your electronic record-keeping as a resource to keep you prepared for any inspection or audit situation.

When your records are accurate and secure, your business will be too!

For more information, contact us at 888.260.9448 or info@cnsprotects.com.

Audit Proof your trucking business

what are csa scores?
Compliance

What are CSA scores?

CSA stands for compliance, safety and accountability. CSA scores are a system used by the Federal Motor Carrier Safety Administration (FMCSA) to identify high-risk motor

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DOT Compliance and Licensing Services

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