Advisory 

Circular

 

Subject: AIR CARRIER INTERNAL 

EVALUATION PROGRAMS

Date: 4/17/06

Initiated by: AFS-230 

AC No: 120-59A 

1. PURPOSE.

a. This advisory circular (AC) provides information and guidance material that may be used 

by air carrier certificate holders operating under Title 14 of the Code of Federal Regulations 

(14 CFR) parts 121 and 135, to design, develop and implement an Internal Evaluation Program 

(IEP). The procedures and practices outlined in this AC can be applied to all of an air carrier’s 

operations. 

b. There is no regulatory requirement for an IEP; however, the Federal Aviation 

Administration (FAA) encourages such a program to increase the awareness of management and 

all employees of their responsibility to promote continual compliance with all regulatory 

requirements and best safety practices. Establishing the type of program described in this 

document is completely voluntary. However, the requirement to have an IEP may be necessary 

under some other programs such as: Department of Defense’s (DOD) Commercial Air Carrier 

Quality and Safety Requirements; and International Air Transport Association’s (IATA) 

Operational Safety Audit (IOSA). Although not a regulatory requirement, a robust IEP can 

facilitate documentation of air carrier system safety management and quality assurance activities, 

including but not limited to, the FAA’s Air Transportation Oversight System (ATOS). 

Implementation of an IEP as outlined in this guidance material will assist the air carrier in 

meeting such requirements. 

2. CANCELLATION. This AC cancels AC 120-59, Air Carrier Internal Evaluation Programs, 

dated October 26, 1992. 

3. DEFINITIONS. 

a. ATOS. A standardized, systems approach to FAA surveillance and certification that 

provides aviation safety inspectors (ASI) the tools to identify safety trends (management system 

weaknesses) to spot and correct problems at their root cause before an incident occurs. 

b. Audit. An audit is a methodical, planned review which builds on the principles of 

inspection and is used to determine how business is being conducted and compares results with 

how business should have been conducted in accordance with established procedures. The most 
AC 120-59A 4/17/06 

Page 2 Par 3 

frequently used audit categories are (quality) system audits, service/product audits, and process 

audits. 

c. Auditor. An individual who has satisfied defined experience prerequisites and is 

successfully qualified under a defined training program to conduct audits. 

d. Audit Scope. The operational disciplines and/or operational areas that are assessed 

during the conduct of an audit. 

e. Authority. A person or group with the power to command, determine, influence, or 

judge. 

f. Concern. A conclusion by an auditor, supported by objective evidence, which is seen as a 

potential problem, trend, or inefficiency that may become a finding. 

g. Continual: A close prolonged succession or recurrence, infinite in time, without 

interruption. 

h. Control: Key procedure, responsibility, or decisionmaking position within an 

organization, department, division, or functional area. Checks and restraints are designed into a 

process to ensure a desired result. Comprehensive evaluations (system audits) will focus on 

verifying and testing the controls within the organization. 

i. Corrective Action. The action(s) taken to correct a deficiency with the intent to preclude 

recurrence of the finding or non-compliance of an approved standard. 

j. Corrective Action Plan (CAP). The total plan of a certificate holder to close all findings 

through implementation of comprehensive corrective action. This plan should include the 

changes in policy and/or procedures that will ensure continued compliance. 

k. Evaluation. A functionally independent review of company policies, procedures, and 

systems. If accomplished by the company itself, the evaluation should be done by an element of 

the company other than the one performing the function being evaluated. The evaluation process 

builds on the concepts of audit and inspection. An evaluation is an anticipatory process, and is 

designed to identify and correct potential findings before they occur. An evaluation is 

synonymous with the term systems audit. 

l. Evaluation Standard. Specific criteria on which basis a functional area will be evaluated 

in terms of compliance or conformance. 

m. Evidence. A documented statement of fact, prepared by an air carrier, which may be 

quantitative or qualitative and is based on observations, inspections, measurements, or tests that 

can be verified. For the purpose of internal evaluation, evidence should generally be in the form 

of written documentation that supports an IEP’s analysis and review. These data are necessary to 

substantiate findings or concerns and to enable management or evaluators to determine the root 

causes of any reported findings. 
4/17/06 AC 120-59A 

Par 5 Page 3 

n. Finding. A determination as a result of an audit that compliance or conformance with an 

evaluation standard is not being achieved. 

o. Followup. A process involving monitoring of CAPs to verify timely and effective 

implementation designed to eliminate the underlying (root) cause of the deficiency. 

p. Inspection. The act of observing a particular event or action to ensure that correct 

procedures and requirements are followed during the accomplishment of that event or action. 

The primary purpose of an inspection is to verify that established standards are followed during 

an observed event or action. 

NOTE: The term “inspection” is defined in this AC within the context of 

quality auditing principles. It does not address or define FAA inspections. 

q. IOSA. An abbreviation and acronym for IATA Operational Safety Audit, which is an 

internationally recognized evaluation system designed to assess the operational management and 

control systems of an operator. 

r. Policy. A high-level overall plan embracing the general goals and acceptable practices of 

a group. Policies state how goals will be achieved. 

s. Procedures. A method for accomplishing a process, or for performing an activity. 

t. Process. A set of interrelated resources and activities that transform inputs to outputs. 

Resources may include personnel, finance, facilities, equipment, techniques, and methods. 

u. Process Audit. A documented activity that assesses the effectiveness and efficiency of a 

series of related or sequential work activities. 

v. Quality Assurance. The independent activity of providing the evidence needed to 

establish confidence, among all concerned, that the quality function is being performed 

effectively. This activity “assures quality” through independent evaluation of established 

processes, procedures, and documentation. 

w. Quality Control. The determination of the quality of a product by inspection and testing 

to determine compliance with standards. This activity “controls quality” through establishment 

of effective controls, documentation, and procedures within specific functional areas. 

x. Quality Management System. A defined organizational structure, written management 

responsibilities, and associated system of processes, procedures, and detail documents to ensure 

compliance with internal standards or regulatory requirements. 

y. Quality System Audit. A documented activity performed to verify by examination and 

evaluation of objective evidence that applicable elements of the quality management system are 

documented and effectively implemented in accordance with specific requirements.
AC 120-59A 4/17/06 

Page 4 Par 3 

z. Responsibility. The quality, state, or fact of being accountable. 

aa. Root Cause Analysis. Determination of what caused a finding. The identification of 

the root cause is the key to the implementation of an effective corrective action. Items to 

consider when determining the root cause should include deficiencies in training, materials, 

procedures, empowerment, or management oversight. 

bb. Safety Attribute Inspection. A surveillance tool planned for at the subsystem level and 

conducted at the “element” level by a team of inspectors to determine if an air carrier has the 

safety attributes of (1) responsibility, (2) authority, (3) procedures, (4) controls, (5) process 

measurement, and (6) interfaces adequately designed into their system element process. 

cc. Senior Management. The highest level of management within an organization that has 

the authority and responsibility for setting policy, demonstrating commitment, meeting 

requirements, approving resources, setting objectives, implementing processes, and achieving 

desired outcomes. 

dd. Service/Product Audit. An objective and structured assessment of conformance to 

required service level or product level performance characteristics. It may be qualitative or 

quantitative, as appropriate. 

4. RELATED READING MATERIAL. For certificate holders seeking additional guidance 

on internal evaluation techniques and procedures, an Air Carrier Internal Evaluation – Model 

Program Guide is available through the National Technical Information Service, 5285 Port Royal 

Road, Springfield, VA 22161; telephone: (703) 487-4600; http://www.ntis.gov. Information on 

other programs that are related to a carrier’s IEP may be obtained at the following Web sites (see 

paragraph 6j, which explains how these programs relate to IEP): 

a. ATOS: http://www.faa.gov/safety/programs_initiatives/oversight/atos/

b. IATA/IOSA: http://www.iata.org/ps/services/iosa

c. DOD: http://public.amc.af.mil/Business/a34b/

5. BACKGROUND. 

a. Operational safety is the responsibility of the certificate holder with the FAA providing 

regulatory oversight. The certificate holder is expected to have processes, procedures, and 

documentation in place to ensure regulatory compliance. Additionally, it is to the advantage of 

every certificate holder to have an effective management system in place to ensure positive 

control of all operational activities. An IEP is a fundamental element to ensure compliance with 

external regulatory requirements, identify nonconformance to internal company policies and 

procedures, and identify opportunities to improve organizational policies, procedures, and 

processes. 
4/17/06 AC 120-59A 

Par 6 Page 5 

b. Within the international aviation community, the IEP is also synonymous with the quality 

assurance function. Quality assurance programs are being expanded beyond aircraft 

maintenance and engineering to include assessment of all operational functions in terms of 

regulatory compliance, and conformance to internal policies and procedures, to include 

evaluation of existing processes, procedures, and documentation. On a broader scale, several 

nations have published Safety Management System (SMS) guidelines in which the quality 

assurance (or IEP) function is a fundamental element of the overall management system that 

includes organizational management, documentation, safety programs, quality assurance, and 

emergency response planning. The thrust of such initiatives is to effectively integrate these 

functions into the management system. 

c. As a matter of policy, the FAA encourages certificate holders to identify, correct, and 

disclose instances of regulatory noncompliance. Therefore, the development and implementation 

of an IEP will benefit both the certificate holder and the flying public. 

6. IEP ELEMENTS. An IEP is a high level voluntary program that provides the certificate 

holder with a means to maintain and refine the management system by continually monitoring 

the effectiveness and efficiency of processes and systems. The certificate holder applies various 

assessment and evaluation tools to derive information reporting how the management systems 

and key processes are meeting both internal quality and external regulatory standards. The 

program is based on the premise that the certificate holder will design and maintain an IEP that 

contains fundamental elements of quality and safety. An effective IEP should include the 

following fundamental elements. 

a. Systems-Oriented Process. Internal evaluation should be a continual process that 

incorporates the techniques of inspections, audits, and evaluations to assess the adequacy of 

managerial controls and processes in critical systems and to continuously improve those systems 

based upon the results of regular evaluations. It should also include continuous monitoring and 

feedback of information on critical processes, and regular trend analysis of resulting data. 

b. Beyond Regulatory Compliance. Internal evaluations should extend beyond regulatory 

compliance to determine the causes of deficiencies and detect and implement needed 

enhancements to company operating practices before deficiencies occur. 

c. Independent. An IEP is an independent process that organizationally has straight-line 

reporting responsibility to senior management. 

d. Defined Responsibility and Authority. The certificate holder’s IEP should identify a 

person or group within the company who have the responsibility and authority to: 

(1) Establish and modify the IEP. 

(2) Perform evaluations, audits, inspections, and analysis of data as a part of an ongoing 

IEP.
AC 120-59A 4/17/06 

Page 6 Par 6 

(3) Initiate, recommend, or provide corrective actions, including preventative action 

through designated reporting channels to address IEP audit findings. 

(4) Track and verify the implementation of corrective actions within specified 

timeframes. 

(5) Communicate and coordinate activities with FAA personnel on a regular basis. 

NOTE 1: With regard to the principals’ independence and authority, 

reporting lines are important. In some cases, internal evaluation activities 

may be centrally controlled under the leadership of a corporate quality 

assurance manager. In other cases, quality assurance managers may be 

embedded within the operational functions reporting to a respective senior 

manager 

NOTE 2: The IEP description (plan/manual) should include an 

organizational diagram that depicts the independence of personnel who 

supervise and perform internal evaluation functions. This diagram should 

delineate the organizational chain of authority through which IEP audit 

results are communicated to senior management. 

e. Senior Management Review. Senior management involvement in an IEP is crucial to 

program success. An effective program should include periodic senior management review of 

IEP audit results. 

(1) For the purposes of this program, senior management includes the certificate holder’s 

chief executive officer, president, chief operating officer, or an equivalent position that has the 

authority for action to resolve issues. 

(2) The management review should be accomplished on a regular basis appropriate to the 

scope of the IEP, but no less frequently than at least annually. The purpose is to review current 

performance and opportunities for improvement in an open discussion format to foster idea 

generation. An agenda should be prepared and distributed to participants at least 1 week prior to 

the meeting. As a minimum, the agenda should include: 

(a) Follow-up actions from previous management reviews, to include progress 

reports on the status of previously established improvement objectives. 

(b) A report on significant or systemic deficiencies, with associated status reports 

detailing corrective actions and planned follow-up activities. 

(c) Strategic or operational changes that could affect the IEP. 

(d) Establishment of new or revised objectives. 
4/17/06 AC 120-59A 

Par 6 Page 7 

(e) Recommendations for improvement and required resources. 

(3) Management reviews should be documented to include not only the content, but the 

resulting management directed action items, if any. A fundamental tenet of the IEP is that 

senior management is accountable for acting on the information it receives from the program. 

The IEP should include assessment of the effectiveness of the management review process and 

identify opportunities for improvement. 

f. Feedback Loop. Quality control takes place by use of a feedback loop. Feedback is a 

dynamic process whereby output of a system is passed (fed back) to the input to continually 

achieve the desired results. Often, this is done intentionally to control the behavior of the 

system. The use of feedback to continually monitor the divergence between objectives and 

outcomes while implementing changes to reduce the variance is also known as a closed-loop. 

An IEP should be designed to achieve quality control through closed-loop feedback. 

(1) An effective IEP provides quality-related information to the affected employee group 

and associated management team members. In addition, information derived from IEP should 

also be fed back into the operating departments from which the data was obtained. Effective 

corrective actions that were driven by root-cause analysis of findings may have applicability in 

other areas of the air carrier. Therefore, opportunities for improvement across the various 

departments within the air carrier may exist. 

(2) Quality-related information is similar to safety-related information typically provided 

to employee groups via a variety of channels. Feedback may include the sharing of best 

practices, typical system/process weaknesses, common management errors, etc.. Such 

information may be disseminated via less formal channels, such as employee “Read and Sign” 

files, bulletins, newsletters, or Web sites, or it may be incorporated in structural changes, such as 

program/policy changes, enhancements to training, manual revisions, procedural changes, or 

personnel reorganization. 

(3) The method of feedback should be in accordance with the size and sophistication of 

the air carrier. The process for this feedback loop should be defined in the IEP documentation. 

g. Continual Process. To effectively anticipate problem areas and correct them before 

actual findings occur, an IEP should be a continual, ongoing process. An internal evaluation 

should be more than spot-check inspections of operating practices. Stand-alone, spot-check 

inspections do little more than identify symptoms of potential problems. A continual process is 

needed to verify whether findings are isolated instances or actual symptoms of systemic policy, 

process, or procedural problems. An IEP should involve more than planned evaluations, tracking 

corrective actions, follow-up evaluations, and special evaluations based on identification of 

trends. It should also include ongoing data collection and analysis to identify opportunities for 

preventative action to preclude adverse events before they occur. Having a well-structured 

program ensures that all areas of operations are assessed at appropriate intervals. It also 

institutionalizes the process so that a change in personnel does not adversely affect the program. 

A continuous process is equally important, however, to identify problems that may otherwise be 

missed by periodic audits. Where appropriate, a continuing process of data collection and 
AC 120-59A 4/17/06 

Page 8 Par 6 

analysis can enhance the efficiency of the IEP by reducing the need for periodic audits, enabling 

a data-driven determination of when audits are needed, or providing the information needed to 

validate the effectiveness of corrective action previously initiated. 

h. FAA Interface.

(1) Program Assistance. The FAA does not approve or accept an IEP. An air carrier 

certificate holder operating under 14 CFR parts 121 and 135 that develops an IEP may ask for 

assistance from their Certificate Holding District Office (CHDO) or principal inspector (PI). 

Preparing program documentation, as discussed in paragraph 7, will provide the FAA with an 

opportunity to review the proposed duties, responsibilities, procedures, and organization of the 

certificate holder’s IEP. In all cases that involve IEP development, the FAA will be available to 

provide advice, assistance, or direction to interested certificate holders. 

(2) Sharing Reports. The FAA encourages certificate holders to openly share the 

results of their IEP with their CHDO or PI. Recognizing that much of the information contained 

in IEP reports/records could be proprietary, an air carrier should maintain and secure these 

reports/records on their premises. If given to the FAA, proprietary information will be protected 

by the FAA in accordance with applicable laws and regulations. Sharing IEP information with 

the FAA at the air carrier offices can enhance the working relationship between the FAA and the 

air carrier. Information not required by regulation that remains on the air carrier’s property 

would not normally be subject to public disclosure. 

(3) Disclosure of Findings to the FAA. For certificate holders electing to voluntarily 

disclose apparent violations discovered by an IEP, further information is provided in AC 00-58, 

Voluntary Disclosure Reporting Program, current edition. Under this policy, when an air carrier 

finds a potential violation of the regulations, reports it to the FAA, and meets other specific 

conditions, the FAA enforcement will be limited to administrative action (e.g., a letter of 

correction). Disclosures such as these require CAPs designed to eliminate the underlying cause 

of the problem. Even though the internal evaluation process supports voluntary disclosures, it is 

not necessary to have an IEP to participate in the voluntary disclosure program, nor is it 

mandatory to disclose findings discovered during an internal evaluation. However, regulatory 

violations that are not disclosed but are otherwise discovered by the FAA may subject the air 

carrier to enforcement action. 

i. External Review. It is recommended that an external and independent review be done on 

the air carrier’s IEP to assess the effectiveness of the program. 

j. IEP Relationship to Other Programs. 

(1) ATOS. ATOS establishes a standardized systems approach to FAA surveillance and 

certification, which provides ASIs with the tools to plan, collect data, and assess risks. ATOS 

tools are designed to examine the systems in place at the air carrier and assess the extent to 

which they are operating effectively to achieve their intended results. The characteristics of 

critical system safety processes that are the subjects of ATOS element evaluations are called 

attributes, and these are used for evaluation and measurement purposes. The ATOS system 
4/17/06 AC 120-59A 

Par 6 Page 9 

safety attributes are responsibility, authority, procedures, controls, process measures, and 

interfaces. The objectives of ATOS are to ensure that the carrier has a robust system in place 

(design evaluation), validate that the system is being operated as designed, and that the desired 

results are being achieved (performance assessment). The attributes are used in evaluating and 

measuring these objectives. Although ATOS and IEP are not directly interrelated, the tools used 

by ASIs to conduct ATOS oversight provide standards that may aid in developing an effective 

internal evaluation system. 

(2) IATA/IOSA Program. Since 2001, IATA has led the effort among the world’s 

leading airlines, regulatory authorities, and other industry participants to develop a standardized 

audit program based on internationally recognized standards called IOSA. The IOSA is an 

internationally recognized and accepted system designed to assess the operational management 

and control systems of an airline. The system employs internationally recognized quality audit 

principles conducted in a standardized manner. Audit standards are identified in the IOSA 

Standards Manual (ISM) and specific audit processes are described in the IOSA Program Manual 

(IPM). The IOSA and IEP have no direct interface. However, the IOSA standards are 

internationally recognized and may be used in the development and implementation of an 

effective internal evaluation system. 

(3) Department of Defense (DOD) Program. DOD Directive 4500.53, Department of 

Defense Commercial Air Transportation Quality and Safety Review Program, charges the 

Commander-in-Chief (CINC), United States Transportation Command, with ensuring the 

establishment of safety requirements and criteria for evaluating civil air carriers and operators 

providing air transportation and operational support services to the DOD. It also charges the 

CINC with ensuring the establishment of a Commercial Airlift Review Board (CARB) and 

providing policy guidance and direction for its operation. Title 32 CFR part 861, Department of 

Defense Commercial Air Transportation Quality and Safety Review Program, establishes DOD 

quality and safety criteria for air carriers providing or seeking to provide air transportation and, 

at the discretion of the CARB or higher authority, operational support services to the DOD. 

Part 861 also includes the operating procedures of the CARB. The CARB has the authority to 

suspend air carriers from DOD use or take other actions when issues of air carrier quality and air 

safety arise. Under the DOD program, civil air carriers and operators providing air 

transportation and operational support services must have an IEP acceptable to the DOD. 

(4) Continuing Analysis and Surveillance System (CASS). CASS is a quality 

management system for air carriers and commercial operators that monitors and analyzes the 

performance and effectiveness of airworthiness inspection and maintenance programs. A CASS 

is required for certain types of air carriers and commercial operators under 14 CFR part 121, 

section 121.373, and part 135, section 135.431 (for operators subject to section 135.411(a)(2). 

(a) As required by regulation, a CASS monitors an operator’s inspection and 

maintenance programs for compliance with applicable requirements, including FAA regulations 

and manufacturer instructions. Each certificate holder subject to these regulations is required to 

establish and maintain a system for the continuing analysis and surveillance of the performance 

and effectiveness of its inspection program and the program covering other maintenance, 

preventive maintenance, and alterations and for the correction of any deficiency in those
AC 120-59A 4/17/06 

Page 10 Par 6 

 programs, regardless of whether those programs are carried out by the certificate holder or by 

another person.

(b) FAA guidance on CASS is available in AC 120-79, Developing and 

Implementing a Continuing Analysis and Surveillance System, current edition. As noted therein, 

an IEP is an independent program intended to provide information to senior management as to 

how well critical programs, such as a CASS, are working. An IEP is not a substitute for CASS. 

An IEP poses questions necessary to determine if the operator’s systems, such as CASS, are 

effective and efficient, and if there are opportunities for improvement in those systems. 

However, much of the guidance provided in AC 120-79 for CASS, such as its discussion of root 

cause analysis, risk assessment, data management, and data analysis, is equally applicable to an 

effective IEP. 

(5) Safety Program. A safety program and an IEP are complimentary functions within 

the management system. Both provide top management feedback regarding the health and 

effectiveness of the organization as a whole. 

(a) Safety programs include the capture and analysis of employee safety/hazard 

reports, the investigation of operational incidents and accidents, the oversight of risk assessment 

activities, and flight operations data assessment programs. As commonly practiced, safety 

programs are often reactive in nature in that they involve analysis of events that have already 

occurred (i.e., investigative efforts are oriented to identify root cause and establish corrective 

actions to prevent reoccurrence or limit frequency to acceptable risk levels). 

(b) In contrast, quality programs (or IEP) are designed to systematically and 

proactively search for weaknesses in the management system, operational processes/procedures, 

or documentation. An effective IEP seeks to assure that key processes and controls are in place 

across the full spectrum of operational safety. The IEP is focused on verifying organizational 

compliance with all external regulatory requirements and internal organizational policies and 

procedures. These comprehensive system audits identify opportunities for improvement, which 

ultimately enhance safety through establishment of predictable and reliable business processes. 

7. IEP DESCRIPTION. Air carrier certificate holders operating under parts 121 and 135 that 

are interested in developing an IEP are encouraged to define and document the following 

essential elements in the program: 

a. Program Documentation. It is recommended that IEP procedures and responsibilities be 

documented. This paragraph provides suggestions for preparing and structuring program 

documentation. 

(1) Preparing Program Documentation.

(a) Preparing a documented program is a recommended practice for the certificate 

holder. Certificate holders should review the size and complexity of their operation to determine 

appropriate level of documentation. 
4/17/06 AC 120-59A 

Par 7 Page 11 

(b) Program documentation should describe the duties, responsibilities, procedures, 

and organization of a certificate holder’s IEP. 

(c) Copies of the program documentation should be distributed to appropriate 

company personnel, so they are aware of, and are familiar with, IEP procedures. In addition, 

revisions should be made as necessary to ensure that the program documentation continues to 

reflect the certificate holder’s current internal evaluation procedures and organization. 

(2) Structuring Program Documentation. As an example, a sample program manual 

using the program elements discussed in this AC is provided in the Appendix. The number of 

items addressed and how they are documented will ultimately depend on the size and complexity 

of each certificate holder’s operation. 

b. IEP Scope. Consideration needs to be given to defining the scope of the program. For 

example, the carrier may include the following areas: organizational management, flight 

operations and dispatch, station operations, onboard service, aircraft maintenance, security, and 

ground handling. It is recommended that any business area within the organization that affects 

the integrity of the carrier should be considered. 

c. Evaluation Standards. Each certificate holder should identify and communicate a 

specific standard(s) against which each functional area will be evaluated. Each such documented 

standard should be developed with the assistance of the applicable management personnel. Once 

established, such standards must be clearly communicated and understood by the management 

team. A specific internal standard may be developed as a composite of multiple sources 

including, but not limited to: 

(1) External regulations (Title 14 CFR, OSHA, etc.). 

(2) Internal company operating policies and procedures. 

(3) IOSA Standards and Recommended Practices (ISARP). 

(4) DOD Quality and Safety Requirements (QSR). 

(5) International Civil Aviation Organization (ICAO) requirements. 

(6) ISO 9001:2000 management elements (as amended). 

d. Types of Evaluations. 

(1) Planned Evaluations. An effective program will establish a schedule of events that 

will be performed during a set calendar period under the IEP. It is helpful to divide the complete 

schedule into segments that are practical from a workload standpoint. However, it is important 

to schedule evaluations to allow enough flexibility for resources to be committed to special 

evaluations or followup evaluations, if needed.
AC 120-59A 4/17/06 

Page 12 Par 7 

(2) Special Evaluations. Conduct special evaluations based on concerns or priorities set 

by senior management. The need for special evaluations can be driven by such factors as a 

review of industry trends, FAA concerns, or adverse trends identified by the IEP or other internal 

programs. 

(3) Follow-up Evaluations. Schedule and conduct followup evaluations to ensure that 

corrective action commitments were met and to verify that corrective actions were effective. 

e. Evaluation Schedule. It is essential for an air carrier’s IEP to include a defined schedule 

of planned activities. This schedule serves to verify that the IEP is comprehensive, well 

controlled, and timely. A published schedule also provides a vehicle for keeping management 

informed. An internal evaluation schedule should include a planned cycle for periodically 

reviewing areas to be covered by the certificate holder’s IEP. The evaluation cycle can be 

flexible but should not exceed 3 years. The scheduling process should also be dynamic and 

allow for special evaluations when trends are identified. In addition, followup evaluations should 

be scheduled as necessary to verify that corrective action commitments were met and that they 

were effective in eliminating any reported findings. 

f. Corrective Action and Follow-up. An IEP should include procedures that ensure that 

CAPs are developed in response to findings and to verify their timely and effective 

implementation. Internal evaluation personnel may participate in the development of a CAP and 

should review the plan prior to implementation. However, organizational responsibility and 

accountability for the development and implementation of CAPs should reside with the 

operational departments cited in the finding. 

(1) A CAP should include: 

(a) A detailed description of the finding and how it was discovered. This should 

include discussion of the scope and extent of the problem so that candidate solutions can be 

analyzed properly.

(b) Analysis of evidence to determine the root cause(s) of the finding. Root cause 

analysis treats errors as defects in the system rather than in a person. Root cause analysis looks 

beyond the symptom to find the organizational defect that permitted an error to occur. Its goal is 

to correct the fundamental problem and to prevent recurrence. The more thorough the analysis, 

the greater the likelihood the operator will uncover why the system deficiency occurred and how 

the organization can respond effectively. 

(c) Identification of planned corrective actions to be taken in response to the finding 

to include specification of how, when, and where these actions will be taken.

(d) Implementation schedule, including a timeframe for putting corrective actions in 

place. 
4/17/06 AC 120-59A 

Par 7 Page 13 

(e) Identification of the individual(s) who are assigned the responsibility for 

implementing each of the corrective steps.

(2) The individuals responsible for managing an IEP should facilitate the corrective 

action process by: 

(a) Ensuring that CAPs are developed in a timely manner. 

(b) Verifying that CAPs include the items outlined above. 

(c) Monitoring and documenting implementation of corrective actions through 

resolution of the issue(s). 

(d) Providing senior management with an independent assessment of CAP 

development and implementation 

(e) Initiating scheduled and/or unannounced followup evaluations to ensure the 

effectiveness of corrective actions specified in CAPs. 

g. Reporting. The content of the detailed evaluation report should be defined in the 

program. An evaluation report should be sent to the responsible managers and the air carrier’s 

senior management for review. Briefings should be given to senior management and to other 

responsible parties as appropriate. Reports of the status of corrective actions should be provided 

as appropriate. The air carrier should decide upon the frequency, format, and structure for 

informing senior management of internal evaluation schedules, results, and followup actions to 

validate that corrective actions have been implemented and that they are effective. It is 

recommended that the reporting structure also be documented by the air carrier and become a 

part of its program. 

h. Records. The results of an internal evaluation should be documented in reports and other 

appropriate records, consistent with the process of internal reporting at the air carrier. Operators 

may find it useful to manage the results of IEP evaluations (as well as the other elements of the 

IEP) through a database or a quantitative application. IEP records should include: 

(1) Planned evaluation reports. 

(2) Special evaluation reports, including the trends or other reasons for scheduling a 

special evaluation. 

(3) CAPs. 

(4) Results of followup evaluations. 

(5) Records of auditor training and qualifications.
AC 120-59A 4/17/06 

Page 14 Par 7 

i. Auditor Training and Qualifications. If feasible, the certificate holder should specify 

that IEP auditors have training and/or experience in recognized quality management auditing, 

systems analysis, root cause analysis, and risk assessment, as well as evaluation principles and 

techniques. Any one or combination of the following could accomplish training: 

(1) In-house prepared courses. 

(2) College courses. 

(3) Home study course materials. 

(4) Industry seminars and workshops. 

(5) Selected FAA courses. 

j. Determination of Resources. To determine the resources needed by an IEP, senior 

management should make the scope of oversight and the extent of involvement for the IEP 

explicit. In most cases, size of the organization and budgetary considerations will be the 

principal defining factors. 

8. CONCLUSION. Development of IEPs, as discussed in this AC, should ensure that company 

policies and procedures are responsive to organizational changes and that certificate holders 

continually comply with appropriate safety and regulatory requirements. Furthermore, the FAA 

strongly encourages certificate holders to make an IEP an integral part of their management 

process. 

9. APPENDIX. An example of an IEP manual that incorporates elements discussed within this 

AC is provided in the appendix. A carrier’s IEP plan should be documented and may be a standalone manual or may be a portion of some larger department’s manual (e.g., the safety 

department’s manual). The example included here may be more appropriate for a large carrier; 

however, it can be scaled down to fit a smaller carrier’s needs. 

ORIGINAL SIGNED BY: 

James J. Ballough 

Director, Flight Standards Service 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 1 

APPENDIX 1. SAMPLE INTERNAL EVALUATION PROGRAM (IEP) MANUAL 

(14 CFR PART 121 OPERATOR) 

1. OVERVIEW. 

a. The Internal Evaluation Program (IEP) will provide a comprehensive method for 

operational departments to continually monitor internal processes, programs, and procedures to 

ensure that each operating department remains in compliance with appropriate company policies 

and procedures and applicable Federal, State and local regulations. 

b. The IEP is mandatory within this carrier for flight operations, inflight services, 

maintenance and engineering, and customer service. Other departments are encouraged to 

develop similar programs to monitor departmental performance and compliance. 

2. PROGRAM. 

a. Key Responsible Personnel 

(1) Director of Safety (DOS). The DOS has overall responsibility to develop and 

implement a comprehensive safety program. 

(a) The duties and responsibilities of the DOS include: 

(i) Monitor and report to senior management on all air carrier activities that may 

have an impact on safety. 

(ii) Establish a reporting system that provides for a timely and free flow of safetyrelated information. 

(iii) Develop and maintain a database of incident/accident information to monitor 

and analyze trends. 

(iv) Monitor and evaluate the various safety and malfunction reporting systems to 

ensure appropriate integration and evaluation of data. 

(v) Investigate and report on incidents/accidents and make recommendations to 

preclude a recurrence. 

(vi) Conduct safety audits and inspections. 

(vii) Solicit and process safety improvement suggestions. 

(viii) Develop and maintain a safety awareness program. 

(ix) Review and evaluate the adequacy of the emergency response plan. 
AC 120-59A 4/17/06 

Appendix 1 

Page 2 

(x) Monitor industry safety concerns that may have an impact on operations. 

(xi) Maintain close liaison with the FAA, National Transportation Safety Board 

(NTSB) and industry safety organizations and associations. 

(xii) Ensure that the necessary safety program elements have been developed, 

properly integrated, and coordinated throughout the air carrier. These elements include: 

[a] A safety incident/accident reporting system. 

[b] Accident/incident investigation. 

[c] Safety audits and inspections. 

[d] IEP. 

[e] Operational risk assessment program. 

[f] Open reporting systems. 

[g] Routine monitoring and trend analysis programs. 

[h] Review of external evaluation programs. 

[i] Safety Committee(s). 

(xiii) Discharge duties as required to meet applicable legal requirements and to 

maintain safe operations in accordance with Title 14 of the Code of Federal Regulations 

(14 CFR) part 119, section 119.65.

(b) DOS Qualifications. The DOS should meet the qualification requirements as 

outlined in the Joint Flight Standards Handbook Bulletin for Air Transportation (HBAT) and 

Airworthiness (HBAW), HBAT 99-19 and HBAW 99-16, 14 CFR Part 121 and 135 Air Carrier 

Safety Departments, Programs, and the Director of Safety, FAA Order 8400.10, Air 

Transportation Operations Inspector’s Handbook, appendix 3, current edition. The DOS should 

have extensive operational experience and professional qualifications in aviation. This includes 

the knowledge and understanding of the following:

(i) Aviation safety programs. 

(ii) Aviation safety standards. 

(iii) Safe aviation operating practices. 

(c) DOS Expertise. DOS should have established professional qualifications. These 

qualifications may be any of the following: 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 3 

(i) An FAA commercial pilot or airline transport pilot certificate. 

(ii) An FAA mechanic certificate. 

(iii) An FAA aircraft dispatcher certificate. 

(iv) Three years experience in a supervisory position with a 14 CFR part 121 or a 

scheduled 14 CFR part 135 air carrier, or 3 years U.S. military aviation operations experience in 

a comparable position. 

(v) Three years experience in a supervisory position with a U.S. Government 

department, board, or agency that deals directly with aviation matters. 

(d) DOS Knowledge. The DOS should have a full understanding of the following 

materials with respect to the airline's operation: 

(i) The airline's operations specifications. 

(ii) The manual required by 14 CFR part 121, section 121.133. 

(iii) All appropriate maintenance and airworthiness requirements of 14 CFR 

chapter I (parts 1 through 199). 

(e) DOS Authority. The DOS has the authority to establish and modify the policies 

and procedures associated with the airline’s IEP. Proposals for modifications to the IEP may be 

submitted by any manager or employee. Proposals will be submitted through the Director of 

Internal Evaluation, who will seek and obtain approval from the DOS prior to implementation. 

Such modifications should be documented within the IEP database (see section 2c below 

concerning IEP data management). 

(2) Director of Internal Evaluation (DIE). The DIE has overall responsibility for the 

day-to-day management of the IEP. This person will serve as the Chairman of the Internal 

Evaluation Review Board (IERB) with regard to IEP management and control. The Director will 

develop and manage the IEP to ensure compliance with the written program as outlined in this 

manual and will seek to continually improve and enhance the program. 

(a) The duties and responsibilities of the DIE include: 

(i) Develop, implement and maintain an IEP in accordance with the guidance 

contained in FAA Advisory Circular (AC) 120-59, Air Carrier Internal Evaluation Programs, 

current edition. 

(ii) Through coordination with the IERB, develop an annual evaluation schedule. 

(iii) Ensure that all evaluations are conducted on schedule (planned start date plus 
AC 120-59A 4/17/06 

Appendix 1 

Page 4 

or minus days). 

(iv) Review all evaluation information and prepare a summary of all evaluations 

for the IERB. 

(v) Prepare finding reports for submission to each operating department with 

evaluation findings. 

(vi) Review departmental corrective action plans (CAPs) for accuracy and 

effectiveness. 

(vii) Track both findings and corrective actions to ensure followup and 

completion. 

(viii) Prepare a monthly summary of evaluation findings and CAPs for the DOS. 

(ix) Prepare quarterly and annual reports of IEP for senior management and the 

Board of Directors Safety Committee. 

(x) Maintain the electronic database of evaluation information and audit findings. 

(xi) Assume the duties of the DOS position in the event that the incumbent is 

unavailable to perform those duties. 

(b) DIE Qualifications. 

(i) Have a full understanding of the airline’s aviation safety standards and safe 

operating practices; 14 CFR, chapter I; the certificate holder’s operations specifications 

(OpSpecs); and the manual(s) required by 14 CFR part 121, section 121.133. 

(ii) Have supervisory or managerial experience within flight operations, 

maintenance and engineering, station management, customer services, or equivalent experience 

in the transportation industry. 

(iii) Preferred: Have successfully completed a recognized comprehensive safety 

certificate program. 

(iv) Be familiar with the Occupational Safety and Health Administration (OSHA), 

the Environmental Protection Agency (EPA) and other federal safety regulations. 

(v) Familiar with accepted auditing techniques. 

(3) Manager of IEPs. The Manager of IEPs reports to the DIE. The Manager of IEPs 

shall oversee and coordinate the efforts of the Supervisors of Internal Evaluation (SIE) for the 

performance of evaluations and audits of systems, processes, operations, stations and facilities. 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 5 

(a) The responsibilities of the Manager of IEPs include: 

(i) Schedule audits and evaluations in accordance with the IEP guidelines. 

(ii) Conduct audits and evaluations of stations and facilities. 

(iii) Conduct annual oversight evaluations of operating departments. 

(iv) Manage the subordinate staff within the department. 

(v) Compile and analyze audit and evaluation findings for root cause 

identification. 

(vi) Recommend corrective actions pursuant to findings. 

(vii) Track corrective actions to completion. 

(viii) Maintain database of audit materials, checklists, findings, root causes, 

corrective actions, and analyses. 

(ix) Prepare reports for the DIE, the DOS, the IERB, and senior management. 

(x) Manage maintenance of the IEP Company Manual. 

(b) Manager of IEPs Qualifications. 

(i) Have a full understanding of the airline’s aviation safety standards and safe 

operating practices; 14 CFR, chapter I; the certificate holder’s OpSpecs; and the manual(s) 

required by 14 CFR part 121, section 121.133. 

(ii) Minimum of 2 years experience in the airline industry in station or operations 

management. 

(iii) Familiar with accepted auditing techniques. 

(iv) Familiar with database management. 

(4) Supervisors of Internal Evaluation (SIE). The SIEs report to the Manager of IEPs. 

These positions will perform the inspections, audits, and evaluations of the airline’s stations, 

facilities, and operating departments in accordance with the IEP guidelines. 

(a) The responsibilities of the SIEs include: 

(i) Conduct scheduled and unscheduled inspections, audits, and evaluations as 

directed by the Manager of IEPs. 
AC 120-59A 4/17/06 

Appendix 1 

Page 6 

(ii) Report findings related to inspections, audits, and evaluations. 

(iii) Track corrective actions related to findings to completion. 

(iv) Maintain files, records, and data related to the IEP. 

(v) Analyze findings and deficiencies for causal factor and root cause 

identification. 

(b) SIE Qualifications. 

(i) Have an understanding of the airline’s aviation safety standards and safe 

operating practices; 14 CFR, chapter I; the certificate holder’s OpSpecs; and the manual(s) 

required by 14 CFR part 121, section 121.133. 

(ii) Knowledge of airport operations, cargo, security, and Hazmat. 

(iii) Minimum of 2 years experience in the airline industry. 

(iv) Current or past qualification as Ground Security Coordinator. 

b. Guidance. The IEP will be established and maintained in accordance with the latest 

revisions of 14 CFR part 119, section 119.65; Order 8400.10, volume 3, chapter 8, current 

edition; and AC 120-59, current edition. 

c. Data Management. The airline has purchased and installed a database system to serve as 

a repository for all data related to the IEP. This is a networked system accessible to specified 

employees within the Safety Division who have been granted permission to perform certain 

operations within the system. Written documentation regarding the operation and functionality 

of the system is maintained within the Internal Evaluation Department by the DIE, and is stored 

electronically within the database itself. Training related to the operation and maintenance of the 

system is provided by the manufacturer, and a recurrent user seminar is conducted annually. 

Functions and capabilities of the system include (but are not limited to): 

(1) Evaluation and audit schedules. 

(2) Organization structure. 

(3) Tracking of staff assigned to audits and evaluations. 

(4) Tracking of time spent by staff on audits and evaluations. 

(5) Tracking by user ID of all actions related to the conduct of audits and evaluations. 

(6) Storage and tracking of all findings related to audits and evaluations. 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 7 

(7) Audit and evaluation scope, objective, and frequency. 

(8) Assignment of responsibility and timeline for responses to findings. 

(9) Forwarding (via e-mail) of findings to the designated party responsible for corrective 

action. 

(10) Identification of overdue audits and evaluations. 

(11) Identification of overdue finding responses. 

(12) Requirement that all findings are resolved before audit/evaluation status can be 

changed to “closed.” 

(13) Automatic scheduling of followup audit/evaluation upon closure. 

(14) Automatic generation of audit/evaluation/finding reports. 

(15) Tools for classification of audit/evaluation results with regard to risk, quality, 

conformity, and effectiveness. 

(16) Tools for causal factor analysis of findings. 

(17) Tools for trend analysis of findings. 

(18) Storage of files related to audit/evaluation accomplishment, findings, corrective 

actions, analysis, trending, root cause identification/correction, audit/evaluation review, and 

closure. 

d. Document Control. In accordance with the provisions of the Management Policies and 

Procedures Manual, audit checklists and work papers will be retained on file for a period of 

2 years. Audit reports shall be retained in active files for a period of 2 years, then archived for 

8 years. In order to enable long-term analysis, derivative data, findings, corrective actions, causal 

factors, root cause analysis, and trending, information will be retained within the database 

indefinitely. 

e. Audit Objectives and Scope. A statement of the objective and scope of each audit is 

contained in the checklist and the audit report. Areas of ongoing oversight: 

(1) Station evaluations will be performed throughout the year, in addition to the annual 

oversight evaluations of operating departments. These evaluations will include checks of 

manuals, training, cargo, hazmat, security, loading, and records. Master checklists are on file in 

the Internal Evaluation department. Internal Evaluation personnel will conduct these 

evaluations. 

(2) Maintenance operations evaluations will be conducted throughout the year by the 
AC 120-59A 4/17/06 

Appendix 1 

Page 8 

Quality Assurance department. These evaluations will be reviewed during and included in the 

annual oversight evaluation of maintenance and engineering. Maintenance QA audits and 

records will also be reviewed during the annual oversight evaluation. 

(3) Classification of findings and tools for quality, conformity, effectiveness, and risk 

assessment – Findings will be entered under the following classifications: 

(a) NCP - noncompliance (with regulations). 

(b) NCF - nonconformance (with documented procedures). 

(c) SRC - Safety Related Concern (currently in compliance and conformance, but the 

problem may have safety implications). 

(d) QRC - Quality Related Concern (currently in compliance and conformance, but 

the problem indicates a weakness in the Quality System). 

(e) OBS - observation (comment). 

(4) The risk assessment matrix shown in Figure 1 will be used to determine the risk factor 

associated with a given finding. An NCP finding should be brought by the DOS to the 

immediate attention of the VP of the responsible operating department in order to enable timely 

submission of a voluntary disclosure to the FAA. NCP and NCF findings will require a written 

CAP to be issued no later than 15 days from the presentation of the finding report to the audited 

entity. OBS, SRC, and QRC findings that have a risk factor of (2) will require a written CAP to 

be issued no later than 30 days from the presentation of the finding report to the audited entity. 

Any finding that has a risk factor of (1) will require immediate corrective action and notification 

of the operating department VP. 

FIGURE 1: RISK ASSESSMENT MATRIX 

RISK ASSESSMENT MATRIX 

Severity 

Likelihood Catastrophic Critical Marginal Negligible 

Frequent 1 1 2 2 

Probable 1 1 2 3 

Occasional 1 2 2 3 

Remote 2 2 3 3 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 9 

Severity Scale Definitions 

Catastrophic Accident with serious injuries and/or fatalities. Loss (or 

breakdown) of an entire system or sub-system. 

Critical Accident or Serious Incident with injuries and/or 

moderate damage to aircraft. Partial breakdown of a 

system or subsystem. 

Marginal Accident or Incident with minor injury and/or minor 

aircraft damage. System Deficiencies leading to poor 

air carrier performance or disruption to the air carrier 

schedules. 

Negligible Less than minor injury and/or less than minor system 

damage. Little or no effect on system or subsystem. 

Likelihood Scale Definitions 

Frequent Will be continuously experienced unless action is taken 

to change events. 

Probable Will occur often if events follow normal pattern. 

Occasional Potential for infrequent occurrence. 

Remote Not likely to happen (but could). 

Risk Classification 

1 High Risk - Unacceptable; requires action. 

2 Medium Risk - May be acceptable with review by 

appropriate authority; requires tracking and probable 

action. 

3 Low Risk - Acceptable without further action. 

f. Unique Terms. A glossary of acronyms used throughout this manual is included at the 

end of this section. 

g. Independence. The DIE reports directly through the DOS to the President and Chief 

Executive Officer (CEO) and to the Safety Committee component of the Board of Directors. 

The following chart depicts this reporting structure: 
AC 120-59A 4/17/06 

Appendix 1 

Page 10 

 

Internal Evaluation Reporting Structure

President & Chief

Executive Officer 

(CEO)

Board of Directors 

(BOD) Safety

Committee

Director of 

Safety (DOS)

Director Internal 

Evaluation (DIE) 

& Regulatory 

Compliance

Manager Internal

Evaluation 

Program (IEP)

Supervisors 

Internal 

Evaluation (SIE)

Operating 

Department 

Evaluation 

Programs

Internal 

Evaluation 

Review Board 

(IERB)

h. Top Management Review. The Safety Division and the IERB will report all audit 

findings on an annual basis to senior management. 

i. Senior Management. The CEO and President constitute senior management. When 

making the report to senior management, the Safety Division and the IERB shall include all audit 

information and findings in the report. Senior management will be actively involved in the 

review process to ensure audit program effectiveness and provide oversight and guidance to 

operating departments. Senior management’s involvement includes review of all audits and 

corrective actions through periodic meetings, briefings, or written reports to assess the 

effectiveness of each operating department’s CAP and audit program. 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 11 

j. Schedule. Flight operations, maintenance and engineering, customer services, and inflight 

services will receive a focused quarterly evaluation (e.g. first quarter-records, second quarter 

manuals, etc.). The schedule for the evaluations of these areas will be determined during the first 

quarter of each calendar year, and will be entered into the system by IEP personnel. All stations 

within the airline’s system will be evaluated three times per year on the following basis: 

(1) “A” Stations (those with more than 1 million passenger enplanements per year) will 

be evaluated three times per year by IEP personnel. 

(2) “B” Stations (those with more than 250,000 but fewer that 1 million passenger 

enplanements per year) will be evaluated twice per year by IEP personnel, and once per year on a 

self-audit basis. The self-audit will be forwarded to the IEP department for entry into the 

database and followup activity tracking. 

(3) “C” Stations (those with fewer than 250,000 passenger enplanements per year) will be 

evaluated once per year by IEP personnel, and twice per year on a self-audit basis. The selfaudits will be forwarded to the IEP department for entry into the database and followup activity 

tracking. 

(4) A list of stations denoting their status (A, B, or C) will be maintained by the IEP 

department and will be updated based on actual passenger enplanement records from the 

previous calendar-year. 

(5) The schedule for the evaluations and self-audits will be entered into the system and 

tracked by Internal Evaluation personnel. The Internal Evaluation department will maintain 

evaluation and self-audit checklists. 

(6) Other evaluation and audit activity will be carried out by IEP personnel on an eventdriven basis, or by request from senior management. 

k. CAPs. All CAPs will be tracked to completion in the system. Audits will remain in an 

“open” status until all corrective actions have been completed. 

l. Root Cause Analysis. The airline has selected the XYZ system for use by the IEP team to 

perform root cause analysis and to aid in the development of corrective actions for deep-rooted 

problems that are discovered during the course of inspections, audits, and evaluations. All IEP 

personnel will receive training in the use of this system. 

m. Training. All IEP personnel who conduct evaluations will receive training including but 

not limited to: 

(1) Basic auditing skills course given by an accredited organization. 

(2) Operational auditing skills course given by an accredited organization. 
AC 120-59A 4/17/06 

Appendix 1 

Page 12 

(3) XYZ root cause analysis. 

(4) Database training (conducted by the database manufacturer). 

(5) Ground security coordinator (conducted by airline personnel). 

(6) Complaint resolution official (conducted by airline personnel). 

(7) Dangerous Goods Acceptance (conducted by airline personnel). 

(8) On-the-job performance of audits, evaluations, and interviews (conducted by IEP 

personnel). 

(9) All training will be documented in a file maintained within the IEP department. IEP 

personnel will receive the minimum training within 6 months of beginning duties in the IEP 

department. 

n. Resources: The DIE will prepare a budget annually for approval by the DOS. This 

budget will include sufficient funds to support the personnel, equipment, infrastructure, and 

activities of the IEP department. This operating budget will be developed, submitted, and 

approved in accordance with the guidance contained in the Management Policies and Procedures 

Manual. 

o. Audits. The IEP will provide a formal, continuous self-evaluation of the airline’s 

operations to enhance system safety and ensure continual improvement and compliance. Each 

operating department will be subject to a formal IEP, which will encompass all stations, 

facilities, domiciles, line stations, and maintenance bases under the operating departments’ 

control. The IEP describes a comprehensive program of audits that is conducted by operating 

departments and the Safety Division and the IERB to measure the effectiveness of internal 

programs and processes. Department-specific audit programs will be developed to review all 

internal processes, programs, and procedures. All departmental IEPs are outlined in later 

sections of this manual. This program will be accomplished through a series of self-audits or site 

audits that will be coordinated and managed by the Safety Division and the IERB. 

p. Tools. Examples of audit tools include: audit checklist, employee performance 

evaluations (pilot and flight attendant check or evaluation rides), aggregate de-identified Flight 

Operational Quality Assurance (FOQA) data, Aviation Safety Action Program (ASAP) 

information, results of safety inspections, employee surveys, and any other assessment tools 

developed by individual departments or by the Safety Division and the IERB that measure 

performance and compliance. Other resources used in the development of individual audit 

programs include: regulations (14 CFR), Department of Transportation (DOT) Regulations, 

National Aviation Safety Inspection Program (NASIP) Audit Checklist, Department of 

Defense (DOD) Air Carrier Survey Office Maintenance Checklist, the DOD Operations Survey 

Checklist, and the FAA’s Air Transportation Oversight System (ATOS) assessment tools. 

q. Recordkeeping and Administration. All audit tools and associated evaluation results 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 13 

used during the Internal Evaluation process will be retained on file in the Safety Department and 

be made available to the Safety Division and the IERB for review during the Safety Division and 

the IERB’s ongoing review process. 

r. Schedule. The audit checklist will be completed in accordance with the yearly schedule 

for a given operating department. Status of unresolved issues or discrepancies will be forwarded 

to senior management as part of the annual audit report to senior management (normally at 

year’s end). 

3. OPERATING DEPARTMENT PROGRAMS. Each operating department’s IEP is 

described below. The programs have been designed to monitor all critical internal departments 

and major functional areas. As described above, individual audit programs may be unique and 

will reflect the organization’s structure and mission. In order to ensure program standardization 

and to assure a level of continuity among the individual programs, some minimum elements have 

been established for mandatory inclusion in the individual departmental audits. Because of 

differences in mission and operational responsibility, a unique minimum element list has been 

provided for each major operating department and is included in the departments’ programs 

below. 

a. Flight Operations (Includes Dispatch, Crew Scheduling, and Systems Operations 

Control): The DOS and the IERB have overall responsibility for the flight operations IEP. The 

DIE is primarily responsible to the DOS for the execution and administration of IEP and will 

advise the DOS regularly on the status of the program and of any findings or considerations 

discovered during the process. Audit checklists have been developed and continuous ongoing 

improvements will be incorporated in these documents, as conditions require. The flight 

operations IEP will include a process to analyze and improve flight operations policies and 

procedures at all levels of the organization. 

b. Minimum Elements: The list of elements provided below represents the minimum items 

that must be included and evaluated in the flight operations IEP. A number in parentheses 

follows some items. The numbers reference the FAA’s ATOS element number, where 

applicable. 

(1) Regulatory compliance (include an assessment of administrative/enforcement actions 

by Government regulatory agencies). 

(2) Compliance with air carrier programs and procedures. 

(3) Review of manuals for currency, accuracy, and maintenance (ATOS 2.1). 

(4) Accident/incident/injury rate. 

(5) Aircraft accident/incident procedures. 

(6) Communication processes between employees and management. 
AC 120-59A 4/17/06 

Appendix 1 

Page 14 

(7) Employee surveys. 

(8) A vendor/supplier audit program for outsource crewmember training (ATOS 4.2.9). 

(9) OpSpecs. 

(10) Safety program (departmental) (ATOS 7.2.1). 

(11) Aircrew standardization (ATOS 4.2 and 4.3). 

(12) FOQA data (de-identified trend information). 

(13) ASAP information. 

(14) Captain upgrade (ATOS 4.2.3). 

(15) Dispatch and flight release (ATOS 3.2.1). 

(16) Personnel training and qualification (ATOS 4.0). 

(17) Training program (ATOS 4.0). 

(18) Crewmember (flight-crew) qualification (ATOS 4.2. and 4.3). 

(19) Dispatcher training (ATOS 4.2.5). 

(20) Flight Simulators and Training devices (ATOS 4.2.8). 

(21) Hazmat training and procedures (ATOS 4.2 and 3.1.12). 

(22) Special airport and route qualifications (ATOS 5.0). 

(23) Scheduling and reporting system (ATOS 6.1.1). 

(24) Crewmember (flight-crew) flight, rest, and duty time procedures (ATOS 6.1.2). 

(25) Dispatcher duty/rest time (ATOS 6.1.4). 

(26) Operational release (ATOS 3.2). 

(27) Technical administration (ATOS 7.0). 

(28) Check airman program (ATOS 4.2.7). 

(29) Aircrew program designees (ATOS 4.2.10). 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 15 

(30) Minimum equipment list (MEL)/configuration deviation list (CDL) procedures 

(ATOS 3.2.3). 

c. In-flight Services (IFS). The DOS and the IERB have overall responsibility for the 

inflight services IEP. The DIE is primarily responsible to the DOS for the execution and 

administration of the IEP and will advise the DOS regularly regarding the status of the program 

and of any findings or considerations discovered during the audit process. Audit checklists have 

been developed and continuous and ongoing improvements will be incorporated in these 

documents, as conditions require. The inflight services IEP will include a process to analyze and 

improve inflight services policies and procedures at all levels of the organization. 

d. Minimum Elements: The list of elements provided below represent the minimum items 

that will be included and evaluated in the inflight services IEP. A number in parentheses follows 

some items. The numbers provide a cross-reference to the FAA’s corresponding ATOS element 

number, where applicable. The IEP will employ company developed tools and standards for 

these elements: 

(1) Regulatory compliance (include an assessment of administrative/enforcement actions 

by Government regulatory agencies). 

(2) Compliance with air carrier programs and procedures. 

(3) Review of manuals for currency, accuracy, and maintenance (ATOS 2.1). 

(4) Aircraft accident/incident procedures. 

(5) Accident/incident/injury rate. 

(6) Communication processes between employees and management. 

(7) ASAP information. 

(8) Employee surveys (when available). 

(9) Intoxicated passengers screening and reporting. 

(10) Carry-on baggage (ATOS 3.1.5). 

(11) Exit row seating (ATOS 3.1.6) 

(12) Outsource crewmember training (ATOS 4.2.9). 

(13) Aircrew standardization (ATOS 4.2 and 4.3) 

(14) Aircrew safety assessment (inflight observations) (ATOS 7.2.1). 
AC 120-59A 4/17/06 

Appendix 1 

Page 16 

(15) Training of flight attendants (ATOS 4.2.4). 

(16) Crewmember (aircrew) qualifications (ATOS 4.3.2). 

(17) Hazmat training (ATOS 4.2). 

(18) Procedures required by the Hazardous Materials/Dangerous Goods Program (ATOS 

3.1.12 and 4.2.4) 

(19) Flight attendant rest and duty time procedures (ATOS 6.1.3). 

(20) Technical administration (ATOS 7.0). 

e. IFS Additional Audit Items. The following items will be evaluated as part of the IFS 

Audit program: 

(1) Cabin crewmember flight, rest, and duty time procedures (ATOS 6.1.3). 

(2) Scheduling practices and compliance (ATOS 6.1.3). 

(3) Outsourced in-flight crewmember training program (ATOS 4.2.9). 

(4) List of current vendors. 

(5) Flight report data management. 

(6) Accident and incident rates and related statistics. 

f. Maintenance and Engineering (M&E). The DOS and the IERB have overall 

responsibility for the M&E IEP. The DIE is primarily responsible to the DOS for the execution 

and administration of the IEP and will advise the DOS regularly regarding the status of the 

program and of any findings or considerations discovered during the process. Audit checklists 

have been developed and continuous ongoing improvements will be incorporated into these 

documents, as conditions require. The M&E IEP will include a process to analyze and improve 

M&E policies and procedures at all levels of the organization. 

g. Minimum Elements. The list of elements provided below represents the minimum items 

that must be included and evaluated in the M&E IEP. A number in parentheses follows some 

items. The numbers reference the FAA’s ATOS element number, where applicable. 

(1) Aircraft airworthiness (ATOS 1.1.1). 

(2) Records and reporting system (ATOS 1.2). 

(3) Maintenance organization (ATOS 1.3). 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 17 

(4) Continuous Analysis & Surveillance (ATOS 1.3.11). 

(5) Regulatory compliance (include an assessment of administrative/enforcement actions 

by Government regulatory agencies). 

(6) Compliance with air carrier programs and procedures. 

(7) Review of manuals for currency, accuracy, and maintenance (ATOS 2.1). 

(8) MEL/CDL Procedures (ATOS 1.3.5) 

(9) Aircraft accident/incident procedures. 

(10) Accident/incident/injury rate. 

(11) Communication processes between employees and management. 

(12) ASAP information. 

(13) Employee surveys (when available). 

(14) Personnel training and qualification (ATOS 4.0). 

(15) Hazmat training for maintenance personnel. 

(16) Hazmat procedures for maintenance personnel. 

(17) Maintenance duty time procedures (ATOS 6.2.1). 

(18) Technical administration (ATOS 7.0). 

h. Customer Service. The DOS and the IERB have overall responsibility for the customer 

service IEP. The DIE is primarily responsible to the DOS for the execution and administration 

of the IEP and will advise the DOS and the IERB regularly regarding the status of the program 

and of any findings or considerations discovered during the audit process. 

(1) Audit checklists have been developed and continuous and ongoing improvements will 

be incorporated in these documents, as conditions require. The customer service IEP will 

include a process to analyze and improve customer service policies and procedures at all levels 

of the organization. 

(2) Documentation (including CAPs) that is provided by customer service to substantiate 

answers to audit questions must be maintained by customer service. Revisions to any such 

documentation must be forwarded to the Safety Division and the IERB for inclusion in the audit 

file. 
AC 120-59A 4/17/06 

Appendix 1 

Page 18 

i. Audits. The customer service IEP is not a single, stand-alone audit. It is a collection of 

regularly scheduled station audits, self-audits, and on-site audits conducted throughout the year. 

The responsibility for collecting, analyzing, and forwarding of audit information is the 

responsibility of the DIE. All audit findings will be routed through the VP of Customer Service 

for corrective action and followup. The DIE will compile and forward an annual audit report in 

accordance with this manual, normally at year’s end. 

j. Minimum Elements. The list of minimum elements provided below represent the 

minimum items that must be included and evaluated in the customer service IEP. A number in 

parentheses follows some items. The numbers reference the FAA’s ATOS element number, 

where applicable. 

(1) Hazmat (ATOS 3.1.12). 

(2) Training records. 

(3) Weight and balance (ATOS 3.2.2). 

(4) Procedures manual. 

(5) Stations files. 

(6) Flight files. 

(7) Security. 

(8) Training program. 

(9) Station personnel (ATOS 4.2.6). 

(10) Mandated training. 

(11) Carriage of cargo (ATOS 3.1.8). 

(12) Station facilities (ATOS 5.1.5). 

(13) Station manuals (ATOS 2.1). 

(14) Passenger handling (ATOS 3.1.1). 

(15) Carry-on baggage (ATOS 3.1.5). 

(16) Exit row seating (ATOS 3.1.6). 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 19 

4. PROCESS. 

a. The Audit. Each department may be subject to either a single annual audit or a continual 

progression of audits throughout the year based upon the department’s operational requirements 

and structure. A detailed audit schedule will be developed each calendar year by the DIE. This 

schedule will be maintained within the database system. 

(1) Departments that are monitored by continual running audits will be subject to an 

annual audit review. During this review, all individual audits will be collected and reviewed by 

management. The collected audits will be combined and analyzed, and a CAP, where required in 

accordance with the criteria in this manual, will be developed for each finding and forwarded to 

senior management for review. The same process will be followed for departments that are 

under an individual annual audit program. 

(2) In all cases, audit information will be analyzed by the operating department and by 

the Safety Division and the IERB, and, where required by this manual, a CAP will be developed. 

Senior management will be briefed on the audit results and plan of corrective action. During the 

conduct of either style of audit, auditors should apply the appropriate classification for risk 

assessment (Figure 1) and for quality, conformance or effectiveness (NCP, NCF, QRC, SRC, or 

OBS) to each audit finding. When Risk Factor (1) or NCP findings are identified, the VP of the 

appropriate operating department should be notified without delay. Every effort must be made to 

correct or eliminate Risk Factor (1) and NCP findings immediately. 

(3) Auditors must ensure that when high risk factor findings cannot be corrected on the 

spot that adequate precautions are taken to prevent injury or accidents. When notified of 

apparent violations of the regulations, management must evaluate each finding and decide if selfdisclosure in accordance with AC 00-58, Voluntary Disclosure Reporting Program, is warranted. 

b. Analysis. The analysis phase begins immediately following the completion of an annual 

audit or at the conclusion of the annual review. Data from either an annual audit or continuing 

audits are combined and an analysis of findings completed. During this phase, all findings must 

be identified and cataloged by the IEP Department. All departments will receive reports from 

the Safety Division and the IERB of findings discovered during audit processes. An audit trail 

must be maintained throughout the audit program. Documentation will be presented to senior 

management and forwarded to the Safety Division and the IERB as part of the final report. The 

focus of data analysis should be to determine the root cause and risk. 

c. Corrective Action. After the analysis of an audit has been completed and reviewed by the 

IERB, the operating department will be required to provide a detailed CAP for each finding. 

Departments shall prepare a written plan, which outlines corrective action for each audit finding. 

This plan will be part of the information presented to senior management and forwarded to the 

Safety Division and the IERB as part of the final report. An effective method must be developed 

to monitor, measure, and validate the effectiveness of corrective actions taken by the department. 

Corrective action may take many forms; it may be as simple as a policy letter or require in-depth 

changes to training programs, manuals, or procedures. Regardless of the form or type of 
AC 120-59A 4/17/06 

Appendix 1 

Page 20 

corrective action planned, an on-going evaluation of the action’s effectiveness must occur. Each 

new or subsequent audit should evaluate and consider the effectiveness of corrective action steps 

taken during prior audits. A continual review of corrective action steps assures a level of internal 

oversight as well as providing a method of validating CAPs. 

d. Audit Report Resolution. After the analysis phase and CAP development phase has been 

completed, and not more than 90 days after an audit is completed, a formal report of audit 

findings, corrective action, and methods planned for tracking findings through resolution will be 

presented to senior management. This plan will outline specific corrective action and provide a 

timeline for completion. For departments that run yearlong programs, an annual CAP is due by 

year’s end. This report should be a consolidated summary of all findings, corrective action steps 

with specific time lines for resolution. 

e. Senior Management Review. Each December, a senior management review will be 

conducted of all audit information from the preceding year. Each department will be required to 

present a status report of all IEP findings and corrective measures taken. Corrective actions will 

be evaluated during the following years’ audit to validate completion and effectiveness. These 

findings will be presented to senior management at the yearly meeting by the DIE. 

f. Employee Feedback. The most recent results of IEP audits for a given functional area 

will be published quarterly in the appropriate employee group newsletter (flight operations, 

maintenance, inflight services, customer service). Results will include progress reports on 

corrective actions for previous audit findings. In addition, companywide IEP findings and status 

reports, as well as audit schedules, will be maintained on the IEP Web site accessible to all 

employees through company intranet. 

5. OVERSIGHT (PROGRAM EFFECTIVENESS). 

a. The Safety Division and the IERB are responsible for oversight of the IEP with regard to 

storage of audit information and for periodic followup with operating departments. Each 

department will forward complete audit information to the Safety Division and the IERB after 

reporting this information to senior management. 

b. The Safety Division and the IERB will track audit findings that remain open or require 

followup action using the system. The Safety Division and the IERB will periodically review 

CAPs and determine if action is being completed as scheduled and is effective in correcting or 

eliminating the finding. A designated Safety Manager will be assigned oversight responsibility 

for each operating department. This manager will monitor progress within his/her assigned 

department with regard to corrective actions taken within the department and the effectiveness of 

that action. In addition, the assigned manager will perform an annual safety audit of the 

operating department. During that audit, a review of the department’s IEP will be conducted. 

c. The operating department’s analysis phase and action plan will be considered and 

evaluated with regard to progress made toward resolution of audit findings. The results of safety 

audits will also be forwarded to senior management for review. In addition, each department 

will implement, where feasible, procedures for continuous measurement and analysis of safety 
4/17/06 AC 120-59A 

 Appendix 1 

 Page 21 

critical processes between audits and evaluations. In order to provide an additional level of 

oversight to the IEP, the Internal Audit Department will add the IEP to its list of audited entities 

and will appraise the adequacy and effectiveness of the program’s internal controls on a biennial 

basis. 

6. ACRONYMS USED IN THIS MANUAL. 

AC Advisory Circular 

ASAP Aviation Safety Action Program 

ATA Air Transport Association 

ATOS Air Transportation Oversight System 

BOD Board of Directors 

CAP Corrective Action Plan 

CASS Continuing Analysis and Surveillance System 

CDL Configuration Deviation List 

CEO Chief Executive Officer 

CFR Code of Federal Regulations 

CSET Certification, Standardization and Evaluation team 

DIE Director of Internal Evaluations 

DOD Department of Defense 

DOS Director of Safety 

DOT Department of Transportation 

FAA Federal Aviation Administration 

FAR Federal Aviation Regulation 

FOQA Flight Operational Quality Assurance 

GMM General Maintenance Manual 

HAZMAT Hazardous Materials (Dangerous Goods) 

HBAT Handbook Bulletin for Air Transportation 

HBAW Handbook Bulletin for Airworthiness 

IATA International Air Transport Association 

ICAO International Civil Aviation Organization 

IEP Internal Evaluation Program 

IERB Internal Evaluation Review Board 

IFS Inflight Services 

MEL Minimum Equipment List 

NASIP National Aviation Safety Inspection Program 

NCF Non-conformance (with documented procedures) 

NCP Non-compliance (with regulations) 

NTSB National Transportation Safety Board 

OBS 

OSHA 

 Observation (comment) 

Occupational Safety and Health Administration 
AC 120-59A 4/17/06 

Appendix 1 

Page 22 

QA Quality Assurance 

QRC Quality Related Concern (currently in compliance and conformance, but the 

problem indicates a weakness in the Quality System) 

SAI Safety Attribute Inspection 

SIE Supervisors of Internal Evaluation 

SRC Safety Related Concern (currently in compliance and conformance, but the 

problem may have safety implications)