Accrual Variance Extract

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Accrual Variance Extract
Payroll
Finance
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A tool that helps verify accruals (past and
future) are correct.
Purpose
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The system will calculate future accrual amounts
and, using accruals in Pay History, combine the
amounts and determine the difference (if any).

• If there are any differences, they can be
  posted to the employees master file and
  interface to finance. No manual journal entries
  !!

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Requirements for accurate calculations

• The Accrual Rate on the Job Info screen must be
  correct.
• The Accrual Code on the Job info screen must
  match an accrual code in the Accrual Calendar
• The Accrual Calendar must have Pay Dates that
  match the dates in the Pay Date table.

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Requirements for accurate calculations

• The Accrual Calendar must have the accurate
  number of Total Days Worked.
• Payoff Date on contract jobs (Pay Type 1 and 2)
  should be correct and should exist in the Pay
  Dates table.
• All future pay dates for the school year must
  exist on the Pay Date table
• No future supplemental (non regular payroll) pay
  dates should exist on the Pay Date table.

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Researching Extract Errors

• After calculations are completed for the selected
  employees, the system will display an extract
  error list.

For the system to provide an accurate reflection
of the status of accruals all errors should be
researched and corrections made prior to
re-calculating. Failure to do so can result in
an incomplete reflection of District Totals of
over or under accruals.
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The system starts calculations from the first
unprocessed pay date in the Pay Date table and
ends with the last pay date in the Pay Date table.
As each pay date has completed processing, a
message will display indicating all calculations
are completed for that pay date, such as
04/24/2006.
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• If there are any errors, they will display
  between each pay date. Many of the errors
  reported are the same errors displayed when
  regular payroll calculations have been performed.
  
• Calculations will continue until all pay dates in
  the Pay Date table have been calculated. The
  last date displayed will be reflective of the
  last date in the Pay Date table.

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• Once a Payoff Date is reached for an employee,
  calculations will discontinue for that employee.
  
• If there are additional unprocessed pay dates in
  the Pay Date table, the system will continue
  processing for other employees until all pay
  dates have been calculated.

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Warning Employee has distribution record for a
job that is not in the job master for job 950
These employees have multiple jobs with only one
job accruing. The Accrual Code on the Job Info
screen populates all jobs but unless the Accrue
Job field is selected, the job will not accrue.
Calculations will be performed for these type
employees on the job(s) that do accrue and the
results will display on the variance reports.
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Failure Accrual variance cannot be calculated.
This message generally displays after the above
warning message. When this error occurs, it means
the Accrue Job field on the Job Info screen is no
longer selected but the employee has accruals in
pay history. Re-calculations should be performed.
Failure to make this change prior to
re-calculating the variance will cause these
employees to not be reflected on the variance
reports.
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Failure Contract balance less than standard pay
rate for job code 103. The Start
Calculations for pay date 07/24/2006 is
displayed above this error and indicates these
employees have payoff dates on the Job Info
screen that do not match a pay date on the Pay
Date or Accrual Calendar table. Re-calculations
should be performed. Failure to make this change
prior to re-calculating the variance will cause
these employees to not be reflected on the
variance reports.
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This report shows the Grand Total Variance
calculations totals based on the information
available on the selected employees at that
moment in time.
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For example, this screen shows that employee 519
is over-accrued and employee 7 is under accrued.
Their pay history records need to be researched
to verify the information and to understand why
this has occurred.
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Employee 519
Run the YTD Accrual Payroll Account Distribution
Journal
Total over accrued 2,816.41 (5 cents less than
the Accrual Variance Extract.
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Employee 7
Quick check is to multiply the difference of
2.607 times the of Days Empld (187) for a
total of 487.51. This amount exceeds the
variance amount of 453.61 by 33.89 and proves
the employee is under-accrued.
Difference of 2.607
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1875.47/144.267 13 (Days on Accrual Calendar
13 X 141.660 1,841.58 - 1875.47 33.89
Run the YTD Accrual Payroll Account Distribution
Journal
141.660 X 21 Total Days Worked 2,975.86 less
Pay Rate of 22.48.16 726.70
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This accounts for the 33.89 difference in the
simple calculation and the variance amount
(487.51 minus 33.89 equals 453.61) which is
within .01 cent of the variance.

• Change the Accrual Rate on the Job Info to
  144.267 and then recalculate the variance. The
  key is to make necessary changes to the employee
  record FIRST, then recalculate the variance and
  Post to Master and Interface to Finance. If the
  Accrual Rate is not changed and the variance is
  posted with the existing rate, the variance
  amount will still be correct. BUT if the Accrual
  Rate is changed AFTER the variance has been
  posted, then the variance will need to be
  re-calculated.

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What happens when errors are corrected?
This is an increase of 7,647.96 from the first
extract.
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Conclusion

• Create this report as often as necessary to
  review the status of employees accruals to be
  sure no surprises will occur as payrolls are
  processed throughout the fiscal year.
• Before the first payroll of the new school year
  is processed, the Accrual Variance Extract should
  be performed.

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Moral of this story?

• Catch potential errors by reviewing this report
  and future problem between payroll and finance
  can be avoided by taking a little time to verify
  the data.

• Wouldnt you rather be a day late than a dollar
  short?