Process Benefit Accruals

Use this procedure to process and maintain benefit accrual information.

To perform periodic benefit accrual, see Perform Periodic Benefit Accrual.

To process benefit accruals

Select Payroll Setup menu > Payroll Options.
Click the Benefits tab and complete the fields related to benefit accruals.

If your company policy allows a third type of benefit, in addition to vacation and sick leave, in the Accrual Benefit Description field, enter the description of the benefit. For more information, see Payroll Options - Fields.
If you want to post benefit accrual amounts to the general ledger by department, complete steps a and b. If you want to recognize benefit expenses at the time the hours are used by employees, and not post amounts to the general ledger by department, proceed to step 4.

Select Payroll Setup menu > Department Maintenance.
On the Main tab, enter the general ledger liability and expense account numbers to which you want to post the vacation, sick leave, and user-defined third benefit (Other) accruals for each department.

The accruals are not posted to the general ledger unless both liability and expense account numbers are entered. For more information, see Department Maintenance - Fields.

Select Payroll Setup menu > Earnings Code Maintenance.
Establish earnings codes to use for vacation, sick leave, and the user-defined third benefit, if applicable. In the Type of Earnings field, you must select Vacation Pay, Sick Pay, or Benefit to identify each earnings code as a particular benefit type.

For more information, see Earnings Code Maintenance - Fields.
For each earnings code, in the Benefit Types to Accrue area, select the types to accrue. You can select any combination of benefit types. If an earning should not accrue any benefit, clear these check boxes.

You should accrue vacation, sick leave, and the user-defined third benefit for all regular earnings codes, as well as the earnings codes created for vacation, sick leave, and the user-defined third benefit types.
Select Payroll Setup menu > Benefit Schedule Maintenance.
Create a separate benefit schedule for each type of accrual method. For example, a first-year employee might accrue only 40 hours of vacation time, compared to a second-year employee who accrues 80 hours of vacation. For more information, see Benefit Schedule Maintenance - Fields.

Note Benefit hours do not accrue if the Hours/Year field is set to zero.

Select Payroll Main menu > Employee Maintenance.
On the Wages tab, assign the appropriate benefits code to each employee. For more information, see Employee Maintenance - Fields.
On the Main tab, click Earnings.
In the Earnings and Vacation Inquiry window, click the appropriate button (Vacation, Sick, or the third benefit) to open the the Benefit Accrual window.
Adjust the Annual Limit field, as necessary, to reflect individual situations. If zero is entered, no benefit will be accrued. For more information, see Benefit Accrual - Fields. Click OK.
Select Payroll Main menu > Payroll Data Entry.
Use the appropriate benefit earnings codes to record the hours used for vacation, sick leave, and the third benefit. For more information, see Payroll Data Entry - Fields.
Select Payroll Main menu > Benefit Register. Print the Benefit Register to provide an audit trail of benefits accrued.

If you post benefit accruals to the general ledger by department, use the Benefit Register to verify the accrual posting amounts. For more information, see Benefit Register - Fields.
Complete payroll processing and print, verify, and update the Check Register and Daily Transaction Register. The benefit accrual amounts are posted when the Daily Transaction Register is updated.

Print the Benefit Accrual Report at least once every quarter to provide a recap of benefit hours accrued for each employee.