Payroll Accruals

TxEIS Payroll AccrualsRegion XVIII Information Systems

I. Accrue = Accumulate

Why do we accrue?

1. From the TEA Accounting Guide: “Expenditures should be recorded and reported in the period in which they are incurred. Therefore, unpaid salaries and related benefits that have been earned but not yet paid should be recorded as accrued expenditures” (liabilities).

2. The process of accruing salaries enables a school district to accurately reflect expenses after each payday.

3. Enables the district to maintain earned but unpaid salary amounts in School YTD for each employee.

4. All businesses and city and state governments accrue pay earned in one fiscal year and not paid until the next fiscal year.

5. Accruing enables districts to fully expense salaries paid out of federal funds by June.

II. Calculation

Formulas:Standard Pay Rate = Contract Amount ÷ 12Daily Rate = Contract Amount ÷ Number of Days in ContractMonthly Amount Expensed = Daily Rate X Number of Days WorkedMonthly Amount Accrued = Monthly Amount Expensed – Standard Pay Rate

-or-

Monthly Amount Accrued= Number of Days Worked X (Contract Amount ÷ Number of Days in Contract) – (Contract Amount ÷ 12)

IllustrationAnnual Salary $36,000.00

Months in Contract 10

Days Employed 187

Standard Pay Rate 36000/12 $3,000.00

Daily Rate 36000/187 192.513

ACCRUAL CALENDAR STAFF JOB/PAY DATA>JOB INFO TAB

PAYDATEDAYS

EARNED DAILY RATE EXPENSESTANDARD

PAY RATE ACCRUED LIABILITY SCHOOL YTD ACCRUAL Notes

Object 61XX Object 2161 Object 2161

8/31/2012 10 X 192.513 = 1925.13 - 0.00 = 1925.13 1925.13 EOY Accruals: Not a Pay Date, No Pay

9/20/2012 20 X 192.513 = 3850.27 - 3000.00 = 850.27 2775.40

10/20/2012 21 X 192.513 = 4042.78 - 3000.00 = 1042.78 3818.18

11/20/2012 20 X 192.513 = 3850.27 - 3000.00 = 850.27 4668.45

12/20/2012 14 X 192.513 = 2695.19 - 3000.00 = (304.81) 4363.64

1/20/2013 20 X 192.513 = 3850.27 - 3000.00 = 850.27 5213.90

2/20/2013 20 X 192.513 = 3850.27 - 3000.00 = 850.27 6064.17

3/20/2013 21 X 192.513 = 4042.78 - 3000.00 = 1042.78 7106.95

4/20/2013 20 X 192.513 = 3850.27 - 3000.00 = 850.27 7957.22

5/20/2013 20 X 192.513 = 3850.27 - 3000.00 = 850.27 8807.49

6/20/2013 1 X 192.513 = 192.51 - 3000.00 = (2807.49) 6000.00 Fully Expensed

7/20/2013 0 X 192.513 = 0.00 - 3000.00 = (3000.00) 3000.00 No Expense

8/20/2013 0 X 192.513 = 0.00 - 3000.00 = (3000.00) 0.00 Payoff Date, No Expense

Total 187 36000.00 36000.00 0.00 0.00 Liability (2161) is eliminated.

III. Accounts

IV. TxEIS End-of-Year (August) Accruals

Step 1

Step 2

Step 5

Step 5 (continued)

Step 5 (continued)

Step 6

Step 6 (continued)

Step 6 (continued)

Step 7

Step 8

Step 9

Step 9 (continued)

Step 10

Step 10 (continued)

Step 11

STOP

Step 12

Step 12 (continued)

Step 13

Step 14

Step 15

V. TxEIS Monthly Payroll Accruals

Step 1

The Pay Dates must match the Pay Dates Table.

Step 2

Step 2 (continued)

Step 2 (continued)

Step 3

XI. Balancing Accruals Monthly

HRS3050: School YTD Report

Finance GL Account Summary: Object 2161

XIII. Correcting Accruals

1. Accrual Variance Extract

1. Accrual Variance Extract (continued)

1. Accrual Variance Report (continued)

1. Accrual Variance Extract (continued)

2. Zero School YTD Accruals

2. Zero School YTD Accruals (continued)

2. Zero School YTD Accruals (continued)

3. Special Adjustments

Finished!!

Questions