5.7 Employee Compensation Accounting
5.7 Employee Compensation Accounting
(Last Modified on January 30, 2018)
Employee compensation and associated tax and benefit costs should be recorded in the general ledger based upon activity from the institution’s payroll system including limited activities originating in the accounts payable system (i.e. unemployment insurance and workers compensation expenditures). Generally, the payroll system should be the system of record for personal services expenditures.
5.7.1 OneUSG Connect Combo Codes: General Ledger Chart Fields
(Last Modified on January 30, 2018)
For OneUSG Connect institutions, combo codes are a name for the full general ledger chart string that is utilized for an expenditure (similar to payroll distribution codes and speed types). The combo code alleviates the need to enter the full chart string. A combo code should only be used to represent one specific full chart string. If any chart field component of the full chart string changes, a new combo code should be established in Financials. Multiple combo codes cannot reference the same full chart string.
Scenario 1: ALLOWED IN OneUSG Connect
| COMBO CODE | DEPT | PROJECT | FUND | PROGRAM | CLASS |
|---|---|---|---|---|---|
| XYZ | 0102100 | 10000 | 11100 | 11000 | |
| ABC | 0102100 | 10500 | 11100 | 11000 |
Scenario 2: NOT ALLOWED IN OneUSG Connect
| COMBO CODE | DEPT | PROJECT | FUND | PROGRAM | CLASS |
|---|---|---|---|---|---|
| XYZ | 0102100 | 10000 | 11100 | 11000 | |
| ABC | 0102100 | 10000 | 11100 | 11000 | |
| Issue: multiple combo codes referencing the same full chart string. |
Scenario 3: NOT RECOMMENDED IN OneUSG Connect
| COMBO CODE | Effective Date | DEPT | PROJECT | FUND | PROGRAM | CLASS |
|---|---|---|---|---|---|---|
| XYZ | 07/01/2016 | 0102100 | 100 | 20000 | 11100 | 11000 |
| XYZ | 10/01/2016 | 0102100 | 101 | 20000 | 11100 | 11000 |
| Issue: Same combo code referencing different full chart strings. |
An institution cannot elect to use multiple combo codes for one full chart string (Scenario 2 above).
If an institution does not follow the recommended best practice and uses the same combo code for different full chart-field configurations (Scenario 3 above), the institution must implement alternate procedures for correction of prior expenditures and the correction of encumbrances. (Consult the OneUSG Connect SOP for more detailed guidance.) Other processes (currently unidentified) may also be negatively impacted by breaking the one to one relationship between combo codes and chart-field combinations.
5.7.2 OneUSG Connect Funding (General Ledger Distribution)
(Last Modified on January 30, 2018)
OneUSG Connect utilizes two types of departments: HR Departments and Financials Departments. The HR department defines the institution’s organizational structure. The Financials department is a cost center. There is not a one to one relationship between the HR department and the Financials department but in many cases they are one in the same.
The institution’s HR department is maintained in the OneUSG Connect system. The HR department may not directly correspond to the institution’s Financials department.
The institution’s Financials department is maintained in the institution’s financials system and is utilized by OneUSG Connect as a component of the combo code for usage in the GL distribution processes. (Reference Section 5.7.1 for more information for combo codes.) Financials departments (cost centers) are not loaded to the OneUSG Connect system as HR departments.
The OneUSG Connect Department Budget Table (DBT) is the primary location for designating the funding source for personal services expenditures. The funding source is the financials system general ledger chart-field combination to which the personal services expenditures are recorded. DBT is defined by the institution’s HR department. A combo code is designated on the DBT for each HR department, and for positions within an HR department. The combo code references the Financials department.
5.7.3 General Ledger Corrections for OneUSG Connect System Transactions
(Last Modified on January 30, 2018)
Since the OneUSG Connect system is the system of record for personal services, corrections needed for OneUSG Connect personal services transactions should originate in the OneUSG Connect system. There are two methods to make these corrections in the OneUSG Connect system: Direct Retroactive Distribution (Direct Retro) and Budget Retroactive Distribution (Budget Retro).
5.7.3.1 OneUSG Connect Direct Retroactive Distributions (Direct Retro)
Direct Retros are used to redistribute funding (credit previously expended chart string and debit correct chart string) without making changes to the specified funding on the department budget table. This would be for one time corrections and would not be available for any future or retroactive payments from the department. Reference the OneUSG Connect SOP PRA-CA-114-PR-003 for examples and more detailed information.
5.7.3.2 OneUSG Connect Budget Retroactive Distribution (Budget Retro)
Budget Retros are utilized in OneUSG Connect when the original funding, as established on the department budget table, has been determined to be incorrect. Budget Retros will automatically make corrections for all previously distributed (transactions recorded in the general ledger) transactions based upon the effective date of the funding change through the next effective date of a change to the department budget table. The change will be available for any future retroactive payments that may occur which helps to ensure the distribution issue does not continue. Budget Retros are only utilized for changes within an OneUSG Connect HR department. If the change is between OneUSG Connect HR departments a direct retro must be utilized. Reference the OneUSG Connect SOP PRA-CA-114-PR-002 for examples and more detailed information.
5.7.4 OneUSG Connect Accounting Related Audit Tables
(Last Modified on January 30, 2018)
Select tables within the OneUSG Connect system will be configured with audit capabilities to identify changes as well as to identify who made the changes.
Position Funding
The department budget table (which established position funding) will be configured to maintain changes as well as who made the changes. Institutions should periodically review the person(s) responsible for making changes to the position funding table to ensure they are authorized personnel.
GL Actuals
The pay earnings distribution, the pay deductions distribution, and the pay tax distribution tables will be configured to maintain changes as well as who made the changes. Institutions should periodically review the person(s) making changes to the GL Actuals table to ensure they are authorized personnel.
5.7.5 OneUSG Connect Suspense Account
(Last Modified on January 30, 2018)
The OneUSG Connect system utilizes a suspense account for payroll related transactions for which the system cannot identify a general ledger distribution account. The institution should review the suspense account after each payroll and make the necessary correction for any expenditures that posted to the suspense account.
5.7.6 Benefits and Payroll Liabilities Reconciliation
(Last Modified on January 30, 2018)
A benefits and payroll liabilities reconciliation should occur at a minimum on a monthly basis. The benefits reconciliation process should include the following:
- Benefits Reconciliation (premium paid to provider reconciled to payroll deduction/expense)
- Institution General Ledger Activity to Payroll System Activity
- Listing of cumulative reconciling items by person for each payroll liability account
The OneUSG Connect benefits administration vendor will provide an interface file for the premiums paid to the providers by employee. Each institution should use this file to reconcile to the amounts processed by payroll.
Reconciling items will occur for deductions/expenses taken in accordance with the accelerated deduction schedule for applicable employees, as discussed in BPM Section 5.1.4, Withholding Schedules for Academic Year Contract Employees. By the end of July, these reconciling items, which are commonly referred to as 7/5th items should be eliminated.
The USG Benefits Reconciliation Module is the preferred/recommended method for institutions to perform the benefits reconciliations.
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