05-P-028 Fiscal Year End Payroll Processing for FY 2005 (Supersedes 04-P-031)
|DATE:||April 29, 2005|
|SUBJECT:||Fiscal Year End Payroll Processing for FY 2005|
|CONTACT:||Joyce Dickerson||(785) 296-3979||Joyce.Dickerson@da.state.ks.us|
|SUMMARY:||Summary of Fiscal Year End Payroll Processing|
This informational circular will discuss key payroll processing concepts to aid in fiscal year end closing. Please note that another informational circular regarding the fiscal year 2006 payroll contribution rates will be issued as soon as the information becomes available.
Benefits Contribution Rates
Supplementals and adjustments use the benefit contribution rates effective for the pay period being adjusted. Supplementals and adjustments that are processed for pay periods ending on or before June 4, 2005 will use fiscal year 2005 benefits contribution rates (or prior fiscal years benefits contribution rates depending on the fiscal year of the payroll period being adjusted). Supplementals and adjustments for pay period ending dates greater than June 4, 2005 will use fiscal year 2006 rates. Benefit contributions include: KPERS, TIAA-CREF, KPEDCP, workers compensation insurance, state leave reserve assessment, flexible spending accounts administrative fee, group health insurance (GHI), and parking administrative fee.
Taxes for supplementals and adjustments will be calculated using the tax rates effective for the paycheck issue date for the off-cycle payroll being processed. Taxes include: OASDI (Social Security), Medicare, federal withholding tax, state withholding tax, local withholding tax, and unemployment compensation insurance. Note for Regents: the use of the 'current' UCI rate for calculation purposes does not replace the reporting requirements for prior period adjustments necessary for quarterly UCI reporting.
Fiscal Year Expenditure Impact
Supplementals and adjustments (with the exception of reversals) will be charged to expenditures in the fiscal year the off-cycle paycheck is issued regardless of the pay period being adjusted. For example, the Run C off-cycle (processed June 20, paid June 23) for the pay period ending June 4, 2005 will be charged to fiscal year 2005 expenditures. The Run A off-cycle (processed June 27 paid July 1) for the pay period ending June 18, 2005 will be charged to fiscal year 2006 expenditures.
Reversals will always reverse expenditures in the fiscal year originally charged. Please note that the Run C off-cycle scheduled for June 20, 2005 (paid June 23) will be the last opportunity to have the reissue of an adjusted paycheck charged to fiscal year 2005 expenditures.
Once the Run C off-cycle for the period ending June 18, 2005 (processed July 5, paid July 8) has been processed, agencies should not request or process paycheck reversals until STARS FY 2005 closing has been successfully completed. STARS is scheduled to resume processing July 21, 2005.
The fiscal year expenditure impact applies to both SHARP agencies and Regents institutions.
Budget End Date and Fiscal Year Changes
The Budget End Date and Fiscal Year on the Department Budget tables will be updated centrally at the beginning of the fiscal year. This process is scheduled to run the morning of June 13, 2005 and should be completed by 8:30 a.m. In that process, a new row will be added to the Department Budget tables with an effective date of June 5, 2005 (beginning date of the first on-cycle payroll charged to FY2006). The Budget End Date will be June 4, 2006. Agencies should not enter any rows with an effective date greater than or equal to June 5, 2005 until after the FY2006 insert has been completed. When adding new rows for FY2006, agencies should verify that June 4, 2006 was used as the Budget End Date for FY2006.
As of July 1, 2005, NO payroll processing for GHI adjustments should be made for contract year 2003. Contact Judy Allman in the Division of Personnel Services at (785) 368-6338 about any event maintenance changes that may affect claims processing for contract year 2003.
Julian Date Reset
The Julian date used for the SHARP off-cycle document numbers will reset to 001 on July 1, 2005. The Julian date used for the off-cycle's document number is determined by the process date of the cycle while the fiscal year is determined by the off-cycle's check issue date. For example (assuming processing occurs before midnight), the Run C off-cycle for the pay period ending June 4, 2005 (processed June 20, paid June 23) will have 355 as the Julian date in the document number and expenditures will be charged to fiscal year 2005. The Run A off-cycle for the pay period ending June 18, 2005 (processed June 27, paid July 1) will have 362 as the Julian date in the document number and expenditures will be charged to fiscal year 2006. The Run B off-cycle for the pay period ending June 18, 2005 (processed June 29, paid July 5) will have 364 as the Julian date in the document number and expenditures will be charged to fiscal year 2006. The Run C off-cycle for the pay period ending June 18, 2005 (processed July 5, paid July 8) will have 005 as the Julian date in the document number and expenditures will be charged to fiscal year 2006.
Regents' Institutions Responsibilities
Regents' institutions are responsible for ensuring that the correct benefit and tax contribution rates are used when calculating payroll for employees of their agencies and for ensuring that the STARS funding file and DA175/176 effect the correct fiscal year expenditures. Regents' institutions are also responsible for ensuring that all appropriate payroll clearing fund indexes are established in STARS for fiscal year 2006.
To help reduce the number of adjustments to process, SHARP agencies are reminded of the following:
- Enter job data changes prior to the creation of paysheets. Paysheets for on-cycle payrolls are created on the Tuesday night following the end of the payroll period. Any changes to the employee's job data information (i.e., pay grade, rate of pay, FLSA status, etc.) that are entered after the creation of the paysheets will not be reflected in the employee's on-cycle paycheck for the period and will require special handling.
- Agencies should review the accuracy of the gross-to-net payroll information and employer contributions after each preliminary pay calculation. The PAY002 report can be used to review the gross-to-net data. On-line agencies can review employer contributions by accessing the employee's paycheck deduction information for the period. Employer contributions have a deduction class of 'Nontaxable'.