18-P-022 Fiscal Year End Payroll Processing for FY 2018
Informational Circular No.: 18-P-022
Supersedes Informational Circular No: 17-P-022
Effective Date: Immediately
Contact Name: Joyce Dickerson
Ph: (785) 296-3979
Approval: Nancy Ruoff (Original Signature on File)
Summary: Summary of Fiscal Year End Payroll Processing
This informational circular will discuss key payroll processing concepts to aid in fiscal year end closing.
Note: Another informational circular regarding the fiscal year 2019 payroll contribution rates will be issued as soon as the information becomes available. There is also informational circular 18-P-020 available regarding the key payroll processing dates related to fiscal year end processing in SHARP and SMART.
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 16, 2018 will use fiscal year 2018 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 16, 2018 will use fiscal year 2019 rates. Benefit contributions include: KPERS, TIAA-CREF, KPEDCP, workers compensation insurance, state leave reserve assessment, 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, adjustments and reversals will be charged to expenditures in the fiscal year the off-cycle paycheck is issued regardless of the pay period being adjusted. Please note, the Run A off-cycle (scheduled for June 25, 2018, paid June 29, 2018) for the pay period ending June 16, 2018 will be the last opportunity to have a paycheck adjustment charged to fiscal year 2018 expenditures.
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 during the batch cycle the night of June 24, 2018 and should be completed by Monday morning, June 25, 2018. In that process, a new row will be added to the Department Budget tables with an effective date of June 17, 2018 (beginning date of the first on-cycle payroll charged to FY2019). The Budget End Date will be June 15, 2019.
Agencies should send Combination Code files or any Department Budget Table files for FY19 changes into Payroll Services by Friday, June 22, 2018. These files will be loaded into SHARP beginning Tuesday, June 26, 2018. Agencies should not enter any rows with an effective date greater than or equal to June 17, 2018 until June 26, 2018. When adding new rows for FY2019, agencies should verify that June 15, 2019 was used as the Budget End Date for FY2019.
A special run of the KPAYGL5C (paycheck accounting transactions file) will be processed on Tuesday June 26, 2018 after the ‘A’ off-cycle process has been completed for the June 16, 2018 pay period end date. A SHARP Infolist message will be sent out to agencies after the KPAYGL5C has finished processing on June 26. Agencies are encouraged to complete all FY18 payroll adjustments on or before the ‘A’ off-cycle which processes on Monday night, June 25, 2018, since the ‘A’ off-cycle is the last payroll cycle in SHARP for FY18. Otherwise, any adjustments processed in the ‘B’ off-cycle on Wednesday, June 27, 2018 will be included with FY19 transactions and will not be included on the KPAYGL5C file until it is run again on Tuesday night, July 3, 2018.
June is a popular retirement month. Many employees will retire by June 16th impacting the amount of GHI for which the employee should be charged for the month of June. In order to avoid processing a refund, MAP should be updated with an employee’s termination date prior to the paycheck for the Pay Period Ending 6/2/2018, if at all possible. This will allow the correct calculation of insurance for the employee in the on-cycle processed for the 6/2/18 pped. The paycheck for pped 6/16/18 is the 3rd check of the month so no insurance deductions or refunds will be processed on that paycheck. If you have any questions or concerns, contact Kansas Department of Health & Environment, Division of Health Care Finance, State Employee Health Plan Membership Services by Email: SEHPMembership@kdheks.gov or Phone: 785-296-3226 about event maintenance that may affect claims processing for any employee.
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 SMART INF06 interface files affect the correct fiscal year expenditures.
To help reduce the number of adjustments to process, SHARP agencies are reminded of the following:
1. Enter job data changes prior to the creation of paysheets. Paysheets for on-cycle payrolls are generally created on the Tuesday night following the end of the payroll period. Agencies should not change Job Data including the FLSA status after Tuesday night as this will cause issues with the paysheets and will require special handling. Agencies should also not change the Assign Work Schedule after Tuesday night if the change affects the Paygroup.
2. 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. Agencies can review employer contributions by accessing the employee’s paycheck deduction information for the period. Employer contributions have a deduction class of ‘Nontaxable’.
Printable version of 18-P-022