DEFINE GENERAL LEDGER ACCOUNTS#
G/L Accounts codes are short names or abbreviations that point to a more detailed account or account mask.
Users less familiar with accounting systems and general ledger accounts usually find G/L account codes simpler to work with than account numbers.
A G/L account code represents either a distribution code or a distribution mask. That distribution code may be a general ledger account, but distribution codes are not limited to containing general ledger accounts only. They may also contain additional segments for costing or other accounting purposes.
An error message will be issued in the UPGL report if any of the account usages are not set up. It is therefore recommended to set up at least one account for each account usage.
If the account is not needed the Description field can be identified as ‘Not Used’, the Distribution Mask field may be left blank (null), and the account does not need to be attached to a pay component.
When a G/L account code points to a distribution mask rather than a distribution code, this indicates that one or more portions of the distribution code cannot be completed until some context sensitive information is supplied at data entry time.
The system wide edit mask of the distribution code is set up in the G/L Company form (IDGC). This provides basic editing whenever a distribution code is entered.
G/L Codes are referred to in the Payroll Bank Set Up (IPBA) form and the Pay Component (IPPC) form. These forms are discussed further in the next topic in this manual.
Pre Payroll – Labor G/L Logic#
Pre Payroll distribution or Labor G/L, is used if it is necessary to account for labor costs prior to the processing of the payroll cycle, perhaps on a daily or weekly basis, and is usually needed to support a separate costing system or High Line’s Financial Cost Control application.On the IDGA form, you must check the ‘Pre-Payroll’ toggle for all Wages G/L accounts that need to be posted by Labor G/L.
If labor costs of $1000 were to be journalized for 2004-05 Fiscal period for wages then the Labor journal entries would be as follows:
- 2004-05 Labor G/L Report
| Account | Debit | Credit |
| Reg.$ | 800.00 | |
| OT $ | 200.00 | |
| Labor Clearing | 1000.00 | |
| 1000.00 | 1000.00 |
Then after the Pay Cycle, the wages will be posted to clear the previous Labor journal entries. The Payroll journal entries are as follows:
- 2004-05 Payroll G/L Report
| Account | Debit | Credit |
| Labor Clearing | 1000.00 | |
| Fed Tax | 75.00 | |
| United Way | 5.00 | |
| ER Health | 100.00 | 100.00 |
| Check | 920.00 | |
| 1100.00 | 1100.00 |
Post Payroll – Payroll G/L Logic#
Post Payroll distribution, or Payroll G/L, is the costing of employee earnings, employee deductions, employer contributions, and employee net pays that have been calculated, and approved, for a pay run or several pay runs.On the IDGA form, you must check the ‘Post Payroll’ toggle for all G/L accounts that need to be posted by Payroll G/L.
In addition, on the IDGA form, each G/L account specifies a ‘Posting Date Method’ that determines the fiscal period of the payline transactions and internally generated amounts in UPCALC.
If all G/L accounts use either the ‘Period End Date’ or ‘Pay Issue Date’ method, then a single pay will journalize all entries to one fiscal period only, depending on the pay period end date or pay issue date.
A standard G/L Report where the posting method is by 'Period End' or 'Pay Issue' would be as follows:
- 2004-04
| Account | Debit | Credit |
| Reg. $ | 800.00 | |
| OT $ | 50.00 | |
| Fed Tax | 75.00 | |
| United Way | 5.00 | |
| ER Health | 100.00 | 100.00 |
| Check | 770.00 | |
| 950.00 | 950.00 |
If the posting method is by ‘Derived Fiscal’ and the pay period spans across two fiscal periods, then the G/L would be posted by the pay line transaction date and the internally generated amounts will be posted by the Pay Issue date.
- 2004-04
| Account | Debit | Credit |
| Reg. $ | 800.00 | |
| OT $ | 50.00 | |
| Payroll O/S | 850.00 | |
| 850.00 | 850.00 |
- 2004-05
| Account | Debit | Credit |
| Payroll Clear | 850.00 | |
| Fed Tax | 75.00 | |
| United Way | 5.00 | |
| ER Health | 100.00 | 100.00 |
| Check | 770.00 | |
| 950.00 | 950.00 |
You should use the ‘Derived Fiscal’ posting date method for most G/L accounts except for certain employee deductions that are manually entered either on the IPSN or IPPH form and may be entered with Period End date but should be posted by Pay Issue date.
Accrual Logic#
Accruals happen automatically as part of the Payroll G/L Journalize Pays process, provided you have set up the accrual rules and you are running an accruable pay period.You must indicate which General Ledger Account codes you wish to accrue in the IDGA form by turning on the ‘Accrual Required’ toggle. The accrual rule is set up in the ‘Accrual Method’ field at the Group level on the IDGR form.
During the last full pay period of a month the Journalize Pays (UPGL) function calculates the percentage of the payroll to be accrued by looking forward to the next pay period (which spans the month end). Based on the number of days (calendar or worked, as indicated on the Group form) that are in that pay period that falls into the current fiscal period, divided by the total number of days (calendar or worked) in the pay period. This will determine a percentage to accrue against the current payroll.
- For example:
- The pay period of 2004-12 (fiscal 2005-04) needs to make an accrual for the 13 calendar days of March that falls into pay period 2004-14 (March 19- April 01) (fiscal 2005-05).
- The system performs the following calculations:
- Mar 19-31 = 13 days = 92.86% of a 14-day pay period
- If the Payroll wage expense for pay period 2004-12 is $1000.00, then the accrual is calculated as $1,000.00 * 92.86% = $928.60.
The Payroll Journal Entries Report (RPGL) will indicate the following:
- 2005-04 Accrual G/L Report
| Account | Debit | Credit |
| Accrual Clearing | 928.60 | |
| Wages | 928.60 | |
| 928.60 | 928.60 |
- 2005-05 Accrual G/L Report
| Account | Debit | Credit |
| Accrual Clearing | 928.60 | |
| Wages | 928.60 | |
| 928.60 | 928.60 |
- 2005-05 Payroll G/L Report
| Account | Debit | Credit |
| Wages | 1000.00 | |
| Deductions | 450.00 | |
| Contributions | 375.00 | 375.00 |
| Net | 550.00 | |
| 1375.00 | 1375.00 |
