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You are here: General Ledger > Monthly Processing > #299 Monthly Direct Workers Comp (Optional)
#299 Direct Workers Comp (Optional)
Function
This option calculates direct workers compensation costs for the month and charges the costs directly to the programs that each employee worked on for the month rather than charging the costs to the fringe benefit pool. This option of charging workers compensation costs is typically used only by agencies that have several workers comp rates and there is a substantial variance between the rates. If this method for charging workers comp costs is chosen, the accrued workers comp menu item under Payroll Processing will be disabled.
Under Payroll, Set Up, Workers Comp Rate, descriptions and rates are set up for each workers comp code. For all employees that are eligible for workers compensation benefits, a workers comp code needs to be entered into each employee file. You must also set up the workers comp base under Payroll, Set Up, Workers Comp Base.
A Monthly Workers Compensation Analysis is prepared which calculates the workers comp costs for each employee and subtotals for each workers comp code. Aggregate rates are calculated for each workers comp code for the distribution of the workers comp costs by computing the ratio of workers comp costs to chargeable salaries, which are gross wages less leave taken. A Monthly Workers Compensation by Activity report is prepared showing the distribution of workers comp costs to all of the program elements excluding leave elements. A journal entry is automatically prepared for posting to the general ledger. This journal entry credits the liability account designated for accrued worker’s comp (or credits an asset account if the worker’s comp costs were prepaid) and debits the program elements based on monthly timesheet charges.
Things You Should Know
Operating Procedures
Special Rate Tab
If you have employees that are classified under more than one workers comp code because of different jobs performed, you can assign an alternative rate for certain workers comp codes under specified elements.
Click on Edit
Element: Enter the element that will receive the alternative rate.
WC Code: Enter the workers comp code that the applicable employee has in their employee file.
Rate: Enter the alternative rate to be used for this element, i.e. 4%.
Click on Save.
Workers Comp Analysis Tab
Period: Enter the month ending date for the month you are preparing the workers comp analysis for.
Expense Code: Enter or select the expense code for the Monthly Direct Workers Comp. You cannot use an expense code that has been set up in the fringe matrix, or any of the cost allocation transfer codes. This field will default to the code entered the next time you go into this report.
Liability: Enter or select the liability account you have set up for accrued workers comp. If the workers comp is a prepaid expense, it will allow you to code it to an asset account also. This field will default to the code entered the next time you go into this report.
Click on the Print button to print the reports. After you have printed the Monthly Workers Compensation Analysis and close out of that screen, the Monthly Workers Compensation by Activity will be displayed. After printing that report and closing out, click on Post to prepare the journal entry and post it to the General Ledger.
This option calculates direct workers compensation costs for the month and charges the costs directly to the programs that each employee worked on for the month rather than charging the costs to the fringe benefit pool. This option of charging workers compensation costs is typically used only by agencies that have several workers comp rates and there is a substantial variance between the rates. If this method for charging workers comp costs is chosen, the accrued workers comp menu item under Payroll Processing will be disabled.
Under Payroll, Set Up, Workers Comp Rate, descriptions and rates are set up for each workers comp code. For all employees that are eligible for workers compensation benefits, a workers comp code needs to be entered into each employee file. You must also set up the workers comp base under Payroll, Set Up, Workers Comp Base.
A Monthly Workers Compensation Analysis is prepared which calculates the workers comp costs for each employee and subtotals for each workers comp code. Aggregate rates are calculated for each workers comp code for the distribution of the workers comp costs by computing the ratio of workers comp costs to chargeable salaries, which are gross wages less leave taken. A Monthly Workers Compensation by Activity report is prepared showing the distribution of workers comp costs to all of the program elements excluding leave elements. A journal entry is automatically prepared for posting to the general ledger. This journal entry credits the liability account designated for accrued worker’s comp (or credits an asset account if the worker’s comp costs were prepaid) and debits the program elements based on monthly timesheet charges.
Things You Should Know
- This is an optional function which is normally implemented during system installation. Should you choose to activate this option, send an email to service@gmsactg.com and request the password for the Monthly Direct Workers Comp and give your client #. If you wish to deactivate it, go to Tools, Supplement Installation/Uninstall, select #299 Mo Direct Workers Comp and click on Uninstall. This will automatically activate the Workers Comp Analysis on the Payroll Processing Menu.
- This function is treated as a supplement as far as installation is concerned, but there will not be a charge if you decide to use this function for charging workers comp rather than the workers comp analysis on the Payroll Processing menu. When this supplement is installed, the workers comp analysis menu item under Payroll Processing will be disabled.
- If any employees are listed under the workers comp code 0, it means that those employees did not have a workers comp code designated in their employee file. If you are required to pay workers comp on any or all of the employees listed under the code 0, go into their employee files and designate the appropriate code and redo this report.
- Should you try to generate a journal entry for a month in which one was previously prepared, you will be warned that the entry already exists and asked if you wish to replace it.
- If you only have timesheet adjustments for an employee that result in zero gross pay, there is no base to calculate the workers comp rate on and the report will show no Chargeable salaries and Leave costs on the first report and no workers comp cost for the elements used in the timesheet adjustments. If you wish to adjust the worker comp amounts for the elements used in the timesheet adjustment, you will manually need to do a journal entry.
- Because of the fact that the calculated workers comp rates do not come out even to two digits to the right of the decimal, there will always be a few cents difference in the two reports. This can be adjusted after your workers comp audit is completed, as you may have other adjusting entries for workers comp at that time.
- Should the allocation try to charge costs to an inactive element you will receive a message that the allocation cannot be done and the system will provide a list of the inactive element (s). At this point you will need to make the listed element(s) active.
- Should the allocation try to charge costs to a terminated element you will be notified and asked if you wish to override.
Operating Procedures
Special Rate Tab
If you have employees that are classified under more than one workers comp code because of different jobs performed, you can assign an alternative rate for certain workers comp codes under specified elements.
Click on Edit
Element: Enter the element that will receive the alternative rate.
WC Code: Enter the workers comp code that the applicable employee has in their employee file.
Rate: Enter the alternative rate to be used for this element, i.e. 4%.
Click on Save.
Workers Comp Analysis Tab
Period: Enter the month ending date for the month you are preparing the workers comp analysis for.
Expense Code: Enter or select the expense code for the Monthly Direct Workers Comp. You cannot use an expense code that has been set up in the fringe matrix, or any of the cost allocation transfer codes. This field will default to the code entered the next time you go into this report.
Liability: Enter or select the liability account you have set up for accrued workers comp. If the workers comp is a prepaid expense, it will allow you to code it to an asset account also. This field will default to the code entered the next time you go into this report.
Click on the Print button to print the reports. After you have printed the Monthly Workers Compensation Analysis and close out of that screen, the Monthly Workers Compensation by Activity will be displayed. After printing that report and closing out, click on Post to prepare the journal entry and post it to the General Ledger.
