Can MYOB automatically accrue the liability for leave entitlements??

Partner GeoffD
2 Posts
Partner
Australia
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Can MYOB automatically accrue the liability for leave entitlements??

Hi All, I'm wondering if MYOB can automatically accrue the liability for annual leave entitlements to the annual leave provision at each pay run.  I have it set up to accrue the actual entitlement, and I can see what those entitlements are per employee, but I can't seem to get this to automatically accrue as an increase in the provision for annual leave. The only way around this seems to be a separate journal entry. Am I missing something here? 

 

Thanks

 

5 REPLIES
Ultimate Partner ronatbas
3,608 Posts
Ultimate Partner
Australia

Re: Can MYOB automatically accrue the liability for leave entitlements??

@GeoffD

 

There is no link between the Payroll module and any provision accounts that you may create on the Balance Sheet. The Entitlement Balance (Summary) Report gives you $$ for each type of Leave. You need to export it to excel and differentiate the different leave.  For the first month this can be directly journalled into the account. From then on it needs to be the difference -this month minus last month. Investigate any large changes - they are generally some one has left or has taken a lot of holidays in the period.

 

Ron B
BAS Group
03 95588477

info@basgroup.com.au
Making MYOB work for you
Ultimate Partner Seattle
1,250 Posts
Ultimate Partner
Australia

Re: Can MYOB automatically accrue the liability for leave entitlements??

@GeoffD @ronatbas

 

It is my understanding that leave entitlements are not a tax deduction until paid.

 

A SME (Small Business Entity) would prepare a Special Purpose Financial Report and not a General Purpose Financial Report. A SME is defined as an entity with aggregated turnover less than $2 million.

The SME arena is my area of expertise.

 

Accounting Standards do require provision for leave liabilities for certain entities.

In twenty years, I have yet to see a Tax Agent prepare Leave Provisions for a SME.

 

As Ron, mentions it would be necessary to make a Journal Entry within MYOB.

It would then be necessary to do an increasing reconciliation in Part 7 of the Company Tax Return.

 

Let us know your thoughts.

 

Duncan

Duncan Smith
Business Advice + Tax
www.businessadviceplustax.com.au
Helping business owners build a better business since 1998
E expressgst@optusnet.com.au T 02 9904 3672 7 days
Ultimate Partner Julie_A_C
3,019 Posts
Ultimate Partner
Australia
Accepted Solution Solved Solution

Re: Can MYOB automatically accrue the liability for leave entitlements??

hi @ronatbas, @GeoffD, @Seattle

 

As Ron said it needs to be done via a general journal, which once set up you can set to automatically remind you to do.

 

As Duncan also said, there is no tax deduction for this and that would be an adjusting entry via end of year entries, which will then get reversed on 1/7/xxxx so the business once again knows it liability for unused leave at any given time.

 

I have one client that pays out unused annual leave as at 30/6 every year, but also 'shuts' down the business for two weeks over Christmas which then satifies the OHS and Award requirements.

 

I also have other clients who have done a provision in the BS for both Annual leave/leave loading and sick/personal leave but didn't think re Long Service leave, so it all depends on how far with provisions  you want to go and whether you just want to advise staff that they take at least two weeks each year and cash in the rest. 

 

This though gets down to the award they are employed under and how much can be cashed out.

 

 

Julie Carter AIPA, BBus(Acctg),
MYOB Professional Partner, Registered BAS Service Provider
Associate Member of Institute of Public Accountants
Member Association of Accounting Technicians
ph: 0417 927 654 email: accuratebooks7@gmail.com
JAC' of All Trades Bookkeeping (Servicing from Leederville to Pinjarra, Fremantle to Armadale WA)
MYOB Moderator Steven_M
18,807 Posts
MYOB Moderator
New Zealand

Re: Can MYOB automatically accrue the liability for leave entitlements??

Hi @GeoffD


Great to see that @ronatbas@Seattle & @Julie_A_C have all provided assistance with your enquiry and additional things to think about.

 

Help Article: Tracking leave accruals as liabilities goes through the process of what is required to in terms of showing those leave accruals as liabilities on a Balance Sheet with AccountRight. Please note that this is a manual process and will not automatically update those values.


Kind Regards,
Steven
MYOB Client Support
Partner GeoffD
2 Posts
Partner
Australia

Re: Can MYOB automatically accrue the liability for leave entitlements??

Thanks everyone for the replies, much appreciated and clarifies the situation. I'll run with the journal entries.

 

Thanks

 

G

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