ASWatCR's avatar
ASWatCR
Experienced Cover User
12 years ago
Status:
Open

Payroll: Automatic journal entry to account for leave liability

I think it would be great if AccountRight could produce the journal entry required to be processed to record the value of the entitlements on the balance sheet e.g. a just like the journal entry that is printed when using BASLink, but for recording entitlements. 

AND/OR

Click a button called "Recognise Entitlements" and it will do the journal for you to a specified date (obviously you would need to setup which entitlements you want recognised i.e. yes to Annual Leave, no to Sick Leave etc)

 

"Automating recognition of leave entitlements"

 

Accounts
Cards
entitlements
Payroll
showing accruals as liabiltiies
  • HannahWalters's avatar
    HannahWalters
    12 years ago

    The $ value of Annual leave liability should be able to be posted during the preparation of payroll directly to the liabilty account rather than having to do a manual journal every month to update.

    • JenPerram's avatar
      JenPerram
      Super Cover User
      12 years ago

      Hi Hannah

       

      This just cannot work.  If you have an employee that has annual leave of say 10 days and earns a salary of $60K and then receives an pay rise to $100K how would you account for the difference in 10 days accrued at $60K which if leave was taken would now be 10 days @ $100K.  Great idea but the practicality of it all is not there.  

    • ASWatCR's avatar
      ASWatCR
      Experienced Cover User
      12 years ago

      This has been suggested elsewhere on the idea exchange so perhaps the moderators can combine the ideas to centralise the votes.

       

      I believe it can work and is practical to do, i.e. and avoid having to do manual journal entries at EOM.

       

      MYOB already tracks the number of leave hours which you can print from the payroll summary entitlements report.  It has a dollar value on it, based on current rates of pay.  MYOB can check the existing balance of the "Provision for Leave" account and does a journal for the difference - to make it agree to the total of the report.  This is what we currently have to do manually. This would therefore take account of any changes in pay rates etc.

       

      There may be some finer details about separating how and where it gets coded (ie if you have direct/indirect wage accounts), who/which payroll categories are journalised, when they are journalised (auto vs click a button) and/ if on costs are/are not added on.)  I believe this would be useful feature.

       

  • JB_Incredable's avatar
    JB_Incredable
    Experienced Cover User
    6 years ago

    Hi. I would like to lodge an idea for improvement. At present our leave accrual is adjusted quarterly (via journal entry) as per the Entitlement Balance Report & actual leave taken is recorded as an expense to wages. I would like MYOB to be able to accrue leave as a dollar value to the leave accrual as well as an hourly value. I can see how I can override the account for leave to the leave accrual instead of wages. This is only one side of the entry. I don't see the point in deducting leave from the liability if we can't accrue it there to start with! I would like to see MYOB automatically process leave accruals in dollar AND hourly values when the Payroll is processed. This would eliminate the need for manual processing via journal entry. We have a small workforce of 20. A larger workforce would be cumbersome.

     

    Kind regards,

    Julie

    • Acu-ease's avatar
      Acu-ease
      Trusted User
      6 years ago

      I agree.

       

      And please add a payroll report that shows the dollar values of all leave entitlements accrued during a particular pay period (holiday, sick and long service), as well as super and tax liabilities, with a total figure at the end. We put money into a savings account after every pay run, so we can pay these liabilities when they become due. At the moment, I have to calculate the amounts manually in a spreadsheet. It will get very time consuming when we have more staff.

       

      Thanks,

      Annette

  • Matthew_W's avatar
    Matthew_W
    MYOB Staff
    12 years ago
    Status changed:
    New
    to
    Open
    Thank you for your feedback, this is something we would be happy to consider adding in for a future update. Any users who have some feedback on how they would like to see this implemented as well would be great to see.
  • PeterMcFadyen's avatar
    PeterMcFadyen
    Cover User
    7 years ago

    Each month we post the entitlement balances of vesting leave entitlements into our P&L so that we can track the expense on a monthly basis.  We then need to post the reversal the next month in order to clear the balance sheet for the next months amounts.  (the issue of reverrsing journals is dealt with in another thread - and I wholly support it). 

     

    Since we can generate the report I think it woudl be an excellent idea if we could attach job nombers as a field for the employees and then select each leave type as vesting or non vesting and have MYOB automatically post those balances as a journal.  This would be an amazing time saver for those of us who have to account for leave balances on a monthly basis.   

  • DannyTangney's avatar
    DannyTangney
    Valued Cover User
    4 years ago

    A very good, time saving idea.

     

    An alternative might be to allow a Liability account to be assigned to the Payroll Entitlement accrual card (similar to what is done for the Wages expense account), and automatically post an entry based on Accrued hrs * Hourly rate for each entitlement/employee when the payroll is processed. Maybe an accountant could provide a better technical solution (e.g. if more than one account is required) but the idea seems like it might work...

  • SusieElizabeth's avatar
    SusieElizabeth
    4 years ago

    Being able to allocate a liability account to a particular entitlement would be a great addition - Personal leave is not payable when an employee leaves 98% of the time so accruing for Annual and Long Service Leave would be great - having the parameters to tell MYOB when to do the Entitlement Journal would also help IE after each payroll, on the last day of the month etc.  A pay increase automatically increases the value of accrued leave so for example when award wages go up being able to see the increase in your entitlement liability automatically would be nice.  If someone take a pay cut but their entitlements are still valid at the higher rate I move these to another liability account and the agreement has always been that THESE entitlements are used first - if MYOB allowed for "entitlement B" for example and allowed the user to draw from that carried forward balance and that FIXED rate it would also help with larger companies that do have this issue often.