Revision: 5/2023
Read this section “Understanding Payroll Accrual”, so that you can determine if you need to do this process. To understand the payroll accrual process, you must know how your district has the July and August Teacher Payroll expenses budgeted. The July and August payrolls are the final contract payouts for the current fiscal year wages. The Payroll Accrual Process allows districts to accrue those July and August payroll expenses into the current fiscal year (FY23).
A Fiscal Year runs from July 1st thru June 30th. Administrators are generally paid over 12 months from July thru June – following the normal Fiscal Year date range. Teachers are also typically given the opportunity to be paid over 12 months. Since their first day of work for the new school year is in August, their contracts are paid out from September thru August. Because of this, the July and August payrolls cross into the next Fiscal Year. You will have to determine how these payroll expenses are budgeted for your district. When you know how these payroll expenses are budgeted, you need to answer the following questions to determine which payroll process you need to use:
- Are ALL of your payroll expenses (salary and benefits) for those July and August payrolls budgeted to FY23?
§ If you answer YES and you are NOT in the state of Illinois, you will need to use the “2023 Payroll Accrual Process – Non-Illinois Clients”.
https://help.schooloffice.com/financehelp/#!Documents/nonilclientsaccrualprocessinstructions.htm
§ If you answer YES and you ARE in the state of Illinois, you will need to use the “2023 Payroll Accrual Process - Illinois Clients”.
https://help.schooloffice.com/financehelp/#!Documents/ilclientsaccrualprocessinstructions1.htm
§ If you answer No, please see the next question.
- Are SOME of your payroll expenses (salary and benefits) for those July and August payrolls budgeted to FY23 and the rest budgeted to FY24?
o For example: TRS expenses are the only benefits budgeted to FY23, all other expenses like salary and health insurance benefits are budgeted to FY24.
§ If you answer YES and you are NOT in the state of Illinois, you will need to use you will use the “2023 Partial Payroll Accrual Process – Non-Illinois Clients”.
https://help.schooloffice.com/financehelp/#!Documents/nonilclientspartialpayrollaccrualprocess1.htm
§ If you answer YES and you ARE in the state of Illinois, you will need to use the “2023 Partial Payroll Accrual Process - Illinois Clients”.
https://help.schooloffice.com/financehelp/#!Documents/ilclientspartialaccrualprocess1.htm
§ If you answer No, please see the next question.
- Are ALL of your payroll expenses (salary and benefits) for those July and August payrolls budgeted to FY24?
o If you answer YES to this question:
§ Are you an Illinois Client? – If yes, please use our “2023 Soft Close Payroll Process”.
§ Are you a client from another state? If yes, please process your payroll as usual. No Accrual Process, nor a Soft Close Payroll Process is needed.
*If you are unsure on how to answer any of these questions, please consult with your auditor, Superintendent, or Finance Manager for your district*
One thing to remember when processing your payrolls, is that the Payroll Date is the date your payroll is expensed.
- If your Payroll Date is June 30, that payroll will be expensed to FY23.
- If your Payroll Date is July 1, that payroll will be expensed to FY24.
Each payroll that is to be accrued must be run as a separate payroll. Payrolls will be processed like normal, except you will select the Accrual option. Illinois clients will not process payroll checks nor direct deposit vouchers, and you will not create the direct deposit file or process your liabilities until closer to the actual payroll date.
If employee changes need to be made after the payroll is accrued but before the actual vouchers are processed, you can certainly update that information. Examples of employee changes could be an address change; or maybe they switched banks, and you need to update their Direct Deposit Account information. Any new employee information would then appear on their payroll vouchers and/or the Direct Deposit file when they are created on the actual payroll date. Other employees that will be paid in the summer, that are not part of the accrual, need to be paid on a separate payroll.
*Please keep in mind, with the Payroll Accrual Process, you WILL NOT be able to change any deductions or benefits after the payroll has been closed/accrued. Once the payroll has been closed/accrued, but before the vouchers/checks are processed, if you notice a deduction or benefit was withheld incorrectly, you CANNOT change it. You would have to Void the paycheck and re-issue it using the same accrual process.*
*If you have ANY questions regarding ANY of these processes, PLEASE submit a Support Case.*