Retroactive Accounting functionality in HCM payroll PART-I

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Introduction:

In this blog I am going to explain how the retroactive accounting functionality of HCM payroll is handled in payroll schema and PCR level.

Retroactive accounting may occur in the payroll in the following two scenarios,

1. Master data changes happened in the payroll past.


2. Processing payroll for more than one payroll period.

Note: I am going to use Saudi Arabia payroll program (PC00_M24_CALC) for demonstrating this functionality.

Disclaimer: The employee number and other details I am using in this blog is from demo system only and this is only for learning purpose.

Scenario 1: Master data changes happened in the payroll past:

Employee number – 17086 is having 2000 SAR per month compensation.

Payroll is processed for employee till January 2022.

 

Now compensation is revised from 2000 to 3000 SAR from January 2022 for an employee 117086.So retro payroll will be triggered in February month due to master data changes in payroll past.

 

Retro accounting activities will be handled under “Retroactive accounting INTERNATIONAL” block in payroll program.

Under “Retroactive accounting INTERNATIONAL” block ELSE part will be processed since there is retro in January 2022.

 

 

In the PCR X048, the value of the variable will be set to Zero.

 

 

Under LPBEG block, IMPRT function will fetch old January 2022 payroll result.

 

Next, Old payroll result (ORT table) will be processed in the PCR X042.

 

The following operations will be processed for /560 wage type from ORT table.

1. /560 will be added to RT table.


2. /560 will be added to /551 Wage type and stored in DT table with (-) sign.


3. /560 will be added to /553 Wage type and stored in IT table with (-) sign.


4. /560 will be added to /551 Wage type and stored in IT table with (-) sign.


5. The value of BTEX variable will be updated to 1.

In our case, /560 WT from ORT table will be 2000. So /551 and /553 will be -2000 in IT table, and in DT table /551 will be -2000.

 

Next, in the PCR X043 DT and IT tables will be processed.

 

 

The following operations will be processed for /560 wage type from IT table.

1. /560 from IT table will be added with /551 from DT table and it will be stored in DT table.


2. /560 from IT table will be added with /553 from IT table and it will be stored in IT table.


3. /560 from IT table will be added with /551 from DT table and it will be stored in IT table.


4. Then the functionality of BTEX variable will be explained in further scenario.

In our case /560 will be 3000, /551 and /553 will be -2000, the following calculation will happen,

/551 from DT = 3000-2000 = 1000.

/551 from IT = 3000-2000 = 1000.

/553 from IT = 3000-2000 = 1000.

 

 

Finally in the RT table for the period January 2022, /551 and /553 Wage types will be present along with /560 Wage type.

 

Under “Retroactive accounting INTERNATIONAL” block IF part will be processed since it is normal payroll period in February 2022.

 

 

DT table will be processed in the PCR X041. DT table contains /551 wage type (Retro differences) from the previous payroll period.

 

 

The following operations will be performed in the PCR X041 for the wage type /551.

1. /551 will be added to /552 and it will be stored in IT table.


2. /551 will be added to /560 and it will be stored in IT table.


3. /551 will be added to /562 and it will be stored in IT table.

 

In our case /560 and /562 will be 3000, /551 will be 1000, the following calculation will happen,

/562 = 3000+1000 = 4000.

/560 = 3000+1000 = 4000.

/552 = 1000.

 

 

Finally in the RT table for the period February 2022, /552 Wage type will be present along with /560 Wage type.

 

 

As a conclusion retro difference 1000 SAR is paid to employee in the current payroll period.

Other scenario,” Processing payroll for more than one payroll period” will be explained in my next blog.

 

Summary:

In this blog I have explained how retroactive accounting functionality of HCM payroll is handled in PCR and schema level.