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Title: Handling Payroll Variance in Unanet

Brief description: This page addresses how to configure and use an alternative to Dilution called Payroll Variance in Unanet.

Payroll Variance allows you to handle salaried pay while leaving Dilution Off. The undiluted cost of salaried employees is charged to a project, with any amount over/under charged to an indirect pool. The amount over/under is calculated via a Time export in the format of a Journal Entry import. 

Using the Payroll Variance method, any differences between the Accrued Wages Payable and the Labor Cost are recorded to one or more payroll variance accounts that roll up to the appropriate indirect cost pool(s).

Terms for this method other than Payroll Variance include "Overhead Credit,” "Standard Cost," and "Standard Hourly Cost."

For more information on Payroll Variance as compared to Dilution, please visit this link: Uncompensated Overtime for Exempts (Overview).

What’s covered in this document:

Initial Setup

  • Ensure Dilution is OFF.
  • Identify which accounts in your GL will have the variance debited/credited.
  • Upload this template into your Unanet site via Admin > Export > ImportPayroll Variance Calculation.csv
    • Edit the template as necessary for debit/credit accounts, legal entity, orgs, and any other logic. 
    • Edit/confirm calculations as necessary. The default export template calculates the difference between regular salary pay and hours * cost rate. The export is a Time export written to result in a Journal Entry import file. 

Periodic Processing

After your periodic Labor Cost Post process is complete:

  • Run the Time export above (calculating the variance from the expected payroll amount, and generating a Journal Entry file import).
    • The Export should be run by your time period. For example, if you have semi-monthly time periods, you should export a semi-monthly period's data. If you have biweekly time periods, you should export a biweekly period's data. 
  • Save the resulting Journal Entry output file.
  • Enter the Journal Entry into Unanet via either of the options below:
    • Option 1: Import the Journal Entry file via Admin > Import > General Ledger Journal Entry.
      • This will apply the salary variance to the accounts you identified in your initial setup steps above. It will either add or subtract it from the payroll liability account and do the same to the payroll variance account. 
    • Option 2: Manually create the Journal Entry in Unanet using the data on the file you just exported. 

NOTE: If you want to record the payroll variances to multiple indirect pools, you will need a manual calculation methodology to spread the variance to the multiple payroll variance accounts. Any mid-period salary changes will need to be addressed. If you would like to use the Payroll Variance method AND only send hours to the payroll provider, you must send the correct number of hours (hours in the time period taking into account Fringe projects) or total hours from the timesheet that could be diluted by the payroll provider.

Additional Information

KC - Dilution/Effective Rate (instead of Payroll Variance)

KC - Uncompensated Overtime for Exempts (Overview)

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