MEMORANDUM NO. 98-32
- PURPOSE
The purpose of this memorandum is to support agencies with the payment conversion of
non-reportable reimbursements to employees. This memorandum is issued to clarify and
improve upon the directives promulgated in Memorandum
No. 97-57, dated October 21, 1997.
- GENERAL INFORMATION
With the first paycheck in 1998 all reimbursements to employees paid from an agency budget
were processed on the payroll. Our Office received suggestions and questions from agencies
and will address these issues within this memorandum.
- EMPLOYEE REIMBURSEMENT FORM
Requests were received from various agencies using the Employee Reimbursement form
(CO-17XP-PR). The form has been revised, a copy is attached to
this memorandum.
The revised Employee Reimbursement form (CO-17XP-PR) has two additional signature blocks:
- an employee (payee) signature block
- a supervisor's signature block
The Petty Cash Recovery Section was
revised to include two transactions:
- one hard coded to recover the advance
- one to cancel the recovery process
The revised form is hard coded with a zero in the object section to
assist payroll personnel, who only enter a three-digit object code (extension).
- FUNCTION/ACTIVITY
Many agencies requested additional space for entry in the function/activity
fields. At this time, those fields cannot be expanded. If the function or activity the
agency uses to charge the expenditure has more digits than the payroll screens can
accommodate, it is advisable for the agency to restructure the coding they use presently
and design a new table. The function field can be any digit from 0-9999 and the activity
field can be from 0-999. If the agency does not want to restructure the internal
Function/Activity table, an Agency Correction or Adjustment Report form
(CO-604)
must be completed and processed to charge the expenditure to the required agency
function or activity code.
- FRINGE BENEFITS
The charging of fringe benefits on employee reimbursements is determined by the object
code. An object code (extension) such as 02610 (261) - Non-reportable reimbursement for
in-state travel, 02620 (262) - Non-reportable reimbursement for out-of-State travel, or
02630 (263) - Non-reportable mileage must be entered. If there is no object code
(extension) entered, the system will calculate fringe benefits on the reimbursement. To
correct a non-reportable reimbursement to an employee that has calculated fringe benefits,
your agency must complete and submit a Reimbursable Cost Recovery Report form
(CO-826)
to correct the entry.
- PETTY CASH
You must have two transactions for a petty cash advance recovery. The first
transaction recovers the advance from the employee's paycheck. The second transaction
requires that the limit amount be entered into the system and will automatically stop the
petty cash recovery deduction once the limit amount has been reached. The limit amount
should be equal to the amount of the petty cash received by the employee. If the second
transaction is not entered, the next pay cycle will also have a deduction from the
employee's paycheck.
- INTERNAL CONTROLS
Each agency must establish its own Internal Controls. The agency must determine which
department, accounts payable or payroll, will code the form and which one will enter the
information on-line.
- ADDITIONAL INFORMATION
- If an employee is not receiving a paycheck on the cycle a non-reportable reimbursement
is made, it will be necessary to code the reimbursement transactions with a transaction
code of R3. This will prevent any deductions from being taken from the
reimbursement.
- Using the SID 001 with an object code beginning with 02 is not
proper.
- All reimbursements are included in the year to date earnings total shown on the
employee's statement of earnings. The amount is included in the total wages for the period
but the non-reportable portion of the reimbursement is not reported to the Federal
Government as taxable wages. The amount is also not included in the individual's W-2 form
at the end of the year.
- TUITION & TRAINING FUNDS (9916)
Payments from the tuition and training funds will continue to be processed with a
CO-17XP
in the usual manner at this time.
- GENERAL
Questions may be directed to the Office of the State Comptroller as follows: Payroll
Procedures
On-line: Payroll Services Division, 702-3463
Remote Job Entry: Payroll Services Division, 702-3462
Character and Major Object Coding
Accounting Services Division, 702-3380
Memorandum Interpretation
Policy Services Division, 702-3436