Daily Operations -- Yearly Processing

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End of Year Processing

    Thanks to Payroll's flexible data storage design, you never have to close a year. Finish all your Payroll runs for the current year, install the next year's tax tables, and begin running Payrolls for the next year. Print W-2s in January for "last year" after you have been running "this year's" Payrolls.

    Use Payroll/Prior Year Adjustments

    The Prior Year Adjustments command is available if you need to correct Payroll year-to-date information from the prior year after you start running Payrolls in the new year. The command is dimmed (not available) unless you have opened the first pay period in Quarter 1 of the new year.

    General Ledger adjustments entered as Prior Year Adjustments are posted to the posting period and use the transaction date you enter. All Prior Year Adjustments, whether or not they affect the G/L, are applied to the final pay period in Quarter 4 of the previous Payroll year. The window displays the prior payroll year and quarter that the adjustments will affect.

    Do not close Quarter 4 of the previous year until you are satisfied with the YTD data from the previous Payroll year. You do not have to close Q4 to start running Payrolls in Q1 of the new year. When you print reports to review Prior Year Adjustments, select the last pay period in Quarter 4 of the previous year (or select the previous year and Quarter 4 when you print 941 Information and Quarterly Wage Statements).

    Adjustment Example. After closing the pay period and starting the new year, you may find a mistake in general ledger account distribution for the previous year. You can use Prior Year Adjustments to correct the general ledger and the employee's records. If you find an error in YTD records that will be reflected on W-2s or the final 941, you can use the Prior Year Adjustments window to correct the data.