AX2009_ENUS_PR_06

Chapter 6: Important Setup Concepts

CHAPTER 6: IMPORTANT SETUP CONCEPTS Objectives The objectives are •

Introduce process and concepts required to set up an accumulator.

•

Introduce concepts and features associated with setting up calculations. Detailed procedures for setting up calculations are discussed in Course 8.

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Introduce the basic process and concepts required to set up and implement earnings for an organization. Detailed setup procedures are provided in Course 9.

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Introduce the basic process and concepts required to set up and implement benefit/deductions for an organization.

Introduction Earlier Microsoft Dynamics® AX 2009 Payroll courses introduced four basic concepts required for managing payroll with the Payroll module: •

Accumulators

•

Calculations

•

Earnings

•

Benefit/deductions

To this point, this collection of courses has explained how payroll administrators use these concepts to manage payroll. For example: •

Administrators use calculations to derive earnings for each employee during each pay period, and also to determine the benefits and deductions associated with those earnings. Calculations can be based on salary amounts, hours worked, or pieces of completed work. They can look up flat amounts that apply to all employees, that are specified for each individual, or that are derived from other information, such as wage rate tiers based on employee hire date.

•

Administrators use accumulators to track information such as taxable earnings in this pay period tax withheld each year, hours worked each pay period, and overtime hours worked each month.

•

Many calculations use the information that is stored in accumulators, such as a monthly benefit that stops being awarded as soon as the accumulated total reaches an annual maximum amount.

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Microsoft Dynamics® AX Payroll This course introduces the overall processes and conceptual information you need to begin learning about setting up and implementing accumulators, calculations, earnings, and benefit/deductions. Detailed setup procedures are provided in courses 8 through 14, and in associated white papers on Partner Source.

Accumulators In Microsoft Dynamics AX 2009 Payroll, accumulators work as storage devices for keeping track of a single piece of numeric data over a period of time.

Accumulators store data that: •

accumulates over time

•

decrements over time

•

is stored for later reference, reporting, or calculation purposes

Implementers set up as many accumulators as necessary for a client's reporting and calculation purposes. The data in each accumulator can be gathered automatically, but it also can be imported or edited manually if required during setup. Examples of accumulators include the following: •

Year-to-date employee hours (individual or by group)

•

Yearly taxable earnings

•

Data for retirement plan calculations

•

Data for withholding tax calculations

•

Data for garnishment deduction calculations

Accumulators can store earning totals, hours associated with earnings, benefit/deduction totals (employee contributions, employer contributions, or both), or payment amounts. They can accumulate values in a single pay period, monthly, annually, ongoing, or over any other date period you have defined in Payroll.

Accumulators operate at one of four levels:

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Company level

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Pay group level

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Employee level

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Employee/position level

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Chapter 6: Important Setup Concepts You set up each accumulator by using three forms, each defining one of the three components that you must have for the accumulator to function correctly:

FIGURE 6.1 THREE FORMS REQUIRED TO SET UP AN ACCUMULATOR.

Accumulator values define which earnings, benefit/deductions, or payments contribute to the accumulator.

Accumulator eligibilities define which employees the accumulator values accrue for.

Accumulator Eligibility Accumulator eligibilities are filters that define which employees or positions the accumulator values accrue for.

You can base your filters upon the employee and position attributes listed on the accumulator eligibility form. An accumulator will not populate with data unless it has at least one eligibility.

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Microsoft Dynamics速 AX Payroll In this screen capture, the payroll administrator decided to determine accumulator eligibility by pay group.

FIGURE 6.2 ACCUMULATOR ELIGIBILITY DETERMINED BY PAY GROUP.

For the best maintainability, define your accumulator eligibilities using as few data elements as possible. For example, if the accumulator should populate for all employees, create a new, blank row and then click the Save button. If the accumulator is relevant to one tax jurisdiction, create a new row and select only the Position filter for that jurisdiction. If it applies to four tax jurisdictions, create four rows for those four different Position filter values.

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Chapter 6: Important Setup Concepts In this screen capture, the payroll administrator decided to determine accumulator eligibility by pay group and position filter (tax jurisdiction).

FIGURE 6.3 ACCUMULATOR ELIGIBILITY DETERMINED BY PAY GROUP AND POSITION FILTER.

Accumulator Values Accumulator values determine which earnings, benefit/deductions, or payments the system will use to update the accumulator. You can define an accumulator value in terms of: •

an individual earning

•

a benefit/deduction

•

a payment type

•

an earning group

•

a benefit/deduction group

•

a payment type group

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Microsoft Dynamics速 AX Payroll For example, the accumulator value for an accumulator that tracks year-to-date retirement savings plan contributions would be the retirement savings plan benefit/deduction. Another example is seen in the following screen capture of the accumulator value for union dues.

FIGURE 6.4 THE ACCUMULATOR VALUE FOR THIS UNION DUES ACCUMULATOR IS THE DEDUCTION CALLED UNION DUES - ASSEMBLY.

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Chapter 6: Important Setup Concepts Another example could be the accumulator value for a taxable earnings accumulator, which would be a taxable earnings earning group. You could use that earning group to populate the values for several different accumulators at different times: pay period, quarterly, and year to date. In the following screen capture, the All Earnings earnings group in used to populate an employment income accumulator.

FIGURE 6.4 THE ACCUMULATOR VALUE FOR THIS UNION DUES ACCUMULATOR IS THE DEDUCTION CALLED UNION DUES - ASSEMBLY.

Generally, make your Payroll configuration as maintainable as possible by defining your accumulator values in terms of groups, unless the accumulator really does apply to only one earning or benefit/deduction.

As you create accumulators, decide whether you have to create a new group for populating the accumulator values. The question to consider is: the next time a user adds a new earning and associates it with the appropriate earning groups, will you want it to populate all the appropriate accumulators automatically, or does the user have to review individual accumulators, and decide for each if the earning applies to that accumulator?

For example, a new earning is a federally taxable earning, and so you add it to the Federal taxable earnings group. When you create the new earning you do not have to know all the accumulators that should be collecting federally taxable earnings; instead, by including the new earning in this group, all those accumulators will update automatically.

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Microsoft Dynamics速 AX Payroll Another example could be the accumulator value for a taxable earnings accumulator, which would be a taxable earnings earning group. You could use that earning group to populate the values for several different accumulators at different times: pay period, quarterly, and year to date. In the following screen capture, the All Earnings earnings group in used to populate an employment income accumulator.

FIGURE 6.5 EARNING GROUP USED AS ACCUMULATOR VALUE.

Generally, make your Payroll configuration as maintainable as possible by defining your accumulator values in terms of groups, unless the accumulator really does apply to only one earning or benefit/deduction.

As you create accumulators, decide whether you have to create a new group for populating the accumulator values. The question to consider is as follows: the next time a user adds a new earning and associates it with the appropriate earning groups, will you want it to populate all the appropriate accumulators automatically, or does the user have to review individual accumulators, and decide for each if the earning applies to that accumulator?

For example, a new earning is a federally taxable earning, and so you add it to the Federal taxable earnings group. When you create the new earning you do not have to know all the accumulators that should be collecting federally taxable earnings; instead, by including the new earning in this group, all those accumulators will update automatically.

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Chapter 6: Important Setup Concepts Process: Create A a New Accumulator Because each accumulator has three components that you must set up in three different forms (Accumulators, Accumulator values, and Accumulator eligibility), the process of creating a new accumulator includes these three procedures: 1. Define and name the new accumulator.

2. Define what will be used to populate values for the accumulators, by defining accumulator values.

3. Add eligibility for the accumulator.

These three procedures are provided in the next three sections.

Define and Name the Accumulator Follow these steps to define and name a new accumulator.

1. In the Payroll area, find the Setup page and then click to expand Accumulators. Click Accumulators, and the Accumulators form appears.

2. Select the Overview tab, and then press CTRL+N. A new row appears.

3. Enter a name for the new accumulator, and select: • A date period the accumulator will be based on •

An accumulator type to define the level for the accumulator

•

An accumulator unit type to define what will track for this accumulator

•

A date period type to define when the accumulator will populate

•

The Read type, which is used in the case of multiple accumulations of the same accumulator values over a single date period. If the accumulator should populate based on all amounts for the entire date period, select Full amount. If the accumulator should populate only based on the amount that has happened since the last payment was processed, select Incremental amount.

•

Yes or No in the Prior period field. This determines whether the accumulator can populate retroactively when you initialize accumulators (using the Set initial accumulator values function in the Periodic area of the Payroll area page.

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Microsoft Dynamics速 AX Payroll Define Accumulator Values Follow these steps to set up the values that populate the accumulator when it updates.

1. In the Payroll area page, find the Setup area and then expand Accumulators. Click Accumulators. In the Overview tab, select the accumulator to set the value for, click the Setup button, and select Accumulator Values. The Accumulators values form appears.

2. Click the Overview tab and select the accumulator.

3. Click the Fast Entry tab. Some boxes may not be editable, depending on whether your accumulator is associated with earnings, payments, or benefit/deductions.

4. If the accumulator is associated with a single earning, a single benefit/deduction, or a single payment type, select it. If the accumulator is tracking a group of earnings, benefit/deductions, or payment types, select the group that represents that group.

5. Decide whether the accumulator value should increase or decrease when you populate it, and by what factor amount. For example, you can specify whether an accumulator should increase or decrease every time that an earning is earned. A banked overtime accumulator may decrease by a factor of -1 every time that you create the earning of banked overtime used.

Adding Eligibilities Accumulator eligibilities define which attributes of an employee or their position define the earnings, benefit/deductions, or payments that can populate the accumulator. Adding eligibility for an accumulator involves selecting the employee attributes that will determine which employees can use the accumulator.

Follow these steps to set accumulator eligibilities.

1. In the Payroll area, find the Setup page and then expand Accumulators. Click Accumulators, and in the Overview tab, select the accumulator to set eligibility for. Click the Setup button and select Accumulator eligibilities. The Accumulator eligibilities form appears.

2. Click the Fast Entry tab and select the accumulator to set eligibilities for.

3. Generally, select the group with the fewest constraints possible.

Specifying the fewest constraints possible helps increase maintainability. Choose eligibility by selecting the appropriate combination of Pay group(s), Organization Unit(s), Occupation(s), Occupation(s), and Union affiliation, Position filter(s), Position type(s), or Position assignment type(s).

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Chapter 6: Important Setup Concepts

4. Click Insert.

5. Click the Overview tab to ensure your accumulator eligibility is defined correctly.

NOTE: When an accumulator applies to all employees, set up accumulator eligibility for all your pay groups and specify nothing else (use the lowest possible constraint to set accumulator values). Every position must have a pay group, so every position will be included in this eligibility and thus populate the accumulator. The only time an update is required for this accumulator eligibility is when you add a new pay group.

Calculations During implementation, you can set up calculations for use in processing employee earnings, benefit/deductions, and entitlements. Calculations in the Payroll module range in complexity from flat amounts to be paid or withheld to complex multi-variable tax calculations. All calculations are maintained in the Calculations table, whereas related tables may contain associated calculation rates and variables.

Calculations produce numeric amounts that represent currency, hours, units, and so on , depending on the purpose of the calculation (to support an earning, benefit/deduction, entitlement, and so on).

Typically, calculations are re-usable. Calculations use calculation variables and calculation rates that can apply to specific employees or circumstances, without having to define new calculations.

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Microsoft Dynamics速 AX Payroll Calculation Variables Calculation variables are amounts specific to individual employees, and are most frequently used in earnings and benefit/deduction calculations (for example, car allowances). You can use calculation variables to track exemption amounts used in tax-specific benefit/deductions calculations. Payroll administrators can add calculation variables for any employee, and can make effective dated changes at any time.

FIGURE 6.6 A CALCULATION VARIABLE FOR EMPLOYEE PENSION PERCENTAGE.

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Chapter 6: Important Setup Concepts Calculation variables are associated with calculation variable items. They usually have a one-to-one relationship, which means that one calculation variable is associated with one calculation variable item. Calculation variable items can provide default rate or amount information for the calculation variables.

FIGURE 6.7 A CALCULATION VARIABLE ITEM THAT DEFINES THE PERCENTAGE TO USE FOR AN EMPLOYEE PENSION VARIABLE.

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Microsoft Dynamics速 AX Payroll Calculation Rates The Payroll module uses calculation rates to look up values to insert into a particular calculation. Examples of this include calculations that must find a value from tax tables and vacation entitlement tables.

FIGURE 6.8 CALCULATION RATE FOR VACATION ACCRUAL.

A calculation may be required to send data to a Calculation rates table, to obtain the correct rate back. For example, if vacation accrual for management personnel is based on the number of years they have worked for the company, then you would build the years of service into the calculation, and have the calculation call the vacation entitlement rate table, which would then return the number of hours of annual vacation entitlement.

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Chapter 6: Important Setup Concepts Here is a rate table for years of service and number of vacation hours allocated.

FIGURE 6.9 A RATE TABLE SHOWING YEARS OF EMPLOYMENT AND NUMBER OF HOURS VACATION ENTITLEMENT.

Three Types of Calculations In Microsoft Dynamics AX 2009 Payroll, calculations are Simple, Basic, or Complex: Simple calculations include the following: •

constant use of a fixed amount

•

standard add, subtract, multiply, and divide operations

Basic calculations include the following: •

a minimum value, a maximum value, or both

•

rounding up or down to the nearest value

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bracketed equations

•

variable rates

Complex calculations include the following: •

calculations within calculations

•

conditional statements such as "when" or "if" (for example, if an employee's age at the end of the year is over 65, a different calculation should be used than if the employee's age is less than 65.)

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Microsoft Dynamics速 AX Payroll Simple Calculation Examples In this scenario, employees who have the Assembly earning rule group assigned to them are paid a flat $6.00 amount for a paid meal break each day; the earning code for this is Meal Break.

FIGURE 6.10 EARNING RULE GROUP CALCULATION FOR THE "ASSEMBLY" EARNING RULE GROUP.

The earning rule group calculation associate the Meal Break earning with the earning rule group called Assembly, and also with the calculation named Meal Break.

FIGURE 6.11 THE CALCULATION "MEAL BREAK".

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Chapter 6: Important Setup Concepts The result of the calculation, a flat amount (6.00), is provided in the Rule tab.

FIGURE 6.12 FLAT AMOUNT SHOWN IN THE RULE TAB.

If you click the Edit button, you can see that the calculation string only contains the flat amount.

FIGURE 6.13 FLAT AMOUNT IN THE CALCULATION STRING.

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Microsoft Dynamics速 AX Payroll In this scenario, some employees are paid for every unit they produce on the assembly line. In this example, employees are paid $0.25 for every Nut produced and the earning code is "Nuts". In the earning rule group calculations table, Nuts is listed as another of the earning codes in the earning rule group called Assembly. The table associates this earning code with a calculation, which is also called Nuts.

The Calculation result in the Rule tab is a flat amount.

FIGURE 6.14 CALCULATION RESULT

The calculation string also consists of a flat amount.

FIGURE 6.15 CALCULATION STRING

Similarly, in this scenario, employees who have the earning rule group of Assembly are eligible to earn OT at 1.5 times their hourly rate for overtime. The earning code OT @ 1.5 is used for an overtime rate of 1.5 times the hourly rate.

In the Earning rule group calculations table, the earning can be found in the Assembly earning group, and is associated with the calculation called Hourly Rate @ 1.5.

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Chapter 6: Important Setup Concepts The Calculation result in the Rule tab shows the simple formula used.

FIGURE 6.16 CALCULATION RESULT FOR OT @ 1.5

The calculation string is equally simple.

FIGURE 6.17 CALCULATION STRING FOR OT@1.5

Basic Calculation Example In this scenario, employees pay 1.3 percent of their eligible earnings as a union dues deduction on each regular payment, with a minimum deduction of $10.00 and a maximum deduction of $50.00 per regular payment. The variable UD Eligible Earnings is defined elsewhere and represents the employee's earnings that are eligible for union dues deduction calculation. The calculation string looks as follows:

FIGURE 6.18 CALCULATION STRING FOR UNION DUES CALCULATION.

In this scenario employees pay $0.01 per $1,000.00 of coverage for life insurance. The coverage is based on four times the employee's annual salary, rounded up to the nearest thousand.

FIGURE 6.19 CALCULATION STRING FOR LIFE INSURANCE CALCULATION.

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Microsoft Dynamics® AX Payroll Complex Calculation Example In this scenario, a complex calculation is used for employee-paid life insurance.

Here the amount of coverage is based on three times annual salary, rounded down to the nearest 1000, whereas the rate paid for each thousand dollars of coverage is based on the employee attribute, age, which represents age at the end of the year: •

Ages 18-25 pay $0.03 per $1000 of coverage

•

Ages 26-35 pay $0.05 per $1000

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Ages 36-45 pay $0.07 per $1000

•

Ages 46-55 pay $0.09 per $1000

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Ages greater than 55 pay $0.11 per $1000

Such a calculation would require five age-based conditions to be set up for the same calculation, or a multiple-level calculation to use a calculation rate to determine the premium amount based on age.

Effective dates Calculations, calculation rates, and employees' calculation variables all have effective dates. Create new effective-dated versions of calculations, calculation rate tables, and employee calculation variables when the values change.

For example, company policy is changing and as of the start of the new calendar year, Contoso will start paying $6.25 instead of $6.00 for the meal break earning.

Mia creates a new effective-dated version of the Assembly Meal Break calculation. She gives the new copy a start date of January 1 and she changes the calculation string from 6.00 to 6.25. The value of meal break earnings dated before the new year continue to appear as $6.00, but new meal break earnings dated after the new year now appear with a value of $6.25.

Earnings In Microsoft Dynamics AX 2009 Payroll, the term earnings refers to the all wages, allowances, and bonuses that an employee can be paid. Each different kind of earning in an employee's earnings is identified by a unique Earning code, which must be set up by the implementer.

An employee's earnings can be a:

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Fixed amount (salary), and be issued each pay period.

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Calculated amount (hourly rate times hours worked, or piece rate times completed work), and be issued each pay period.

•

Fixed or calculated amount, but generated when particular conditions apply (for example, earnings such as travelling stipends, clothing allowances, and so on)

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Chapter 6: Important Setup Concepts NOTE: The term "generated earning" can mean two different things in AX Payroll: Non-time-based, automatically granted earnings that are additional to regular pay; and Time-based, automatically generated earnings, such as earnings derived from shift premiums.

Be sure you are aware which one you are referring to when you work with earnings.

About Earnings and Earning Codes The following are some important concepts related to earnings and earning codes.

Earnings and Calculations A calculation of some kind is required to produce most earnings. For example: an employee's regular hourly earnings are calculated using a time record (number of hours) and the employee's hourly wage.

Some earnings, such as a bonus earning, may not require a calculation. When a bonus is awarded, it is recorded in the earnings journal as a flat amount against an employee ID and date.

An earning might have one calculation that applies to all employees in the company. Alternatively, for the same earning code different calculations might be used depending on what earning rule group the employee belongs to. For example, employees who belong to a staff earning rule group may be paid 1.5 times their hourly rate for overtime earnings. Employees who belong to the Managers earning rule group may be paid 2.0 times their hourly rate when they earn the same overtime earning.

Earning Rule Groups An earning rule group associates a calculation or calculations to an earning or set of earnings.

To calculate earnings, every client's organization must have at least one earning rule group. Multiple-earning rule groups are required if the policies determining how earnings are calculated are different for different groups of employees. In this case, many employees can be paid using the same earning codes, but the earning rule group assigned to each employee determines which calculations are used.

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Microsoft Dynamics® AX Payroll You can assign earning rule groups to employees at three levels: •

Position

•

Employee

•

Occupation

The Payroll module always uses the same order of priority when it looks for earning rule group information in these levels, and always uses the highestpriority information that it finds. The position level has the highest priority, then employee, and then occupation.

During implementation, it is important to decide at which level the earning rule groups will be specified. Consider both ease of implementation and ease of maintenance by payroll administrators. Once you decide, all users must become familiar with maintaining this information at the same level, and must understand the possible consequences of defining earning groups at multiple levels.

For example, if a company decides to define employee rule groups at the position level, and a user subsequently makes an effective-dated earning rule group change at the employee level, then the expected change will not occur. The original position-level information still takes precedence over the employee-level effective dated change, and so the system still will use earning rule group information specified at the position level for calculating earnings.

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Chapter 6: Important Setup Concepts Earning Rule Group Calculation Use an earning rule group calculation to associate each earning rule group with a corresponding earning or group of earnings, and one corresponding calculation.

For each eligible earning or group of earnings in an earning rule group, implementers must create an earning rule group calculation that links the earning and the earning calculation.

FIGURE 6.20 THE ROLE OF THE EARNING RULE GROUP CALCULATION FORM.

Payment Types Earnings must be associated with payment types. A payment type defines the types and nature of the transactions you can process (maximum and minimum payments, advances, negative nets, and so on) for a payment (such as regular, cancellation, replacement, supplemental, and advance payments. You can specify payment type earning selections, which identify specific earnings and groups of earnings that will be processed for each payment type.

If, for example, bonus and commission earnings always are issued as separate supplemental payments, then the implementer must ensure that those earnings are associated with the supplemental payment type, and that other payment types include all earnings except bonus and commission earnings.

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Microsoft Dynamics® AX Payroll Grouping Methods It is important to collect earning codes into groups; typically, you will want to group earnings that: •

share the same calculations - grouping these earnings will make it easy to populate and maintain the earning rule group calculations table.

•

are similar in nature, to simplify the population and maintenance of accumulator values.

•

must be associated with the same Payment type earning selections.

•

will be used in Time rule group premiums and in Earning thresholds

•

will be used with an Earning project category.

Because many of the terms used for grouping are similar, use this table as a reference:

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Grouping Method

Description

Earning Groups

A well-designed, maintainable Payroll implementation will use earning groups to associate earnings with accumulators and payment types. Every time that an earning is added, implementers should review their list of earning groups, and add the new earning into the appropriate earning groups. You also can use earning groups for reporting purposes.

Earning Rule Groups

Use earning rule groups to provide different earning calculations for different sets of employees based on the associated rule group calculation. Each company must have at least one earning rule group, and needs more than one earning rule group if, for example, managers and regular employees require different calculations for the same earning code. Many earning rule group calculations can be defined for each earning rule group, with each associated to the appropriate calculation earning code.

Generated Earning Group

A generated earning is an earning that is set up for automatic generation (such as certain types of allowances), and has an earning code just like any other earning. A generated earning group is a collection of generated earnings that are scheduled to be paid in the same pay period.

Earning Types

Group earning codes into earning types, which organize similar types of earnings for reporting purposes (such as base earnings, overtime earnings, and premium earnings). Earning types usually are set up during implementation. Earning types are optional.

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Chapter 6: Important Setup Concepts Process: Create a New Earning Every time that an earning entry is made for an employee in the earning journal, a corresponding earning code must be selected as well. If the appropriate earning code does not exist, then you must create a new one using the following six-stage process. Each step in this process is discussed here separately; detailed procedures for each step are provided in course 9.

1. Define and name the new earning code.

2. Add the earning to the appropriate earning groups, which will be used to associate earnings with: • Accumulators •

Payment types

•

Generated earning schedules

3. Make any unique, non-group related links as required: • If the earning needs to be individually linked to an accumulator (in other words, a unique association not shared by a group), then add that earning to the accumulator's values (recall that in Payroll, accumulator values are one of the three main components of a functioning accumulator). If the earning type accumulator does not yet exist, then create it, and also add the accumulator eligibility.

•

If the earning needs to be individually linked to a payment type (in other words, a unique association not shared by a group), then make that link by using Payment type earning selections.

This stage is not discussed in this course; for associated procedures, see courses 7 and 9.

4. If the earning needs a new calculation, create it. Associate the earning with an earning rule group and calculation in the earning rule group calculation table.

5. If the earning is a generated earning, like a car allowance, create or modify (maintain) a generated earning. If it is an enrolled generated earning, create or modify a generated earning enrollment.

6. Associate generated earning with generated earning group (for scheduling).

7. If the generated earning needs to be scheduled individually, rather than through a generated earning group, then schedule the generated earning.

8. Test for expected results by assigning the new earning to an employee, and then processing earnings for that employee.

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Microsoft Dynamics速 AX Payroll Stage One: Define and Name the New Earning Code The first stage in the process of creating an earning is to define and name the new earning, so you can assign it to groups of employees in your payroll system:

FIGURE 6.21 THE EARNINGS FORM

1. In the Payroll area, find the Setup page and then click to expand Earnings. Click Earnings, and the Earnings form appears.

2. Create a new record in the Overview tab.

3. Enter a name in the Earning field (this is the earning code), and enter an Earning Description.

4. Select the Unit type (amount, hours, or units) and Salaried impact.

Salaried impact refers to the effect the earning has on an employee's regular salary: it is either included in that salary, in addition to it, or as a replacement for it.

5. Enter information as needed in the remaining fields.

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Chapter 6: Important Setup Concepts Stage Two: Add to Earning Group This part of the earning-creation process adds a newly created earning to any group(s) as required:

FIGURE 6.22 SELECTING EARNINGS TO BE INCLUDED IN THE EARNING GROUP.

1. In the Payroll area, find the Setup page and then click to expand Earnings. Click Earning groups, and the Earning Groups form appears.

2. In the Overview tab (which lists all earning groups), select the earning group the new earning belongs to.

3. In the Earning group earnings tab, add your new earning to the selected earning group by moving the new earning from the Earnings remaining list to the Earnings selected list.

4. Repeat for each additional earning group that the new earning belongs in.

Stage Three: Set Up Calculation The next stage of the earning creation process involves creating and naming a calculation for your new earning. You also must add the calculation to a group of rules, which is set up for a particular group of employees:

Name and Describe the Calculation 1. In the Payroll area, find the Setup page and then click to expand Calculations. Click Calculations, and the Calculations form appears.

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Microsoft Dynamics速 AX Payroll 2. Create a new calculation in the Overview tab, which lists all defined calculations.

3. Enter the calculation name in the Calculation field. Enter other information in the remaining fields as required.

Define and Test the Calculation 1. Click the Rule tab, then click the Edit button. Remove 0.00 from the calculation string and enter the desired calculation.

2. Click the Save button; to test, click the Test button (instructions for testing are in the student exercises).

NOTE: You can find more information about calculations in Course 7, "Payroll Calculations". You can find detailed procedures regarding the use of calculations for earnings in Course 9.

Associate Calculation and Employees in the Earning Rule Group Calculation Table 1. In the Payroll area, find the Setup page and then click to expand Earnings. Click Earning rule group calculations, and the Earning rule group calculations form appears. This is where the new calculation will be associated with the earning code defined above, and where both are associated with employees in a particular earning rule group.

2. Create a new record in the Overview tab, which lists all defined calculations.

3. Select an earning rule group, an earning, and a calculation, and then enter information as required in the remaining fields.

FIGURE 6.23 EARNING RULE GROUP CALCULATION FORM.

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Chapter 6: Important Setup Concepts Stage Four: Link to Accumulator(s) The fourth stage in the earning-creation process associates the new earning with any number of accumulators, and establishes which groups of employees can use them. Typically, most clients are best served if you establish these links when you associate earnings with earning groups - before coming to this fourth stage.

Typically, this stage is used only when you have to explicitly refer to a particular earning.

If an accumulator you want to associate the new earning with does not yet exist, then you must first create it.

If an accumulator has multiple earnings associated with it, use an earning group to collect these earnings together, and instead just associate the earning group with the accumulator. This helps to simplify the task of maintaining these associations.

Associate Earning with Accumulator(s) 1. In the Payroll area, find the Setup page and then click to expand Accumulators. Click Accumulators, and the Accumulators form opens. Use the Search or Overview tabs to select the accumulator that the new earning will be added to. If a new accumulator is required, create it and name it appropriately.

2. Click the Setup button in the Accumulators form, and select Accumulator values from the list that appears. The Accumulator values window is where you will associate the new earning with the accumulator you previously selected.

3. Use the Fast Entry tab to locate and select the new earning, then click the Insert button. The new earning has been associated with the selected accumulator - you can use the Search tab to confirm this.

4. Repeat the process for as many accumulators as are required to associate with the earning.

Set Accumulator Eligibilities Follow these steps to set accumulator eligibilities if you created a new accumulator.

1. Return to the Accumulator form, and ensure that the same accumulator is still selected. Use the Setup button again, but this time select the Accumulator eligibility option.

2. In the Accumulator eligibility form, click the Fast Entry tab and select the accumulator eligibilities that must be defined.

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Microsoft Dynamics速 AX Payroll 3. Select which pay groups are eligible to use the accumulator that you associated with the new earning, and if necessary, refine your choice by selecting Organization, Occupation, Position, and Pay characteristics, as well. Ensure that you use the lowest level of constraint possible to make future maintenance easier for the user.

4. Click the Insert button to set your accumulator eligibilities.

Stage Five: Create or Maintain a Generated Earning The next stage in the earning-creation process is conditional: use it if the new earning will be an allowance-type earning. In this case, you must set up the earning as a generated earning, and if it is an enrolled generated earning, you must also create generated earning enrollments for it.

Create/Select a Generated Earning 1. In the Payroll area, find the Setup page and then click to expand Earnings. Click Generated earnings, and the Generated earnings form appears.

2. Create a new generated earning record in the Overview tab, or select an existing record.

3. Click the General tab and select the characteristics needed for the generated earning.

FIGURE 6.24 GENERATED EARNINGS FORM

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Chapter 6: Important Setup Concepts Define Generated Earning Enrollment 1. In the Payroll area, find the Setup page and then click to expand Earnings. Click Generated earning enrollments, and the Generated earning enrollments table appears.

2. To create a new generated earning enrollment, click the Overview tab, and press CTRL+N. Select a generated earning from the list, then click the Fast entry tab. Select the Employees, Generated earnings, and Earning rule groups that will be enrolled. Also select and enter the Override characteristics.

3. To maintain an existing enrollment, use either the Search or Overview tabs to locate the desired enrollment, click the General tab, select the new earning, and then modify any other fields as required.

FIGURE 6.25 GENERATED EARNINGS ENROLLMENT FORM (FAST ENTRY TAB).

Stage Six: Schedule the Generated Earning If the earning is a generated earning, then the last stage in the earning-creation process is where you define when that earning generates. You can associate the generated earning with an earning group, or you can create a new schedule, or you can use/modify an existing one. Follow these steps to create or use an existing schedule.

1. In the Payroll area, find the Setup page and then click to expand Schedules. Click Pay period generated earnings, and the Pay period generated earnings schedules form appears.

2. To create a new schedule in the Overview tab, select the Date period, Pay period end dates, Rule groups, Generated earnings, and Generated earning groups. These selections define when, how, and for whom the generated earning is to be scheduled, and you can use as many as you need.

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Microsoft Dynamics® AX Payroll 3. To maintain an existing schedule, use either the Search or Overview tabs to locate it, and use the General or Fast Entry tabs to modify as required.

4. Click the Insert button to schedule the generated earning.

FIGURE 6.26 PAY PERIOD GENERATED EARNINGS SCHEDULES FORM (GENERAL TAB).

Benefit/Deductions Benefit/deductions were introduced earlier in this collection, and considered from the perspective of a payroll administrator. This course outlines the general process and concepts involved in setting up and implementing benefit/deductions. Course 10 provides detailed procedures for setting up benefit/deductions to meet specific client needs.

Benefits administration a major task for payroll staff. Accurate and timely maintenance of benefits and deductions are essential to successful pay period processing. In Microsoft Dynamics AX Payroll, the term benefit/deduction refers to a type of charge or service that is paid for by the employee, by the employer, or by both. Examples of benefit/deductions include the following:

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•

National, state, provincial, or local income taxes

•

Insurance plans (for example, dental, health, or life insurance)

•

Company-specified fees such as charges for parking or the use of a company gym

•

Deductions for pension plans

•

Union or professional dues

•

Court-ordered deductions (garnishments, child support)

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Advance recovery deductions (used after an employee has received a pay advance)

•

Negative net deductions (used when an employee has more deductions than earnings on a payment, and the remaining deductions must be taken from subsequent payments)

NOTE: The term Statutory Benefit/Deductions refers to benefit/deductions that are governmentally and/or legally required. Consult your local Microsoft partner about the availability of pre-defined statutory benefit/deductions for the jurisdictions applicable to you.

About Benefit/Deductions The Payroll module has two objectives for benefit/deductions: •

Minimized data entry and maintenance workloads through grouping and other strategies.

•

Unique application to each employee.

The flexibility to meet these objectives comes in part from using benefit/deduction rule groups and benefit/deduction rule group calculations. In fact, at least one benefit/deduction rule group must exist for a company, so it can tie benefit/deductions to its calculations. As the following paragraphs indicate, however, there are also some significant differences between earnings and benefit/deductions.

Setting up, implementing, and managing benefit/deductions in Microsoft Dynamics AX 2009 Payroll requires the coordinated use of the following forms and features: •

Employees

•

Benefit/Deductions

•

Benefit/Deduction Rule Groups and Rule Group Calculations

•

Calculations - both employee and employer

•

Enrollments

•

Benefit/Deduction Groups

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Microsoft Dynamics速 AX Payroll

Implementers must know what these features are, how they relate to each other, and why they must be set up during implementation.

FIGURE 6.27 THE ROLE OF THE BENEFIT/DEDUCTION RULE GROUP CALCULATION.

Benefit/deductions Benefit/deductions are set up in the Payroll module because a company needs to account for and manage specific employee benefits or deductions - for example, a dental plan. A particular benefit/deduction may be applied differently for different circumstances - for example, there may be three different ways in which an employee could be enrolled in the company's Dental Plan benefit/deduction, depending on if they are single, in a relationship, or if they have children.

For this reason, the user can select Benefit/deduction enrollments to associate with each specific benefit/deduction, as required.

Benefit/deduction enrollments All benefit/deductions for an employee are listed in the employee's Employee benefit/deduction form, and if needed, the employee's corresponding benefit/deduction enrollments also are selected here. These employee's benefit/deduction enrollments determine in what way the benefit/deduction will be applied. Ultimately, they help determine what calculation is used to determine a particular employee's benefit deduction.

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Chapter 6: Important Setup Concepts

For example, the Dental Plan benefit/deduction discussed above might include enrollments called Couple, Family, and Single, each with a different way of calculating the way in which the benefit applies to employees. Every employee who receives this benefit/deduction would have to have one of these three enrollments selected for it. In other words, when an employee is assigned the Dental Plan benefit, then the Couple, Family, or Single Benefit/deduction enrollment must also be selected for that benefit.

Benefit/deduction groups The company sets ups benefit/deduction groups for various reasons in the system.

Use benefit/deduction groups to: •

Associate like benefit/deduction codes together to schedule to them to occur during the same pay periods

•

Associate like benefit/deduction codes together to associate them with specific payment types

•

Group like benefit/deduction codes together to use to populate accumulator values

•

Associate groups of benefit/deductions to an optional cafeteria plan

•

Associate groups of benefit/deductions together to start calculating for employees at special times by using a derived date

For example, a company may choose to include Dental Plan in two different groups of benefit/deductions: •

one that is applied every pay period (a time-based criteria)

•

one that deducts only from payments that are of the Regular Payment type (and not, for example, from bonus payments)

An employee's tax deductions, however, would likely belong to a benefit/deduction group that includes all payment types.

Benefit/deduction contributions may be a fixed amount, but also typically are calculated. The Dental Plan benefit/deduction previously mentioned is an example of a benefit to which both the employee and employer will make contributions.

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Microsoft Dynamics® AX Payroll Calculations Because benefit/deductions must account for two contributions to the same benefit/deduction - an employee and an employer amount - there are frequently two calculations for the same benefit/deduction. However, the number of Calculations that must be set up depends on the nature of the benefit/deduction: •

If employee and employer contributions will be the same every time that the benefit applies, then the same calculation could be used for both.

•

If employee and employer contributions are different, then two separate calculations will be required (employee contribution and employer contribution).

•

If the benefit/deduction applies differently for different circumstances (for example, it has different enrollments), then additional calculations also must be set up. For example, the Dental Plan benefit/deduction may apply differently for employee couples, employees with families, or single employees; if so, then a different calculation is needed for each.

Accumulators At least for reporting purposes, the company must set up Accumulators to track the contributions made over time by the employee and the employer. Additional accumulators may be required as well; for example, if the company's dental plan offers employees the option of contributing toward their own dental fund (to cover procedures not covered in the basic dental plan), then a separate accumulator may have to be set up to track both contributions and withdrawals from that fund.

Benefit/deduction rule groups Use benefit/deduction rule groups to help minimize the workload in selecting benefit/deductions for new employees, and to minimize benefit/deduction maintenance for payroll administrators. Benefit/deduction rule groups are collections of benefit/deductions that apply to a specific set of employees, such as all the Production workers in the company, or all the Management staff. When creating a new employee, the payroll administrator selects a benefit/deduction rule group to which that employee belongs. If a benefit/deduction is a part of that benefit/deduction rule group, then the administrator will see that benefit/deduction and its calculations automatically appear in the new employee's list of benefit/deductions. If the benefit/deduction is not assigned to any rule groups, then the administrator must assign it individually to each employee (and select each corresponding calculation).

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Chapter 6: Important Setup Concepts In this way, benefit/deduction rule groups minimize workload by performing as a default set of benefit/deductions, enrollments, and calculations for specific sets of employee. Here are some additional examples of when clients may need multiple sets of benefit/deduction rule groups: •

If taxes are withheld for multiple tax jurisdictions, employees working in one jurisdiction need a different set of benefit/deductions than those working another jurisdiction.

•

Different employees may have different benefit packages.

•

One group of employees may pay all of the expense for a benefit; however, another group of employees may pay half of the expense, with the employer contributing the other half.

Although an employee's benefit/deduction rule group defines the standard configuration of benefits for that employee, the list of employee benefit/deductions is maintained separately for each employee - in the Employee benefit/deductions form (as discussed in enrollments above). Two key points to understand here are: •

You can override the defaults in the benefit/deduction rule group by making changes to these settings in the Employee benefit/deduction form. Benefit/deductions that are part of the benefit/deduction rule group can be expired, and this will not affect employees who already have that benefit/deduction. Calculations can be changed. Employeespecific benefit/deductions can be added, such as an individual garnishment.

•

When you make changes to a benefit/deduction rule group, the Employee benefit/deductions form does not update. If needed, Administrators will update employee benefit deductions separately.

Benefit/deduction rule group calculations The paragraphs above discussed benefit/deductions, calculations, and benefit/deduction rule groups, but have not yet addressed how they all link together. The form that links them together is the Benefit/deduction rule group calculation form. Setting up a benefit/deduction rule group calculation is relatively simple. It involves selecting a benefit deduction rule group, selecting a benefit/deduction (and its applicable enrollments, if any), and selecting the appropriate employee and employer calculations.

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Microsoft Dynamics® AX Payroll Process: Create a New Benefit/Deduction This section applies the concepts discussed in "About Benefit/Deductions" to the overall process of creating a benefit/deduction. Each step in the following process is discussed in the following pages, whereas the detailed procedures related to each step can be found in Course 10, "Set Up Benefit/Deductions".

1. Name and define the new benefit/deduction, then add enrollments.

2. Ensure the benefit/deduction is included in correct benefit/deduction groups (unless you are assigning individual, employee-specific benefit/deductions).

3. Create calculation(s) for the new benefit/deduction.

4. Set up a new benefit/deduction rule group calculation that ties together the benefit/deduction rule group, the benefit/deduction (and its associated enrollments, if applicable) with an employee calculation and/or an employer calculation.

5. Add the new benefit/deduction to the appropriate accumulators (create new accumulators if appropriate ones do not exist).

6. Ensure payment type benefit/deductions are associated correctly with payment types (for benefit/deductions that have to be scheduled individually on a payment type basis, rather than through a benefit/deduction group).

7. Schedule the new benefit/deduction: • Usually, by adding it to the appropriate benefit/deduction groups.

•

If the benefit/deduction must be scheduled individually on a time-related basis (rather than through a benefit/deduction group), schedule which pay periods the benefit/deduction will be taken in.

8. Mass assign the new benefit/deduction to employees as needed.

9. Test the new benefit/deduction.

Stage One: Name & Define the New Benefit/Deduction This first stage of the benefit/deduction creation process is naming and defining the new benefit/deduction, and assigning which employees can enroll in it.

Follow these steps to name and define a new benefit/deduction.

1. In the Payroll area, find the Setup page and then click to expand Benefit/deductions. Click Benefit/deductions, and the Benefit/deductions form appears.

2. Create a new record in the Overview tab, and enter a name for the new benefit/deduction. Select the benefit deduction type, select an insufficient funds action, and fill in any other fields as necessary.

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Chapter 6: Important Setup Concepts 3. If enrollments are necessary for the new benefit/deduction, use the buttons in the Benefit deduction enrollment selections tab to transfer selected items between the Selected and Remaining panes.

Those items in the selected pane will be the enrollments assigned to the new benefit/deduction.

FIGURE 6.28 BENEFIT/DEDUCTION FORM (GENERAL TAB).

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Microsoft Dynamics速 AX Payroll Stage Two: Add to Benefit/Deduction Groups Follow these steps to add a newly created benefit/deduction to any group(s) as required.

1. In the Payroll area, find the Setup Folder and then click to expand Benefit/deductions. Click Benefit/deductions groups and the Benefit/deduction groups form appears.

2. In the Overview tab (which lists all benefit/deduction groups), select a benefit/deduction group that the new benefit/deduction belongs in.

3. In the Benefit deduction group benefit deductions tab, move the new benefit/deduction from the Benefit deductions remaining list to the Benefit deductions selected list.

4. Repeat this step for each additional benefit/deduction group that the new benefit/deduction belongs in.

FIGURE 6.29 BENEFIT/DEDUCTION GROUPS FORM (BENEFIT/DEDUCTIONS GROUP BENEFIT DEDUCTIONS TAB).

Stage Three: Set Up a Calculation Follow these steps to define and test your calculation(s) for the new benefit/deduction.

1. In the Payroll area, find the Setup page and then click to expand Calculations. Click Calculations, and the Calculations form appears.

2. Create a new record in the Overview tab (which lists all defined calculations). Enter a calculation name in the Calculation field, and enter information in the remaining fields as required.

3. In the Rule tab, click the Edit button and enter the desired calculation.

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Chapter 6: Important Setup Concepts 4. Click the Save button; to test, click the Test button.

5. Repeat for as many calculations as are needed for the benefit/deduction (at least two may be required for many benefit/deductions with employee and employer contributions).

NOTE: A detailed discussion of Calculation variables is not included in this course; for more information, see Course 8 and Course 10.

Stage Four: Associate Calculation & and Employees in Ben/ded Rule Group Follow these steps to link the new benefit/deductions, calculations, and benefit/deduction rule groups together in a benefit/deduction rule group calculation table.

1. In the Payroll area, find the Setup page and then click to expand Benefit/deductions. Click Benefit/deductions rule group calculations, and the Benefit/deduction rule group calculations form appears.

2. Create a new record in the Overview tab (which lists all existing benefit/deduction rule group calculations).

3. In the General tab, select the new benefit/deduction, benefit/deduction rule group, enrollments (if applicable), and both employee and employer calculations as required. You also can choose to select the same information by using the Fast Entry tab.

Stage Five: Add to Accumulators This stage involves adding the new benefit/deduction to an accumulator, and designating which groups of employees are eligible to use it. If the required accumulator does not exist, you will have to create it.

1. In the Payroll area, find the Setup page and then click to expand Accumulators. Click Accumulators, and use the Search or Overview tabs to select the accumulator the new benefit/deduction will be added to. If the a new accumulator is needed for this purpose, create it (see Course 10 for appropriate procedures).

2. Click the Setup button in the Accumulator form, and select Accumulator values to open the Accumulator values form. Using the Fast Entry tab, add the new benefit/deduction to the accumulator by clicking the check box beside its name.

3. Clicking the Insert button adds the new benefit/deduction to the selected accumulator - you can use the Search tab to confirm.

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Microsoft Dynamics速 AX Payroll 4. Return to the Accumulator window, and then click the Setup button again. This time, select Accumulator eligibility, and use the Fast Entry tab in the Accumulator eligibility form to select set eligibilities for the accumulator. As required, select position types, departments, occupations, and so on. Click the Insert button to associate the eligibilities you chose for the accumulator with the new benefit/deduction.

5. Repeat for as many accumulators as required.

Stage Six: Associate Benefit/Deduction to Payment Type Stage six is where you ensure that the new benefit/deduction is associated with the applicable payment types correctly. Normally, you can do this by adding the benefit/deduction to the appropriate benefit/deduction group associated with the payment type.

Follow these steps to associate the benefit/deduction individually to a payment type, using the payment type benefit/deductions selections.

1. In the Payroll area, find the Setup page and then expand Payments.

Click Payment type benefit/deduction selections, and the Payment type benefit/deduction selections form appears.

2. Create a new record in the Overview tab, and use either the General or Fast Entry tabs to schedule the benefit/deduction.

3. Select the new benefit deduction and benefit deduction group to include in the payment type.

FIGURE 6.30 PAYMENT TYPE BENEFIT/DEDUCTIONS FORM (FAST ENTRY TAB).

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Chapter 6: Important Setup Concepts Stage Seven: Schedule Benefit/Deductions by Pay Period In this stage, ensure that the new benefit/deduction is scheduled for deduction correctly by assigning it a benefit/deduction schedule. Normally, you can do this by adding the benefit/deduction to the appropriate benefit/deduction group associated with the benefit/deduction schedule.

To schedule the benefit/deduction individually, follow these steps to select which pay periods the benefit/deduction will be taken in.

In the Payroll area, find the Setup page and then expand Schedules. Click Pay period benefit/deductions, and the Pay period benefit/deductions schedules form appears.

1.

2.

3.

4.

Use either the General or the Fast Entry tab.

Select a pay group and the new benefit/deduction.

Select the appropriate benefit/deduction rule group.

Click the Insert button, then use the Search tab to confirm the scheduled benefit/deduction.

FIGURE 6.31 PAY PERIOD BENEFIT/DEDUCTIONS SCHEDULES FORM (GENERAL TAB).

Stage Eight: Mass Assign to Employees Benefit/deduction rule groups act as a template for the package of benefit/deductions an employee would normally receive, but the actual management of the benefit/deductions falls at the employee level on the employee benefit/deduction form.

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Microsoft Dynamics速 AX Payroll When new benefit/deductions are added, therefore, they only will be included as part of the benefit/deduction when you add new employees, after you add the benefit/deduction to the benefit/deduction rule group calculation.

If the new benefit/deduction should be assigned to several employees or all employees, use the mass assign benefit/deduction function to achieve this result.

Stage Nine: Test the New Benefit/Deduction The specific method of testing a new benefit/deduction will depend on the nature of the benefit/deduction being tested. Use the following general process, and remember to perform the test using a database reserved for testing.

1.

2.

3.

4.

Select an employee.

Add the new benefit/deduction to that employee.

Perform a manual payment for the employee you selected.

Confirm that the new benefit/deduction worked, and that the resulting deduction and pay calculations are accurate.

Summary The detailed setup and implementation procedures in courses 8 through 14 depend on the implementer being able to perform the basic processes required to set up typical accumulators, calculations, earnings, and benefits/deductions. This course provided these basic procedures, which you can use to meet specific setup and implementation goals.

Accumulators and calculations are used throughout the Payroll implementation process, and are integral to setting up both earnings and benefit/deductions.

Properly setup earnings and benefit/deductions are essential to successful implementation. The objectives not only involve accurate and timely payroll information that directly rely on well-defined earnings and benefit/deductions, but also include minimizing data entry and maintenance workloads for payroll administrators. To meet these objectives, implementers must use strategies that closely involve how they set up earnings, benefit/deductions, and their associated groupings.

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Chapter 6: Important Setup Concepts

Test Your Knowledge 1. What kinds of purposes are accumulators used for? (Select all that apply) ( ) To hold data used in calculations. ( ) To hold data for reporting purposes. ( ) To accumulate data used to trigger events. ( ) To accumulate or decrement entitlement-related data.

2. What is the purpose of the Accumulator eligibility form, and how is accumulator eligibility determined?

3. Each accumulator is either: •

earnings-based

•

benefit/deduction-based

•

payment-based

4. The accumulator values selected in the Accumulator values form determine which earnings, benefit/deductions, or payments will be used to update the accumulator.

5. Accumulator values can be defined in terms of individual codes or groups (for example, individual earning codes or earning groups, such as "Federal taxable earnings").

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Microsoft Dynamics速 AX Payroll 6. What, generally, can you do with your accumulator values to make your Payroll configuration as easy to maintain as possible?

7. Where are all calculations maintained? ( ) All calculations are maintained in the employee calculation accumulator. ( ) All calculations are maintained in the Employee benefit/deduction form. ( ) All calculations are maintained in the Calculations table that corresponds to an organization, whereas related tables contain the required rates and variables. ( ) All calculations are maintained in the Calculation variables table.

8. What are the three basic categories of calculations used in Microsoft Dynamics AX 2009 Payroll?

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Chapter 6: Important Setup Concepts 9. What does the term "earning" refer to in Microsoft Dynamics AX 2009 Payroll?

10. Match the following earning-related items: _____ 1. Earning rule group. _____ 2. Earning rule group calculation. _____ 3. Earning group. _____ 4. Generated earning group. _____ 5. Generated earning. _____ 6. Earning type

a. Associates each earning rule group with one corresponding earning, and one corresponding calculation. b. Associate earnings with accumulators and payment types. Also can also be used for reporting purposes. c. Associates a calculation to a set of earnings, so that earnings can be calculated. Every organization must have at least one. d. Used to organize similar types of earnings for reporting purposes, usually set up during implementation, and optional. e. A collection of generated earnings that are paid in the same pay period. f. An earning that is set up for automatic generation and has an earning code.

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Microsoft Dynamics速 AX Payroll 11. Put the following earning-related steps in order: Step: _____: Add the earning to the appropriate earning groups. _____: Make any unique, non-group related links as required. _____: If needed, create or modify a generated earning. If it is an enrolled generated earning, create or modify a generated earning enrollment. _____: If the earning needs a new calculation, create it; then associate the earning with an earning rule group. _____: If the generated earning needs to be scheduled individually, rather than through an earning group, then schedule the generated earning. _____: Define and name the new earning code.

12. What is the role of employee benefit/deduction enrollments in the Payroll module?

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Chapter 6: Important Setup Concepts 13. Match the following benefit/deduction-related items: _____ 1. What are benefit/deduction groups set up to achieve? _____ 2. What purpose do benefit/deductions serve? _____ 3. What are benefit/deduction rule groups used for? _____ 4. What are benefit/deduction rule group calculations used for?

a. To account for and manage specific employee benefits or deductions. b. To link together benefit/deductions, calculations, and benefit/deduction rule groups. c. To schedule when the benefit/deductions are to must be calculated and deducted. d. To help minimize the workload in selecting benefit/deductions for new employees, and to minimize benefit/deduction maintenance for payroll administrators.

14. This question concerns the process of creating a new benefit/deduction. Put the following steps in order for creating a new benefit/deduction: Step: _____: Schedule the new benefit/deduction by using benefit/deduction groups, or by scheduling individually on the basis of time or payment type. _____: Test the new benefit/deduction. _____: Create calculation(s) for the new benefit/deduction. _____: Name and define the new benefit/deduction, then add enrollments. _____: Unless assigning individual, employee-specific benefit/deductions, set up or select a benefit/deduction rule group. _____: Tie together the new benefit/deduction, calculation(s), and benefit/deduction rule group by setting up a new benefit/deduction rule group calculation. _____: Add the new benefit/deduction to the appropriate accumulators.

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Microsoft Dynamics速 AX Payroll

Quick Interaction: Lessons Learned Take a moment and write down three key points you have learned from this chapter 1.

2.

3.

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Chapter 6: Important Setup Concepts

Solutions Test Your Knowledge 1. What kinds of purposes are accumulators used for? (Select all that apply) (√) To hold data used in calculations. (√) To hold data for reporting purposes. (√) To accumulate data used to trigger events. (√) To accumulate or decrement entitlement-related data.

2. What is the purpose of the Accumulator eligibility form, and how is accumulator eligibility determined?

MODEL ANSWER: Accumulator eligibility determines which data can be recorded in an accumulator. It also determines which employees, jobs, or pay groups the accumulator will applyies to. Accumulator eligibility is defined using filters that screen for particular employee and job attributes. These filters are set up for each accumulator in the Accumulator eligibility form.

3. Each accumulator is either: •

earnings-based

•

benefit/deduction-based

•

payment-based

4. The accumulator values selected in the Accumulator values form determine which earnings, benefit/deductions, or payments will be used to update the accumulator.

5. Accumulator values can be defined in terms of individual codes or groups (for example, individual earning codes or earning groups, such as "Federal taxable earnings").

6. What, generally, can you do with your accumulator values to make your Payroll configuration as easy to maintain as possible?

MODEL ANSWER: Generally, you can make your Payroll configuration as maintainable as possible by defining your accumulator values in terms of groups, unless the accumulator really does apply to only one earning or benefit/deduction.

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Microsoft Dynamics® AX Payroll 7. Where are all calculations maintained? ( ) All calculations are maintained in the employee calculation accumulator. ( ) All calculations are maintained in the Employee benefit/deduction form.

(•) All calculations are maintained in the Calculations table that corresponds to an organization, whereas related tables contain the required rates and variables. ( ) All calculations are maintained in the Calculation variables table.

8. What are the three basic categories of calculations used in Microsoft Dynamics AX 2009 Payroll?

MODEL ANSWER: Calculations can be termed Simple, Basic, or Complex. Simple calculations include constant use of a fixed amount, or standard add, subtract, multiply, and divide operations. Basic calculations can include a minimum and/or a maximum value, rounding up or down to the nearest value, bracketed equations, and variable rates. Complex calculations can include calculations within calculations, and conditional statements.

9. What does the term "earning" refer to in Microsoft Dynamics AX 2009 Payroll?

MODEL ANSWER: In Microsoft Dynamics AX 2009 Payroll, the term earnings refers to the all wages, allowances, and bonuses that an employee is entitled to. Each different kind of earning in an employee’s earnings is identified by a unique Earning earning code, which must be set up by the implementer. An employee`s earnings can be fixed (salary), calculated, and fixed but condition-based (Generated earnings - a fixed amount, but awarded only when certain criteria are met).

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Chapter 6: Important Setup Concepts 10. Match the following earning-related items: c 1. Earning rule group. a 2. Earning rule group calculation. b 3. Earning group. e 4. Generated earning group. f 5. Generated earning. d 6. Earning type

a. Associates each earning rule group with one corresponding earning, and one corresponding calculation. b. Associate earnings with accumulators and payment types. Also can also be used for reporting purposes. c. Associates a calculation to a set of earnings, so that earnings can be calculated. Every organization must have at least one. d. Used to organize similar types of earnings for reporting purposes, usually set up during implementation, and optional. e. A collection of generated earnings that are paid in the same pay period. f. An earning that is set up for automatic generation and has an earning code.

11. Put the following earning-related steps in order: Step: 2

: Add the earning to the appropriate earning groups.

3

: Make any unique, non-group related links as required.

5 : If needed, create or modify a generated earning. If it is an enrolled generated earning, create or modify a generated earning enrollment.

4 : If the earning needs a new calculation, create it; then associate the earning with an earning rule group.

6 : If the generated earning needs to be scheduled individually, rather than through an earning group, then schedule the generated earning.

1

: Define and name the new earning code.

12. What is the role of employee benefit/deduction enrollments in the Payroll module?

MODEL ANSWER: Employee's’ benefit/deduction enrollments determine in what way the benefit/deduction will be applied - ultimately, they help determine what which calculation is used to determine a particular employee's benefit deduction. For example, a benefit/deduction may include enrollments called Couple, Family, and Single, to provide for three different ways in which a benefit (such as medical or dental benefits) can be applyied to employees.

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Microsoft Dynamics速 AX Payroll 13. Match the following benefit/deduction-related items: c 1. What are benefit/deduction groups set up to achieve? a 2. What purpose do benefit/deductions serve? d 3. What are benefit/deduction rule groups used for? b 4. What are benefit/deduction rule group calculations used for?

a. To account for and manage specific employee benefits or deductions. b. To link together benefit/deductions, calculations, and benefit/deduction rule groups. c. To schedule when the benefit/deductions are to must be calculated and deducted. d. To help minimize the workload in selecting benefit/deductions for new employees, and to minimize benefit/deduction maintenance for payroll administrators.

14. This question concerns the process of creating a new benefit/deduction. Put the following steps in order for creating a new benefit/deduction: Step: 2 : Schedule the new benefit/deduction by using benefit/deduction groups, or by scheduling individually on the basis of time or payment type.

7

: Test the new benefit/deduction.

4

: Create calculation(s) for the new benefit/deduction.

1

: Name and define the new benefit/deduction, then add enrollments.

5 : Unless assigning individual, employee-specific benefit/deductions, set up or select a benefit/deduction rule group.

6 : Tie together the new benefit/deduction, calculation(s), and benefit/deduction rule group by setting up a new benefit/deduction rule group calculation.

3

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: Add the new benefit/deduction to the appropriate accumulators.

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