Begin Your Year With An Ending

-------------------------------------
(A Gladiator’s guide to Year-End Processing)

Lakshmi Sampath
SiteStuff, Inc., Austin, TX
Objectives:

Payroll 11i Year End Processing

– Information repository
– Roadblocks encountered during W2 &
1099R Processing
– Case-Study
– Dos and Don’ts
– Transition to New Year
Speaker’s Qualifications

• Lead ERP Developer at SiteStuff Inc.

• Working with Oracle ERP for more than 6
Years specialising in HRMS/Financials
implementations
• Presented at various conferences such
as Oracle OpenWorld,OAUG etc.
 The Eleven Magic Steps for a
successful Year-End

1. Planning, Preparation and

Communication
2. Identification and Scheduling
3. Setup and Review
4. Running Pre-Archival Reports
5. Balancing, SQWL and Data Cleanup
6. Running Year End Processes and Data
Extraction
 The Eleven Magic Steps for a
successful Year-End

7. Running Post-Archival Reports

8. Recording, Resolving and
Reconciliation
9. Printing W-2’s and 1099R’s
10. Generating W-2 and 1099R Magnetic
Media Files
11. Transitioning to the New Year
Begin Your Year With An Ending

Planning, Preparation and Communication Phase

1.Formulation of project plan

2.Creation of work/resources breakdown structure
3.Scheduling the Initial Planning Meeting
4.Establishment of Holiday work schedule
5.Determination of all supplies and equipment needed
6.Estimation of time-lines for achieving various milestones.
7.Communication to all employees regarding verification of
SSN and Addresses
 Identification &
Scheduling

a) Identification of Special Year End Processing which

includes a special Bonus Run, Noncash/Cash Taxables,
Backing out Void Checks etc.
b) Identification of special Run to clean up wages, Non-Tax
related Year End reports/Processes etc.
c) Identification of tasks related with the employees Social
Security Verification with EVS (Enumeration Verification
System).
d) Identification of timeframes to apply various Year-End
Patches and testing.
e) Scheduling the testing of Year End Processes and
Reports.
The significance of patching

A. Mandatory patches to stay compliant with Legislative

requirements and IRS rules and regulations.

B. To make certain the system availability for all users.

C. To ensure that Payroll has full access to a completely

patched and updated system by early October.
Federal Reporting Set Up

1. Navigate to: Work

Structures→Organization→Description
2. Change your Effective Date to: 01-JAN-1951
3. In the “Find Organization” window, select GRE /
Legal Entity from the list of values in the Name field
under the heading of Organization Classification.
Click “Find”
4. Click on the GRE / Legal Entity line in the
Organization Classification form and click the
“Others” button, then select W2 Reporting Rules as
shown
W2 Reporting Rules

Column Name Data

W-2 Transmitter Yes
2678 Filer Yes
Company Name Name of the Company
Contact Contact Name
Problem Notification Method Postal Service
Preparer Self-Prepared
Tax Jurisdiction All US States and District of
Columbia
Terminated GRE Leave Blank
Third Party Sick Pay No
Other EIN Leave Blank
Computer IBM
Internal Labeling No Label
Density 6250 CPI
Recording Code ASCII
Blocking Factor 10
Job Development Fee Leave Blank
Other Things to be considered

• Employer Identification
• Federal Tax Rules
• SQWL Gen. Trans. Rules
• State Tax Rules
1099R Setup

• Pensions
• Annuities
• Retirement or Profit sharing plans
• IRAs
• Insurance Contracts
New Oracle Balances for
1099-R Information Return

• New Oracle Balance Name

• Capital Gain
• EE Contributions Or Premiums
• Unrealized Net ER Sec Apprec
• Other EE Annuity Contract Amt
• Total EE Contributions
Extra Information Type (EIT)

Segments of New US Pension Reporting EIT

1) Flexfield Segment
2) Taxable amount unknown
3) Total distributions
4) Employee distribution percentage
5) Total distribution percentage
 Loading EIT’s for 1099R

This new Assignment Extra Information using

PER_INFO_TYPE_SECURITY with information type of
PAY_US_PENSION_REPORTING and
INFO_TYPE_TABLE_NAME of
PER_ASSIGNMENT_INFO_TYPES is seeded for three
delivered responsibilities

This EIT can be loaded for all retirees using the following API’s:

hr_assignment_extra_info_api.create_assignment_extra_info
hr_assignment_extra_info_api.update_assignment_extra_info
hr_assignment_extra_info_api.delete_assignment_extra_info
Pre-Archival Reports

• Diagnostic
• Balancing
• Reconciliation
Diagnostic Reports
Report Name
Unacceptable Tax Balance Report
Invalid Address Report
Over Limit Report
State Quarterly Negative Balances
Report
Used For Frequency
Pre-Archival Reports
Diagnostic Reports
Use to find negative wages, over- Quarterly
withheld taxes, and other tax Yearly
conditions which might cause QE and
YE processes to fail
Use to identify incorrectly entered or Quarterly
missing addresses that would cause Yearly
QE and YE processes to fail
Use to identify employees who have Quarterly
taxes withheld in excess of the legal Yearly
limit
Use to find negative wage or tax Quarterly
balances for State Level taxes
Balancing Reports

Balancing Reports
US Gross to Net Summary Use to view summary payroll Each Processing
Report calculations. This report can Quarterly
be run to view Current, QTD Yearly
or YTD amounts
GRE Totals Report This report helps you to Each Processing
As needed for quarterly and y early
balance W-2s. It lists totals for
reconciliation
selected, or all, GREs.

Federal and State Tax Use to provide tax totals for Each Processing
Remittance Manager Report weekly tax deposits. Provides Quarterly
summary tax information by Yearly
Tax Type within Jurisdiction
Use to reconcile QTD and
YTD totals
Reconciliation Reports
Payroll Register
Employee Run Results Report
Payroll Activity Report
Reconciliation Reports
Use to view employee payroll Each Processing
details. Includes detailed tax As needed for quarterly and yearly
information reconciliation
Use to identify balance Each Processing
problems for individual As needed for quarterly and yearly
employees reconciliation
Used to show employee and Each Processing
group level payroll details for As needed for quarterly and yearly
pay runs, quick pays, balance reconciliation
adjustments, balance
initializations, voided
payments and reversals. This
report can also be used to
identify employees with
selected transactions in a
given time frame
 Balancing, SQWL and Data Cleanup

Importance of Balancing

•Reconcile your payroll throughout the year to avoid problems at

year-end.

•Balance after each period, perform tax testing, and compare the G/L
transfer to your payroll register.

•Run balance adjustments as a separate run to make it easier to

rollback the balance adjustments as a whole if there is a problem.

•Use pay_balance_adjustment_api can to do mass balance

adjustments if payrolls have not been run in the new GRE
Geocodes

What are they?

Geocodes are the geographical codes supplied by
Vertex.

The use of geocodes (or Jurisdiction Code)

determines which jurisdiction will be updated on
the employees record.

The geocode is a 3-part record in the format of XX-

XXX-XXXX. The first 2 digits are the State code, the
next 3 digits are the county code and the last 4 are
the city code.
 Running Year End Pre-Process and
Extraction

Gross Earnings
W2 Nontax Sick
W2 Expense Reimb
W2 Qual Move
W2 No Gross Earnings
Table showing W2 Boxes and Fields with
Archive Table Information

• Detailed info is available in my white paper

Table showing W2 Boxes and Fields with Archive Table Information
Box Title Information Contained Archive Table
a Control Number Assignment Action ID archived by the Year End pay_us_wages_w2_v
Pre-Process

b Employer’s Identification Number Employer ID (Federal EIN) pay_us_wages_w2_v

c Employer’s Name, address, and Tax Unit Name (GRE Name) Tax Unit Address pay_us_wages_w2_v
Zip Code (GRE Location)

d Employee’s SSN National Identifier pay_us_wages_w2_v

e Employee’s Name, First, Middle Initial, Last pay_us_wages_w2_v
f Employee’s address, and Zip Code, Primary Address pay_us_wages_w2_v
1 Wages, Tips, and other FIT_REDUCED_ SUBJ_WHABLE + SUBJ_NWHABLE pay_us_wages_w2_v
Compensation (PER_GRE_YTD)

2 Federal Income Tax Withheld FIT_WITHHELD (PER_GRE_YTD) pay_us_wages_w2_v

3 Social Security Wages SS EE TAXABLE (PER_GRE_YTD) pay_us_wages_w2_v
4 Social Security Tax Withheld SS WITHHELD (PER_GRE_YTD) pay_us_wages_w2_v
5 Medicare Wages and Tips MEDICARE EE TAXABLE (PER_GRE_YTD) pay_us_wages_w2_v
Running the Post-Archival Reports

a) W-2 Register Report,

b) W-2 Exception Register Report,
c) 1099-R Register Report,
d) 1099-R Exception Register Report,
e) Year End Negative Balances Report etc.
Quarterly/Yearly Tax Reports
• Tax Rpts Quarterly Tax Return Worksheet
(Form 941)
State Quarterly Wage Listing (SQWL)
Annual FUTA Tax Return (Form 940)
Year End Pre Processor
Year End Negative Balances
W-2 Register
W-2 Exception Register
Employee W2 Report
Employer W2 to be filed with the state
Federal W-2 Magnetic Media
State W-2 Magnetic Media
Federal 1099R Magnetic Media
Report
State 1099R Magnetic Media Report
Quarterly Tax Reports
Use to provide line-by-line totals to be
transcribed to the Quarterly 941 tax
Quarterly
return
Used to create magnetic tapes and Quarterly
files for state reporting
Yearly Tax Reports
Use to provide line-by-line totals to be Yearly
transcribed to the Yearly 940 Tax
Return
Used to prepare data for W-2 reports Yearly
and Processes
Used to find negative wage and tax Yearly
records that would cause YE
processes to fail
Used to provide box-by-box totals that Yearly
will print on employee W-2’s. Year
End Pre-Processor must be run in
order to print this report
Used to find exceptional conditions Yearly
that would cause W-2 process to fail
Used to print employee W-2’s Yearly
Used to print employer copies of W- Yearly
2’s to be filed with the state
Used to produce magnetic file to Yearly
transmit to the IRS/SSA
Used to produce magnetic file to Yearly
transmit to the State Department of
Revenue
Used to produce magnetic file to Yearly
transmit to the IRS/SSA
Used to produce magnetic file to Yearly
transmit to the State Department of
Revenue
Recording, Resolving and
Reconciliation

1. Verification of terminated employess in the

custom reports.
2. Tighter allocation of resource and time for
custom reports correction due to negligence.
3. The big showstopper -! Employees with multiple
assignments.
4. For legislative reporting requirements include
balances of terminated employees.
Case Study

Generating W-2 and 1099R Magnetic Media

Files

The following error messages showed up

when the Federal W-2 Magnetic media was
run.

HR_6881_HRPROC_ORA_ERR SQLERRMC ORA-20001: +

Exception ORA-06512: at "APPS.HR_DYNSQL", line 1264
What Happened?

No GRE's are being picked up in the process. This is in-spite of the

GRE setup and all the other troubleshooting scripts seeming to
be fine.

Solution:
There were two database items that were missing in that instance
which
was actually required for the W2 Processing.

The Year End Phase I Patch 2383759 and 2516296 delivered these
two
database items.
The two database items that were missing were:
A_LC_W2_REPORTING_RULES_ORG_W2_2678_FILER'‘
A_LC_W2_REPORTING_RULES_ORG_W_2_TRANSMITTER‘
What We Did:
In specific, the database item creation script was in the Hrglobal.drv
patch. After going through all the packages hr_dynsql.pyrsql,
pay_us_mmref_reporting.range_cursor,
pay_us_mmref_reporting.preprocess_check,
pay_us_archive.preprocess_checkwe found out that the error
occurs when we retrieve the following query for the two database
items (username in ff_database_items)
'A_LC_W2_REPORTING_RULES_ORG_W2_2678_FILER'
'A_LC_W2_REPORTING_RULES_ORG_W_2_TRANSMITTER'
select
fdi.user_entity_id, fdi.user_name
into l_user_entity_id
from ff_database_items fdi,ff_user_entities fue
where fdi.user_name = :p_dbi_name
and fue.user_entity_id = fdi.user_entity_id
and fue.legislation_code = 'US'
We reapplied the patches and everything worked fine.
Do’s & Don’t’s of Year End Pre-
Process

• Change of employee’s record after running the

Year End Pre-Process ?
--- you can retry the Year End Pre-Process

• Do not re-run the entire process. Rollback/Re-

run
-- In instances where large volumes of employees’
balances are changed.
Retrying the Year End Pre-Process

• Employee assignments that have been

marked for retry will be re-archived.
• Roll back the below reports if they have
been generated.
1. Federal W-2 Magnetic Media report
2. State W-2 Magnetic Media report
3. Federal 1099-R Magnetic Media report
4. State 1099-R Magnetic Media report
 Tips & Tricks

1. One month prior to quarter-end, run your Unacceptable Tax Balance and
State Quarterly Negative Balance reports to clean up any outstanding items.
2. Also run your Year End Pre-Process, W2 Exception Report and W2
Register, and balance these to your GRE Totals and Tax Remittance
reports.
3. Remember to rollback the Year End Pre-Process and other magnetic
reports.
4. At quarter-end, rerun the Unacceptable Tax Balance and State Quarterly
Negative Balance reports again, do your 941 reconciliation, and reconcile
and submit any state required reports.
5. Prior to year-end, review and resolve any questionable payments to
employees via Accounts Payable. Perform your 401k, 403b and Section 125
compliance reviews.
6. You should also review possible changes to the W-2 form itself. You can
check the IRS website for the latest changes.
Tips & Tricks Continued …

7. Individual assignments can be marked for retry in the

Employee Assignment Process window.
8. Employer data can be re-archived by marking the payroll
action for retry in the Payroll Process Results window.
9. Then retry the process by selecting Retry US Payroll Process
from the Submit Requests window.
10. If a GRE does not have any employees in it, then its employer
data will be archived when the Year End Pre-Process is run for
that GRE.
11. In the case of point 10, you cannot re-archive employee data
through the Retry US Payroll Process. You must rollback the
process, and then rerun the Year End Pre-Process
Transitioning to the New Year

" End-dating the Expired Elements and Links

" Establishing the new Elements and Links
" Collecting new forms from employees with Tax
Exempt Status
" Running PTO Accrual Carryover Process
" Verification and Update of SUI Rates
" Reviewing Payroll Calendar for the New Year
" Verification and Review of all the Limits and
Carryovers
Appendix: Sample Payroll Yr-End Project Plan

Sample Payroll Year End Project Plan (W2 & 1099R Processing)
Phase ID Task Name

A 1 Initial Planning Meeting

A 2 Year End Communications
A 3 Identify &Schedule Special Year-End Processingsing
A 4 Identify / Schedule Non Tax Related Year End Reports / Processes
B 5 Refresh Test Environment from Production
B 6 Apply Year End / Year Begin Phase 1 Patch To Test Instance
B 7 Test Year End Processes and Reports
B 7.1 Review and Complete GRE Setup for State W2, Federal W2, Magnetic Media, State Quarterly
Wage Listing
B 7.2 Run Pre-Archival Reports
B 7.3 Process YE preprocessor
B 7.4 Run State W2
B 7.5 Run Federal W2
B 7.5.1 Send W2 and 1099R information via internet to ADP
B 7.6 Run Employee W2 Report for active and terminated employees. Verify totals and boxes.
B 7.7 Run paper W2
B 7.8 Complete any other testing identified
B 7.9 Report all problems to Oracle Support Services.
B 7.10 Apply Year Begin / Year End Phase 1 Patch to Production
B 7.11 Determine GRE information for 1099R and document
B 7.12 Balance 1099R for conversion and payments
Sample Payroll Year End Project Plan (W2 & 1099R Processing)
Phase ID Task Name

B 7.13 Make balance adjustments as needed

B 7.14 Load EIT information to 1099R assignment screen
B 7..15 Run Year End Preprocess for 1099R
B 7.16 Run 1099R Process
B 7.17 Send 1099R to ADP for testing
B 8 Refresh Test Environment from Production
B 9 Apply Year End / Year Begin Phase 2 & III Patches to TEST environment
B 10 Test Year End Processes and Reports
B 10.1 Run Pre-Archival Reports
B 10.2 Review and Complete GRE Setup for State W2, Federal W2, Magnetic Media,
State Quarterly Wage Listing
B 10.2 Review ADP W2 and 1099R run results and make corrections
B 10.3 Process YE Preprocessor
B 10.4 Run State W2
B 10.5 Run Federal W2
B 10.5.1 Send CD-Rom to ADP with W2 Information – 2nd Run
B 10.6 Run paper W2
B 10.7 Complete any other testing identified
B 10.8 Report all problems to Oracle Support Services.
C 11 Install Year End / Year Begin Phase 2 Patch in Production Environment
C 12 Year End Forms
• For a more detailed sampling on the project
plan, you can refer my white paper

“Begin Your Year With An Ending”

Thank You!