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Liabilities Topics and issues related to accounting for current, and long-term liabilites. This includes accounts payable.

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Old 12-18-2008, 06:48 PM   #1 (permalink)
 
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Default Vacation accrued

We've been keeping track of vacation and sick time in an excel spreadsheet. But, I'm thinking we need to record the liablility. Does anyone else do this? How so?

Thanks!
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Old 12-29-2008, 07:29 AM   #2 (permalink)
 
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We've been keeping track of vacation and sick time in an excel spreadsheet. But, I'm thinking we need to record the liablility. Does anyone else do this? How so?

Thanks!
On the accrual basis of account you do need to accrue a liability for unused vacation time. Simply, add up the hours by employee and multiply that by their respective pay rate. Thats how much you will need to accrue in total
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Old 07-01-2009, 06:40 AM   #3 (permalink)
 
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On the accrual basis of account you do need to accrue a liability for unused vacation time. Simply, add up the hours by employee and multiply that by their respective pay rate. Thats how much you will need to accrue in total
How to treat accrued vacation times in the books depends largerly on the size and type of company and the contractual treatmeant of accumulated vacation credits.

Companies that need to hire temps when one of their permenant employee goes on vacation are usually accruing the vacation time to avoid that during the absence of the employee, the monthly accounts are charged with two salaries, the salary of the person on vacation and the salarly of the temp.
In companies where the workload is carried by the remaining staff and no temps are needed, the no vacation accruals are usually booked.

In this connection, it is reminded that the vacation accrual system should be carefully planed. Many companies state in their employment contracts that accumulated vacation credits cannot be carried over to the next fiscal year unless specifically authorized by the manager. This is to avoid that employees with 25 years plus employment claim all of a sudden the entire accumulated vacation credits over the past 15. If that employee leaves the company at the same time, such credits must be paid in cash unless otherwise stated in the employment contracts.
Werner Reisacher
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Old 07-01-2009, 07:02 AM   #4 (permalink)
 
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How to treat accrued vacation times in the books depends largerly on the size and type of company and the contractual treatmeant of accumulated vacation credits.

Companies that need to hire temps when one of their permenant employee goes on vacation are usually accruing the vacation time to avoid that during the absence of the employee, the monthly accounts are charged with two salaries, the salary of the person on vacation and the salarly of the temp.
In companies where the workload is carried by the remaining staff and no temps are needed, the no vacation accruals are usually booked.

In this connection, it is reminded that the vacation accrual system should be carefully planed. Many companies state in their employment contracts that accumulated vacation credits cannot be carried over to the next fiscal year unless specifically authorized by the manager. This is to avoid that employees with 25 years plus employment claim all of a sudden the entire accumulated vacation credits over the past 15. If that employee leaves the company at the same time, such credits must be paid in cash unless otherwise stated in the employment contracts.
Werner Reisacher
Why would the size of the company matter? Knowing how the company treats its vacation is obviously an assumption. If an employee cannot rollover time, then there is no accrual to make.

What would an accrual have to do with temp employees??? Regardless of hiring a temp or not, if there is UNUSED and EARNED vacation time that is able to rollover, it needs to be accounted for. My company does not hire temps for people on vacation and at year end we accrue unused vacation time. Earned vacation time is an expense incurred in the current year, how could you not accrue for it???
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Old 07-03-2009, 11:33 AM   #5 (permalink)
 
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Why would the size of the company matter? Knowing how the company treats its vacation is obviously an assumption. If an employee cannot rollover time, then there is no accrual to make.

What would an accrual have to do with temp employees??? Regardless of hiring a temp or not, if there is UNUSED and EARNED vacation time that is able to rollover, it needs to be accounted for. My company does not hire temps for people on vacation and at year end we accrue unused vacation time. Earned vacation time is an expense incurred in the current year, how could you not accrue for it???
I am surprised about the unprofessional replies that you are sending in your function as a "Moderator". Triple question marks and capital letters are not exactly what I expect from a professional.
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Old 07-06-2009, 06:48 AM   #6 (permalink)
 
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I am surprised about the unprofessional replies that you are sending in your function as a "Moderator". Triple question marks and capital letters are not exactly what I expect from a professional.
Werner Reisacher
how is emphasizing confusion and stressing words, unprofessional? Smiley's are also available to use, but would that be unprofessional by your standards? Your not writing a company memo or a novel. Forum's, to me, are considered more of a platform for people to converse as if they were talking directly. I'm not against, nor do i consider adding life to your words to be unprofessional.

If that offends you, i do apologize, guess thats why i chose accounting and not english major.

Id like to stay on point if that's ok with you.
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