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Vacation Leave Accounting

Learn about the vacation leave accounting process.

Background

  • October 1, 1980: San Diego campus implemented a vacation accounting system to record vacation accruals and usage within departmental expenditure accounts.
  • The procedure provides a systematic method to record the cost of all employees eligible to accrue vacation.
  • It relieves departments from having to monitor vacation reserves within various funding sources.
  • It also helps avoid having to submit cumbersome financial transfers when an individual is transferred to, from or between departments.
  • Departments do not suffer a severe financial hardship when employees terminate with large vacation balances.

Policy

  • The vacation accrual and usage accounting process is contained within the Financial Ledger.
  • Within the General Ledger System, a vacation liability account has been established to record vacation accruals and usage.
  • Within the Operating Ledger, the VACLAC contains detailed information of vacation accruals assessments and usage.

Procedure

  • The accrual rate is based on the lowest appointment from the Payroll Personnel System (PPS) whether this appointment is active or not.
  • Once it determines the leave code rate it moves down to the distributions and other appointments.
  • Accruals are pro-rated according to funding percentages from all active accruing distributions.

Vacation Leave Liability Account Activity (VACLAC)

  • Generated on a monthly basis
  • Contains all the vacation assessments and usage details by individual account/fund/subaccount.
  • It identifies the amounts to the Operating Ledger as one-line entries with an S-90 voucher number.
  • Accrued Pay + Accrued Benefits + Used Benefits is posted with object code 668930.
  • Used Pay is posted as a separate line entry using the corresponding object codes 611850 (Sub1), 621850 (Sub2), and 601850 (Sub 0).

Calculating Vacation Accrual

  • Monthly Employees
    • Divide monthly salary rate by 174 (average monthly hours) and multiply result by hours earned for Accrued Pay.
    • Multiply Accrued Pay by Benefits Code rate for Accrued Benefits.
  • Biweekly Employees
    • Use hourly rate and multiply by hours earned for Accrued Pay.
    • Multiply Accrued Pay by Benefits Code rate for Accrued Benefits.

Calculating Vacation Usage

  • Monthly Employees
    • Divide hours used by actual hours in the pay cycle, multiply result by monthly salary rate for Used Pay.
    • Multiply Used Pay by Benefits Code rate for Used Benefits.
  • Biweekly Employees
    • Multiply hours used by hourly rate for Used Pay.
    • Multiply Used Pay by Benefits Code rate for Used Benefits.

Transferring Funds with PETs

  • Vacation accruals can be moved via a PET within the specified period of 12 months.
  • Vacation usage can only be moved via timekeeping within a period of 12 months.

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