Troubleshooting Encumbrances Tuesday, August 2, 2016

Troubleshooting EncumbrancesTuesday, August 2, 2016

Edna Moore, IVEE Software Support Analyst

Marla Carrejo, IVEE Advisor

Troubleshooting Encumbrances

In Today’s Webinar…

• What is an encumbrance?• How is an encumbrance created?• When is an encumbrance released?• How to troubleshoot encumbrance issues?

© Tyler Technologies 20123

What is an Encumbrance?

• An encumbrance is a claim against the budget.

• Examples:– A signed PO is a legal claim against the district’s budget.

– An invoice is a legal claim against the district’s budget.

– A generated payroll journal is a claim against the district’s budget.

– A computed deduction journal on the employer match side is a claim against the district’s budget.


How is a purchase encumbrance created and released?

• Purchase encumbrances in IVEE Accounting are created by:– Requisitions, Purchase Orders, Warehouse Reqs., and Invoices

• A requisition creates a PRE-encumbrance record against the account code.

• Purchase order creation does the following: releases the requisition PRE-encumbrance, creates a PO ACTUAL encumbrance

• Invoice Processing: releases the PO ACTUAL, and creates Outstanding Invoices ACTUAL encumbrance.

• Voucher Processing: releases Outstanding Invoices ACTUAL. No additional encumbrance records will occur if PO is closed and all encumbrances are cleared.

• If PO left open, PO ACTUAL encumbrance – less Posted Invoices ACTUAL = remaining PO ACTUAL encumbrance against account code.


Requisition to Check


Payroll Encumbrances: Actual vs. Pre• Actual Encumbrance is the Salary and Benefits

encumbered in the employee’s payroll and deduction journals. However, a Pre Encumbrance encompasses any Vacant positions and supplementals and the benefits that go along with those vacancies.

• Pre-Encumbrance is optional, it is something you plan to pay. We have a special utility in the system to include these amounts in your reports and totals.– Once the set up is done, the Pre Encumbrances are calculated

automatically when a payroll is posted to the General Ledger, or you can manually perform the calculation in the Position Pre Encumbrance screen.


How is a Payroll ACTUAL Encumbrance created?

• Payroll ACTUAL encumbrances are created in IVEE Accounting by:– Employee Positions and Supplementals that have been generated with unposted journals.

– Salary Encumbrances are created automatically every time you create/modify an employee position.

– Salary Encumbrances do not need to be computed to be included in Payroll Encumbrance Totals.


How is a Payroll ACTUAL benefit encumbrance created?

• Benefit ACTUAL encumbrances are created in IVEE Accounting by the computed employee deduction journals which should be computed as often as possible for accurate totals (Payroll | Payroll Processing | Process Payroll | Actions | Compute Selected Periods).


How is a Payroll pre encumbrance created?

– Vacant positions and supplemental pay records.

– Hourly Time Card pre encumbrances if set in the employee position.

– Benefit Encumbrances that follow the salary pre encumbrances.


How is Payroll pre encumbrance tracking set up?

• Setting up Pre Encumbrance Calculations :

• General Ledger | Configuration | General Ledger Default Settings | Budget Information | select the Track Payroll Pre Encumbrance option.


How is Payroll salary pre encumbrance set up?

Salary Pre Encumbrance – Vacant Positions & Supplementals that have a Position Amount in place will be calculated based on an Encumbrance Ratio.

– The # of Days Left on the Position divided by the total # of Days on the Work Calendar= Encumbrance Ratio . Encumbrance Ratio * Position Amount = Position Pre Encumbrance.

– For example: A Position for $39,000.00 on a 180-day work calendar has a start date of 8/23/2014 and an end date of 6/6/2015. At the point this calculation is made, the system is half way through the year. The number of days remaining are 91. The Ratio is 91/180 = 50.55%. So, the Position Pre Encumbrances calculates at 50.55% * $39,000.00 = $19,716.65.


How is Hourly Time Card pre encumbrance set up for a filled position/supplemental?

Hourly Time Card pre encumbrances can be computed on Positions/Supplementals that have a $0.00 Position Amount.

– When the Hours per Day field is 0.00 on Hourly/Timecard Positions, the Position Amount is $0.00. The Pre Encumbrance field is available for editing under this condition. The Pre Encumbrance Amount less the FTD Amount = Pre Encumbrance.


Benefit Pre Encumbrances

• If you wish to use benefit pre encumbrances, there is setup required on the budgeting side.

• General Ledger | Budgeting | Position Budget Modeling | Position Budget Template

– Create a Position Budget Template for each best-guess combination of employer paid benefits. These templates will be assigned to the Pre Encumbrances Positions/Supplementals.


Benefit Pre Encumbrances

• General Ledger | Budgeting | Position Pre Encumbrances | Position Pre Encumbrances | Actions | Calculate Pre Encumbrance for Payroll.– The Final Step is to Calculate the Salary & Benefit Pre Encumbrances in

Position Pre Encumbrances.

© Tyler Technologies 201215 © Tyler Technologies 201215

Recap: When is an encumbrance released?

• When invoices are posted an encumbrance amount is released. ACTUAL Posted Invoices are backed out of the line encumbrance total.

• When a purchase order is closed, all remaining encumbrances are dropped.

• Payroll postings release salary and benefit ACTUAL encumbrances.

• Salary and Benefit PRE encumbrances are released as payrolls are posted. The PRE encumbrance amount reduces throughout the fiscal year.


Where to research a purchase encumbrance?

PO Pay History Report



Invoice Processing



• Journal Detail | Purchase Encumbrance tab



• Account Detail | Pending Invoices field


Where to research a Payroll encumbrance?

• Journal Detail | Payroll Encumbrance tab


Where to research Payroll encumbrance?

• Journal Detail | Transactions tab


Where to research Payroll encumbrance?

• General Ledger | Budgeting | Position Pre Encumbrances


Troubleshooting Purchase EncumbrancesScenario 1Sample PO 20161 – PO Pay History Report. Encumbrance amount is incorrect. We have paid, but the report is not calculating correctly. PO Amount is $20 and we paid $15. Shouldn’t the encumbrance amount be $5? Reports says encumbrance is $10.


Troubleshooting Purchase EncumbrancesScenario 1 - Solution• Review the PO Pay History Report. • Encumbrances are by account line and not by total purchase order amount.• The overpayment of one account line, does not decrease the encumbrance against the

remaining lines. • Reminder, an encumbrance is a claim against the district’s budget.

• In this sample, notice that line 1 still has a remaining claim against the budget on account code 001.100.1000.6610.010.000.0000 for $10.00. Going over budget on line 2 does not relieve the budget secured/encumbered for line 1.


Troubleshooting Purchase EncumbrancesScenario 2Sample PO 20162– PO Pay History Report. Encumbrance amount is incorrect. It’s been paid. We tried revising the PO to zero out the lines. Line 2 used to say $500, but we zeroed it because it was canceled and we are not going to re-order. We also tried opening and closing the PO, but it will not release the encumbrance.


Troubleshooting Purchase EncumbrancesScenario 2 - Solution• Review PO Pay History Report, and based on findings, Invoice Processing. • Note item #7 pay history shows a payment for $500 with no check or voucher

number.• Reminder, unposted invoices are encumbrances. Found similar invoice V441123. with

a Suspended status.• Since line 2 is canceled and line 1 has been paid, we can delete suspended invoice.


Troubleshooting Purchase EncumbrancesScenario 3Sample PO 20163– General Ledger Report Writer or On-Demand Reporting is wrong. The report is showing an encumbrance amount, but the purchase order is closed. The account code on the PO is 001.100.1000.6601.015.201.0000.


Troubleshooting Purchase EncumbrancesScenario 3 - Solution• Timing issue. The On-Demand Report is accurate.• The user set a report date range of 7/1/15 – 6/30/16.• A closer look at General Ledger | Transaction Inquiry | Journal Detail | Purchase

Encumbrance tab reveals the purchase encumbrance was not released until 7/19/16 (after 6/30/16).

• Open the date range on the report to capture all encumbrance records.


Troubleshooting Benefit EncumbrancesScenario 4 Benefit Encumbrances are not accurate. They are reported as too high or too low.

Scenario 4 – SolutionCompute Selected Periods after completing a payroll and before printing reports. The payroll encumbrances will be up to date based on current set up in payroll.


Troubleshooting Payroll Encumbrances

Scenario 5The Report dates used may be beyond a recent payroll that has already been run and you expect the totals to reflect as expended.

Scenario 5 - SolutionDepending on pay dates, the reports should be run with a date range that includes the pay date.

Depending on the GL report used, you may need to deselect the option to “Filter Encumbrance Detail by Date Range.”


Troubleshooting Payroll Encumbrances

Scenario 6Employee positions/supplementalshave not been properly ended for terminated employees. It is still showing an encumbrance even though we have stopped paying the employee. The employee’s last day was May 15, 2015 and we removed the Issue paycheck flag.

Scenario 6 – SolutionMake sure to edit the End Dates of termed positions/supplementals to match last day of work. Note in the image below, the position is still encumbering through 6/30/15 and PP 26.

Make certain to edit the Position End Date and End Pay Period. This will release the salary ACTUAL encumbrance.


Troubleshooting Pre Encumbrances

Scenario 7 My pre-encumbrance calculations are too low. They are not calculating the total position amount.

Scenario 7 - SolutionThe system looks at the first unposted pay period assigned in the position or supplemental.

Verify Start/End Pay Periods assigned in the vacant position/supplemental.

PP10 starts on 11/2/XX, however the position starts on 8/12/XX. The system is calculating the number of days remaining from the first unposted pay period which is 11/2/XX. Edit the start Pay Period to match the position Start Date.


Troubleshooting Payroll Pre Encumbrances

Scenario 8The position pre-encumbrance calculated records are not accurate.

Scenario 8 – SolutionWhen pre encumbrance calculations do not appear to be accurate, go to GL | Budgeting | Position Pre Encumbrances | Position Pre Encumbrance | Actions | Calculate Pre Encumbrance for Payroll


Troubleshooting Payroll Pre Encumbrances

Scenario 9Benefits are not calculating for my pre encumbrance positions.

Scenario 9 – SolutionIn Payroll | Employees | Employee Positions & Pay – filter for Vacant records and assign the appropriate Position Budget Template.

From EE Positions and Pay screen, filter grid for pre encumbrance positions, and mass assign a position budget template.

Q & A Session


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Troubleshooting Encumbrances Tuesday, August 2, 2016

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