How do I correct the Net Vacation Accrued balance total? Adjusting the vacation available as of (date) total in the Payroll Info tab does not correct this balance.

Hey mswanson!

Since the Vacation Pay available in the Payroll Info tab doesn't affect any accounts or reports, you'll need to do a YTD adjustment. You can do this by clicking Employees>Payroll Setup>Set Up YTD Amounts.

Please let me know if you have any other questions!

To get a proper historical net Vacation Accrued balance, you should adjust the total Vacation Accrued since the employee's hire date, less the total Vacation used.  To do this, follow steps below:

1.  Open YTD Adjustment window for affected employee.  Choose the correct date period you want the adjustment to show up in.

2. In the 'Other Employee and Company Payroll Items', delete all lines except for VacPay-Accrued.  Enter in amount of vacation employee should have accrued since their start date, up until the last pay period.

3.  Create two hourly payroll items and include in employee's payroll info.  a) Hourly Wages and b) Vacation Hourly (these might be a native item to QB and already set up).  Make sure they are active and connected to the correct G/L Accounts.

3.  In a current pay cheque for the same employee, calculate their payroll as usual.

4.  Add a line to pay cheque under Earning, using Hourly Wage payroll item, deducting the number of hours (-) of vacation the employee has taken to date.

5.  Add another line to pay cheque using Vacation Hourly payroll item, add (+) the number of hours of vacation the employee has taken to date.

*You may need to adjust the hourly rates or hours on these lines slightly to get to the correct $ amount, especially if employee has had some pay raises along the way, and has taken vacation at more than one different salary rates.  The idea is to reduce the amount of regular salary by the same amount as vacation taken and increase the vacation item by the same amount.

6.  The two extra lines create an in and an out, with net difference of $0.00.  All that has occurred is that you now will have the correct amount in your wage expense account for that employee, as well as the correct net liability for the employee in your vacation liability account.

7.  Check the amount of Vacation Avail ($) on your current pay cheque.  It should be what you know the net vacation liability is.  If not, go to the employee's payroll info on the Vacation tab and change the amount of vacation available as of the date stated there, adjusting for the amount the employee will be accruing on this current cheque.  The amount you enter there plus the current period's accrual, should be the total net vacation liability for this employee.  This only affects what appears on the cheque and does not impact the G/L accounts at all.  Your adjustments should have corrected the G/L accounts.

I have attached an example, using John Doe who earns $60,000/yr, who started on Jan 1/18 and whose adjustments will take place in Feb /19, with current pay period being Feb 28/19.  It also assumes that John Doe took 6 days (or 48 hrs) of vacation during that time period.

To get a proper historical net Vacation Accrued balance, you should adjust the total Vacation Accrued since the employee's hire date, less the total Vacation used.  To do this, follow steps below:

1.  Open YTD Adjustment window for affected employee.  Choose the correct date period you want the adjustment to show up in.

2. In the 'Other Employee and Company Payroll Items', delete all lines except for VacPay-Accrued.  Enter in amount of vacation employee should have accrued since their start date, up until the last pay period.

3.  Create two hourly payroll items and include in employee's payroll info.  a) Hourly Wages and b) Vacation Hourly (these might be a native item to QB and already set up).  Make sure they are active and connected to the correct G/L Accounts.

3.  In a current pay cheque for the same employee, calculate their payroll as usual.

4.  Add a line to pay cheque under Earning, using Hourly Wage payroll item, deducting the number of hours (-) of vacation the employee has taken to date.

5.  Add another line to pay cheque using Vacation Hourly payroll item, add (+) the number of hours of vacation the employee has taken to date.

*You may need to adjust the hourly rates or hours on these lines slightly to get to the correct $ amount, especially if employee has had some pay raises along the way, and has taken vacation at more than one different salary rates.  The idea is to reduce the amount of regular salary by the same amount as vacation taken and increase the vacation item by the same amount.

6.  The two extra lines create an in and an out, with net difference of $0.00.  All that has occurred is that you now will have the correct amount in your wage expense account for that employee, as well as the correct net liability for the employee in your vacation liability account.

7.  Check the amount of Vacation Avail ($) on your current pay cheque.  It should be what you know the net vacation liability is.  If not, go to the employee's payroll info on the Vacation tab and change the amount of vacation available as of the date stated there, adjusting for the amount the employee will be accruing on this current cheque.  The amount you enter there plus the current period's accrual, should be the total net vacation liability for this employee.  This only affects what appears on the cheque and does not impact the G/L accounts at all.  Your adjustments should have corrected the G/L accounts.

I have attached an example, using John Doe who earns $60,000/yr, who started on Jan 1/18 and whose adjustments will take place in Feb /19, with current pay period being Feb 28/19.  It also assumes that John Doe took 6 days (or 48 hrs) of vacation during that time period.