Year-end Processing Tips Volume 5 – Closing the Payroll Module

Very few companies that use the Payroll module in Sage ERP MAS 90 and 200 are ready to print their W2 forms before they process the first payroll of the new year. Unfortunately, you cannot post a payroll with a check date in a future period (quarter) until the current quarter is closed. For this reason, we ALWAYS recommend that our clients create an Archived Payroll Company (see our post: Year End Processing Tips Volume 1 for instructions to copy data to a new company code) prior to closing the year in Payroll. Using an Archive company allows the user to print their W2 forms and any other required government forms (Quarterly Government Report, Quarterly 941 Form, etc.) at their leisure (but before the required due dates). So, our first tip is: BACKUP.

Before performing Year-end Processing in the Payroll module, be certain that:

  • All payroll cycles have been entered and updated for the quarter.
  • All checks written during the quarter have been entered and updated.
  • The Payroll Module date is set to the last day of the calendar year.
  • You have a backup of the Payroll files – preferably in the form of an Archived company. Double-check to be sure that you have a valid backup!!!

If you opt not to retain an Archive company code, also make sure that you print your government forms prior to closing the year, and, if using Electronic Reporting, that you have processed and created your electronic files.

Print, review and retain the following Payroll module reports prior to closing the year:

  • Quarterly Tax Report
  • Payroll Check History
  • Quarterly Pay Period Recap
  • Earnings Report
  • Deductions Report
  • Quarterly Governmental Report
  • Quarterly 941 Form
  • Benefit Accrual Report
  • Workers Compensation Report

Be certain to reconcile all QTD and YTD totals on all reports, and make any necessary adjustments before you close the year. We recommend that you print these reports using the Paperless Office Period-end Report function instead of printing to paper.

During Payroll Year-End Processing the following tasks are performed:

  • Resets the QTD and YTD employee fields to zero.
  • Increments the current year to the next year.
  • Changes the current quarter to 1.
  • Resets employee benefit limits according to Payroll Options Setup.
  • Resets Pension Plan, Cafeteria Plan Deduction, Allocated Tips, Fringe Benefits, Non-Qualified Plan, and Dependent Care Benefits fields to zero.
  • Sets all quarterly and yearly reports to zero.
  • Removes check history and perpetual history depending upon your system settings.
  • Purges terminated employees.
  • Purges standard deductions that have met their goals.

When performing Year-end processing in the Payroll module, be certain to select the Quarter and Year End Processing option on the Period End menu. Once you have completed year-end processing, it is time to install the Q1 tax table update for the new year. It is important that the tax table update is installed prior to running your first payroll of the new year.

 

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