Adjust a Payroll Liability

You can create an adjustment to the amount you pay a vendor when the amount that should be paid is different from the amount deducted from paychecks, or when credits or extra charges appear on invoices from an insurance company.

• System deductions, such as FICA, state and federal Withholding, cannot be adjusted.

• Liabilities can only be adjusted on new payroll vouchers. If you need to adjust a liability on an approved voucher, you'll have to void the voucher and create a new one.

• Only excluded liabilities can be adjusted.

• You can adjust amounts for both expenditure and liability accounts.

You can use the Payroll Register Deduction Detail Report to help determine the proper account code allocations for the adjustment. The report provides the list of expenditures, employees, employee and employer deduction amounts, subtotals by account, and totals for the payroll register from which the deductions were generated.
You can also check job account details in Human Resources or use the information in Manage Deductions to obtain the correct employee- and employer-side accounts.

Create an adjustment to a liability

1. Select Payroll Voucher Management from the Payroll menu. The Payroll Voucher Management window opens, listing all the vouchers for the selected accounting cycle.

2. Select the New voucher on which you want to adjust a liability, and click the Edit button at the bottom of the window. The Voucher Detail window opens.

3. Select an excluded liability that you want to adjust, and click the Add Adjustment button at the bottom of the window. The Adjustments window opens.
   Note: If the liability you need to adjust has been included on the voucher, you'll first need to exclude it. See Exclude Liabilities from a Payroll Voucher.

4. Complete the fields as described below.

   • Adjustment Amount: Enter the amount by which the liability should be changed, not the new liability amount. In other words, if the liability should be reduced by $20, enter -20.00.

   • Description: Text entered here is displayed in the Voucher Detail window.

   • Expenditure Account Code(s): Enter the expenditure account(s) to which this adjustment will be debited (if positive) or credited (if negative). See Account Code Assistant for instructions on completing the fields.

   • Liability Account Code(s): Enter the liability account(s) to which this adjustment will be credited (if positive) or debited (if negative). See Account Code Assistant for instructions on completing the fields.
     Note: The expenditure accounts and liability accounts do not need to balance by fund. If there is a discrepancy, Due To/Due From transaction lines will be created automatically for all transactions created by the adjustment.

5. When finished entering account codes, click Save. You're returned to the Transaction Detail window.

6. Select the adjustment for inclusion on the voucher, and click Include.

Return to Payroll Liabilities Overview