Accounts and Reports

GAAP POLICY AND PROCEDURE MANUAL

• The State records vacation leave as expenditure when paid. Classified State employees accrue vacation leave based on the number of years employed up to a maximum rate of 6.5 hours per pay period, and may accumulate a maximum of 240 hours. Upon retirement or termination, employees are paid for accrued vacation leave up to their maximum accumulation. The estimated unrecorded liability for vacation leave payable at June 30, 1999, was $81.5 million. ($81.6 million per the June 30, 1998 report).
• State employees earn sick leave at the rate of 3.7 hours per pay period. Employees who terminate are not paid for unused sick leave. Employees who retire are paid a portion of their unused sick leave based on years of service and hours accumulated. Unrecorded sick leave payable at June 30, 1999 was estimated to be $31.3 million. ($27.9 million per the June 30, 1998 report).

• Vacation and sick leave is expended as paid. K.S.A. 75-5542 authorized the State Leave Payment Reserve Fund (7730) to provide for the payment of accumulated sick and vacation leave upon retirement from state service and for the payment of accumulated hours of sick leave upon being laid off from state service. Each agency is assessed annually to provide moneys into this fund.

• Document methods used to estimate the liability for vacation and sick time.
• Spread the accrual by functional expense categories.
• Determine current portion of liability.
• Determine the beginning and ending balance and the changes for the year.
• Full accrual adjustments needed.
  • For the initial year:
    Dr. GLA 3007 Fund balance
        Cr. GLA 2022 Comp. Absences Short Term Pay  
        Cr. GLA 8888 Comp. Absences Long Term Pay.
    To record compensated absences payable at the beginning of the year.
  • For subsequent years
    Dr. GLA 5001 Salaries expense using ESO 1001
        Cr. GLA 2022 Comp. Absences Short Term Pay
        Cr. GLA 8888 Comp. Absences Long Term Pay
    To record compensated absences payable for the year.

• Policies.
• Beginning and end of year balances.
• Increases and decreases for the year.
• The portion that is due within one year of the statement date.
• Indicate which governmental funds typically have been used to liquidate compensated absences.

• Since only a portion of sick leave is paid, the estimated liability for sick leave is calculated using the termination method as described in GASB Cod. C60.901 (GASB Statement 16) by compiling sick leave paid from the KPAY313 report for Sharp data and similar reports prepared by the universities for the data not in Sharp. This information is combined with information received in the prior four years to estimate the sick leave liability. The estimate is then multiplied by 115.13% to arrive at the estimated amount gross pay plus benefits.
• The estimated annual leave liability is calculated by compiling the outstanding balances for current employees from the KPAY313 report for Sharp data and similar reports prepared by the universities for the data not in Sharp. This estimate is then multiplied by 115.13% to arrive at the estimated amount gross pay plus benefits.
• Total compensated absences will be allocated based on the fund number. We modified our procedures to additionally receive the Sharp information electronically with Sharp KPAY344. This report was created to receive by fund the information from the KPAY313. We will allocate to all Sharp funds, except fund 7730, the vacation leave based on the "others-current and terminations" percentage for short term and long term as determined in the excel file. The "others" percentage is determined by how much annual leave was paid in the last year for retirees versus other employees. The new Sharp report will be compiled using SAS program COMABPAY to create the automated adjustments that will be imported into Access. This report is received from the Payroll Section, Division of Accounts & Reports. It was received electronically starting with FY01 and via paper for FY00. Manual adjustments will be made for the regents vacation leave and the retiree vacation leave. Sick leave will be manually adjusted to fund 7730 because that is the only fund that would pay sick leave. The estimated annual leave liability for retirees will be manually adjusted to fund 7730 as well.
• The short term portion of both the sick leave and annual leave liability will be estimated based on leave actually paid for the year obtained from the necessary KPAY244 reports provided by Payroll Section, Division of Accounts and Reports.

• Most state agencies.

• The information gathered statewide will also be used to estimate by agency the annual leave and sick leave liabilities for agencies that produce their own Comprehensive Annual Financial Report (CAFR).