News From GMS a publication for GMS clients

Volume 28, No. 9 September 2016

In this Issue

Cost Allocation Article Series

GMS Leave Pool Tax Time Page 2

RLSS and Handling Bankruptcies

Farewell to Deann

Retirements Page 3

Welcome Lisa Basic Payroll Procedures

Webinar Shenendoah Area

Agency on Aging- Job Opening

Page 4 GMS Summit 2017

GMS, Inc. 10559 Metropolitan Avenue

Kensington, MD 20895

Phone: 800-933-3501

Fax: 301-933-3502

E-mail: service@gmsactg.com

Cost Allocation Articles Series Over the next several months we will be presenting articles on cost allocation and how the various pools work within the GMS software. The first three months will contain articles on the Leave, Fringe and Indirect Cost Pools (all part of the basic accounting software package), followed by articles on our various cost allo-cation supplements, their features and benefits. Note: these articles may be very helpful in assisting you in answering questions asked by your auditor or a funding source monitor so you may wish to print and retain them for later reference. Following is the first article of the series on the Leave Pool.

GMS Leave Pool Part of the basic GMS Accounting and Financial Management System is the Leave Pool. The leave pool is a method of allocating your organization’s leave costs to the appropriate programs. The logic behind using the leave pool is basic accountability. For example, you may have an employee that works on three programs over the course of a year at a ratio of 60%, 30% and 10%. When that employee takes a day of leave (any type), even with the employee’s work history, you cannot really justify direct charging that leave time to those three programs. This is because while on leave, the employee is not benefitting those programs as they are not working on them. Accordingly, why would the leave time be direct charged to the programs? The leave pool will accumulate the organization’s leave cost by class of employee and allocate them by class, using the ratio of YTD leave costs to the selected base. For example, let’s say three months into your fiscal year the total leave costs for your class 1 staff is $22,900. Also at that time your total base (direct charged salaries) is $146,850. A simple ratio of your class 1 leave costs to your class 1 base is $22,900/$146,850 or .1559. This percentage would then be applied to all of the direct charged class 1 salaries, under the pro-gram elements where the salaries were charged. So if a program element has $10,100 of direct charged class 1 salaries, the class 1 leave costs allocated to that element would be $1,574.59 ($10,100 * .1559). The system will then do the same process for class 2 salaries, class 3 salaries, etc. until all employee classes have been accounted for. The first step in General Ledger\Monthly Processing\Cost Allocation is Leave Cost Allocation which generates the Leave Rate Computation and Analysis. This report provides you with the cal-culation and leave rates as described above. There are two items set up in the software that will have an effect on the leave rate(s) and how they are calcu-lated. They are (1) whether or not you accrue the cost of certain leave types when they are earned, and (2) how your base is defined. 1) If you expense all leave when it is taken, the leave cost to your organization will simply be those leave

costs recorded on the timesheets. If your personnel policies allow for unused leave to be paid out upon termination, typically Annual Leave or Paid Time Off, that leave liability is normally charged when earned. In this case, in addition to the leave taken charges, the system will take into account the increase or decrease in the amount of the liability of the specific leave type(s) you are expensing when earned.

2) When defining the Leave Base in the software, in addition to regular time you may also include Overtime and/or Compensatory time earned in that base period.

Of course, when setting up the allocation items you must make sure you are doing so in accordance with your organization’s policies and procedures. Watch for the October, 2016, GMS Newsletter for the next article in the Cost Allocation Series – the Fringe Benefit Pool!

Tax Time – Attention Payroll Department!

On Friday, September 2nd you will receive an email from us on how to order forms or services from GMS for your year end tax processing including W2, 1094C, 1095C, 1099 and 1098 forms. Make sure you read that email for the ordering deadline and an explanation of all that is available to you as a GMS client!

The GMS offices will be closed Monday,

September 5, 2016 in honor of Labor Day. We will reopen with

normal business hours Tuesday, September 6.

Page 2 NEWS FROM GMS A PUBLICATION FOR GMS CLIENTS VOLUME 28 NO. 9

Present versions of Software are:

Accounting 1.2.305 RLSS 1.0.0.12

Retirements We have learned the following clients have retired within the past few months. Louise Lindberg Controller at CAC of Santa Barba-ra County in Goleta, CA Maralyn Jones Bookkeeper at Kennebec Valley COG in Fairfield, ME Faye Moring Fiscal Director at Southeast AL RPDC in Dothan, AL Debbie Katterhenry Fiscal Manager at Lincoln Hills Development Corp. in Tell City, IN May you ladies enjoy your retire-ment. We’ll miss chatting with you and seeing you at our annual Summits.

“For every minute you are angry you lose sixty

seconds of happiness.” ~Ralph Waldo Emerson

RLSS and Handling Bankruptcies

When dealing with high-risk loans, sooner or later your agency will likely be faced with a borrower who has filed for bankruptcy. In general, when a borrower files for bankruptcy, and your agency receives legal notification of that filing, the account is “frozen” until the outcome is determined. The following recom-mendations are based on routine lending procedures, but we recommend you defer to your own attorney or auditor for the best advice. There are several steps to be taken in GMS-RLSS software to

accommodate the bankruptcy. 1) Review the Loan Master file for interest calculation. If the

loan is set as Daily interest, it will not need to be edited. If it is set as Amortized, you will want to edit it to Daily interest, at least until further information regarding the bankruptcy is received.

continued on page 4

Farewell to

Deann

We are sad to announce that Implementation and Training Manager Deann Hasbrouck has resigned from GMS effective August 19, 2016.

GMS was very fortunate to have Deann as part of our family for 28 years and she will truly be missed by staff as well as clients. Her

professionalism and work ethic were second to none. We want to thank her for so many years of dedication to our company and wish her the best in all of her future endeavors.

Page 3 NEWS FROM GMS A PUBLICATION FOR GMS CLIENTS VOLUME 28 NO. 9

We would like to welcome Lisa Kraeger to the GMS team as our new Implementation and Train-ing Manager. Lisa brings 17 years of experience from the Non for Profit Sector. She has been Fi-nance Director for two GMS’ clients: Lewis County Opportunities, Inc., and Mohawk Valley Communi-ty Action Agency. Lisa and her husband Mike, along with their 10 year old son Eric, have a dairy and maple farm in northern New York. GMS President/CEO Donald Cassady has been training Lisa in her new job responsibilities. He worked with her in mid-August in the St. Louis, MO area, training her in the how-to’s of setting up a new accounting software client. Donald com-mented that he is benefiting from the new per-spective she brings to the company. We look forward to working with Lisa in the con-tinued growth of GMS.

This webinar is designed for GMS users that are new to the Payroll Process or would like a refresher course of the basics. We will cover topics ranging from the initial setup of employee files to calendar year end activities such as W2 processing. You will be guided through the mechanics of the process and learn about the importance of internal control, proper reviewing of preliminary reports and timely backups. Tips and/or suggestions will be provided to help assure your employees get paid on time!

Deduction Setup

Employee File Setup and Maintenance

Timesheet Data Entry

Payroll Adjustments

Backup Procedures

Leave Processing

Payroll Processing

Quarterly Processing

End of Year Processing and W2s

Questions and Answers

Shenandoah Area Agency on Aging Accounting Position Opening

Seeking an experienced, detail-oriented professional to perform a wide range of

accounting duties under the direction and supervision of the Director of Finance. Thorough understanding of Generally Accepted Accounting Principles (GAAP). Associate degree in Business

or Accounting preferred. Minimum 5 years experience in accounting field is required.

Experience with GMS accounting software and GHG timesheet a plus. Proven capability to learn

new accounting software a must. Full-time position. Competitive wages, paid time off, medi-cal/dental insurance and 401K. Applications can be obtained at 207 Mosby Lane, Front Royal or

online at www.shenandoahaaa.com. Resumes/applications can be emailed:

m.lebrecht@shenandoahaaa.com, or delivered/mailed Attn: HR, 207 Mosby Lane, Front Royal,

VA 22630. EOE.

Page 4 NEWS FROM GMS A PUBLICATION FOR GMS CLIENTS VOLUME 28 NO. 9

RLSS and Handling Bankruptcies Continued from page 2 2) Using menu option Loan Activity, enter a zero repayment. Use the date the bankruptcy was filed as

the activity date, enter zero under activity total, and enter the previous paid-thru and next payment due dates as the new paid-thru and next pay due dates for this activity. This posting will result in the loan history “accruing” any interest due through the date of the bankruptcy, and the screen should reflect a positive number in the “accrued interest” field. You may want to use the notes section of the screen to document the bankruptcy filing.

3) Return to the Loan Master file and change the interest percentage to zero (0.0%) so the loan will not accrue interest until further information is received regarding the bankruptcy.

The court may request a document as proof of claim toward the bankruptcy. Utilizing Loan Payoff, found on your Features menu, a document may be printed that reflects the principal balance and interest that has accrued through the date entered in step #2 above. Once the bankruptcy is settled, you should receive a statement informing you of the amount awarded your claim by the court, along with an interest rate, if any, that may now be applied to the loan. If the new interest rate is zero, no activity needs to be recorded. If a revised rate is now in effect, repeat step #2 above, using the date interest is reinstated as the activity date, and then edit the Loan Master File to reflect the new interest rate. When payments resume, be prepared to see part of the payment applied to accrued interest. This will be reflected as a negative number within the “accrued interest” field on the activity screen. If the loan was set to Amortization prior to the bankruptcy, once the above steps are taken the Loan Master file may be changed from Daily interest back to Amortized.