CAR Newsletter - August 2017

Newsletter Archive | Statewide Accounting Manual | Forms | State Comptroller


Employee Name and Social Security Number Entries in HCM

When entering a new employee’s name and social security number (SSN) or updating a current employee’s name, please verify the name and social security number entered is exactly as it appears on the employee’s social security card. This is critical for reporting not only the W-2 wages at year end but the Affordable Care Act (ACA) required health offer/coverage information. If the name and SSN does not match the Social Security Administration (SSA) records, the employee’s wages may not be credited to their social security account. Additionally, if the name and SSN do not match, the employee may not be reported correctly for ACA purposes which could result in an IRS letter to the employee for possible lack of health coverage or an IRS letter to the agency for not offering coverage.

Beginning Sept. 8, 2007, the Social Security Administration updated the social security card.  The number holder’s name will always be printed on two lines, with the last name printed directly below the first and middle names. If you receive a prior version from an employee and are unsure, please ask the employee to verify the first, middle, and last names.

First, middle, and last names can only contain letters, spaces, hyphens, periods, and apostrophes. Other characters will cause a mismatch with the SSA and IRS. For suffixes, only letters or spaces are allowed. Please be sure to enter the suffix in the correct field, it is not considered part of the last name entry. Titles are not considered part of the employee’s name and are not to be included. Enter only the name as it is shown on the social security card.

Additionally, compound names do not need to be hyphenated. If an employee provides a name with an apparent compound or multiple last names, ask the employee which name is the beginning of the last name and which (if any) is the middle name.

Please update the employee’s name in the HCM system as instructed in the COR301 Part II manual beginning on page 42 (Navigation:  Workforce Administration > Personal Information > Modify a Person).  You can enter the name that the employee currently uses as their paycheck name if desired so their paycheck will continue to have the same name as in the past but their employee record and W-2 information will match their social security card.

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OMES Form PWC, Payroll Warrant Cancellation

The OMES Form PWC should only be used when an employee is not entitled, in part or whole, to the funds.  All PWC forms received by OMES will initiate the process to retrieve the funds, if direct deposit, and cancel the warrant in the payroll system. It is imperative that agencies identify payroll errors and process the Form PWC immediately upon discovery.

Paper Warrant Cancellations:
The original warrant must be marked “Void”, attached to the completed PWC form, and sent to OMES Transaction Processing. These requests cannot be processed by fax.

Direct Deposit Cancellations:
Fax OMES Form PWC (revised 4/2017) to 405-522-2186.  Verify the fax was successful.  Requests for cancellation of direct deposits must be made by completing the PWC form and faxing it to OMES to initiate the cancellation procedures. To ensure that direct deposit funds are returned, the PWC request must be received by 12:00 p.m. (noon) three business days prior to the effective pay date.

Any faxed request for cancellation of direct deposits after that cutoff will be subject to recall or reversal procedures which are subject to denial by the employee’s bank. An employee must be notified in writing of a reversing entry and the reason for the reversing entry no later than the effective date of the reversing entry.  Please notify the employee no later than the day the OMES Form PWC is submitted for processing. 

The statement below can be modified by your agency and used to inform your employee(s) of the pending reversal. 

“A payroll item will be posted in error to your bank account on MM/DD/YY.  A reversal has been issued and will post to your account to pull these funds back to the state.  Please keep the full amount of this deposit in your account. If the state cannot retrieve the full amount of the deposit, action will be taken in accordance with applicable procedures to retrieve the funds from you.”

Once the funds have been returned to the state, OMES will process a cancellation in the payroll system which returns the funds to the agency. If the funds cannot be recovered from the bank, the agency is responsible for recovering the funds from the employee. Please refer to O.S. 74 Chapter 27A, Section 840-2.19 D for proper procedures for recovering overpayments if needed. The agency should submit the OSF Form 94P for processing if the employee reimburses the funds through a miscellaneous payroll deduction or cash.

PWC forms received for direct deposit items that are more than five business days past the effective date will not be processed in accordance with NACHA rules. If agencies encounter erroneous entries more than five business days past the effective date, please contact OMES or OST for consultation on options for recovering the funds.

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Searching for Individuals using the Statewide Employee View

The Statewide Employee View functionality can be used to find any person in PeopleSoft HCM.  When trying to determine if an individual already exists in the system, please search by “National ID” (social security number).

Searching with criteria other than National ID can cause an agency to identify a person that isn’t truly the one they want. Please review the search results carefully to ensure the individual found is who you need. The navigation is:  Home > Workforce Administration > Personal Information > Statewide Employee View (0491).

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Taxability of Gift Cards, Certificates, and Coupons

Giving gifts to employees is restricted and should only be given as part of a formal employee recognition program. See 74 O.S. § 4121 and 4122. Furthermore, any gift cards, certificates or coupons given to employees are to be included in the employee’s taxable income. These items are considered by the Internal Revenue Service to be cash or a cash equivalent and do not meet the requirements to be excludable as a de minimis fringe benefit. 

Even when an employer provides gift cards, certificates or coupons to purchase a turkey, ham or other nominal value property, these are considered wages and are subject to income and employment taxes. This is true even when the card restricts the items purchased, the time to use the coupon, and any unused portion is forfeited. Cash equivalents do not meet the de minimis fringe benefit requirements. 

In the HCM system, process the gift card amount using the TRC Code of “GIFT,” which will show as earnings code “GFT.” The amount will be included as taxable income and will be taxed on the paycheck.

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Payroll Processed Before a Reversal is Completed

Agencies are responsible for going to the timesheet and removing the time that is processing through payroll when a replacement check is processed before a reversal is completed. 

When a payroll check that had time pulled in from Time and Labor is reversed, the reversal creates offset payable time with status “Reversed” and an additional row in payable time with “Estimated” status when the check reversal is confirmed. The “Estimated” payable time will be pulled into payroll again when payroll is processed if not removed which may cause an overpayment. 

A replacement check should not be issued until the reversal has been processed. This allows wage balances to be updated and reversed time to either be processed through payroll again, or if needed, time can be corrected and then processed again. If time entered was invalid or incorrect and should not be pulled into payroll again, it should be corrected on the timesheet and processed through Time Administration.

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Deposit Restrictions on Class Funding 78900

Deposits should never be made into the 789 class funding.  The use of this fund is restricted and should not be used for any purpose other than that for which it was created.  The only transactions allowed in the 789 class funding are Payroll Fund Transfers and the payments to applicable individuals/entities from money in the 789 class funding.  OMES DCAR is checking these funds periodically and agencies will be notified to create a deposit correction for any amounts deposited there.

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Reconciliations for 78900 Class Funding

Class funding 78900 was set up during the payroll transition in late 2015.  Specialized accounts were set up to allow for ease of balancing and tracking.  Due to the restricted uses and the structure of the 789 class funding, reconciliations on it should be relatively simple and clean.  Detail instructions on how to reconcile the fund were provided during the transition.  The link to the reconciliation tips is provided below.  Agencies which have not reconciled this fund should do so as soon as possible.  If payments from the 789 fund have been processed with incorrect account codes, corrections should be made using a journal voucher.  If payments that should have been paid from the 789 fund were processed from a different class funding, a journal voucher must be processed to keep the 789 fund reconciled.  Agencies should have processes in place to ensure that the correct account is used and that the fund is reconciled monthly.  Any balance remaining in the fund should be identifiable to a specific vendor.

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GAAP Package Deadlines

Upcoming GAAP Package deadlines:

August 10th

K – Insurance Claims Liability
Y – Infrastructure Assets

September 7th

C – Accounts Receivable and Deferred Revenue
D – Federal Grants/Entitlement Receivables and Deferred Revenue
E – Taxes Receivable
F – Due from Other Funds
I – Accounts Payable and Encumbrances
M – Lessor
R – Interagency Payments
X – Miscellaneous
Z – Schedule of Expenditures of Federal Awards

October 5th

N – Litigation
Q – Medicaid

Please consult the GAAP conversion letters sent to your agency in June to verify that all necessary conversion packages are completed. If there are any questions, contact your agency’s Financial Reporting Analyst.

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Tax Abatements (GASB 77)

For fiscal year 2017, the State of Oklahoma must implement GASB statement 77 Tax Abatement Disclosures in the Comprehensive Annual Financial Report (CAFR). In order to be in compliance with the new requirements, the Financial Reporting Unit (FRU) has been gathering information about programs that meet the definition of tax abatement.

In order to qualify as tax abatement, three criteria must be met:

  1. An agreement must be in place between the government and a tax paying entity in advance
  2. A specific action must be taken on the part of the tax payer
  3. Revenue must be reduced as a result

Any incentive that meets these criteria will have information that must be considered for disclosure in the CAFR.

The FRU has already approached agencies that are believed to administer programs that could be considered tax abatements. However, if you are aware of an incentive program that may meet the definition of a tax abatement that may not have been detected by the FRU, please contact Matt Clarkson at 405-521-2759.

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Common Mistakes in Fair Value Measurement Disclosures

GASB Statement 72, Fair Value Measurement and Application, which added disclosure requirements for deposits and investments, was implemented during fiscal year 2016. It was noted during the CAFR audit that many agencies that prepared GAAP statements failed to include some required information.

As fiscal year 2017 statements are being prepared, consider that all investments (including derivatives) must include the valuation approach and level of fair value hierarchy used.

There are three approaches that can be used for valuation:

  • Market – uses prices and other relevant information generated by market transactions involving identical or similar assets, liabilities, or groups of assets and liabilities. An example would be quoted market prices for stocks.
  • Cost – reflects the amount that would be required currently to replace the present service capacity of the asset.
  • Income – converts future amounts (such as cash flow) to a single current amount. An example would be valuing the investment at present value.

The fair value hierarchy defines inputs by the following categories:

  • Level 1 – Unadjusted quoted prices in active markets for identical assets.
  • Level 2 – Quoted prices for similar assets, or inputs that observable, or other forms of market corroborated inputs.
  • Level 3 – Pricing based on best available information, including primarily unobservable inputs and assumptions market participants would use in pricing the asset.
  • Net Asset Value (NAV)– If a nongovernmental entity does not have a readily determinable fair value, NAV can be determined in a manner consistent with the Financial Accounting Standards Board’s measurement principles.

Information on how the valuation was determined should be provided by the broker of the deposit or investment, and should be disclosed as part of the footnote for deposits and investments. If it is not included in the financial audited financial statements, this information should be sent to the OMES Financial Reporting Unit in a supplemental report by the October 31st deadline.

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Cash Controls on 7xx funds

Work is in progress to activate cash controls on 700 funds.  The Budget and Cash Balance Report (ABC Report) is being modified to include all 700 funds.  Agencies need to be reviewing these funds to be sure that they are not showing a negative balance.   It is anticipated that the cash controls will be put on the funds the weekend of September 2nd, and funds that have a negative balance will not be able to process vouchers against the fund until the balance becomes positive.

Class 789 Reconciliation Tips can be found here.

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Properly Completing the OMES Form 20R


When submitting an OMES Form 20R–Warrant Replacement Request, be sure to include a contact name and phone number (space located at the bottom of the form below Approving Officer signature). The contact information is for any questions concerning the request and when sending out the replacement warrant.

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Travel Period for 24-Hour Rule - Update

O.S. 74 § 500.9, Subsection E., reads: Reimbursement for meals and lodging on out-of-state trips shall not begin more than twenty-four (24) hours before the meeting, workshop, conference or other objective of trip begins and shall not continue more than twenty-four (24) hours after said meeting, workshop, conference or other objective of trip ends.  This twenty-four-hour limit shall also apply for in-state travel when the agency determines that travel is of duration where overnight travel prior to or after the trip objective would be necessary.

Agencies are not consistently applying this 24-hour rule.  Often travel claims for per-diem have started two or more days prior to the event.  These claims will be denied unless there is a documented business purpose for arriving early at the location.  For example, special business-related meetings prior to a conference.  Activities that are provided primarily for the entertainment of participants, such as sightseeing tours, athletic events, etc. are not appropriate for claiming per-diem.  Proper documentation of the business purpose for any time claimed outside the 24-hour rule is required.

There may be other appropriate situations such as limitations on flight times requiring an earlier flight. This is an appropriate exception only in cases where flight choices are severely limited, and is not appropriate if based on employee preference. Documentation of the situation must be included with the voucher.  We have seen many vouchers where the traveler left earlier than 24 hours prior to the event quoting limited flight availability, but upon audit, we find other flights available.  In these instances, the 24-hour rule will be enforced.  

Appropriate documentation:  Conference or meeting agenda or other documentation showing the starting and ending time of the conference or meeting along with written justification of any time outside of the 24-hour rule.  

In order to confirm compliance with the 24-hour rule, OMES has the following procedure in the Office of Management and Enterprise Services: Statewide Accounting Manual.

50.30.03 Travel Reimbursement Guidelines

A. General Provisions

3. Commencement/Termination of Travel Periods for Reimbursement of Meals and Lodging

(a) Standard 24-Hour Travel Rule. Reimbursement for meals and lodging expenses shall not extend more than 24 hours before and/or more than 24 hours after the date/time the object of travel (e.g., meeting, workshop, conference, etc.) begins and/or ends.

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State Paycard Conversion

The state will transition to a new payroll card service during the next few months. The existing contract with KeyBank expires September 30, 2017; and as a result, KeyBank will not be accepting direct deposit payments to state employee paycard accounts after 9/30.  Conduent (formerly Xerox) was awarded the new paycard services contract.  Conduent is also the state’s debit card services provider for income tax refunds and unemployment insurance benefits. Paycard participants will receive information regarding their new cards towards the end of August and will receive Mastercard branded cards for all payroll deposits effective on or after 10/1.

By mid-August, agency paycard contacts will receive correspondence from the Office of the State Treasurer (OST) regarding next steps in the conversion process. If you don’t receive information from OST and believe that you have active employees on the paycard program or if there are any questions regarding the details, please contact Kiranmaye Nallayahgari at 405-522-6860 or

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Same-Day ACH Payments

On September 15, 2017, an amendment to the NACHA Operating Rules will become effective enabling same-day ACH debits. This amendment will expand the options available to financial institutions to originate certain same-day ACH debits and credits and mandate all receiving financial institutions to receive same-day ACH transactions. ACH credit and now debit transactions, except for international transactions (IATs) and transactions above $25,000, will be eligible for same-day processing.

Initially same-day ACH payments will be significantly more expensive to process than future dated entries to allow financial institutions to recover their costs for enabling and supporting this function. The Office of the State Treasurer (OST) will only originate same-day ACH transactions on an emergency basis. Agencies should NOT begin sending same-day effective dates in their files, the entries will continue to be processed on the next valid, future effective date. If your agency anticipates a need for same day ACH transactions please contact the Director of Banking and Treasury Services at OST, Kiranmaye Nallayahgari 405-522-6860.

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Volume 28, Number 2
Fiscal Year-2018
August 11, 2017

In This Issue ...


OKC American Payroll Association Monthly Lunch & Learn Chapter Meetings

OKC American Payroll Association
Monthly Lunch & Learn Chapter Meetings

Fringe Benefits
Thursday August 17, 2017
11:30 a.m. - 1 p.m.

For more information, please visit their website.

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Payroll Law 2017

Presented by Fred Pryor Seminars

August 11, 2017 – Oklahoma City
December 4, 2017 - Tulsa
December 5, 2017 – Oklahoma City

For more information, please visit their website.

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2017 Oklahoma Payroll Conference

Presented by the Oklahoma City and Northeastern Oklahoma Chapters of the American Payroll Association 

Friday, September 15, 2017

Northeastern State University
3100 New Orleans Street
Broken Arrow, OK 74014

For more information please visit their website.

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OKFMA Quarterly Meeting

Mark your calendars for the next Oklahoma Financial Managers Association quarterly meeting on Thursday, September 21, 2017.   In an effort to cut down costs and continue providing these seminars free of charge we are asking all participants to print their own copies of available documents from the website.  To ensure that an adequate number of refreshments are available, please register at:

Date:   September 21, 2017
Time:   1:30 - 4 p.m.
Place:   Business Conf. Center Auditorium
MetroTech Springlake Campus
1900 Springlake Drive
Oklahoma City, OK

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The Complete Guide to Payroll Taxes and 1099 Issues

Presented by the Oklahoma Society of Certified Public Accountants (OSCPA)

Friday, September 29, 2017 – Oklahoma City

For more information, please visit: OSCPA website

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APA Preparing for Year End and 2018

Presented by American Payroll Association

Friday, October 27, 2017 - Tulsa

For more information, please visit:  APA website

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State Comptroller:
Lynne Bajema, CPA

Deputy State Comptroller:
Steve Funck, CPA, CGFM

OMES Services CAR Accounting:
Jennie Pratt, CPA, CGFM

Agency Business Services:
Steven Hawkins, CGFM 

Financial Reporting Unit:
Matt Clarkson, CPA

Transaction Processing Manager:
Steve Wilson

Statewide Accounts Payable:
Courtney Cowart

Replacement Warrants:

Voucher Processing:

Payroll Transaction Processing:
Elsa Kunnel

Payroll Reporting:
Lisa Raihl, CPA

Purchase Cards and Travel (Online Booking) Assistance:
Linda Powell

Vendor Registration:
Victoria Baker

Vendor File Maintenance:

Vendor Remittance Updates:
Updates to remittance contact for vendor payment notification.

OMES Service Desk:
405-521-2444 or toll-free 866-521-2444