tracking accrued vacation

What a *glorious* day in Vancouver, BC!!  I must admit I’ve spent most of this morning thinking and planning my upcoming vacation this summer and I imagine most of you already have a general idea of when you are taking your vacation and where you’d like to go.  However,

have you told your manager/controller when you plan to take vacation?

Tracking vacation earned and taken, “the vacation accrual”, is a part of the finance month end close process.  Why?  Because vacation days that are owed to you are a liability of the company until you take the days and therefore it must be included as such on the balance sheet.

So, who let’s the finance folks know you are on vacation?

Typically at a very small company you can tell who is on holiday by looking around the office.  As you get bigger, the Controller hopes management advises finance of days taken but most likely the Controller ends up sending out a reminder email to management every month to let them know.  When you get even bigger a calendar is usually set up or some time tracking system that finance can just go in and query instead of pestering management.

Great!  I’ve done my part in letting finance know!

Well, for the finance group that is only part of the equation.  You see, each month they accrue so many hours for you to be eligible for vacation.  Then when you take them they reverse the number of days you have taken.  At any given time the Finance team should be able to tell you how many days you have available.  If you have less than five employees this is very simple.  However, when you get more it becomes complicated to track and have in a presentable form for both your net accrual journal entry but also for the individual.

Hmmm, good point.  Do you have something we can use to track vacation?

Fortunately, Business Ready has come up with a template to help you track your Vacation Accrual.   This template sets up individual reports for vacation taken and earned (in case one of the employees asks) while also consolidating the information for your monthly net journal entry for accrued vacation.  Yeah!

Now, where are you going for your holiday this year?  Hah!