ppms 101 corrections presented by lynn melton. 2 part 5 - corrections ach return & notification...
TRANSCRIPT
PPMS 101Corrections
Presented by Lynn Melton
2
Part 5 - Corrections
ACH Return & Notification of Change Report
Positive Pay ACH Reversals/Cancel an Advice Stop Payments/Check Cancellations Hand Drawn Checks PPMS Screens – PS1005, PS1006 &
PS1007
ACH Return & Notification of Change Report
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ACH Return & Notification of Change Report US Bank produces a report each
banking day that documents:Notification of Change
Transit Routing Number Account Number Coding (checking/savings)
Rejected PrenotesItems Returned
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ACH Return & Notification of Change Report Notification of Change
Lynn or Brenda will email the colleges banking contact with the Notification of Change obtained from the receiving bank of the state employee.
These changes stem from a variety of reasons why the receiving bank is requesting the change:
Information on PS0014 is incorrect Information on screen PS0014 partially correct, but
requires bank to manually post, versus automatically Employee changed account number and failed to notify
college Bank implements new system requiring new account
structure.
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ACH Return & Notification of Change Report Are these Notification of Changes
correct? About 98% of the time, yes.
Contact the employee to let them know that the next payment will be in check form.
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ACH Return & Notification of Change Report Notification of Change – Examples
To: Colleges Banking ContactRe: Bank Notification
I received notification from the bank today requesting the following change:
Employee NameChange account numberChange transit routing numberChange coding (checking/savings)
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ACH Return & Notification of Change Report Rejected Prenote
Lynn or Brenda will email the colleges banking contact with the Rejected Prenote.
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ACH Return & Notification of Change Report Rejected Prenote
These changes stem from a variety of reasons why the receiving bank is rejecting the prenote:
Bank could not find employees account based on info from screen PS0014
Employee changed or closed account number and failed to inform college
Information on PS0014 is incomplete or incorrect for ACH purposes
Transit Routing Number was taken from a Deposit Slip
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ACH Return & Notification of Change Report Rejected Prenote
Once you receive the email from Lynn or Brenda, the Payroll Payment Method field on screen PS0014 should be changed from a “D” (deposit) to a “C” (check) to create a check until the corrected information is received by the employee or bank.
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Once the corrected information (transit routing number, account number or account type) has been input into screen PS0014 and the Payroll Payment Method has been changed back to a “D” (deposit), a “Y” in the Prenote Indicator field will indicate that the next payroll processed for this employee will create a payment via a check and a test prenote.
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ACH Return & Notification of Change Report Items Returned
Lynn or Brenda will email the colleges banking contact with the Items Returned obtained from the receiving bank of the state employee.
The returned items stem from a variety of reasons why the receiving bank is rejecting the funds:
Closed or Frozen Account Account could not be located Account number is invalid Transit routing number was taken from a deposit slip
Banks have 72 hours to legally hold the funds prior to returning or posting the funds to an account.
Positive Pay
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Positive Pay Each payroll, the Bellevue office sends the
bank the employees name, SID and amount. When an employee negotiates a payroll
check, this is matched with the information on the tape. If it matches, great! Processing continues and the
check is considered negotiated and now void. If it does not match, the State Board gets notified
and a decision must be made regarding the payment or rejection of the check.
Positive Pay
Current trends Order checks from Office Depot with payroll bank
account and write checks to Safeway/Walmart. Steal check, endorse the back of check using the
employee’s name, then endorsing it again using fraudulent name.
Deposit stolen check through ATM with no endorsement.
Take very good copy of check, deposit copy….2 months later, deposit the original (valid) check.
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ACH Reversals/Cancel an Advice
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ACH Reversals/Cancel an Advice When to cancel an Advice (process
an ACH Reversal)Golden Rule: ONLY when funds have
been returned to the payroll account. (see also Items Returned)
Overpayment Contract/# of hours paid in error Leave without pay not posted NOTE: Garnishments not processed are no
longer a valid reason to request a reversal.
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ACH Reversals/Cancel an Advice When NOT to cancel an Advice
Employee closed their accountEmployee has frozen accountEmployee decides need check payment
(divorce, creditor/IRS have garnished checking account or theft)
Garnishments/child support not taken
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ACH Reversals/Cancel an Advice Deadline for requesting to cancel an Advice
One BANKING day (key word here - has nothing to do with our state work schedule), plus 2 banking hours after cut-off is the accepted deadline to start the process. For example:
Cut-off processed on Wednesday. Deadline would be Friday morning at 10:00am.
Cut-off processed on Friday with a Monday Banking Holiday.
Deadline would be Wednesday morning at 10:00am.
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ACH Reversals/Cancel an Advice If it is found that an advice must be
canceled after the 10:00am deadline has passed, call Lynn Melton at SBCTC. Lynn will determine if there is a possibility that the reverse can be processed successfully. All the steps remain the same, however, the waiting period is extended to 5 (five) days instead of 3 (three) days after payday and if given prior to the 5th day, the bank can take back on the 5th day.
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ACH Reversals/Cancel an Advice Once it has been determined that canceling
an advice is necessary, complete the following 3 steps in order:1. Complete the “US Bank ACH Services Fax
Adjustment Request” form.2. Call Lynn Melton or Brenda Philpott at (360)
704-4392 or email to [email protected] to request the Advice to be “reversed”.
3. Fax the form to US Bank at: (866) 822-0276. This is printed in the upper right corner of the form.
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Completing the “US Bank ACH Services Fax AdjustmentRequest” form
ACH Services RequestItem Adjustments
If you would like to confirm your request, please call (651) 495-7012 or (800) 944-7504, Opt. 2
Company Name: The Best Community College Company ID Number:
91-xxxxxxx
Requested by: Suzie Payroll Telephone Number:
(800) 123-4567
ACH File or Batch
Company Name – your college nameRequested by – person completing the formTelephone number – your direct telephone number, including ext.Item Adjustments – circle “Reversal”
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Individual ID number – employees SID (not SSN) Amount – the NET amount of Advice Circle Type – circle “CR” Account Number – account number shown on
screen PS0014
123-45-6789 246.17 CR/DR 45698701
Individual ID Number
Amount Circle type Account Number
Completing the “US Bank ACH Services Fax Adjustment Request” form
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R/T Number – routing transit number shown on screen PS0014
Individual Name – employees name Effective Posting Date – payday (not cut-off) Date file sent – leave blank
3250008471 Joe College
3/26/2012
RT Number Individual Name
Effective Posting Date
Date File Effective
Completing the “US Bank ACH Services Fax Adjustment Request” form
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ACH Reversals/Cancel an Advice
Call SBCTC at (360) 704-4392 or email to [email protected] to request the advice to be “reversed”.
The required information needed is:1. College Name2. Employee’s Name (Last, First, Middle I)3. Net amount of advice
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After receiving approval from Lynn or Brenda, fax the completed form to:
Fax to: (866) 822-0276 Attn: ACH ADJUSTER Date: 3/21/2012
ACH Reversals/Cancel an Advice
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ACH Reversals/Cancel an Advice
After you fax the form to US Bank, the bank will call SBCTC to verify that processing is approved. This is necessary because the colleges do not have “signing authority” on the payroll bank account and cannot approve such a transaction. This is recorded and monitored at the SBCTC for further processing.
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ACH Reversals/Cancel an Advice
Once all the steps have been completed, it is not known that the funds will, or can, be returned to the payroll account. This is only verified (not guaranteed, but verified) the next banking day after payroll occurs.
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ACH Reversals/Cancel an Advice
If the advice was for an incorrect amount or a deduction was/was not taken correctly and the employee is to receive a different net amount, a hand drawn check may be produced. However, SBCTC will not guarantee that the funds will be returned to the payroll account until the three-day waiting period has expired.
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ACH Reversals/Cancel an Advice
The three (or five) -day waiting periodUS Bank has a “Two Day Recall” clause, which
simply means that they can take the funds out of the payroll account because complications from the receiving bank have made it impossible for them to retrieve the funds from where they were initially sent.
(Note: The three-day becomes a five-day waiting period if the initial request to process the ACH Reversal passes the 10:00am deadline.)
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ACH Reversals/Cancel an Advice
Some of these complications include: The receiving bank account has a negative
balance and the funds are no longer there to retrieve the net pay sent via advice. (In other words, the employee’s account was NSF and the receiving bank will not refund the total net amount. Partial amounts are not an option, only full net payments will be negotiated.)
The employee withdrew all the funds from his/her account after the deposit and therefore there is nothing to send back to the payroll account at US Bank.
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ACH Reversals/Cancel an Advice
Some of these complications include: The account entered in the PPMS system
sent it to a closed account. In this case, the receiving bank will “reject” the $’s and send it back to the payroll account at US Bank. If a reverse is put on this transaction, it creates a “double” transaction for only one “issue” (the “reject” is the first and the “reverse” is the second). This causes bank reconciliation problems between SBCTC and US Bank and quite often delays the process of getting the dollars back into the payroll account.
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ACH Reversals/Cancel an Advice
Three days after payday, US Bank will guarantee the funds that have been returned to the payroll account. This is when the SBCTC will also guarantee funds to be distributed to the employee by a hand drawn check. It is your college policy allowing the college to incur the liability to pay the employee on payday, even though the funds are not guaranteed until the third day after payday (five days if the process started after the 10:00am deadline).
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ACH Reversals/Cancel an Advice If the funds come back to the payroll
account, Lynn or Brenda will email the College’s Banking Contact the name of the employee and the amount deposited into the payroll account.
If the funds do not come back, there will be no email.
In other words….no news is bad news .
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ACH Reversals/Cancel an Advice Once notified that the funds were deposited
into the payroll account, a cancellation of the advice is input into PPMS, a hand drawn check can be produced and input into PPMS and finally given to the employee.
If the funds did not return to the payroll account, a cancellation of the advice does not make the funds come back. In fact, that simply wins you a call from Lynn asking you to reverse the cancel.
Stop Payments/Check CancellationsThe dog ate my check….I shredded my check….my check was stolen….…and other perils of processing checks
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Stop Payments/Check Cancellations
There is no such thing as a stale dated check (a check that is over 90 days old). US Bank has negotiated checks that are 13 years old.
*Yes, these get rejected because they have already been dealt with.
- Canceled and Reissued- DOR, Unclaimed Wages
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Stop Payments/Check Cancellations
Check demolition The dog/bird ate my check The check was washed The check was shredded
Lost/Stolen/Theft Lost in the mail Purse/wallet stolen Car broken into
An “Affidavit of Lost or Destroyed Check” must be completed, emailed/faxed to the State Board prior to requesting a StopPayment.
When to request a Stop Payment:
**NOTE: THE ONLY TIME STOP PAYMENTS ARE PROCESSED IS IF YOU DON’T HAVE THE ORIGINAL CHECK IN YOUR POSSESSION AND YOU HAVE A COMPLETED “AFFIDAVIT OF LOST OR DESTROYED CHECK”.
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Stop Payments/Check Cancellations When NOT to request a Stop Payment
You have possession of original check“Affidavit of Lost or Destroyed Check”
not completed, accurate or un-readable Limitations for processing a Stop
PaymentStop Payments can not be processed on
Banking Holidays and after 3:00 on banking days.
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Stop Payments/Check Cancellations
Process Verify check is on US Bank Account Reconciliation Plan
report. Complete an Affidavit of Lost or Destroyed Check Fax Affidavit to (360) 704-4417 or Email scanned Affidavit to [email protected]
Stop Payment processed on US Bank SinglePoint website
Documentation emailed back to requesting college Failed Stop Payment: can request copy of check DO NOT CANCEL Successful Stop Payment – can reissue if appropriate
CANCEL CHECK
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Stop Payments/Check Cancellations
Verify check is on US Bank Account Reconciliation Plan report
Why?Because if it’s not listed on this report it is no longer an outstanding check, meaning the bank has negotiated (deposited or cashed) the check.
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Stop Payments/Check Cancellations Stop Failed – Check Already Paid
DO NOT cancel check in system as the check has been negotiated
Can request a copy of the front/back of check to verify signature
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Stop Payments/Check Cancellations Stop Payment Placed Successfully
Verify if Stop Payment is still valid the following banking day
Cancel check on next available payroll - Stop is valid for 12 months
Check is entered into the Incomplete Stop Payment database at the State Board and remains on report, sent monthly, until check has been correctly canceled in PPMS
Process a Hand drawn check, input into PPMS and give to employee (don’t forget to pay taxes).
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Stop Payments/Check Cancellations Why cancel the check in PPMS?
Once the check has a valid stop payment, it becomes a non-negotiable item
If the check is not cancelled in the PPMS system, the income will still be recorded on the employees W-2 at year end
Not canceling the check produces an outstanding item on the bank reconciliation
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Stop Payments/Check Cancellations
If you don’t cancel the check within 12 months after the stop payment has been processed, another stop payment must be made in order for the check to remain non-negotiable. Stop payments are only good for 12 months and then expire, releasing the check as a negotiable item. Canceling the check in the PPMS system produces a “cancel check” on the tape US Bank receives every processed payroll, telling them that this check is no longer a valid, negotiable instrument.
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Stop Payments/Check Cancellations
Once a check has been cancelled, a system payroll report is produced listing all the cancellations (advices and checks) and sent to the SBCTC. These cancelled checks are entered into the access database. If all the steps have been completed in the correct order listed above, this is the final process that finishes the stop payment transaction. If not everything in the process has been completed, the item remains on your monthly Incomplete Stop Payment Report sent out by SBCTC.
Hand Drawn Checks
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Hand Drawn Checks
Calculate Net Pay Request Hand drawn check Input Hand drawn into PPMS Give Employee Hand drawn check Pay associated taxes
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Hand Drawn Checks
Calculate Net PayUse same amount of check that Stop
Payment was placedRun test payroll with all associated
deductions, reductions & contributionsCreate spreadsheet to calculate net pay
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Hand Drawn Checks
Request Hand drawn check from Business Office Input Hand drawn into PPMS on the next available
payroll Use screens PS1006 and PS1007 (covered next) First 2 digits of check # in PPMS needs to be your district
number Check # needs to be 8 digits long Do not use alpha characters, only numeric characters
Give Employee Hand drawn check, documenting release date in file
Pay associated taxes based on your tax deposit schedule (monthly or semi-weekly)
PPMS ScreensPS1005, PS1006 & PS1007
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PS1005 – Automatic Check Cancellation Screen
PS1006 – Cancellation/Overpayment/Hand drawn Header Screen
PS1007 – Cancellation/Overpayment/Hand drawn Distribution Screen
PPMS Screens – PS1005, PS1006 & PS1007
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PPMS Screens – PS1005Function: (A)dd Screen: PS1005
Key 1: BlankKey 2: BlankKey 3: Payroll Schedule
Check Date: Date ck was issuedEmployee ID: SSN:C/A: C if Check, A if AdviceCheck/Advice #: 8-digit check or advice number
Once you press enter it is gone - only to be seen again on PS1006 and PS1007.
This screen allows the user to cancel many checks at the same time, sending the data to fill in screens PS1006 and PS1007.
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PPMS Screens –PS1006Important fields to ALWAYS check:
“C/O/H”: Cancel/Overpayment/Handdrawn(the “C” never means “check” – always CANCEL)
“REVERSE?”: do you want to process the opposite of what is in the C/O/H field?
“QTR/YR”: especially important when crossing calendar years
“QTR/YR for deductions”: always match the QTR/YR with the income – always
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PPMS Screens –PS1006
What is wrong with the following statement?
STATEMENT: “I’m going to cancel Joe Smith’s Handdrawn check issued on 2/9/07 in the amount of $72.56 that was sent through the wash.”
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PPMS Screens – PS1007
This screen documents the budget/account code the earnings is being charged to or reversed from.
If posted from PS1005, you should have no changes to make. Otherwise, input according to original check or calculations for handdrawn.
Questions??