PeopleSoft Pension Administration 9.1 PeopleBook

Setting Up Function Results

This chapter provides an overview of function results and discusses how to add a function result.

Understanding Function Results

Pension Administration uses 19 core functions, including three consolidation processes, to determine benefits. Using the core function pages, you set up methods (also called definitions) for calculating particular portions of a benefit.

Function results are the final calculation element that you build in order to apply your definitions to specific employees at specific times. In a function result, there are three types of information attached to a definition: effective dates, groups, and time segments.

Effective Dates

Effective dates enable you to track changes to your rules over time. For example, suppose your plan rules for vesting were originally effective January 1, 1990, and then the rules changed as of July 1, 2007. You then would have two effective dates for your vesting rules: the first set with the original vesting definition effective-dated January 1, 1990, and the second set with the new vesting definition effective July 1, 2007.

Groups

Groups enable you to apply different definitions to different people. The following are examples of grouping criteria:

Hire date: Employees hired before a particular date receive a grandfathered benefit not available to employees hired after that date.
Job data: Union negotiations result in different benefits for employees in different unions or in different locations.
Service: Employees with more service get more generous cash balance credits, interest rates, early retirement factors, or other benefits.
Benefit eligibility: Normal retirement, early retirement, disability retirement, and death retirement benefits vary.
Payee type: QDRO alternate payees require differently structured calculations.

Time Segments

Time segments enable you to apply different definitions at different points in an employee's career. This only applies to functions that can apply different rules at different times. For example, if you use an hours counting service method until January 1, 1990 and an elapsed time method subsequently, you do not recalculate service prior to 1990 with the new method. Instead, you use the earlier method for any time worked prior to January 1, 1990 and the later method for time worked January 1, 1990 and after. You then add the two separately-calculated segments to arrive at the total service.

Eight functions use time segments:

Consolidated earnings
Consolidated hours
Consolidated contributions
Service
Cash balance accounts
Employee accounts
Death coverage factors
Participation

Adding a Function Result

To add a function result, use the Function Result (FUNCTION_RESULT) component.

This section lists the pages used to add a function result and discusses how to set up a function result.

Pages Used to Add a Function Result

Page Name	Definition Name	Navigation	Usage
Function Result	PA_FUNCDEF_MAIN	Set Up HRMS, Product Related, Pension, Pension Plan Implementation, Function Result, Function Result	Associate your definitions with effective dates, groups, and (for some functions) time segments.
Employee Account Parms	PA_FUNCDEF_EACCT	Set Up HRMS, Product Related, Pension, Pension Plan Implementation, Function Result , Employee Account Parms	Enter additional function result parameters that are used only for employee accounts function results.

Setting Up a Function Result

After creating the definitions, you need to apply them to the right people at the right times. You use function results to do this.

Access the Function Result page (Set Up HRMS, Product Related, Pension, Pension Plan Implementation, Function Result, Function Result).

Function

When you add a function result, identify both the plan and the functions. The following table lists the 19 core functions:

Function Name	System Name
Consolidated earnings	CONSOLIDTE
Consolidated hours	CONSOLIDTH
Consolidated contributions	CONSOLIDTC
Plan eligibility	PLANELIG
Participation	PLANPARTIC
Service	SERVICE
Vesting	VESTING
Retirement (benefit) eligibility	BENELIG
Final average earnings	FAE
Cash balance accounts	CASHBAL
Employee accounts (contributory balances)	EMPLACCTS
Social security	SOCSEC
Covered compensation	COVRDCOMP
Early and late retirement factors	AGEADJUST
Death coverage factors	DEATHCVRG
Benefit formula	BENCALC
Employee paid benefit	CONTSBEN
Optional forms of payment	OPTFORMS
415 limits	LIMIT415

General Settings

Description

The description is particularly important for benefit formula function results. This description appears on the calculation worksheet and is the best indication of what a benefit is.

Use Start-Up

When you initially set up Pension Administration, you can load starting balances for three functions: service, cash balance accounts, and employee accounts. The startup consists of a starting balance and an as of date. For example, Wanda Jackson has 5.2 years of service as of January 1, 1997, so the system only calculates service accrued after that date and adds 5.2 to the calculated amount.

The calculation only checks for startup information if you select the Use Start-Up check box. If you do not select this check box, the system ignores any startup information. Select this check box if you loaded startup values.

For Pension Status Codes (Multiple Job Processing Only)

This option only appears for service function results.

If you select this option, the system reads additional information from the service function result, which is used in the custom statements.

See Using Pension Statuses.

Functional Definition

Effective Date

Effective dates always correspond to the date of a change in plan rules.

When you run a calculation, you specify a rules as of date on the calculation page. The system determines the appropriate rules using this date. This enables you to run historical and future dated calculations and automatically use the rules effective on the indicated as of date.

Effective dating does not automatically grandfather plan rules. Any grandfathered provisions must be included within an effective-dated row.

Parameters

Time segments represent the portions of an employee's working history to which the specified rules apply.

Most functions use a single time segment for all definitions. This time segment covers an employee's entire career. For example, even if your final average earnings rules change, you do not use one rule to average earnings for the first five years the employee worked and another rule to average earnings for the next ten years. Instead, you determine which rule to use (based on the rules effective on the employee's event date and the group the employee is in) and apply that one rule over the employee's entire career.

Certain functions can apply different rules over different parts of an employee's career:

Consolidated earnings
Consolidated hours
Consolidated contributions
Service
Cash balance accounts
Employee accounts
Death coverage factors
Participation

For example, a plan might changed its service rule as of January 1, 2001. In this case, you would use the earlier rule for any time worked before 2001 and the later rule for time worked from January 1, 2001 on. To find the final service amount, you would add the two amounts.

The benefit calculation does not use time segments. Each benefit calculation function result only uses one definition for each group of employees. If you want to add the benefit earned during one time period to the benefit earned during another time period, you have to set up an additional benefit formula definition and function result to handle this.

Like effective dates, time segments correspond to the dates of changes in plan rules. The difference, however, is that a new time segment does not replace an old one. Instead, it applies the rule to a specific portion of an employee's working history.

Start Date and Stop Date	You can enter a date or an alias in either field. Aliases must reference calculation inputs—typically the event date. Do not reference employee personal data (such as the hire date) because the system determines the start and stop dates prior to the selection of any employee data. To ensure that a time segment covers all periods in an employee's career, use the date that your plan went into effect as the start date. Note. Always use EVENT_DT (the calculation event date) as the stopping point for current rules. Certain functions have built-in stop dates: Service always stops at the event date. Cash balance accounts produces results as of the event date, the normal retirement date, the benefit commencement date, and the lump sum date. Employee paid benefit automatically projects the employee account to the later of the refund of contributions date or the normal retirement date.
Group	Specify the group name. Note. The plan eligibility function is unique in that it does not include groups in its function results. In this case, the group logic is incorporated into the definition, so the Group field is made unavailable.
Precedence	Implicit in the idea of the group-definition association is the requirement that for each effective-dated row, each employee belongs to a single group only. If an employee meets the criteria for multiple groups, you need a way to determine which group affiliation takes precedence. Indicate the group precedence order by entering a number in the Precedence field of every rule set. Groups with precedence 1 take precedence over groups with precedence 2, and so on. Note. The system evaluates employees against the group criteria in the order of the group precedence. Group processing stops after the first match. Therefore, processing time is reduced if you assign precedence 1 to the group that includes most employees, precedence 2 to the next largest group, and so on.
Order	To set the precedence order, click the Order button, which transfers you to the Group Precedence page. Note. Manually save the Function Result page before transferring so that any new data appears on the Group Precedence page.

Warning! Be sure that every employee is in at least one group. One approach is to create an "all employees" group that has the lowest precedence among your groups. This group catches any employees who do not belong to other groups.

Ensure that all the employees that you process are in the appropriate groups.

Definition Name

Each inner row on the Function Result page contains a single set of rules, which is represented by a single definition. The definition is the calculation method you created on the pages that correspond to a particular function.

Specify which definition to use in the Definition Name field. The rest of the parameters in the Parameters group box provide instructions for applying the definitions—that is, they specify the group and the time segment.

Break Definition Name

This field appears only when you select a service function result.

When you create a function result for the service function, you include a break definition name along with each service definition. Break definitions determine how to treat periods of time when an employee is not accruing service and when to take away previous service credit due to breaks in service.

If your break rules change, you create a new effective-dated row in the function result, just as you would if the service rules change.

Note. There can be only one type of service definition within one effective-dated row of a service result for definitions that have the same start date and stop date.

See Grouping Employees.

See Defining Service and Break Rules.

Definition Applies to

This group box appears only when you select a service function result.

Often rules depend on whether an employee meets a plan's eligibility requirements at a specific point in time. For example, service typically accrues only during periods of eligibility. The cash balance accounts and employee accounts functions typically accumulate both credits and interest during periods of eligibility, but only accumulate interest during periods of ineligibility.

The plan eligibility function produces a timeline of eligible and ineligible periods, so information about employee eligibility is available through the delivered alias PLAN_ELIG. However, eligibility-based grouping is so fundamental to the way that a pension plan works that Pension Administration provides a shortcut for setting up these groups. Instead of including eligibility criteria in the group definition, you can set up eligibility grouping in the Definition Applies to group box.

Eligible

This option adds an "and employee is eligible" clause to your group statement.

Ineligible

This option adds an "and employee is ineligible" clause to your group statement. Both clauses evaluate eligibility over time, so employees use the appropriate definition based on their changing eligibility status.

Both

If you select this option, the group statement remains untouched. It does not have any eligibility criteria unless you explicitly add it.

If you set up a row for eligible time periods, be sure to set up a corresponding row for ineligible time periods. This ensures that calculations have definitions to use at all points in an employee's career.

Note. If you create pairs of eligible and ineligible definitions, make sure that the ineligible definition mirrors the eligible definition except for the difference required for the ineligible period. This is important because some adjustments are based on the final definition. For example, the final service adjustments are all done based on the definition in effect on the event date, so you want to be sure that the adjustments are made regardless of whether the employee is eligible or ineligible at that particular time.

Warning! If the calculation does not have definitions to cover an employee's entire career, it will fail.

Multiple Jobs

The Multiple Jobs group box appears only when you select a service function result.

Use All Jobs or Use Eligible Jobs Only

Select Use All Jobs if you want to include all jobs, eligible and ineligible. Select Use Eligible Jobs Only if you want to include only eligible jobs.

Note. In the multiple jobs environment, some jobs may not be covered by a pension plan.

Entering Function Result Parameters for Employee Accounts

Access the Employee Account Parms page (Set Up HRMS, Product Related, Pension, Pension Plan Implementation, Function Result, Employee Account Parms).

Employee Account Type

Pension Administration supports three types of employee accounts: contribution, withdrawal, and service purchase. You create separate function results for each account type that you use. You specify the employee account type here and also in each of the definitions used in the employee account.

Note. The function result and all the definitions that it references must have the same employee account type.

For a contribution account, do not enter any more information on this page. For withdrawal and service purchase accounts, complete the remaining fields, as specified in the following fields.

Parent Contribution Account

Transactions in withdrawal accounts and service purchase accounts roll up to a "parent" account, the plan's actual contributory account. Enter the contribution account for the parent account.

Service Function Result Name

Activity in withdrawal and service purchase accounts can affect an employee's service credit. Specify the service function result name for the related service account.

Service Adjustment Method

When you establish a withdrawal account or a service purchase account for an employee, you establish the total amount of service available to be bought.

Specify the method by which employees receive credit for the service: Upon Any Payment/Redeposit, Upon Full Payment/Redeposit, or On a Prorated Basis.