Using Employee Accounts Function Results

You need to keep track of employee contributions and the interest they earn. The employee accounts function keeps track of pre-tax and post-tax contributions, interest (which is always pre-tax), and total balance. Employee accounts keeps periodic subtotals and running balances.

When you set up the employee account function result, you specify the account type. There are three types of employee accounts:

• The function result for a plan's main contribution account is the final dollar amount of the account as of the event date.

• The function result for a withdrawal subaccount tracks amounts that employees withdraw and repay from the plan contributory account.

• The function result for a purchase subaccount tracks amounts that employees pay into the main contribution account to buy service for specific time periods.

  Note:

  Do not use purchase accounts to track repayment of withdrawn amounts.

All transactions in withdrawal and purchase subaccounts roll up to the main contribution account and to one or more service function results that you identify when you set up the employee account function result.

Because employees already own the amounts in their contributory accounts, there are special considerations for incorporating the amount into a final pension calculation. Also, a plan must always pay back all of an employee's contributions and interest, so it's important to record final account balances and track pension payments against those final balances.

Note:

If you create subaccounts, put them before the main account when you set up the job stream on the Plan Implementation page.