Retroactive effect (RAE)
Because in Profit all relevant data are time-dependent, Profit provides the option to make changes to processing results after they have been approved. Such a change is called a Retroactive Effect entry (RAE).
The main advantage of making changes with RAE is that the wage calculation is always correct and that changes related to approved periods are immediately corrected and processed in the current period.
Two types of changes are possible in Profit Payroll:
- Changes to the provisional processing
Changes to the provisionally processed period This is the period for which the salary processing has been performed but not approved yet.
- Changes with retroactive effect
Changes that are made to periods after they have been approved. You can process them in in the current main period or in a correction period.
On a timeline, this looks as follows:
- At moment 1 you create an RAE entry for January, after January has been processed provisionally. You can reprocess the period and include the entry.
- At moment 2 you create an RAE entry for January, after the January salaries have been approved. If the January payment has not yet been made, or if you want to make the payment as soon as possible, you choose to process this RAE period in a correction period for January. If time is not an issue, the entry will automatically be processed in February.
- At moment 3 you create an RAE entry for January, after the February salaries have been approved. You can process this entry in a February correction period or include it in the salary processing for March.
If you make changes with RAE in an approved period, Profit calculates all intervening periods.
In period 1 you have paid out a loan to an employee. In periods 2 - 8 you withheld the repayment.
If you have approved period 1 to 8 and delete the loan from period 1, a change with RAE is created. Because deleting a loan does not affect one period only, but multiple periods, all periods up until the current period are recalculated and reprocessed. When the salaries for period 9 are processed, a correction for period 1 to 8 is created for the employee (in period 1 the payment of the loan is reversed and in the periods 2 to 8 the repayments are reversed). Period 9 is processed 'normally'.
Changes with retroactive effect (RAE) are created when you make changes to periods after they have been approved. The changes can occur because of:
- A CLA update
If we implement a change using a CLA Update which makes it necessary to recalculate data for all employees, the CAO Update initiates the RAE entry. AFAS will always tell you about this in the release notes that come with the CLA Update.
- Changes to the master data
Because of date dependent changes to the properties of an employee, employer or agency.
- Changes to the payroll configuration
Because of changes in the payroll configuration, for example a change in the value of a wage component parameter.
- Wage entries
By adding, deleting and changing wage entries.
- Automatic RAE
Profit automatically initiates an RAE entry, if you change data that affect the wage calculation and that have been specified in a time-dependent way. For example: a change in the salary or the timetable of an employee, a new wage entry or a new value of a wage component parameter.
- Manually initiate changes with RAE
For most of the entries, Profit automatically initiates RAE entries in approved periods. However, you can also initiate RAE entries manually.
- Add a correction period
A correction period is a separate processing period in the salary processing plan. You can use a correction period to process the RAE entries, perform the processing for employees paid per hour that has been delayed because the hours were only known at a later time, or pay out a holiday allowance.
- Process a correction period
You process a correction period in Profit separately from the main period. In the correction period Profit processes only the RAE entries that have been initiated for the preceding approved periods.
- View RAE entries
After processing the changes with RAE, additional options become available for the overviews and view functions. These options help to give you the desired insight into the RAE entries.
- Approve a correction period
The approval of a correction period closes this period.
- Payment file for a correction period
Depending on the settings for the employer Profit can generate the payment file automatically following the approval of a salary processing plan line.
- RAE pay slips for differences and replacement pay slips
Per period you can generate the payslips for differences and replacement pay slips.
- RAE entries in a journal entry analysis
If an RAE entry is present in a period, you can also see this in the. In the journal entry, the correction amounts are posted to the period in which the RAE entry was paid.
- RAE entries in a cost analysis
If an RAE entry is present in a period, you can also see the RAE in the. When you view the cost analysis, the RAE data can be viewed in the period the costs of the RAE entry refer to.
- Wage declaration and RAE
Depending on the status of a period, an RAE entry will result in a correction declaration or a new complete declaration.
- RAE entries across years
In Profit you can make corrections to preceding wage years. The corrections are called RAE entries across years in Profit.
- Purge RAE entries that do not cause differences
From the command line you can purge the RAE entries that do not cause differences in the salary calculation.