Overview
Payroll Costing Allocations determine how salary and fringe benefit expenses post to the General Ledger (GL) by assigning funding to combinations of Worktags. Use Worker, Earning, or Position Restriction Costing to override Default Organization Assignments when necessary.
Purpose and Common Scenarios
Costing Allocations may be needed when:
- Financial staff need to update an employee’s funding for a future pay period (e.g., employee begins work on a grant).
- Hiring managers (supervisors) create a new job requisition, triggering a subprocess for the Cost Center Manager to define position funding.
- Overriding a specific earning (e.g., Overtime assigned to a different funding source).
For more information on the process for assigning and editing Costing Allocations, refer to the Costing Allocations job aid.
Best Practices
- Ensure Costing Allocations are entered and approved before **Day 1 of Payroll Processing** (see Period Close Calendar).
- Avoid retroactive changes; they will not update prior payroll and can create challenges with financial reconciliation and effort reporting. Changes to completed Payroll funding must be done via a Payroll Accounting Adjustment.
- Use the first day of the pay period for biweekly employees to avoid proration. To view Pay Period Schedules, visit Payroll Services on the Business and Finance website.
- Enter End Dates when adding new rows to maintain historical integrity and prevent gaps.
- Always verify all Worktags for accuracy before submitting a Costing Allocation.
- Redact sensitive information on any attachments.
Completing a Costing Allocation
- In Workday, search for Assign Costing Allocation.
- Select the appropriate Costing Allocation Type.
- Review existing allocations, if applicable; add End Dates to lines that are being replaced.
- Click Add (+) to create new Proposed Costing Allocation rows.
- Enter Start Date. Ensure there are no gaps if replacing an existing Costing Allocation (use first day of pay period for biweekly populations).
- Fill required Worktags in this order: Costing Company, Cost Center, (Grant if applicable), Fund, Function; verify Balancing Unit and all Worktags after entering
- Distribute percentages across multiple rows; total must equal 100%.
- For Salary Over the Cap, use the SOC column override; do not use grants, FD520 Grants and Contracts Sponsored Programs Fund or FD101 Default Clearing Fund in overrides.
Add Comments and attachments (redact sensitive data). Submit for approval.
Understanding Costing Allocation Hierarchy
Workday applies costing allocations in a specific order of priority when multiple allocations exist. This hierarchy determines which funding source is used for payroll expenses.
- Pay Input (most specific)
- Earning Costing
- Worker Costing
- Position Restriction Costing
- Default Organization Assignment (fallback)
Example: Brutus Buckeye had Worker Costing for January (CC22222), Position Restriction Costing through February (CC33333), and a Default Organization Assignment (CC11111) effective indefinitely. Workday applied CC22222 for January, CC33333 for February, and CC11111 for March, following the Costing Allocation Hierarchy.
When Do I Use Which Costing Type:
| Situation | Use This Costing Type | Why |
|---|---|---|
| Funding an employee temporarily | Worker Costing | Overrides default for a defined period |
| Funding only a specific earning type (e.g., bonus, Faculty Administrative Attachment, Vacation Payout, etc.) | Earning Costing | Only impacts that earning |
| Assigning permanent funding to a position | Position Restriction Costing | Follow the position regardless of worker |
Additional Office of Sponsored Programs (OSP) Considerations
- Grants subject to Salary Over the Cap: retro earnings never charge directly to the grant; use Salary Over the Cap (SOC) overrides. If SOC are not identified, the Default Organization Assignment will be charged.
- Grants not subject to Salary Over the Cap: retro earnings charge to the grant only if active for the corrected period.
Post Submission Process
- Timely Costing Allocation approval is necessary to ensure salary and fringe expenses are charged appropriately to the General Ledger.
- Costing Allocations route to Cost Center Managers (CCMs) and applicable approvers.
- Cost Center Managers (CCMs) who submit Costing Allocations for Cost Centers they manage will auto-approve; others will route to all CCMs as appropriate.
- Use Worker Profile → Job → Worker History to monitor status after approval.
Roles
| Business Role | Business Responsibilities |
|---|---|
| Requester | The Requester identifies a Costing Allocation or update to an existing Costing Allocation is needed. The Requester initiates the Costing Allocation. The Requester is responsible for providing any additional information for the Costing Allocation to ensure timely approval, if applicable. |
| Cost Center Manager | Reviews and approves Costing Allocations for Cost Centers they manage. Will route to multiple Cost Center Managers if multiple cost centers are affected. Responsible for reviewing the Costing Allocation for the use of appropriate worktag combinations, including any additional information or comments from the Requester. |
| Grant/Principle Investigator | Reviews costing to grants where applicable; ensures compliance with grant terms. |
Key Reports
| Report Name | Description |
|---|---|
| Payroll Funding – Costing Allocations for Filled Positions – Expired or Missing | Allows finance users to identify Costing Allocations for Filled Position in their area as of a specific date that are missing or expired. It is recommended that this report is ran before each pay period (or more frequently) to identify costing for all filled positions. |
| Payroll Funding – One Time Payment | Allows finance users to proactively identify One-Time Payments within their units and ensure costing overrides exist where needed. |
| HR for Finance – Termination and End Additional Job | Allows finance users to identify terminations in their area and designate where payouts (Vacation, Sick Leave, or Compensatory Time) will post with an Earning level costing, if applicable. |
| HR for Finance – Compensation Changes (excludes changes from Hires, Add Job and Change Job) | Allows finance users to identify allowances that were added for an employee in their area that may need Earning level costing, if applicable. |
Training and Job Aids
| Resource Type | Resource Name | Resource Description |
|---|---|---|
| Job Aid (ARC) | Costing Allocations | Outlines the process for assigning and editing Costing Allocation as well as various Costing Allocation types |
| Job Aid (ARC) | Advanced Costing Allocations for 9/12 Faculty | Provides an overview with examples of costing and the differences between each month for 9/12 Faculty |
| Training (BuckeyeLearn) | Costing Allocations in Workday | This 75-minute eLearning course explores the various ways Costing Allocations are applied and their hierarchical stages |
| Training (BuckeyeLearn) | Workday Payroll Expenses and Commitments | This 2-hour eLearning course introduces concepts behind various payroll processes and common accounting principles in Workday |
Contacts
For non-grant costing questions: BF-CTL-PayrollAccounting@osu.edu
For OSP grant questions: OSPGrantAccounting@osu.edu