Managing Awards Approval and Payout

This chapter provides an overview of awards approvals and payouts and describes:

How to approve and submit awards.
Integration with Payroll for North America and Global Payroll.
Integration with Stock Administration.
Integration points related to variable compensation.
How to view and report on variable compensation history.

Understanding Approving and Submitting Awards

When you’re satisfied with the awards on the Award Allocation page, finalize them for payout or distribution using an automated approval process, manual approval, or no approval. After you finalize all of the awards in a plan or group for a payout period, the system automatically submits them for payout or distribution.

When you define the variable compensation (VC) plan, decide whether to finalize awards for processing with or without approval. If you select award approval, you can run the Approve Awards batch process or approve awards individually.

Finalizing and Submitting Awards Without Approval

To finalize and submit awards without approval:

Clear the Approve Awards check box on the VC Plan - Plan Business Rules page.
Manually set the Award Status of each award to Ready to Submit on the Award Allocation page when you are satisfied with the award amount.

When all individual awards in the period for the plan or group have the Ready to Submit or Canceled Award Status, the system changes the Group Status on the Award Allocations page to Ready to Submit.

The system automatically submits awards for payout or distribution when the Group Status is Ready to Submit and changes the status to Submitted.

Approving Awards Manually

To approve awards manually:

Select the Approve Awards check box on the VC Plan - Plan Business Rules page.
- If the plan member rule is Ad Hoc Awards or Empl VC Record, also identify the approver ID on this page.
- For plans that use groups, establish the approver for each group when you set up VC Tree security.
The manager manually sets the Award Status of each award to Recommended on the Award Allocation page when satisfied with the award amount.

When all awards have the Recommended status, the system sends a workflow notifying the authorized approver.
The approver changes the Award Status to Approved for each award that he or she wants to approve.

Only the authorized approver can enter the Approved status.
- If the plan does not use groups, specify the approver ID on the Plan Definition page.
- If the plan uses groups, define the approver ID when you define the group on the Group Definition page.
  
  When all individual awards for the period under the plan or group have the Approved or Canceled Award Status, the system changes the Group Status to Ready to Submit. When the Group Status is Ready to Submit, the system automatically submits awards for payout or distribution and changes the status to Submitted.

Approving Awards in a Batch Process

To approve awards in a batch process:

Select the Approve Awards check box on the VC Plan - Plan Business Rules page.
- If the plan member rule is Ad Hoc Awards or Empl VC Record, also identify the approver ID on this page.
- For plans that use groups, establish the approver for each group when you set up VC Tree security.
When satisfied with the award amount, the manager manually sets the Award Status of each award to Recommended on the Award Allocation page.

When all awards have the Recommended status, the system sends a workflow notifying the authorized approver to run the approval process.
When the Award Status on the Award Allocations page is Recommended, the approver runs the Approve Awards process or the Approve Awards with Groups process.

Only the authorized approver can run the process for the plan or group.
- If the plan does not use groups, specify the approver ID on the Plan Definition page.
- If the plan uses groups, define the approver ID when you define the group on the Group Definition page.
  
  The process changes the Award Status of all approved awards from Recommended to Submitted and then to Approved.
  
  When all individual awards for the period under the plan or group have the Approved or Canceled Award Status, the system changes the Group Status to Ready to Submit.
  
  When the Group Status is Ready to Submit, the system automatically submits awards for payout or distribution and changes the status to Submitted.

See Also

Viewing and Adjusting Award Allocations

Pages Used in Approving and Submitting Awards

Page Name	Object Name	Navigation	Usage
Approve Awards by Plan	VC_RUNCTL_APPWRD_P	Compensation, Variable Compensation, Finalize Awards, Approve Awards by Plan, Approve Award	Run the batch approval process when the plan member rule is Ad Hoc Awards or Empl VC Record. Also use the process to remove approved status from approved awards.
Approve Awards by Group	VC_RUNCTL_APPWRD_G	Compensation, Variable Compensation, Finalize Awards, Approve Awards by Group, Approve Award	Run the batch approval process when the plan member rule is Empl VC Record with groups or Define Tree/Group. Also use the process to remove approved status from approved awards.

Approving Awards by Plan

Access the Approve Award by Plan page.

VC Plan ID	The only available values are the VC plans for which this user ID is the designated approver on the Plan Business Rules page.
Approve	Select to approve all awards that have the Recommended status under the plan for the corresponding payout period. Clear this field to remove approval if you already ran the approval process and now want to change it. The system selects Approve by default.

Approving Awards by Group

Access the Approve Award by Group page.

This page is identical to the Approve Awards by Plan page with the addition of the Group ID field.

VC Plan ID

The only available values are the VC plans for which this user ID has security access.

Understanding Integration with Payroll Applications

When the Group Status field on the Award Allocation page is D (ready to submit), the Variable Compensation system submits monetary and non-stock, non-monetary awards for payout.

Payroll for North America

If Payroll for North America is installed on your database, the system publishes the awards directly to Payroll for North America for payout.

Global Payroll

If Global Payroll is installed on your database, the system publishes the awards directly to Global Payroll for payout.

Payroll Interface

If Payroll Interface is installed on your database, the system automatically generates a flat file containing the award data, which your organization can use as input into your Payroll Interface system.

Multiple Payroll Systems

If you have multiple payroll systems installed on your database, the system refers to the pay system indicator on the worker’s Job record to determine how to submit the award. If the worker is paid through Payroll for North America or Global Payroll, the system publishes the award through Application Messaging. If the worker is paid through Payroll Interface, the system submits the award through a flat file.

Integrating with Payroll for North America and Global Payroll

Integration between Variable Compensation and these two payroll applications is automated through application messaging technology. The variable compensation administrator does not run any processes for this integration. If awards are returned due to error, the VC administrator must resolve the reason for the error. The VC administrator can also request that awards be rejected if they are submitted in error.

Summary of Integration with Payroll for North America and Global Payroll

These steps summarize the award payout integration between variable compensation (VC) and the Payroll for North America and Global Payroll applications.

Note. In this summary, payroll refers to both of these payroll applications unless otherwise specified.

VC publishes awards.

When the status of all individual awards on the Award Allocation page is D, S, or C, the system changes the group status to D and publishes a message that inserts the awards into a publishing staging table. The Group Status and individual Award Status on the Award Allocations page are changed to S (submitted).
Payroll subscribes to the message.

Subscription inserts the awards into a subscribing staging table.
Payroll validates or rejects the VC data.
- Validated awards:
  
  If VC data are valid, payroll proceeds with processing.
- Erred or rejected awards:
  
  When payroll validates the VC data, it checks for error conditions that require correction prior to payroll processing. If errors are detected, payroll publishes an acknowledgment to VC and supplies reason codes.
VC subscribes to the acknowledgement of rejected or erred awards. The subscription updates the Award tables.
- If all awards for a specified VC plan and payout period are rejected at VC request due to error in VC submission, the Group Status and Award Status are changed to J (rejected).
- If awards fail validation, the Group Status and Award Status are changed to E (error) and payroll supplies a reason code.
- The Award Date is updated to the current date.
- Workflow notification of erred or rejected awards is sent to the VC administrator.
  
  If the awards are erred or rejected by Payroll for North America, the VC administrator can run the Subscription Error report to see the details of rejections, errors, and reasons. Otherwise, the VC administrator can check the message monitor to view the details.
- VC administrator corrects the awards and sets the individual Award Status to D (ready to submit). When all individual awards have the status of D, S, or C the Group Status is changed to D, which triggers publishing of the awards.
Payroll processes validated awards and issues checks.
Payroll publishes a verification of payment to VC.
VC subscribes to the verification of payment. The subscription updates the Award tables.
- Updates the Group Status and Award Status to P (paid/granted).
- Updates the Award Date to the value set by payroll as the date of payment ( Payroll for North America only).

Administering the Integration with EnterpriseOne General Ledger

Error Reason Codes

When Payroll for North America or Global Payroll publishes notification of erred awards (Award Status of E), the notification includes reason codes for the error.

Payroll for North America error reason codes:
- Invalid Earning Code (Invalid EC).
- Invalid Employee ID & Record# (Invalid EE).
- Invalid Currency Code (Invalid CC).
- Transaction already exists (Tran exist).
- Amount Exceeds Payroll Maximum (Exceed Max).
Global Payroll Error Reason Codes:
- Invalid Currency Code (Invalid CC).
- Transaction already exists (Tran exist).
- Error Updating Gen PI (PI Err).
- Error Updating ACK_PUB (Pub Err).
- Invalid Pin Number (Pin Err).

Integrating with Stock Administration

When the Group Status on the Award Allocation page is D (ready to submit), the Variable Compensation system publishes the awards directly to Stock Administration for distribution if Stock Administration is installed on your database.

Summary of Integration with Stock Administration

These steps summarize the award distribution integration between the Variable Compensation business process and Stock Administration:

The Variable Compensation (VC) business process publishes awards to Stock Administration.

When the status of all individual awards on the Award Allocation page is D, S, or C, the system changes the group status to D and publishes a message that inserts the awards into a staging table. The Group Status and individual Award Status on the Award Allocations page are changed to S (submitted).
Stock Administration subscribes to VC’s message. Subscription performs validation and proceeds to either generate grants or to void, modify, or reject grants.
- Generate Grants:
  
  Stock Administration runs the Generate Grants Application Engine process to generate the grants and batch publishes the awards to VC.
  
  The batch publish of grants generated results in these changes to the VC Award table:
  
  – Changes the Award Date to the date granted.
  
  – Changes the Award Status to P (paid/granted) when granted with no validation errors or to E (errored) when granted with validation errors.
  
  – Updates the Actual Award to the number of shares granted.
  
  – Updates the Award Value.
- Void, modify, or reject grants: (This is generally done if there was a data entry error in the run control for generating the grants)
  
  – Batch publish of voided grants to VC sets Award Status to C (cancelled).
  
  – Batch publish of modified grants to VC through staging table generates the same updates to VC data as publishing grants without modification.
  
  – Batch publish of rejected grants sets Award Status to J (rejected) if the awards were sent to Stock Administration in error.
  
  Note. Once the awards are rejected, they can’t be recalculated in the same period. They must be recalculated in the following period.
Shares for VC plans or funding periods that have expired are returned to Stock Administration.

Stock Administration decreases the VC funding table by the number of shares remaining.
Stock Administration updates VC tables when stocks split.
- Updates the Awards table and the Plan Funding table.
- Batch publishes effected VC awards.
Stock Administration recalculates award value when stock is repriced and publishes revised awards updating the Award Value.

Integration Points Between Variable Compensation and other Applications

The system uses application messaging technology to transfer awards and payout data between the Variable Compensation application and Payroll for North America, Global Payroll, or Stock Administration.

Integration Points Between Variable Compensation and Payroll for North America

Integration Point Name	Message Name	Message Definition
Variable Compensation (VC) request for payment	VAR_COMP_PAYMENT_REQUEST	VC publishes award data to Payroll for North America and payroll subscribes to the award data.
Acknowledgement/Verification of VC payment	VAR_COMP_PAYMENT_ACKNOWLEDGE	Payroll for North America publishes payout data to VC and VC subscribes.

Integration Points Between Variable Compensation and Global Payroll

Integration Point Name	Message Name	Message Definition
Variable Compensation (VC) request for payment	VAR_COMP_PAYMENT_REQUEST_GP	VC publishes award data to Global Payroll and payroll subscribes to the award data.
Acknowledgement/Verification of VC payment	VAR_CMP_PAYMENT_ACKNOWLEDGE_GP	Global Payroll publishes payout data to VC and VC subscribes.

Integration Points Between Variable Compensation and Stock Administration

Integration Point Name	Message Name	Message Definition
Award Data	AWARD_GRANT_ISSUE	VC publishes award data to Stock Administration and Stock Administration subscribes to the award data.
Grant Data	GRANT_AWARD_UPDATE	Stock Administration publishes grant data to VC and VC subscribes.

Activating Integration Point Messages and Channels

All integration point messages are delivered inactive. You must activate the messages in Application Designer. Set the status of each selected message to Active, and set the status of the corresponding message channel to Run.

See Also

PeopleTools PeopleBook: Integration Tools

PeopleTools PeopleBook: Application Messaging

Reporting Related to Award Payout and Distribution

PeopleSoft Enterprise provides these reports to assist in payout processing:

Actual Awards report.

After the system submits the awards for payout, run the Actual Awards report. This report is similar to the Calculate Awards report, but it shows any modifications that you made to the award on the Award Allocations page.
Subscription Errors report.

The variable compensation (VC) administrator can run the Subscription Error report after receiving workflow email notification that an erred or rejected award has been returned from Payroll for North America or Stock Administration.

Pages Used to Run Award Payout and Distribution Reports

Page Name	Object Name	Navigation	Usage
Varies	RUNCTL_VC_REP	Compensation, Variable Compensation, Award Reports, Actual Awards Compensation, Variable Compensation, Award Reports, Subscription Errors	Use this page to run both reports: Actual Award Report (VC001). You can select a detailed report or a summary report. The detailed report lists all workers in a plan by group, the worker’s target award value, annual rate, job code, actual award, and value. It also indicates whether the award is either the minimum or maximum payout under the plan, the total award value for each group, and the grand total for the plan. The summary report lists the total award value for each group and the grand total for the plan. Subscription Error Report (VC013).

Page Name

Object Name

Navigation

Usage

Varies

RUNCTL_VC_REP

Compensation, Variable Compensation, Award Reports, Actual Awards
Compensation, Variable Compensation, Award Reports, Subscription Errors

Use this page to run both reports:

Actual Award Report (VC001). You can select a detailed report or a summary report.

The detailed report lists all workers in a plan by group, the worker’s target award value, annual rate, job code, actual award, and value. It also indicates whether the award is either the minimum or maximum payout under the plan, the total award value for each group, and the grand total for the plan.

The summary report lists the total award value for each group and the grand total for the plan.
Subscription Error Report (VC013).

Viewing and Reporting on Variable Compensation History

View historical plan information by worker or by plan. Use the Employee History inquiry page to view worker information online. Use the Employee History report or the Plan History report to print variable compensation history by worker or by plan, respectively.

Page Used to View and Report on Variable Compensation History

Page Name	Object Name	Navigation	Usage
Employee History Inquiry	VC_EE_HISTORY	Compensation, Variable Compensation, Finalize Awards, Review Employee Award History, Employee History Inquiry	View the history of a worker’s target and actual awards in each plan and payout period.
Employee History Report	RUNCTL_VC_EEHIS_RP	Compensation, Variable Compensation, Award Reports, Employee History, Employee History Report	Run the Employee History Report (VC005). For each worker, the report lists target values, award values, and units by plan and payout period. It also prints the total values and units for each plan. In addition, select to print each worker’s grand total values for all plans.
Plan History Report	RUNCTL_VC_REP	Compensation, Variable Compensation, Award Reports, Plan History, Plan History Report	Run the Plan History Report (VC009). The report provides information about the plan definition and lists award values, proration, and approver information by payout period for the plan ID that you specify.

Viewing Employee Target and Awards History

Access the Employee History page.

Award Date

The date on which the award was granted for each payout period.

Award (Amt) (award amount)

The award amount in the currency of the plan. (This column is hidden if the worker did not receive a monetary award in the plan period.)

Award (Units)

This column of the grid is hidden if the worker did not receive a non-monetary or stock award in the plan period.

Award Value

The value of the award granted in each period, expressed in the currency of the plan.

Target Value

The value of the worker’s target award (expressed in the currency of the plan) as calculated by the Calculate Awards process for each payout period.

Total Actual Award

The total of awards granted to the worker under the plan ID, expressed in units or currency, depending on the plan type. Monetary value is expressed in the currency of the plan.

Total Target Award

The total of target awards calculated for the worker under the plan ID, expressed in units or currency, depending on the plan type. Monetary value is expressed in the currency of the plan.

Award Date	The date on which the award was granted for each payout period.
Award (Amt) (award amount)	The award amount in the currency of the plan. (This column is hidden if the worker did not receive a monetary award in the plan period.)
Award (Units)	This column of the grid is hidden if the worker did not receive a non-monetary or stock award in the plan period.
Award Value	The value of the award granted in each period, expressed in the currency of the plan.
Target Value	The value of the worker’s target award (expressed in the currency of the plan) as calculated by the Calculate Awards process for each payout period.
Total Actual Award	The total of awards granted to the worker under the plan ID, expressed in units or currency, depending on the plan type. Monetary value is expressed in the currency of the plan.
Total Target Award	The total of target awards calculated for the worker under the plan ID, expressed in units or currency, depending on the plan type. Monetary value is expressed in the currency of the plan.