Understanding the Profit Sharing Processes

At the end of a reference period, the compensation administrator runs the profit sharing processes to calculate the global fund available and each employee's share of the fund. This diagram illustrates the steps involved in the profit sharing processes:

The four profit sharing processes that must be run are:

Extract Eligible Employees.

This is the first process that you must run. It compiles a list of employees who are entitled to share the global fund. It also imports payroll information for eligible employees from PeopleSoft Global Payroll for France or from a specified record in the database.
Compute Global Fund.
This process calculates the global fund available, based on the funding formulas defined in the agreement. For worker's participation agreements, there can be multiple formulas for different establishments or groups of employees (work units).
Distribute Global Funds.

This process divides the global funds calculated by the Compute Global Fund process and distributes the fund according to the distribution methods specified in the agreement definition.
Process Interest and Payment.

This is the final process that you must run. This process has a dual role: it completes the profit-sharing calculations and also processes payments. The process calculates deductions for employees' funds and calculates interest that is due for profit-sharing funds, using the Company Investment investment method. If you integrate your system with Global Payroll for France or another payroll system, the Process Interest and Payment process manages payments for profit sharing and worker's participation agreements.

Typically, you run the first three processes (Extract Eligible Employees, Compute Global Fund, and Distribute Global Funds) once for each reference period. However, you run the Process Interest and Payment process at intervals, because it processes payments, updates interest amounts and fund status, and calculates funds.

Compensation administrators can review the results of each process and make any adjustments necessary before running the next process in the sequence. The Member Entitlements component provides administrators with a view of the results generated by the eligibility and calculation processes. In addition, compensation administrators can rerun processes before moving on to the next stage.