Recording Wisconsin Retirement System Employer Credit Provided by 1999 Wisconsin Act 11

The Wisconsin Department of Employe Trust Funds (WRS) has identified in a June 20, 2001 credit invoice to each school district the amount of retirement system employer credit they are eligible for as a result of 1999 Wisconsin Act 11. The WRS should be contacted directly with questions regarding use of the credit. The WRS phone number is (608) 267-9034.

The Wisconsin Employment Relations Commission (WERC) should be contacted with questions regarding the effect of Act 11 on the qualified economic offer (QEO) calculation. The WERC phone number is (608) 266-1381.

An explanation of considerations in accounting for and using the Act 11 Credit is available at: Considerations

The following are the accounting entries school districts are to use for reporting the Act 11 credit in the 2000 - 2001 Annual Report to the Department of Public Instruction. The effect of these entries is to record the Act 11 credit as a refund revenue in the 2000 - 2001 fiscal year and establish an asset account for the unused credit balance.

1. The following entry is to be made to record the identified Act 11 credit amount in fiscal year 2000 - 2001: (The amount recorded is the "Total Act 11 Credit" shown on the June 20, 2001 "Employer Invoice Credit" from WRS. The district must identify the Act 11credit amount contained in these accounts in the Annual Report Addendum.)

Account Code	Account Description	Entry
10 B 719 000 000	Other Current Assets	Debit (Increase) for total Act 11 amount
10 R 000 000 971	Aidable Refund of Disbursement	Credit (Increase) for total Act 11 amount

2. As payrolls are processed by the district, the following entry to record WRS expense is made though the district's payroll processing system as usual: (The specific Object 210 and 10 B 811 620 000 accounts used will be the payroll accounts used by the district for WRS payments. Note that there is NO reduction for use of Act 11 credits.)

Account Code	Account Description	Entry
Fund - Function - Object 210	Retirement Benefits Expenditure	Debit (Increase) for payroll amount
10 B 811 620 000	Retirement Deductions Payable	Credit (Increase) for payroll amount

3. As the Act 11 employer credit is applied against WRS payments by the school district, the following accounting entries should be made: (The specific 10 B 811 620 000 account used will be the payroll liability account the district uses for WRS payments).

Account Code	Account Description	Entry
10 B 811 620 000	Retirement Deductions Payable	Debit (Decrease) for the WRS liability amount
10 B 719 000 000	Other Current Assets	Credit (Decrease) for Act 11 credit amount used

After making the above entry, the amount in 10 B 719 000 000 will be the Act 11 credit yet to be applied by the district.

4. If the Act 11 employer credit amount is not enough to offset the required WRS payment, a cash payment by the district will be necessary:

Account Code	Account Description	Entry
10 B 811 620 000	Retirement Deductions Payable	Debit (Decrease) for the WRS liability amount
10 b 719 000 000	Other Current Assets	Credit (Decrease) for Act 11 credit amount used
10 b 711 000 000	Cash	Credit (Decrease) for the cash amount paid

5. If the district uses the Act 11 credit to reduce the district's WRS prior service liability rather than using it against monthly WRS billings, the use of the credit will be offset against an expenditure account by a journal entry:

Account Code	Account Description	Entry
Fund 10 Function 290 000 Object 210	Other Support Service Expenditures	Debit (Increase) for Act 11 credit amount used
10 b 719 000 000	Other Current Assets	Credit (Decrease) for Act 11 credit amount used

For questions about this information, contact dpifin@dpi.wi.gov (608) 267-9114

Last updated on 2/25/2008 11:56:27 AM