This policy establishes procedures for the proper accounting treatment of fringe benefit adjustments.
Procedures outlined in this sample include: (A) At the start of each fiscal year, a calculation should be made to spread by period the planned wage dollars used in establishing annual budgeted fringe rate. Spread should be calculated based on number of work days per period. (B) The hourly fringe calculation should be calculated by multiplying the actual monthly payroll distribution by the planned fringe percentage. (C) On a period basis, total wages paid, exclusive of vacation and holiday pay, should be compared to planned wages to determine over or under absorption.