Skip to main content
Documentation
Documentation
Administrator Guide
Last Updated: 2025-08-22
Steps: Set Up Payroll Accounting

Steps: Set Up Payroll Accounting

  • Understand your company implementation for payroll and how it affects your account sets, posting rules, and ledgers.
  • Review setup considerations for:
    • Payroll accounting without Financial Management.
    • Payroll accounting with Financial Management.
    • Intercompany accounting.
Set up all the payroll accounting elements required to pass payroll expenses to Workday Financial Management, including accounts, account posting rules, fiscal schedules, and ledger types.
If you have set up some or all of your financial and payroll accounting components, you can view each configured element to verify the setup.
When completed, you can process on-cycle and off-cycle payrolls to:
  • Generate payroll accounting entries.
  • Review payroll accounting results.
  • Correct any posting and ledger period errors.
  1. (Optional) Access the
    Maintain Payroll Accounting Options
     task.
    Select:
    • Off-Cycle - Use Payment Date as Accounting Date
       to set up journal entry lines for off-cycle payments to use the payment date instead of the period end date.
    • Budget Date - Use Period Schedule Payroll Payment Date
       to set up payroll and fringe benefit transactions so that the transaction budget date uses the pay period payment date instead of the pay period end date. You can set it for all payroll commitments and actuals journals.
    • Intercompany Accounting - Enable
      .
    Security:
    Set Up: Tenant Setup - Payroll
     domain in the System functional area.
  2. Access the
    Maintain Ledger Account Types
     task.
    Define ledger account types for payroll. Although Workday Payroll uses only asset, liability, and expense account types, Workday recommends that you set up all available account types in the
    Balance Sheet
     and
    Income Statement
     sections.
    Security:
    Setup: Ledger and Book
     domain in the Common Financial Management functional area.
  3. Access the
    Create Account Set
     task.
    Define an account set for payroll. You can use the
    Edit Account Set
     task to edit existing account sets, or the
    View Account Set
     report to view them.
    Security:
    Set Up: Payroll - Company Specific (Accounting)
     domain in the Core Payroll functional area.
  4. Access the
    Create Account Posting Rule Set
     task.
    Within an account set, you can define ledger accounts for each account posting type used by payroll:
    • Payroll Commitment
    • Payroll Deduction
    • Payroll Earnings
    • Payroll Expense
    • Payroll Forward Accrual
    • Payroll Net Pay
    For payroll earnings and expenses, you can direct a forward accrual to accounts other than payroll actuals by using
    Forward Accrual
     for both the
    Dimension
     and
    Value
    .
    Any resulting worktags that you create for payroll account posting rules display as optional journal dimensions that you can select after enabling journal summarization.
    Security:
    Set Up: Payroll - Company Specific (Accounting)
     domain in the Core Payroll functional area.
  5. (Optional) Access the
    Maintain Payroll Journal Options
     task.
    Select
    Summarize Payroll Journals
     to consolidate payroll journals before sending results to the ledger. You can summarize journals to improve financial reporting and restrict visibility to journal entry details. Optional summary dimensions that you select display on summarized journals in addition to automatic summary dimensions.
    You can enable journal summarization for an in-progress payroll. However, journal summarization won't be effective until the next pay cycle. Once you enable journal summarization, only an implementer can disable it.
    Security:
    Set Up: Payroll - Company Specific (Accounting)
    domain in the Core Payroll functional area.
  6. Define fiscal schedules and posting intervals for payroll accounting.
  7. Access the
    Edit Company Accounting Details
     task.
    Specify the account set, the account posting rule set, and the fiscal schedule you just defined. You can't change these settings after you post payroll accounting results.
    Security:
    Set Up: Payroll - Company Accounting
     domain in the Common Financial Management functional area.
    Security:
    Set Up: Payroll - Company Specific (Accounting)
     domain in the Core Payroll functional area.
  8. Access the
    Maintain Ledger Types
     task.
    Define at least 1 ledger type.
    Actuals
     is required, and you can have only 1
    Actuals
     ledger type per company. You can define
    Commitment
     and
    Obligations
     to make them available for selection when creating company ledgers.
    Security:
    Set Up: Ledger and Book
    domain in the Common Financial Management functional area.
  9. Select a company and
    Actuals
     ledger type, and optionally enable the
    Commitment
     and
    Obligations
     ledger types.
  10. Access the
    Create Ledger Year and Ledger Periods
     task.
    Define ledger years and periods for each company ledger.
    Security:
    Set Up: Ledger and Book
    domain in the Common Financial Management functional area.
  11. Access the
    Update Ledger Period Status
     task.
    Open the ledger period to generate payroll accounting results. You can open ledger periods anytime in advance. Set the ledger period
    Status
     to
    Open
    .
    Security:
    Process: Period End
    domain in the Common Financial Management functional area.
When you complete a payroll, Workday generates on-cycle and off-cycle pay calculations and sends payroll results to payroll accounting.
Each new fiscal year:
  • Create the new ledger year and periods.
  • Set the new ledger period
    Status
     to
    Open
    .