Purpose

This document explains how Human Resource Partners (HRPs), Academic HRPs, Lead HRPs, Budget Partners, and Costing Allocation Partners can manage costing allocations in Workday as a standalone business process. Managing costing allocations includes the actions of Assigning, Maintaining, and Ending costing allocations.

When managing costing allocations, whether you are Assigning, Maintaining, or Ending costing allocations, all three of these actions are initiated through the Assign Costing Allocations task in Workday.

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Navigation

• Keep in Mind
  • General
  • Costing Allocation Levels
  • Chart of Accounts and Project Cost Collection Segments
    • Project-Specific Information
  • Salary Over the Cap
  • Employees Assigned to “9 Over 12” Academic Job Family
• Initiating the Assign Costing Allocations Process
• Assigning Costing Allocations
• Maintaining and Ending Costing Allocations

Keep in Mind

General

• Costing allocations tell Workday how a worker’s position and/or earnings are funded and for how long. Regardless of funding source or number of sources, all employees who receive compensation through Workday payroll are required to have costing allocations assigned.  This ensures that fringe benefits are accurately generated and aligned with the designated costing allocations.
• While the name of the Assign Costing Allocations task itself indicates assign, this task also allows the actions to maintain and end costing allocations.
  • Assigning costing allocations is the action of adding costing allocations for the very first time.
    • Note, Assigning costing allocations is almost always going to route to you as a sub-process that automatically initiates during the Hire, Add Job, and Change Job processes in Workday; rarely would you initiate this task standalone.
  • Maintaining costing allocations is the action of updating already existing costing allocations and/or distribution percentages. When maintaining costing allocations and/or distribution percentages, you must always end the existing allocations, first. Ending costing allocations is the action of closing/stopping already existing costing allocations. However, anytime a costing allocation is ended, a new one must be setup because there cannot be a gap in costing allocations. For example, if one costing allocation ends on 12/31/2026, the new costing allocation must start on 01/01/2027. 
    • If an update needs to be made to a worker’s costing allocations, even to correct an error, end the current costing allocations by entering a date in the End Date field. Add a new costing allocation and use the start date of the new costing allocation in the Start Date field.
    • Another way to Maintain costing allocations is through the Pay tab on the left-side of the employee’s profile. Select Costing Allocations at the top of the screen and then choose the Maintain button.
    • Note, all employees, excluding staff and tenured faculty, must have End Dates assigned to their costing allocations.
      • Workday does not notify you when a costing allocation End Date approaches or passes therefore careful monitoring is required for costing allocations that include an End Date.
• To complete the Assign Costing Allocations task, you need the following information:
  • COA or POET(AF) information that is funding the position and/or earning. 
    • See the Chart of Accounts and Project Cost Collection Segments section for more information.
    • If you do not know the COA/POET(AF) segments to use, review the COA Hierarchies Orbit Report for a comprehensive view of each segment's hierarchy or contact your Organization Financial Manager.
  • Applicable funding dates.
  • The distribution percentages, if more than one COA or POET(AF) is being used to fund the worker’s salary.
• Any changes to costing allocations must be submitted by noon of the bi-weekly or monthly payroll close to ensure upcoming payroll expenses are charged to the correct combination of COA and/or POET (AF) accounts.
• To review a history of costing allocations that have been changed for a worker, please follow the instructions in the Viewing Worker History in Workday Knowledge Base Article.
• When applying a retroactive costing allocation change or correcting a payroll expense cost error, you need to:
  • Update costing allocations in Workday, AND,
  • Initiate a Payroll Expense Cost Correction in Workday, if payroll has already run.
• Access the Top Reports for Campus Users dashboard in Workday for a list of helpful reports categorized by security role.
  • See the Costing Allocations Reports in Workday Knowledge Base Article for an inventory of reports tied to Costing Allocations in Workday, including their definitions, report prompts, authorized roles who can execute them, and key information found in these reports.

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Costing Allocation Levels

• Costing allocations can be assigned to a Worker, Position, and Earning (such as a housing allowance or vacation allowance) or costing allocations can be assigned to a Worker and Position only. At minimum, costing allocations must be set up at the Worker and Position level.
  • NOTE: If the Worker and Position costing allocations expire and new ones are not setup, the COA listed in the default organizational assignments of the position is used to issue payment.
• If you are funding a specific earning for the employee differently than the rest of their salary, you need to ensure the Worker, Position, and Earning level of costing allocations are entered before entering the Worker and Position level.
  • IMPORTANT: When assigning costing allocations at the Worker, Position, and Earning level:
    • First, set up the Worker, Position, and Earning costing allocations for the specific Earning.
    • Second, set up another costing allocations at the Worker and Position level for the remainder of the salary.
• Compensation always pays out at the Worker, Position, and Earning level before the Worker and Position level.  Consider the following example:
  • An employee has Regular Pay and a Housing Allowance.
    • Costing allocations are assigned at the Worker, Position, and Earning level specifically for the Earning “Housing Allowance”. Costing allocations are also setup at the Worker and Position level.
    • When Workday processes the employee’s paycheck, it first checks for Worker, Position, and Earning costing allocations. Accordingly, the employee’s Housing Allowance pays out based on the values included in the Worker, Position, and Earning costing allocations.
    • Because no other Earnings are specified, the rest of the employee’s compensation pays out based on the values included in the Worker and Position costing allocations.

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Chart of Accounts and Project Cost Collection Segments

• Costing Allocations are assigned using either a Chart of Accounts, otherwise known as COA, or a Project Cost Collection Segment, otherwise known as POET(AF).  For more details, please see the following training in Workday:
  • Introduction to Oracle and Orbit
• For definitions of each COA and POET(AF) segment, please review the Oracle to Workday Terminology Differences for COA/POETAF Knowledge Base Article.
• When determining if a COA, POET, or POET(AF) segment is needed, consider the following:
  • COA is used when the worker is not directly supporting a grant, project, or individual award and discretionary funds.
  • POET is used when the worker is supporting non-sponsored, non-billable projects such as Capital Projects and Internal Projects.
  • POET(AF) is used when the worker is supporting sponsored, billable projects such as University Research, Clinical Research, Grants, and Individual Awards and Discretionary Funds.
• When entering COA/POET(AF) segments and either the Entity, Cost Center, or Purpose differ from the worker’s default organization assignments, you must enter the new segment value to override the default value.
  • When the Entity differs from the default, the Cost Center also needs to be overridden and come from the new/differing Entity.
  • If the Purpose value differs from the default and the updated Purpose value causes a validation error with the Fund, then a new Fund value must be entered based on the error message received.
• Multiple COA/POET(AF) values may be entered to fund a position or an earning.
• When entering COA/POET(AF) segments, custom validations and Oracle Cloud cross validation rules run, which may result in a warning or error.  If a warning or error occurs, please work with your department’s finance team. See the Chart of Accounts Cross-Validation Rules (as of 7/16/2024) Knowledge Base article for more information.
• Assigning Costing Allocations overrides the default COA values listed in the position’s default organization assignments. These default COA values are attached to the position when the position is first created. Costing Allocations should be assigned once a worker is moved into a position.
  • POET(AF) values are not allowed to be used for default organization assignments and are unavailable to select.

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Project-Specific Information

• For POET(AF), when entering distribution percentages for a sponsored project the distribution percentages should reflect the proportion of effort, or work, that the person dedicates to the project. 
  • Effort is the proportion of time spent on sponsored projects, expressed as a percentage of the total professional activity for which an individual is employed by the institution. This must be a reasonable estimate with total effort equaling 100%
  • Payroll distributions and effort reports are not the same thing. Payroll distributions are the distribution of an individual's salary, while effort reports describe the allocation of an individual's actual time and effort spent for specific projects, whether or not reimbursed by the sponsor.
• IMPORTANT: If using POET(AF) values, make sure to keep track of the project’s start and end dates. An account can only be charged while the project is still active. If a project has ended or been closed, add a backup account (secondary account) to the worker’s costing allocations, so charges don’t go to an inactive account. Setup and add this backup account in Workday before the project ends or as soon as it is closed.
  • If costing allocations contain a project and/or grant that has ended, payroll may or may not override the invalid account and replace it with the default COA values from the organization assignments of the position. 
    • If the invalid account(s) is not overridden, payroll charges to the invalid account, resulting in unprocessed costs in Oracle.  Payroll Expense Cost Corrections are required to process these costs in Oracle, moving the payroll expenses off the invalid account(s), onto a valid account(s). 
      • See the Manage Unprocessed Costs Reports Knowledge Base Article for more information on how to identify unprocessed payroll costs in Oracle that most likely require PECCs in Workday.
    • If the invalid account(s) is overridden with the default COA but this is not accurate, PECCs are required to move the payroll expenses to the correct account(s).
  • Project and Award/Grant end dates are not tracked in Workday therefore careful coordination with fiscal teams is required to proactively monitor and identify workers who are funded from grants that may end during a pay period.

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Salary Over the Cap

• Salary Over the Cap is tracked in Workday. If a worker’s costing exceeds the federal salary cap amount for that month, the amount over the cap should be placed into the COA worktag combination specified in the Salary Over the Cap Default Costing Allocations section located above the Costing Allocations section.  Salary Over the Cap must be charged to a COA; POET(AF) cannot be used.
  • Within the Costing Allocation Details table, after adding an award number containing a salary cap, a badge icon (represented by a circle with a number in it) appears under the Salary Over the Cap column. If desired, select this badge to make overrides to the Salary Over the Cap Default Costing Allocations values.
  • IMPORTANT: If a new salary cap needs to be added into Workday, please submit an Ask a Payroll Question with the new salary cap information.

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Employees Assigned to “9 Over 12” Academic Job Family

• Salaries posted to the REGULAR – 912 and MINISTERIAL HOUSING 912 earn codes should generate an accrual entry to account for the 9 months of effort paid to individuals over 12 months.
  • The accrual entry charges a COA/POET(AF) for the individual’s effort and credits another COA/POET(AF) for the same amount. The net effect on all COA/POET(AF) is that the employee receives 1/12 of their salary each month of their appointment.
•  In Workday, a costing allocation needs to be created for the REGULAR 9/12 ADJUSTMENT (ADJ) earning (which is the accrual entry) to direct the credit entry to a unit’s appropriate COA combination. Note that every individual who has a costing allocation for a position in a ‘9 over 12’ job family needs to have a corresponding costing allocation created for the accrual entry credit, ADJ.
• When entering costing allocations for employees assigned to a 9 over 12 Academic Job Family, ensure there is a separate costing allocation entered on the REGULAR 9/12 ADJUSTMENT earning level.
  • The start date of the costing allocation should always align with the costing allocation start date on the position level.

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1. Log into Workday using your CNetID and password.
2. Navigate to the Employee’s Profile by typing their name or another unique identifier (Chicago ID, SSN, Employee ID, etc.) in the search bar at the top of the screen. Select the appropriate suggested record that appears below the search box, or press Enter to run the complete search, and find the right employee.
   1. Use the prefixes worker: or id: to refine the search results. For details on how to use prefixes, review the Workday Search Prefixes Knowledge Base Article.
3. From the Employee Profile, select the Actions button, hover over Payroll, and choose Assign Costing Allocation.
4. Under the Include Existing Allocations section, the From field auto-fills with today’s date. If applicable, enter an end date for the costing allocation within the To field.
   1. To view costing allocations prior to today’s date, update the From field to an applicable date. Suggest backdating the From field at least a year (e.g. 6/31/24) to ensure all existing costing allocations are captured.
5. Under the Worker Costing section:
   1. The Worker field auto-fills and the Position may auto-fill. 
      1. If the Position does not auto-fill or is incorrect, use the Hamburger Menu (the icon with three dots and three dashes) to select the appropriate position.
   2. If you are managing costing allocations for a specific Earning that differs from the costing allocations assigned at the Worker and Position level, then you need to assign costing allocations at both levels. You need to assign at the Worker, Position, and Earning level and at the Worker and Position level.
      1. First, assign the Worker, Position, and Earning level by selecting the specific Earning type and proceeding to the next step.
      2. Once the Earning’s costing allocations are complete, return to the employee’s profile and select the Actions button, hover over Payroll, and choose Assign Costing Allocation.
      3. Set up costing allocations at the Worker and Position level by leaving the Earning type blank and proceeding to the next step.
6. Select OK to be brought to the next Assign Costing Allocation page.
   1. If you are adding costing allocations for the very first time, proceed to the Assigning Costing Allocations section of this document.
   2. If you are making changes to already existing costing allocations, proceed to the Maintaining Costing Allocations section of this document.
   3. If you are ending already existing costing allocations, proceed to the Ending Costing Allocations section of this document.

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1. On the Assign Costing Allocations screen costing allocations are divided into two tabs: Proposed Costing Allocations and Existing Costing Allocations.
   1. The Existing Costing Allocations tab displays a read-only table of current costing allocations, if any have been set up. Since costing allocations are being added for the very first time, this table will be blank.
   2. The Proposed Costing Allocations tab allows you to add new costing allocations.
2. In the Proposed Costing Allocations tab, in the middle of the page the Default Organizational Assignments (As of Start Date) information is listed, for reference.
   1. Remember, if costing allocations are invalid, expired, or non-existent then payroll is charged to the COA values listed here.
3. In the Proposed Costing Allocations tab, on the left-side of the page select the (+) Add option to insert a new tab into the left-side navigation menu to assign costing allocations. Each tab displays the Start and End Date, if applicable, for the corresponding allocations.
   1. Enter the Start and End Date for the allocations.
      1. All employees, excluding staff and tenured faculty, must have end dates assigned to their costing allocations.
      2. REMINDER: There cannot be a gap in costing allocations. For example, if a costing allocation’s End Date is 12/31/2025, then the new costing allocations Start Date must be 01/01/2026. 
   2. Under the Costing Allocations section, insert rows as needed by selecting the Plus (+) icon.
      1. Enter the appropriate COA and/or POETAF segments.
         1. Multiple COA and/or POETAF values may be entered to fund a position or an earning.
         2. Data entry must occur from left to right using the Hamburger Menu to the right of the appropriate prompt boxes.
         3. For COA segments, fill out the Entity, Cost Center, Fund and Purpose columns. Within the Additional Worktags column, enter the remaining segments, if required: Program, Activity and Site.
         4. For POET(AF) segments, leave the Entity, Cost Center, Fund and Purpose columns blank (unless these fields require updating). Within the Additional Worktags column select the appropriate options for Funding Source, Grant, PPM Projects and Task.
            1. In the rare case when a worker is paid out of a project that has an Entity different from the worker’s default organizational assignments, this field requires completion.
            2. When the Entity differs from the worker's default Entity, you also need to enter a Cost Center that belongs to the newly entered Entity.
            3. In the rare case when a worker is paid out of a project that has a Cost Center different from the worker’s default organizational assignments, this field requires completion.
            4. When the Cost Center does not fall under the worker's default Entity, then you must first enter the new Entity and then select a new Cost Center under the newly entered Entity.
            5. If a Purpose value is entered that causes a validation error against the worker's default Fund, a new Fund value must be entered.
            6. In the rare case when a worker is paid out of a project that has a Purpose different from the worker’s default organizational assignments, this field requires completion.
               1. When the newly entered Purpose causes a validation error against the worker's default Fund, which is listed under the Default (As of Start Date) column, then enter a new Fund value.
                  1. Please see the Chart of Accounts Cross-Validation Rules and Chart of Accounts Purpose Values and Definitions Knowledge Base Articles for more information.
            7. Salary Over the Cap is tracked in Workday. If a worker’s costing exceeds the federal salary cap amount for that month, the amount over the cap should be placed into the COA worktag combination specified in the Salary Over the Cap Default Costing Allocations section located above the Costing Allocations section.  Salary Over the Cap must be charged to a COA; POET(AF) cannot be used.
               1. Within the Costing Allocation Details table, after adding an award number containing a salary cap, a badge icon (represented by a circle with a number in it) appears under the Salary Over the Cap column. If desired, select this badge to make overrides to the Salary Over the Cap Default Costing Allocations values.
         5. Under the Distribution Percent column, type in the percentage of the salary or earning that is to be paid from the specified account and sub account. The total must equal 100%. For sponsored projects, the distribution percentages should reflect the proportion of effort, or work, that the person dedicates to the project.
4. To add additional costing allocations, repeat step 3 and make sure the Start Date is correct and add an End Date, if applicable.  Fill in all presented columns.
   1. To automatically add a new costing allocation table that mirrors the previous, checkmark the Copy Costing Allocation box. This displays the same funding distribution and COA/POET(AF) values as the previous allocations.
      1. This saves time, especially when maintaining multiple funding COA/POET(AF) values for one individual that experiences slight changes in funding allocations from month to month.
5. To remove costing allocations, select the Remove icon, as represented by a black circle with a white minus icon in the middle, located in the top-right corner or each costing allocation tab.
6. Optionally, under the Costing Allocation Attachments section upload documents either by choosing Select files and selecting the appropriate file from your computer, or by dragging and dropping the file into the gray box. To insert additional documents, select Upload and add appropriate files. If an incorrect document is mistakenly uploaded, select the Trash Can icon
   1. Note, this section defaults as collapsed. To expand this section, select the arrow pointing right located next to the section header.
7. Once costing allocations are finalized select Submit to complete this process.
   1. Once submitted, custom validations occur which may result in warnings such as using an inactive worktag. Also, based on Oracle Cloud cross validation rules, critical errors related to combinations of COA segments may trigger.  If a warning or error occurs, please work with your department’s finance team.
   2. A common error with costing allocations is when historical costing allocations conflict with the Start and End Dates of new ones.
      1. If this error is presented, scroll to the top of the screen and choose the Change Selection icon as represented by a set of sliders and located to the right of the Assign Costing Allocations screen header. In the new window, under the Include Existing Allocations section, update the From field to a date further in the past. Suggest backdating this field at least a year.

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1. On the Assign Costing Allocations screen costing allocations are divided into two tabs: Proposed Costing Allocations and Existing Costing Allocations.
   1. The Existing Costing Allocations tab displays a read-only table of current costing allocations.
   2. The Proposed Costing Allocations tab allows users to add new costing allocations and view previous ones.
2. In the Proposed Costing Allocations tab, on the right-side of the page the Default Organizational Assignments (As of Start Date) information is listed, for reference.
   1. Remember, if costing allocations are invalid, expired, or non-existent then payroll is charged to the COA values listed here.
3. In the Proposed Costing Allocations tab, even if you are updating costing allocations, locate the current costing allocations tab on the left and enter an End Date. Remember, if an update needs to be made to a worker’s costing allocations, even to correct an error, the current costing allocations must be ended before a new costing allocation can be added.
   1. IMPORTANT: If costing allocations are ended without setting up new ones, payroll expenses will be charged to the position’s default organization assignments.
4. After an End Date has been added to the current costing allocations, select the (+) Add option on the left-side of the page to insert a new tab.
   1. Enter the Start and End Date for the allocations.
      1. All employees, excluding staff and tenured faculty, must have end dates assigned to their costing allocations.
      2. REMINDER: There cannot be a gap in costing allocations. For example, if a costing allocation’s End Date is 12/31/2025, then the new costing allocations Start Date must be 01/01/2026. 
   2. Under the Costing Allocations section, insert rows as needed by selecting the Plus (+) icon.
      1. Enter the appropriate COA and/or POETAF segments.
         1. Multiple COA and/or POETAF values may be entered to fund a position or an earning.
         2. Data entry must occur from left to right using the Hamburger Menu to the right of the appropriate prompt boxes.
         3. For COA segments, fill out the Entity, Cost Center, Fund and Purpose columns. Within the Additional Worktags column, enter the remaining segments, if required: Program, Activity and Site.
         4. For POET(AF) segments, leave the Entity, Cost Center, Fund and Purpose columns blank (unless these fields require updating). Within the Additional Worktags column select the appropriate options for Funding Source, Grant, PPM Projects and Task.
            1. In the rare case when a worker is paid out of a project that has an Entity different from the worker’s default organizational assignments, this field requires completion.
            2. When the Entity differs from the worker's default Entity, you also need to enter a Cost Center that belongs to the newly entered Entity.
            3. In the rare case when a worker is paid out of a project that has a Cost Center different from the worker’s default organizational assignments, this field requires completion.
            4. When the Cost Center does not fall under the worker's default Entity, then you must first enter the new Entity and then select a new Cost Center under the newly entered Entity.
            5. If a Purpose value is entered that causes a validation error against the worker's default Fund, a new Fund value must be entered.
            6. In the rare case when a worker is paid out of a project that has a Purpose different from the worker’s default organizational assignments, this field requires completion.
               1. When the newly entered Purpose causes a validation error against the worker's default Fund, which is listed under the Default (As of Start Date) column, then enter a new Fund value.
                  1. Please see the Chart of Accounts Cross-Validation Rules and Chart of Accounts Purpose Values and Definitions Knowledge Base Articles for more information.
            7. Salary Over the Cap is tracked in Workday. If a worker’s costing exceeds the federal salary cap amount for that month, the amount over the cap should be placed into the COA worktag combination specified in the Salary Over the Cap Default Costing Allocations section located above the Costing Allocations section.  Salary Over the Cap must be charged to a COA; POET(AF) cannot be used.
               1. Within the Costing Allocation Details table, after adding an award number containing a salary cap, a badge icon (represented by a circle with a number in it) appears under the Salary Over the Cap column. If desired, select this badge to make overrides to the Salary Over the Cap Default Costing Allocations values.
         5. Under the Distribution Percent column, type in the percentage of the salary or earning that is to be paid from the specified account and sub account. The total must equal 100%. For sponsored projects, the distribution percentages should reflect the proportion of effort, or work, that the person dedicates to the project.
5. To add additional costing allocations, repeat step 5 and make sure the Start Date is correct and add an End Date, if applicable.  Fill in all presented columns.
   1. To automatically add a new costing allocation table that mirrors the previous, checkmark the Copy Costing Allocation box. This displays the same funding distribution and COA/POET(AF) values as the previous allocations.
      1. This saves time, especially when maintaining multiple funding COA/POET(AF) values for one individual that experiences slight changes in funding allocations from month to month.
6. To remove costing allocations, select the Remove icon, as represented by a black circle with a white minus icon in the middle, located in the top-right corner or each costing allocation tab.
7. Optionally, under the Costing Allocation Attachments section upload documents either by choosing Select files and selecting the appropriate file from your computer, or by dragging and dropping the file into the gray box. To insert additional documents, select Upload and add appropriate files. If an incorrect document is mistakenly uploaded, select the Trash Can icon
   1. Note, this section defaults as collapsed. To expand this section, select the arrow pointing right located next to the section header.
8. Once costing allocations are finalized select Submit to complete this process.
   1. Once submitted, custom validations occur which may result in warnings such as using an inactive worktag. Also, based on Oracle Cloud cross validation rules, critical errors related to combinations of COA segments may trigger.  If a warning or error occurs, please work with your department’s finance team.
   2. A common error with costing allocations is when historical costing allocations conflict with the Start and End Dates of new ones.
      1. If this error is presented, scroll to the top of the screen and choose the Change Selection icon as represented by a set of sliders and located to the right of the Assign Costing Allocations screen header. In the new window, under the Include Existing Allocations section, update the From field to a date further in the past. Suggest backdating this field at least a year.

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