2806142 - Variable Pay - Point in time calculations

• What is point in time calculations?
• How can this be enabled?
• How does this work?

**Image/data in this KBA is from SAP internal systems, sample data, or demo systems. Any resemblance to real data is purely coincidental**

SAP SuccessFactors Variable Pay

What is point in time calculation?

Historically in Variable pay calculations we always assume a customer’s bonus plan uses prorated calculations based on the base pay within each assignment.

This is not always true, there are number of customers who will use base pay for the bonus calculation to be based on a particular date, for example the end of the year.

This is the business process for many customers, and a regulation in certain countries where inflation can be very high.

In such program's customers may only be interested in the salary from specific date, for example the end of the year (12/31/20**) to calculate a bonus target.

Generally, customers had created dummy employee history files and loaded them into the system, merged employee history records to show just one record and changed employment dates to align with the program dates.

This could cause additional issues when using EC integrated plans as there was no easy way have the assignment dates changed and aligned with program dates.

How to enable

To enable point in time calculation, go to Plan Setup> Settings> Set Bonus Calculation> Configure basis amount as:

From the drop-down menu you will have three options to use for the calculation of your basis. For point in time select "Fixed effective date i EC or User Data File (point in time calculation)"

How does it work?

Once enabled and you defined your date, what this calculation applies to etc.

With the options available there are always three scenarios.

Scenario 1 (most common)

• Salary/Earning = Effective date given
• Bonus Target = No effective date given

Scenario 2

• Salary/Earning = No effective date given
• Bonus Target = Effective date given

Scenario 3

• Salary/Earning = Effective date given
• Bonus Target = Effective date given

With this the system will us the salary or target % effective from the date you have specified within this section.

Examples

The following is an example of using point in time calculations.

Within set bonus calculation we have the following defined. We are only setting an effective date for Salary/Earnings.

NOTE: When selecting either options under "Apply to" and mapping the fields the system is check values from the first option downwards.
For example, if you have a field mapped to "Bonus target "%" field mapping in job/comp info" but there is no value, the system will then check what's in "Bonus target "%" field mapping in pay range".

The employee we have in this example will have two assignments. Within EC they will have the following:

From the calculation settings we are pulling "Target %" to come from the annualized salary amount effective 12/31/2019.

When importing the history and running bonus calculation, we will see the following for this employee.

You will initially notice from the first assignment 4,500 is not 10% of 40006.2.

The reason we see 4,500 is because we have set the calculation on salary to be effective 12/31/2019.

Therefore, the first assignment target amount of 10% will come from the second assignments salary which is 45000.0.

This calculates at 4,500 at 45000.0*10% for the first assignment and 9,000 which is 45000.0*20% for the second assignment.

If you select the option Target % to be effective as well as Salary/Earnings, then this would also be effective dated.

Additional examples

If we select the "Salary/Earnings" ONLY to be effective from 12/31/19.

Here the Base will be coming from the 45000.0 as this is effective at 12/31/19. Therefore the targets will come from this value.

If we select the "Target %" and "Salary/Earnings" to be effective from 5/20/19.

The base here will be calculated from the 10% target which is effective from 5/20/19.

Should we select only "Target %" for point in time calculation, define the effective date to be 12/31/19 we will see the following.

In this scenario we are using 30% which comes from the second assignment against each assignments salary. This is because we only selected "Target %" and have not included "Salary/Earnings"

Additional information can also be found within the implementation guide.

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