During implementation, your team will be asked whether your payroll system can accept negative values on monthly payroll reports. These values are typically used to reflect returns, corrections, or adjustments.
If your system cannot accept negative values, they will be excluded from the monthly file.
Why are negative values used?
Negative entries may appear in payroll reports to account for situations like refunds or reversed transactions. Here are two common examples:
Forma Claim Example
An employee purchases an item with their personal credit card and submits a claim for reimbursement. The claim is approved, and the reimbursement is processed through payroll.
Later, the employee realizes the product is damaged. They return the item and contact Forma’s Support team. The claim is reversed and marked as rejected, and a negative adjustment appears on the next payroll report. Your team would then claw back the reimbursed amount from the employee’s paycheck.
Forma Store & Forma Card Example
When an employee purchases an item from the Forma Store or using their Forma Card, the cost is deducted from their account. This transaction is included in the payroll report so the appropriate tax can be applied.
If the employee returns the item, Forma sends a negative adjustment on the next payroll report. Your team would then adjust the tax accordingly and reclaim the taxed amount via payroll.