Year end carry forward of leaves
There is an option to select if the leave is to be carried forward to next year or not. When this parameter is selected as yes and additionally the maximum and minimum carry forward limits are defined the system ensures that the leaves are carried forward as per these values. Leaves which are in excess of maximum carry forward limit lapse at the end of the year and if leave encashment is done it is allowed keeping the minimum carry forward limit in consideration.Leaves which are remaining at the end of year can have one of three outcomes -
1. Encashment: actually Encashment can be done at any time during the year but most companies prefer to do it during the end of year. If a Leave is encashed then the employee gets money and the Leave Balance is reduced
2. Carry Forward: end of year leaves can be carried forward to the next year. The company can decide the limit beyond which the Leaves will get lapsed. The leaves which are carried forward is shown in the "Opening Balance" except for Two step Compensatory Off where the carried forward leaves are shown as "Accrued"
3. Lapse: if Encashment or Carry Forward options are not given then the leaves which are remaining at the end of year are reduced to zero.
If a leave is setup as accrual for end of year then the timing at which the leave is accrued during the year end processing is important. Suppose there is an end of year accrual of 24 leaves. The logic which is being used is as follows –
• The batch job which manages the year end carry forward logic is run first - so if an employee has a leave balance of 12 and CF max = 10 and CF min = 2 then his 10 leaves will be carried forward and 2 will lapse
• Then the year end leave accrual of 24 will be given
• His next year's opening balance will be 34
• In other words end of period accrual is similar to beginning of period accrual for the next period.
If employee applies a leave for next year and carry forward is not selected for the leave even then he is allowed to submit this leave request. On 1st of next year the opening balance will also include the leaves carried forward due to the approved leaves even though carry forward is not allowed as a policy.
The option to carry forward leaves is not available for leaves where "Leave Basis" = "Per Incidence".
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