___________________________________________________ 

Civil Service Federal Employees Federal Employees Federal Employees 

Retirement Group Life Health Benefits Retirement 

System Insurance Program System 

United States 

Office of 

Personnel Management 

The Federal Government’s Human Resources Agency

Retirement and Insurance Service 

Financial Management Letter 

Number: F-00-05 Date : August 28, 2000 

SUBJECT: RECONCILIATION OF INTERGOVERNMENTAL BALANCES: ACCOUNTING 

FOR THE “STRADDLING PAY PERIOD” 

As you know, agencies must record an accrued expense for employer contributions due the 

Retirement, Health Benefits and Life Insurance Programs at the end of the fiscal year. To do so 

properly, agencies must devote special attention to the pay period that includes or “straddles” 

September 30. 

During the reconciliation of the FY 1999 intergovernmental account balances, we learned that two 

methods were commonly used to calculate the amount to accrue for the “straddling” pay period. 

Some agencies used a ratio of the number of calendar days that fell in FY 1999 over the number of 

calendar days in the “straddling” pay period [i.e., 5/14]. Other agencies used a ratio of the number 

of workdays that fell in FY 1999 over the number of workdays in the “straddling” pay period [i.e., 

4/10]. We used the calendar day method to compute our accrued revenue in FY 1999. The use of 

different approaches to compute year-end accruals resulted in “built-in” and often material 

intergovernmental account balance differences with many of our partner agencies. 

To address this inconsistency, we asked OPM’s Office of Pay Policy whether an employee is 

actually paid for a five-day or for a seven-day workweek. The answer was that employees are 

entitled to pay based on the number of days in their established work schedule – five days per 

week for most. Accordingly, we have established that workdays, not calendar days, should be 

used to calculate the accruals pertaining to the “straddling” pay period. For the pay period that 

“straddles” September 30, agencies must, therefore, multiply their employer contributions for this 

pay period by the ratio of the number of workdays falling in the accounting year over the number 

of workdays in the pay period. 

For FY 2000, the “straddling” pay period is the one that begins on September 24 and ends on 

October 7. Thus, for this pay period, agencies with biweekly pay periods will multiply their 

employer contributions for this pay period by the ratio of the number of workdays falling in FY 

2000 [i.e., five] over the number of workdays in the pay period [i.e., ten]. The amounts computed 

will be reflected as a charge to account 6400G.24 – Benefit Expense – and as a credit to account 

2213G.24 - Employer Contributions and Payroll Taxes Payable [note that this account is new for 
FY 2000]. We will also use workdays in the calculation of our accrued Benefit Revenue for the 

“straddling” pay period. You will note that, for FY 2000, the ratio by which agencies will multiply 

their employer contributions for the “straddling” pay period will be the same, regardless of 

whether they use the workday [5/10] or calendar day [7/14] method. Since this rarity may not 

reoccur for many more years, agencies should seek nonetheless to modify their processes as 

soon as is practicable. 

Please note that a change from a calendar day to a workday calculation is a change in accounting 

estimate. As such, the accounting approach is prospective. No catch-up adjustment should be 

computed or reported. The opening payable balance that agencies should report on their FY 2000 

confirmation report should be their actual balance in account 2210G.24 as of September 30, 1999. 

To assist in the reconciliation, we will ask that agencies note on their FY 2000 confirmation report 

whether the September 30, 1999 balance in account 2210G.24, was computed using a calendar day 

or a workday calculation. 

If you have questions about this matter, please direct them to 202-606-0606 or us at 

finance@opm.gov. 

 

 Robert A. Yuran, Chief 

 Financial Policy Staff 

 Retirement and Insurance Service