how to account for end of service benefit accrual monthly
Accruing end-of-service every month, before it is owed 1:35 min
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End-of-service is earned every month and paid years later. This is what the Emirates side would owe if everyone left tomorrow. And this is what it grows by, every single month. Across this many people, booked for this many months. Recording a cost in the month it's incurred is called an accrual. Run it for July. One transaction, every active employee, in one pass. Per person: service, daily rate, this month, running total. Service is net of unpaid leave — unpaid leave doesn't count. And some rows are zero, on purpose. Emiratis are covered by GPSSA. Omanis by the Social Protection Fund. And it posted itself to the ledger. Debit expense, credit provision. The cost hits this month. The debt sits on the balance sheet. Booked on exactly the rules that will pay it out.
Frequently asked questions
What is an end-of-service accrual?
Recording the cost in the month it is incurred. End-of-service is earned every month and paid years later, so the accrual books the expense now: the cost hits this month and the debt sits on the balance sheet.
What does one accrual run produce?
One transaction covering every active employee in a single pass, showing per person their service, daily rate, this month's amount and the running total — and it posts itself to the ledger, debit expense, credit provision.
Why are some rows zero?
On purpose — Emirati nationals are covered by the federal pension scheme and Omanis by the Social Protection Fund, so no employer gratuity accrues for them. Service is also net of unpaid leave, which does not count.
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