Leave Balances & Year-End Processing
Leave balances represent the number of leave days available to an employee under each leave category. Accurate balance tracking is critical for employees planning time off, managers approving requests, and payroll processing that depends on leave consumption data.
This chapter covers how leave balances are calculated, how to view and adjust them, and how year-end processing handles carry-over and lapse of unused leave.
What You Will Learn
- How leave balances are calculated
- How to view leave balances (employee, manager, and admin perspectives)
- How to adjust balances manually
- How fiscal year alignment works for leave calculations
- How year-end processing executes carry-over and lapse rules
- How to generate leave balance reports
- How to review leave history across fiscal years
Prerequisites
Required: Leave categories, leave policies, and policy-to-employee assignments must be configured. See Chapters 21, 22, and 24.
How Leave Balances Are Calculated
A leave balance for any employee and category is computed using the following formula:
Available Balance = Opening Balance + Accruals - Consumed Leaves
| Component | Description |
|---|---|
| Opening Balance | The balance carried over from the previous fiscal year (after carry-over and lapse processing). |
| Accruals | Leave days credited during the current fiscal year based on the assigned leave policy (monthly or annual accrual). |
| Consumed Leaves | Leave days used — i.e., approved leave requests and any LOP-converted days. |
Example Calculation
| Component | Days |
|---|---|
| Opening Balance (carry-over from last year) | 5.0 |
| Annual Accrual (Casual Leave — 12 days) | 12.0 |
| Total Available (before consumption) | 17.0 |
| Consumed (3 CL requests approved) | -6.0 |
| Current Available Balance | 11.0 |
Tip: Employees can view their real-time balance on the Leave section of their self-service portal. The balance updates immediately when a leave request is approved or cancelled.
Viewing Leave Balances
Employee View
Employees can check their own leave balances:
- Navigate to Leaves in the left sidebar.
- The Leave Balance summary appears at the top of the page, showing each leave category with:
- Available balance — Days remaining
- Consumed — Days used so far this year
- Total entitlement — Opening balance + accruals for the year
Manager View
Managers can view leave balances for their direct reports:
- Navigate to Team > Leave Balances (or Leaves > Team Balances).
- A table displays each team member's balance across all leave categories.
- Use filters to view specific categories or date ranges.
| Employee | Casual Leave | Sick Leave | Privilege Leave |
|---|---|---|---|
| Anita Sharma | 8 / 12 | 5 / 7 | 10 / 15 |
| Rahul Verma | 4 / 12 | 7 / 7 | 6 / 15 |
| Priya Nair | 10 / 12 | 3 / 7 | 12 / 15 |
(Format: Available / Total Entitlement)
Administrator View
Administrators have access to organization-wide leave balance data:
- Navigate to Leaves > All Balances (or use the Reports section).
- View balances for any employee across any category.
- Filter by department, office, designation, or individual employee.
- Export balance data for external analysis.
Adjusting Leave Balances Manually
In certain situations, an administrator may need to manually adjust an employee's leave balance. Common scenarios include:
- Correcting data migration errors
- Granting additional leave for special circumstances
- Adjusting balances after a policy change
- Crediting Compensatory Off days
Steps to Adjust a Balance
- Navigate to the employee's profile.
- Go to the Leave tab.
- Click Adjust Balance (or Edit Balance).
- Select the leave category to adjust.
- Enter the adjustment:
- Positive number to add days (e.g., +2 to credit 2 additional days)
- Negative number to deduct days (e.g., -1 to remove 1 day)
- Enter a reason for the adjustment (mandatory for audit purposes).
- Click Save.
The adjustment takes effect immediately and is reflected in the employee's balance.
| Field | Description |
|---|---|
| Category | The leave category to adjust |
| Adjustment | Number of days to add (+) or deduct (-) |
| Reason | Explanation for the adjustment (recorded in audit log) |
| Effective Date | The date on which the adjustment applies |
Warning: Manual balance adjustments bypass the normal accrual and policy rules. Use them sparingly and always document the reason. All adjustments are recorded in the system's audit trail for compliance.
Fiscal Year Alignment
Leave calculations in Udyamo HRMS are aligned to the organization's fiscal year, which is configured through the fiscal_start_month setting.
Common Fiscal Year Configurations
| fiscal_start_month | Fiscal Year Period | Common Usage |
|---|---|---|
| April (4) | April 1 to March 31 | Most Indian organizations |
| January (1) | January 1 to December 31 | Calendar year-based organizations |
| July (7) | July 1 to June 30 | Some educational institutions |
Impact of Fiscal Year on Leave
- Annual accruals are credited at the start of the fiscal year.
- Monthly accruals follow the fiscal year calendar (first credit in the fiscal year's first month).
- Year-end processing (carry-over and lapse) occurs at the end of the fiscal year.
- Pro-rata calculations for mid-year joiners are based on remaining months in the fiscal year.
- Leave reports are generated on a fiscal-year basis by default.
Tip: Verify your fiscal start month under Settings > Organization > Fiscal Year before configuring leave policies. Changing the fiscal year after policies are active requires careful recalculation.
Year-End Processing
Year-end processing is the most critical annual event for the leave management system. It handles the transition from one fiscal year to the next, executing carry-over rules and resetting balances.
What Year-End Processing Does
For each employee and each leave category:
- Calculate unused balance — The current available balance at the end of the fiscal year.
- Apply carry-over rules — Determine how many unused days carry forward based on the leave policy's carry-over limit.
- Lapse excess days — Any unused days that exceed the carry-over limit are forfeited.
- Set opening balance for the new year — The carried-over amount becomes the opening balance for the new fiscal year.
- Credit new accruals — Annual accruals (if applicable) are credited for the new fiscal year.
Year-End Processing Example
| Employee | Category | Year-End Balance | Carry-Over Limit | Carried Forward | Lapsed | New Year Opening |
|---|---|---|---|---|---|---|
| Anita | CL | 4 days | 0 | 0 | 4 | 0 |
| Anita | PL | 12 days | 10 | 10 | 2 | 10 |
| Rahul | CL | 8 days | 0 | 0 | 8 | 0 |
| Rahul | PL | 6 days | 10 | 6 | 0 | 6 |
| Priya | CL | 0 days | 0 | 0 | 0 | 0 |
| Priya | PL | 15 days | 10 | 10 | 5 | 10 |
After year-end processing, the new fiscal year's balances are:
| Employee | Category | Opening Balance | Annual Accrual | Total Available |
|---|---|---|---|---|
| Anita | CL | 0 | 12 | 12 |
| Anita | PL | 10 | 15 (monthly accrual) | 10 + monthly credits |
| Rahul | CL | 0 | 12 | 12 |
| Rahul | PL | 6 | 15 (monthly accrual) | 6 + monthly credits |
Running Year-End Processing
- Navigate to Settings > Leaves & Attendance (or Leaves > Year-End Processing).
- Select the fiscal year to close.
- Click Run Year-End Processing (or Process Carry-Over).
- The system displays a preview showing each employee's current balance, carry-over amount, lapse amount, and new opening balance.
- Review the preview carefully.
- Click Confirm to execute.
Warning: Year-end processing is a significant operation. Run it only once per fiscal year, and review the preview thoroughly before confirming. Incorrect processing can be difficult to reverse and may require manual balance adjustments for every affected employee.
Leave Balance Reports
Udyamo HRMS provides several reports related to leave balances:
Available Reports
| Report | Description | Access |
|---|---|---|
| Leave Balance Summary | Current balance for all employees across all categories. | Reports > Leave Reports |
| Leave Usage Report | Leave consumed by category, department, or individual. | Reports > Leave Reports |
| Leave Approval Report | Summary of approved, denied, and pending requests. | Reports > Leave Reports |
| Carry-Over Report | Year-end carry-over and lapse details. | Reports > Leave Reports |
| Leave Trend Report | Monthly or quarterly leave consumption trends. | Reports > Leave Reports |
Generating a Leave Balance Report
- Navigate to Reports > Leave Reports.
- Select the report type.
- Configure filters:
- Date range — Select the fiscal year or custom period
- Department — Filter by department
- Office — Filter by office location
- Category — Filter by leave category
- Click Generate.
- View the report on-screen or Export as CSV / Excel / PDF.
Tip: Run the Leave Balance Summary report at the end of each quarter to identify employees who have not taken sufficient leave. This helps prevent year-end lapse situations and supports employee well-being.
Leave History Across Fiscal Years
Udyamo HRMS maintains leave history across fiscal years. To view historical data:
- Navigate to the employee's profile > Leave tab.
- Select the fiscal year from the dropdown.
- The system displays the leave balance, accruals, consumption, and carry-over for the selected year.
Historical Data Includes
| Data Point | Description |
|---|---|
| Opening balance | Balance at the start of the selected fiscal year |
| Accruals | Total days credited during the year |
| Consumed | Total days used (approved leaves) |
| Lapsed | Days forfeited at year-end |
| Carried forward | Days transferred to the next year |
| Adjustments | Any manual balance adjustments made during the year |
This historical data is essential for:
- Employee queries about past balances
- Audit and compliance requirements
- Verifying carry-over calculations
- Full-and-final settlement calculations during offboarding
Troubleshooting Common Balance Issues
| Issue | Likely Cause | Resolution |
|---|---|---|
| Balance shows 0 despite having a policy | Policy not assigned to the employee | Assign the leave policy via the employee profile > Leave tab |
| Accrual not credited for the current month | Monthly accrual runs at the end/start of the month | Wait for the scheduled accrual run, or contact admin to trigger it manually |
| Balance is negative | Leave approved beyond available balance | Review the leave request. Adjust balance or mark excess as LOP in payroll |
| Carry-over not applied | Year-end processing not yet run | Run year-end processing for the previous fiscal year |
| Balance does not match manual calculation | Manual adjustment or imported leave not accounted for | Review the adjustment log and import history in the employee's leave tab |
Best Practices
- Run year-end processing promptly. Execute carry-over processing within the first few days of the new fiscal year so that balances are accurate when employees start applying for leave.
- Communicate lapse policies clearly. Employees should know well in advance which leave categories lapse and which carry over. Send a reminder 1 -- 2 months before fiscal year-end.
- Use reports proactively. Quarterly balance reviews help identify trends and prevent issues.
- Limit manual adjustments. Every manual adjustment should have a documented reason. Over-reliance on manual adjustments suggests a policy configuration issue that should be fixed at the source.
- Archive year-end reports. Export and save the carry-over report each year for compliance and audit purposes.
What Comes Next
This concludes Part 5: Leave Management. With leave categories, policies, holidays, the request workflow, and balance management all in place, your leave system is fully operational.
Proceed to Part 6: Payroll, starting with Chapter 26: Salary Components — Earnings & Deductions.