We recently had a customer who is a government entity update with the Round 4 payroll update for Microsoft Dynamics GP 2010. As a government entity, employees are subject to Medicare tax, but not Social Security tax. After the Round 4 update was installed, deduction codes which were tax sheltered from FICA were no longer populating during the Paycheck Calculation process.

A case with Microsoft was opened. The initial solution we received from them was a script to run in SQL, which was no more than doing the same method of unchecking the Tax Sheltered From FICA box in Deduction Code Maintenance. This obviously was not an acceptable solution because now employees’ taxable wages would not calculate correctly.

In informing the solutions specialist for Microsoft of this, the case was then escalated to development for Microsoft to do additional testing on their own. It was deemed that this was indeed a “bug” and been released in Quality Report #62784 “Deductions missing from Calc based of Tax settings after you apply the round 4 tax update”.

I am told our client is listed as one of those majorly impacted by this bug and no incident was charged in the matter. In fact we were the first to alert Microsoft of this issue to the Development Team. As of right now, in order for deductions to be taken out of their employees’ checks, their taxable wages remain incorrect. There is no way to move backwards from an update other than restore from a backup, but data had been put into the system by the time this “bug” was discovered.

As of Friday (May 13, 2011), we received confirmation that a “hot fix” will be released on this issue in June 2011. There have been many Microsoft Dynamics GP clients affected by this “bug”. It is my opinion that we do not update any of our other government employees to the Round 4 Update or SP2 until this “hot fix” is released.

K. Caron
Consultant