1. Florida International University HR Liaisons Meeting January 15, 2009

2. Agenda – Introduction – Payroll Audit –Audit Findings –Audit Action Plan – Payroll Update – FICA Alternative Plan – Open Forum

3. Payroll Audit

4. Scope of Audit –Fieldwork conducted from August 24, 2008 to October 30, 2008 –Audit Period: January 1, 2008 through August 31, 2008 –Objective: –(a) time worked and leave taken were properly approved; –(b) adding or removing employees from payroll and executing pay rate changes were limited to appropriate personnel; –(c) payroll expenditures were reconciled properly and timely.

5. Audit Methodology –Selected 24 Cost Centers out of 1,045 –Selected Cost Centers consisted of 790 out of 7,672 Employees –Selected 4 Pay Period –January 24 –February 7 –August 7 –August 21 –4 Pay Period totaled $41,382,084.00

6. Audit Findings

8. Audit Action Plan – Time Approval Process – Post Guidelines on HR Website – Targeted Communication to Time Approvers every three months – Information will be presented in the monthly HR Liaison meetings periodically – Human Resources will send area Vice President the list of Individuals that were not signed-off by Time Approvers and get them to assist the enforcement of timely approvals for their respective areas and request they go back to validate reported or non- reported work time and/or leave.

9. Audit Action Plan – Nepotism – Employee and Labor relations will be contacting the affected employees and they must complete the nepotism form within two weeks –Access Control – EV4 access will be restricted to the following schedule: – Monday through Friday 6:00 a.m. to 8:00 p.m. – Update Access Request Form to include EV4 request

10. Payroll Update

11. –Form W-2: –The Form W-2 for 2008 will be mailed to your home by January 31, 2009. –Electronic Form W-2 will be available on Employee Self Service (ESS) after January 31, 2009. –Requesting Duplicate 2008 Form W-2: - Available on-line through ESS after January 31, 2009. - Log on to ESS: https://portal.adp.com/public/index.htmhttps://portal.adp.com/public/index.htm - Paper copies can be requested after February 16, 2009. - Use W-2 Replacement Form available on Payroll Website: http://www.fiu.edu/hr/formslibrary/payroll/w2replacement.pdfhttp://www.fiu.edu/hr/formslibrary/payroll/w2replacement.pdf - Please specify if you would like the duplicate mailed or picked up. - All duplicate requests will be processed within three business days.

12. FICA Alternative Plan

13. – IRS Approved Savings Plan for all Temporary Employees (exception: FT students) – Allows employee pre-tax contributions of 7.5% earnings and tax-deferred growth as an alternative to Social Security tax. – Medicare tax of 1.45% of earnings is not affected by the FICA Alternative Plan.

14. FICA Alternative Plan – No matching contributions from employer: 6.2% savings on Social Security withholding – FIU 1 st year estimated savings: $1.5M – No separate administrative fees

15. Employee Benefits –Funds are 100% Vested Immediately –Employee Beneficiary Designations –Self-Directed Investment Options: –Guaranteed Pooled Fund - default account, interest-bearing 3.85% as of 01/01/2009 –17 no-load mutual fund platform –BENCOR Administrative Services processes all account changes –Account information accessible: –Internet: www.bencorplans.com –Customer Service: (888) 258-3422

16. Paycheck Example FICA without PlanFICA Plan $ 2,000.00Gross Earnings $ 2,000.00 $ -FICA Plan Deposit $ 150.00 $ 2,000.00Taxable Income $ 1,850.00 $ 198.75Federal Income Tax $ 176.25 $ 124.00 Social Security Tax (employer savings) $ - $ 29.00 Medicare Tax $ 29.00 $1,648.25 Take-Home Pay $1,644.75

17. FICA Plan Implementation Process – Mailing of packages to all temporary employees by Bencor – Plan effective date: February 6, 2009 – 1 st Deductions to take place February 27, 2009 – Communication for new temporary employees via HR liaisons and new hire package

18. Fund Withdrawals Separation from Service* ◦ Participants can roll money to an IRA, 401(k), 401(a), 403(b), etc. Retirement* Attainment of 70 ½ or retirement, if later. Total disability Death (beneficiaries) * 10% tax penalty may apply to early withdrawals under IRS guidelines (Age 55 at service separation or age 59 ½)

19. – University of Florida – University of South Florida – Florida State University – Florida Atlantic University Participating Florida Universities

20. Questions or Comments? Open Forum