The “days worked” on the retirement report is royally screwed up for one of my hourly employees. What’s the likely cause?

You have the hourly employee marked as “salaried”. Go to Add/Edit Employees and click on the Payroll tab. Uncheck the Salaried box. Note: Salaried employee records that do not have this box check will also have problems with the days worked on the retirement report. If using “electronic” NYS Retirement reporting (ASCII file) – corrections can be made by viewing the file prior to sending it to the retirement system.

Understanding Fund Accounting and Its Vital Role in West Virginia

When we think about accounting, we usually picture a private business trying to maximize its profit. But for government entities—like the State of West Virginia and its municipalities—the primary goal isn’t making a profit; it’s public accountability. This fundamental difference is why governments use a specialized system known as fund accounting.

Fund accounting is a method of recording financial resources and activities within restricted, self-balancing categories called “funds.” Instead of pooling all of the state’s money into one giant bank account, fund accounting divides the money based on its source and the legal restrictions on how it can be spent.

The Three Pillars of Government Funds

To understand how this works in practice, it helps to look at the three main types of funds used by state and local governments:

Governmental Funds: These account for the core, tax-supported services of the government. In West Virginia, the largest is the General Revenue Fund, which pays for public education, state police, and health and human resources. This category also includes Special Revenue Funds and Capital Project Funds.
Proprietary Funds: These account for the business-like activities of the government, where services are financed by user fees rather than taxes. For a West Virginia municipality, this includes Enterprise Funds for water, sewer, and sanitation services. By law, these utilities must run as standalone businesses, and money generally cannot be freely transferred in or out of them.
Fiduciary Funds: These are resources held in trust for others, such as the pension funds for West Virginia’s teachers and public employees. The state manages this money, but it ultimately belongs to the beneficiaries.

Why Fund Accounting is Essential for West Virginia

West Virginia fund accounting might sound like a dry administrative detail, but it is the financial lifeblood that keeps West Virginia’s government functioning legally, transparently, and effectively. Here is why it is uniquely important for the Mountain State:

1. Protecting Dedicated Revenues (The State Road Fund)

One of the best examples of fund accounting in action is West Virginia’s State Road Fund. Maintaining infrastructure across the state’s mountainous terrain is incredibly expensive. The State Road Fund is a dedicated Special Revenue Fund financed by the state’s gasoline taxes, vehicle sales taxes, and federal highway grants.

Fund accounting ensures that every dollar collected from a gas pump in West Virginia is legally fenced off. It guarantees that politicians cannot quietly siphon money meant for filling potholes or paving secondary roads to pay for a shortfall in general government operations.

2. Managing Federal Dependency

West Virginia relies heavily on federal funding, which historically makes up roughly one-third to one-half of the state’s total budget, funding critical programs like Medicaid and infrastructure development. Federal grants come with strict, legally binding strings attached. Fund accounting provides the granular tracking necessary to prove to the federal government that every grant dollar was spent exactly as intended. Without this system, the state would risk losing billions in crucial federal support due to compliance failures.

3. Enforcing the Balanced Budget and Rainy Day Funds

West Virginia law requires the legislature to pass a balanced budget. Fund accounting prevents the commingling of funds, which could otherwise be used to mask deficits or hide the true cost of government services.

Furthermore, when West Virginia collects more tax revenue than it spends, fund accounting dictates exactly how that surplus is categorized. It allows the state to cleanly transfer excess money into its Revenue Shortfall Reserve Funds (commonly known as the Rainy Day Fund). By keeping these reserves in distinct, restricted funds, the state ensures the money is only accessed during true fiscal emergencies or severe revenue downturns, rather than being quietly absorbed into everyday spending.

4. Driving Local Transparency

At the local level, fund accounting protects residents from financial mismanagement. For instance, if a city’s general fund is running low, proper fund accounting prevents the city council from secretly raiding the water utility fund to pay for street paving—a move that would eventually conceal poor budgeting and lead to sudden utility rate hikes or failing water infrastructure.

The West Virginia State Auditor’s Office has championed this structure with transparency initiatives like Project Mountaineer and the WV Checkbook. By mapping local and state expenditures to a uniform chart of accounts, they provide citizens with a clear, searchable window into exactly which funds are collecting money and where those dollars are going.

The Bottom Line

Fund accounting is the architectural framework of government financial trust. For West Virginia, it ensures that constitutional requirements are met, federal dollars are secured, state roads get their dedicated funding, and taxpayers can verify exactly how their hard-earned money is put to work.