Payroll Key Operating Procedures


Like the other modules, the Advantos Enterprise Payroll module has been designed so a user can process a payroll, calculate and pay taxes and prepare and submit required reporting with minimal assistance. While the payroll process can be done by inexperienced operators, because of the severe penalties arising if taxes are not processed correctly, we recommend a supervisory review be maintained over the tax payments.

The primary purposes of the Payroll module are to create and maintain employee salary and benefit records, create or void payroll checks, calculate and pay required taxes and to generate reports, including 940s, 941s and W-2s. We will look at all these functions below, discussing what needs to be done to bring an Operator to a satisfactory performance level.

Create and Maintain Employee Data

In order to create an employee record, the Operator will simply need to verify if an entity is present in the Address Book, with the address to be used for the Payroll Check. If it is present, a simple key stroke will add the record in Payroll, where additional information can be added. If the entity is not present, then it can be added at the time of look-up. The system will assign an employee number at the time a record is added in Payroll. Old numbers can be retained, but no longer will indicate alphabetical order on reports. Before adding an employee to the system, a W-4 form must be on hand so withholding information can be added to the system.

The system will not allow an Operator to skip past the Social Security Number field when adding an employee record. It is possible to force the addition of the record by typing in any number, but it is recommended this not be done due to problems arising from the improper record keeping of any payroll generated using an incorrect tax identification number.

In order to manage this employee data base satisfactorily, there should be a commitment to timely maintenance of all data and to ensuring accuracy of salary, tax and benefit codes.

Maintain Salary Data

The Payroll System provides an easy way to keep salary data updated. The Salary File Maintenance program allows an Operator to update information on salaried employees. It is also designed to allow the salary to be allocated to as many as 10 different employers (clients). The salary may also be allocated to a maximum of 10 G/L accounts, by creating 10 different line items for one client.

Note: An Operator should be aware the salary input here must correspond to the Pay Cycle code selected when setting up the employee record. In addition, when an employee's pay rate is altered, this record will be altered as well.

Maintain Tax Rates

Maintaining accurate tax rates is critical to the correct payment of federal, state and other taxes. The system is designed to streamline the upkeep of this information, but access to this data is restricted to System Administrator security levels.

There are two separate programs for maintaining tax rates in the system and only two types of tax rates--Federal Employee Tax Rates and Other Employee/Employer Tax Rates. Both processes are simple to access and maintain; however, it's critical the data input is correct. Once taxes have been paid, if you discover they were calculated incorrectly, a great deal of work must be done to correct them.

Payroll Preparation

The payroll process in this system has been streamlined, for the user, to the point a complete payroll may take as little as 30 minutes to process, from the input of timesheet information to the printing of checks. A checklist walks the Operator though all the necessary steps, including updating employee records, inputing wage data, running checks and reports, creating and delivering tax payments and issuing payroll checks. The Payroll System, like Accounts Payable, benefits from the laser-printed check feature which creates the entire check, including the MICR numbers, at the time of printing.

The operator must have completed time sheets, and information regarding any changes to salaried wages. All other data maintenance should be completed before beginning the payroll process. As mentioned above, payroll should not be run for an employee where no social security number has been submitted and verified. Also, please remember, payroll is calculated from wages. Therefore, salaried personnel must have wages created from their salaried file prior to processing them in payroll.

Void Payroll Checks

Hopefully, if care is taken to review wage and other data before inputting, incorrect payroll checks can be avoided. However, from time to time, it may be necessary to void a payroll check and re-issue one. The system is designed to make this as easy as possible for the user, ensuring accounting entries are processed automatically from Payroll to General Ledger and the Bank Accounts.

In order to avoid a great deal of extra work, the Operator should follow the payroll checklist closely. This directs the Operator to void payroll checks before the taxes are calculated and the tax payments created.

Calculate and Pay Taxes

Again, the Payroll checklist directs the Operator when in the payroll process to prepare the tax invoices. If the checklist is followed and tax rates and tables have been maintained, taxes will be correct. The tax invoices are automatically posted in Accounts Payable. The Payroll Operator will need to coordinate with the A/P Operator in order to have the tax checks prepared, by special check run if necessary.

The operator must be observant about paying or depositing the taxes on a timely basis. In some instances, there are only three days from the payroll date to deposit Fed taxes without penalty! It doesn't do any good to cut the checks if they don't make it to the bank!!

Generate 940s, 941s, and W2s

The Payroll System provides for easy preparation of tax reports. The Operator can walk through these processes by using the On-Line Help functions or by referring to the operating procedure covering the subject.

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