Payroll

Published on March 2017 | Categories: Documents | Downloads: 72 | Comments: 0 | Views: 317
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PAYROLL
Payroll is the sum of all financial records of salaries for an employee, wages, bonuses and deductions. In accounting, payroll refers to the amount paid to employees for services they provided during a certain period of time. Payroll plays a major role in a company for several reasons.  From an accounting perspective, payroll is crucial because payroll and payroll taxes considerably affect the net income of most companies and they are subject to laws and regulations From an ethics in business viewpoint payroll is a critical department as employees are responsive to payroll errors and irregularities: good employee morale requires payroll to be paid timely and accurately.



There are three components to the execution of payroll.  Timekeeping Timekeeping is the means of keeping track of hours worked by non-salaried, or hourly, employees. (Salaried employees are paid a pre-determined wage every pay period.) Timekeeping is recorded manually, via a paper timesheet and keypunching, or automatically, via a time clock feeding directly into your payroll software. Calculating Wages Payroll is responsible for calculating the gross and net wage for each employee each pay period. This is a highly involved process, involving calculations for every employee based on their salary status, benefits, hours worked during a pay period and many other factors. Strict adherence to state and federal tax laws is required. Distributing Checks After wages are calculated, the payroll process is completed with the distribution of checks. This is done either by direct deposit – automatically depositing funds directly into a bank account – or by submitting a paper check and pay stub to an employee, who then deposits the check at a bank branch or ATM.





Types of Payroll Processing

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