Signs you need to Automate your payroll

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Signs you need to Automate your payroll

 

With human resources and payroll departments under more pressure than ever before, a modern automated payroll solution is an essential for any business, says Sandra Swanepoel, sales director at Sage VIP.

Yet many organisations are still using manual processes that can’t keep pace with the demands of today’s workforce and the fast-changing legal and tax environment. Here are five signs that it is time to consider automating your payroll function.

You are spending too much time on manual work
A payroll system will automate the processes of printing and distributing payslips as well paying your employees each month. That will save you many hours spent manually calculating statutory deductions and spare you the risk of making an error that could put your business at risk. It can also help you do away with mountains of manual work around processing leave applications, calculating hours worked, managing expense claims, printing payslips for employees, and keeping accurate employee information.

You are doing your General Ledger transactions manually
With today’s payroll solutions, you can integrate your payroll data directly into your accounting system. This will save you time because you won’t need to manually capture journal entries for your salary costs. Allocating costs to the right GL accounts and cost centres will enable you to track costs by department or cost centre.

Look for a payroll solution with a trouble-free general ledger interface that cuts your processing time. Manually balancing your journals is a waste of time that could be spent on marketing and sales efforts, growing your business, and taking it to the next level.

Statutory compliance is keeping you awake at night
The labour and tax environment in South Africa is always changing. Making sure your payroll is 100%-compliant will give you peace of mind of knowing that your employees are taxed accurately. It will allow you to give employees a professional payslip that meets the requirements of the law.

Small business owners don’t want to be payroll specialists and they should not need to be. Automated payroll takes the complexities away and gives you peace of mind. It frees your time to look for the best human resources for your business since you’re spending less time on compliance.

You lack payroll reports and find it difficult to manage overtime and payroll costs
Your payroll solution should deliver reporting information that helps you to make consistently informed and effective business decisions. For example, you should be able to mine your payroll data to how employees are contributing to profitability, what resources you need and at what cost for major projects, and where you have gaps or surpluses in your human capacity. Without automation, you will find it hard to capture accurate data and then analyse, present, and share business intelligence.

You are open to payroll fraud or erroneous transactions
Payroll fraud is a major risk, especially for smaller businesses, and erroneous payments can cost you dearly. Payroll software delivers better visibility into transactions, proves an audit trail, and offers a set of controls, checks and balances that help to prevent errors and fraud. Look out for features such as bank account and ID number verification from within the system to reduce opportunities for fraud. With a manual process, you are far more open to fraud and error.

Payroll is just the start
Once your payroll is automated, you could also consider an integrated employee self-service module. Such a solution streamlines your processes by giving your employees user-friendly tools to update their personal details, apply for leave, submit expense claims and overtime, and view payslips and IRP5s online. Transactions are automatically updated in your payroll database, saving you the hassle of doing so manually.

Payroll Plunders

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Payroll Plunders – Payroll Fraud

By , ITWeb contributor
Johannesburg, 10 Mar 2015

Under
standing how HR relates to legislative business concerns is far too often overlooked by executives. HR needs to play an integral role in the legal side of the business, or companies stand to suffer fines and other legal penalties.

“Local legislation evolves constantly, and this plays a big role in business,” says CEO of CRS Technologies, James McKerrell. “Companies need to know and understand how HR fits into legislation, as reporting incorrectly could, for instance, lead to a huge fine.”

Sage HR & Payroll MD Anton van Heerden says it’s especially important for local companies to have a grip on the ever-changing legal landscape. “In SA, law and tax play in a dynamic environment. Since 1994, new laws are constantly coming into play and existing laws are frequently updated,” he says.

Paying on time, for example, is a critical function in any company, and there can be legal implications if a business does not adhere to this. “Not to mention the many facets of labour law and employment equity,” he says.

Payroll fraud

According to Van Heerden, payroll fraud is one of the biggest risks facing companies, with losses bigger than those of cash-in-transit heists. “The worst part about payroll fraud is cases often go unreported by the business, due to embarrassment. Instead of laying a charge against the guilty party, they’re simply let go. Without prosecution, the fraudster will go to another company and do the same there, creating a vicious cycle.”

 By implementing certain features into an existing payroll system, the risk of fraud can be reduced significantly.

Van Heerden suggests the following:

* Access control: Controlling who can access what, and restricting what certain users can do on a particular system.

* ID verifications online: Checking against the Home Affairs database to ensure IDs are legitimate.

* Bank account verification: Verifying bank account details to ensure account number and account holder match.

* Direct link to banking system: Instead of imputing an electronic file into the banking system, a direct link to the banking system can be implemented, ensuring no files can be tampered with en route.

“Despite legislation being promulgated, it’s not being adhered to,” McKerrell reminds us. “Features built in to HR and payroll software can go a long way in helping a company comply.”