To manage your company’s payroll processing more efficiently, it is advisable to utilize a reliable system of logging employees’ time in and out; check for changes or adjustments in salaries; consistently follow the proper way to manually compute salary or use payroll software; open a separate bank account for your payroll; utilize a uniform delivery system for checks; and save and keep a file of payroll summary for every payday.
Good management is necessary for effective administration of payroll, in your company. As your company grows, the processing of the payroll will become more complex. Here are certain helpful management tips in order to make payroll processing more efficient:
Keep track of employees' reporting and departing time through a dependable procedure
One part of processing payroll includes keeping a record of the hours that each employee has worked. In order to make sure your payroll is correct, you need to have a method to accurately record your staff's work time. In order to avoid this problem, you will have to ensure the reliable tracking of hours worked by utilizing electronic time clocks and online time loggers.
*Time clocks. Unlike older time clocks, modern time clocks can be self-calculating, which means they automatically calculate the number of hours worked between “time in” and “time out,” making payroll processing a lot easier. The best way for small companies, with no more than fifty employess, to keep track of their employees hours is to punch into a time clock using time cards.
*Time loggers that are computerized. If you are managing a larger company, you can utilize computer-based time loggers wherein an employee logs in and out using a computer terminal by entering his employee ID or swiping his ID card through a magnetic stripe terminal. We can either download online time loggers free on the Internet or it be bought with payroll software.
Look for fluctuations in salaries
Prior to getting your list of worked time, ensure that you proofread to account for salary changes. There are several things that will affect payroll, such as new hires, terminations, raises etc.
Use a software for the purpose or apply a reliable manual method to calculate your salary
You must be aware that basic salary is not all that matters when computing an employee’s paycheck. You need to include overtime fees, bonuses, commissions, as well as Federal, Social Security, and Medicare taxes and other amounts to be deducted in the proper order. In order to avoid confusion on your part or on the part of your accountant, ensure you regularly do follow the same method of computation for all your employees, irrespective of whether you are doing it manually or are using payroll software.
Open a separate bank account for your payroll
It is required by law that companies differentiate an account for employee compensation. To distinguish salary payments from other company expenditure a different account, besides being within the law, is more straightforward. It makes it simple to track the approval tasks.
Use a system that gets checks where they need to be via the same method
Employees can cut company costs by receiving their checks electronically, or they have the option to receive paper checks distributed by the inter-office delivery system. Just make sure you utilize a uniform system of delivering pay checks to ensure easy management and minimize delivery issues.
Save and keep a file of payroll summary for every payday
You’ll find it’s convenient to keep a record of payroll details for every payday that applies. This assists in verifying the payroll of your enterprise and guarantees accurate monthly statements. One last point: it’s essential to have a backup of your payroll summaries, so always make printed copies of them and file these in an organized way.
Whether you are working on your company’s payroll manually or using software, these tips will help you manage your payroll better, resulting in more accurate and efficient processing. The question of whether to manually compute wages or use software is up to you to decide, depending on which is more beneficial for your company.