Page 20 - Essentials of Payroll: Management and Accounting

CHAPTER 1
Creating a Payroll System

After reading this chapter you will be able to

• Determine the differences in transaction steps between an
outsourced, in-house computerized, and in-house manual
payroll system
• Collect all the payroll and human resources information
needed to assemble a new-employee hiring packet
• Properly assemble an employee’s personnel folder and
divide the information into easily accessible subsections
• Use a summary-level employee change form to centralize
all employee change requests into a single document

his chapter provides an overview of how the payroll process typi-
cally functions, using either a payroll supplier, an in-house payroll
Tprocess assisted by computer systems,or an in-house system in which

everything is processed entirely by hand. These descriptions include
flowcharts of each process and details of the controls that are most useful
for each situation. The chapter also covers the types of documents used
to set up a new employee in the payroll system, how to organize this
information into a personnel folder, and how to process changes to
employee information through the payroll system. As noted in the
summary,the information in this chapter is supplemented in later chapters

with more detailed descriptions of specific payroll issues.

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