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Unit Payroll October 16, 2017
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Transaction Cycles Purchasing Cycle Revenue Cycle Payroll Cycle
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Far More Danger Disbursing company money to employees
Relatively few independent checks & balances Employees are familiar with the procedures Employees feel entitled Employees are friends with each other
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Payroll Cycle Dealing with individuals, not “commerce”?
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Payroll Cycle Dealing with individuals, not “commerce”
Far more diversity between companies Different documents Different job titles Different reporting paths Different information flows
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NOT FLOWCHART
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President Operations Personnel Controller
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President Treasurer VP Operations Controller Production Manager Director HR Sales Manager
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President Treasurer VP Operations Controller Production Manager Personnel Manager Sales Manager
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President Treasurer Controller VP Operations Production Manager Personnel Manager Sales Manager
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President Operations Personnel Controller
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Tri-Partite Segregation
Human Resources, Personnel, etc. AUTHORIZATION TO HIRE SETUP & MAINTENANCE OF EMPLOYEES & PAY RATES LEGAL REQUIREMENT COMPLIANCE Controller’s Office: Payroll Department PAYROLL PROCESSING Production, Sales, Operations, All Other Depts. INITIATION TO HIRE SELECTION OF CANDIDATE ACTUAL WORK THE EMPLOYEE PERFORMS FOR PAY
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Tri-Partite Segregation
Human Resources, Personnel, etc. Controller’s Office: Payroll Department Production, Sales, Operations, All Other Depts.
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Tri-Partite Segregation
Human Resources, Personnel, etc. AUTHORIZATION TO HIRE SETUP & MAINTENANCE OF EMPLOYEES & PAY RATES LEGAL REQUIREMENT COMPLIANCE Controller’s Office: Payroll Department PAYROLL PROCESSING Production, Sales, Operations, All Other Depts. INITIATION TO HIRE SELECTION OF CANDIDATE ACTUAL WORK THE EMPLOYEE PERFORMS FOR PAY
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Functional Supervisor
Determines Need Functional Manager Human Resources Budget, Strategic Plan, Etc. Executive Management Advertises Position
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Informs HR of which candidates to interview
Human Resources Candidates Candidates Candidates Resumes Screening Best Resumes Functional Supervisor Schedule Interview Informs HR of which candidates to interview
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Informs HR of hiring decision Hiring Decision
Functional Supervisor Candidate Human Resources Interview Creates Offer/Contract Informs HR of hiring decision Hiring Decision Employment Offer/Contract Functional Supervisor Employment Offer/Contract Candidate
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Functional Supervisor New Employee Human Resources (registration) I-9 W-4 Benefits Enrollment
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Functional Supervisor New Employee Human Resources (registration) Employee Master File
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Functional Supervisor Employee Payroll Time Sheet Enters Data Clock Card Hours Data
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Functional Supervisor Employee Payroll Enters Data Production System Production System Hours Data
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Functional Supervisor Payroll Employee Master File Human Resources Production System Time Sheet Hours Data Payroll Run
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President VP Operations Controller VP Personnel Functional Supervisor Payroll Human Resources
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Payroll Prodn System Time Sheet Hours Data Employee Master File Payroll Run Payroll Budget Payroll Budget Payroll Report Payroll Report Treasurer Functional Manager Payroll Report Controller Pay Stub Employee Form 941 Pay Check WithholdingDeposit Emp. Bank IRS
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Payroll Prodn System Time Sheet Hours Data Employee Master File Payroll Run Payroll Budget Payroll Report Payroll Report Payroll Report Treasurer Functional Manager Payroll Report Controller Pay Stub Employee Form 941 Form 941 Pay Check WithholdingDeposit Emp. Bank IRS
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Payroll Disburse-ment File
Prodn System Time Sheet Hours Data Employee Master File Payroll Run Payroll Budget Payroll Report Payroll Disburse-ment File Treasurer Functional Manager Payroll Report Controller Pay Stub Employee Withholding Deposit and Form 941 Emp. Bank Net Pay IRS
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Controller Payroll Report Deposit Receipt Bank Statement Bank Reconciliation
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End of Year (after Dec 31 but before January 31) Payroll Payroll Records W2 W2 W-2 Transmit Employee IRS
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Questions? Questions about a “batch-based” system?
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Transaction Cycles Purchasing Cycle Revenue Cycle Payroll Cycle
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