Page 221 - F1 - AB Integrated Workbook STUDENT 2018-19

Financial systems and procedures

The payroll system

4.1 Stages in the payroll system

The main stages in the payroll cycle and the issues to be considered are as follows:

Employees record hours worked e.g. using clock cards,
Hours worked time cards
recorded
Hours worked usually authorised by supervisor

Salaried employees may receive additional pay for
Overtime
recorded overtime hours. If so, they will submit a timesheet with
details of hours worked

Per hour or per month
Pay rates If manual system, the pay clerk will manually look these
obtained up. If computerised, computer will do this

Hours × rate per hour, or a set monthly pay
Pay calculated If calculated manually, transactions should be checked

Deductions Depending on the country, this could be tax, social
calculated security etc. Deductions are made from gross pay

Usually via bank transfer
Net pay paid to Occasionally via cash. Supervision required to prevent
employee theft and employees should sign to acknowledge
receipt of the money

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