Ok The year end approaches and a new Payroll season is about to commence. Two things you should do -
- Prepare for the year end Payment Summary
- Review what Payroll solution you need for 2011-12
Preparing for the End of the Year
Start by reviewing your Payroll records making sure that you have all the names and addresses, tax file numbers even having a dummy run on the payment summary process are all worthwhile activities prior to having the payroll run on the day. With products like MYOB there is a set window you have to run the Payment Summary within before you run the next payroll for the new year.
Now is the time to get that Bank Rec upto date, making sure that what is reported in the payroll matches what you have reported on your BAS and in the Profit and Loss. Considering if Super should be paid out – remember that Super needs to be paid as cleared funds into the Superannuation Fund. And if you have a Bookkeeper – Make that appointment to have the payroll completed and payment summaries prepared.
Planning for 2012
While all the detail is important to get out the Payment Summary for this year – Don’t forget about next year – its just a couple of weeks away as this goes to press!
If you’ve been running MYOB as integrated Payroll perhaps now is the time for some thought on if you should continue. Those upgrades are not getting any less expensive and functionality has been light over the past few years. Do you want to continue this again or consider a different approach? Here are some alternatives to ponder.
Use a Third Party Tax Table Provider
One approach is to consider using a third party tax table such as FGHTables. I’ve not personally tried them but I see no reason as to why this would not work. Your issues would be two fold.
- If there was a change like Reportable Employer Superannuation Contributions (RESC) where there are structural changes inside MYOB then just updating the tax tables would not provide this change to you. You’d have to take the upgrade.
- If you lodge electronically The Tax Office has a format that it will accept. It does change every few years.
This year does offer a unique circumstance. The only change to the tax tables this year is the Flood Levy. There are no structural changes and if you are on the current version the electronic lodgement format is the same for 2012 as the current software. So this is a strategy you may want to consider more closely.
Consider an on-line solution – PayCycle.
Think about it for 10 seconds before you dismiss this. Your Banking is On-Line, Your Email is On-Line. We use the internet to share data like calendars and documents. I even use it to transfer files and communicate with my clients – Live via Skype and GoTo Meeting. Most likely most of you will connect with your computer and the internet on a daily basis. Why not run your Payroll on-line? It’s just the next natural progression and opens up a world of possibilities.
Australia is about the only market that cares about an integrated Payroll and General Ledger solution. Thankfully a lot of people are now realising that its both a pain and more of an exposure to integrate the payroll with the General Ledger. Its much more secure to have it safe on an online system. – Think I’m kidding consider these two facts
- Physical Security -What is the security of your building, your car or where ever you store your laptop? Where ever you hold or store your current MYOB file or its Backup. Do you have alarms, locks, guards – Nervous yet?
- Password Security – If you don’t password protect your file its Administrator and Enter to gain access. Ok you have a password – now go and Google “MYOB Password Reset Tool”. There is no security – Once I have physical access to the MYOB file its less than minute to get in.
The advantage of an On-Line system is Physical Security and Password Security. Being hosted in a secure data centre prevents the physical threat. You are at a level of physical security that a small business can only dream of. You also have the ability to apply technology to the issue of backup’s, version control, testing and new function.
In terms of password security that is somewhat back in your control. You have to store a userid (email address) and password. Of course you can make your password harder to crack with use of special characters $%^ UPPERCASE and Numbers. Your provider can set minimum standards. In PayCycle case its 7 characters one must be special character – an excellent standard to enforce to avoid the simple password.
Importantly once a staff member leaves you can remove their access in about a minute.
But the big thing you are getting with PayCycle is functionality. Every few months you get new functionality most recently the employee portal where Employees can request leave and you can setup approvals for it. Employees can see their payslips and their payment summary. Currently they can view their details – you’d expect in the next turn that they maybe able to update them.
But you can be anywhere there is the internet and process the payroll. For less than the cost of the MYOB upgrade you can have a dedicated payroll system that will save you money right from day 1.
If the running the Payroll in this way excites you the having your General Ledger online with Xero will blow your mind. Naturally you can integrate PayCycle and Xero. If you want to remain with MYOB then you can simply set up a reoccurring General Journal and fill in about 6 figures no matter the number of people on your payroll. Its simple, secure and efficient.
Smart people will tell you that if you continue to do the same thing – typically you will get the same result. The other way of looking at this if you don’t look for improvements to the way you do things – you’ll be passed by your competitor who is. Consider what you could be doing to your payroll processing to make it more efficient and save some money in the process.
Disclosure:
I make no commission from FGHTables. I do sell MYOB, PayCycle and Xero but only make commission if you specifically purchase an MYOB Upgrade from me or Sign up with PayCycle or Xero with Goldmine Bookkeeping Solutions. I’m an MYOB Certified Consultant and a Xero Certified Advisor. I’m a partner with PayCycle.
