Payroll Resources

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Payroll management is an important function of Human Resources within an organization. Certain aspects of payroll management, such as processing and compliance concerns, are often delegated to outside service vendors.

Payroll has two meanings in a business which are very similar. From a broad company perspective this refers to the sum total of all financial records for an employee or group of employees including salaries and wages, bonuses and deductions. From a purely accounting standpoint, it is more specific, referring to payments to an employee within a certain time frame.

Payroll in both uses is important to a companies finances and the morale of its employees. The accounting department must take care in the preparation and disbursement of payrolls to meet both state and federal guidelines that are required. Payroll and the taxes on it, which are separate and different from income taxes, are generally one of the largest financial considerations for a company, and affect the financial condition of the business possibly more than any other single aspect.

From a morale and ethical perspective, payroll is vitally important to the atmosphere and culture of a business. Employees expect timely and accurate payment for their labor or service, and mistakes in pay, withholdings, or deductions can be a major cause of friction and dissatisfaction among the workforce. Ensuring the timeliness and accuracy of pay should be a top priority for any company's HR or accounting departments.

Pay is most often disbursed by companies in bi-weekly or twice per month (first and fifteenth of the month) payments, although weekly is also fairly common. Occasionally daily, monthly, quarterly, and annual pay occurs, depending on the company and the position. Many companies outsource their calculations and disbursements to a payroll company, which allows for less company expenses in many situations because of lightened burden of regulation and legal compliance, as well as training.
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