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Payroll |
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All companies need to pay their
employees. At the end of every pay period (week or month) they run a
computerised payroll application to
calculate how much each employee should be paid. |
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Input :
- A database of employees data
(employee master file) stores
fields such as their identity code, pay rates, NI Number, tax code.
- Timesheets
may be input that record how many hours an employee has worked, and
whether any overtime has been done.
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Data that is input will need to be
validated. |
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Processing :
- Timesheet file may need to be sorted
in the same order as the employee master file.
- The computer will calculate
for each employee:
- The gross amount earned.
- Bonuses or
overtime.
- Deductions such as tax, NI
contributions, pension scheme payments.
- The net amount payable - the
gross amount with bonuses added and all deductions subtracted.
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Output :
- Data in the employee master file will be
updated.
- Printed payslips showing
earnings and deductions.
- Data may need to be sent to the BACS
system so money can be transferred to employee bank accounts.
- Printed reports summarising
the company's payments - needed by the accountants.
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BACS
stands for Bankers Automated Clearing System - It is an electronic
system for transferring money from one bank account to another. |
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A payroll system is an example of a batch
processing system. Timesheet files and employee files are
prepared and then the payroll application is run at an off-peak
time with no human intervention needed. A simple
payslip is shown below: |
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Employee No. |
Employee Name |
Nat. Ins. No. |
Tax Code |
NI Code |
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32771 |
David Jones |
AC548768YH |
413H |
7 |
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Payments |
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Title |
Rate |
Hours |
Amount |
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Rate 1 |
£37.00 |
12 |
£ 444.00 |
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Overtime |
£45.00 |
2 |
£ 90.00 |
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Total Gross Pay |
£ 534.00 |
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Deductions |
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Pay Period |
9 |
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Title |
Amount |
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Pay Date |
13/01/2008 |
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Tax |
£ 68.20 |
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Pay Method |
BACS |
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N Insurance |
£ 32.00 |
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Pension |
£ 11.50 |
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Student Loan |
£ 9.30 |
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Total Deductions |
£ 121.00 |
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Net Pay |
£ 413.00 |
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