Salary Accounting

13.1	Introduction The university’s salaries and wages are administered by the Human Resources Division through the payroll module of the Concept Management system (HRMS). Matters relating to policies, procedures and practices on the administration of salaries and wages are contained in the Administrative Handbook. The control of budgets and accounting of expenditure relating to employment, and the payment of salaries and wages are administered by the Payroll Accountant, in the Human Resources Division. The HRMS is interfaced to the Flinders Finance System General Ledger for the purpose of transfer of data relating to cost of employment. Documentation required for payment of PAYE and Payroll Tax is prepared and authorised by appropriate personnel in the Human Resources Division before passing to the general accounting area for processing of cheques. Net salaries and deductions are sent by electronic funds transfer to Credit Union Services Corporation Australia Ltd (CUSCAL) in Sydney. The amount of net salaries and deductions are compared to the transactions on the bank statements and a reconciliation is performed by the Finance Department.
	Procedure 13.1.1 Interface — HRMS to Flinders Finance System General Ledger 13.1.1.1 Payroll will be run on a fortnightly basis. 13.1.1.2 The payroll interface will be used for the importation of salary and related costs from the Concept Human Resource Management system to the Flinders Finance System General Ledger. 13.1.1.3 Data will be loaded into the ledger from which an Easylink journal is created. 13.1.1.4 Posting of the journal will allocate costs to accounting flexfields. 13.1.1.5 Accrual accounting procedures will be followed in that only costs relevant to a particular period will be posted. 13.1.1.6 Four weekly reporting periods eliminate the need for accruals except for salaries paid in advance. 13.1.1.7 The following steps in the transfer process will be undertaken by the Payroll Section : Generation of General Ledger transactions; Printing of transaction reports; Generation and checking of summary; 13.1.1.8 The following steps in the transfer process will be undertaken by F.U.S.T : Generation of General Ledger batches; Posting of batches to General Ledger.
	13.1.2 Payment of salary, tax and deductions 13.1.2.1 Each fortnight, documentation and authorisation of payments will be issued by the Payroll Section for payment to employees through banks and financial institutions, taxation office and other relevant third parties. 13.1.2.2 Payment will be made via credit transfers through banks and financial institutions as nominated by the employees. 13.1.2.3 The Human Resource Management System (HRMS) produces a computerised disbursement file stating the amount payable to each payee, bank or institution and coded to the relevant clearing account is forwarded electronically to CUSCAL, the University Financial Clearing house in Sydney.This file (hard copy) matches the GL transactions created by HRMS and is transferred electronically to Flinders Finance System and credited to the clearing account. 13.1.2.4 Electronic transfer of the Disbursement file is performed on the Wednesday or Thursday before the pay days. 13.1.2.5 For salary payments not processed through the payroll in the current pay period, the Payroll Section will prepare manual cheque authorisation forms. 13.1.2.6 Manual cheques for signature by the authorised officer will be prepared and the payments will be debited to Salaries Clearing Account (000–0000– –000–0–01). 13.1.2.7 Manual payments will be processed through the Human Resources Management System as cheques already issued. The manual pay creates credits to the Salaries clearing account by electronic transfer.
	13.1.3 Payment of deductions for employees 13.1.3.1 Certain deductions will be made from payroll for direct payment to nominated organisations and institutions on behalf of the staff concerned. 13.1.3.2 The HRMS will produce a total for each deduction organisation.This will be included in the Electronic Disbursement file and the Electronic G/L transactions forwarded to Flinders Finance System.
	13.1.4 Payment of pay as you earn tax instalments 13.1.4.1 PAYE tax instalments will be deducted through the payroll system as pay for each employee is calculated by the HRMS. 13.1.4.2 The payment of the tax instalments will be authorised by the Payroll Section via a computer report produced by HRMS each pay period stating the amount payable to the Australian Taxation Office and an Electronic transaction will be sent to the Group Tax clearing account. 13.1.4.3 The payment to the Australian Taxation Office will be included in the Electronic disbursement file forwarded to CUSCAL. 13.1.4.4 A Group Tax Remittance form will be completed and dispatched to the Australian Taxation Office by the twenty first of the month for pays in the first fourteen days of the month; and by the seventh of the following month for pays in the balance of the month.
	13.1.5 Payment of payroll tax 13.1.5.1 A Payroll Tax Return will be completed and tax computed based on the taxable wages for the month. 13.1.5.2 Payroll Section will submit the Payroll Tax Return after completing each four weekly calculation of gross wages, allowances and the relevant deductible items to General Accounts. 13.1.5.3 A cheque request will be prepared for the total Payroll Tax payable after reconciling the value of taxable wages with the report from the HRMS interface on the total Payroll Tax payable. 13.1.5.4 The Payroll Tax payable will be calculated based on the total taxable earnings at the rate currently prevailing. 13.1.5.5 The cheque request will be coded to the Payroll Tax Clearing Account and processed as an invoice in the Accounts Payable module. 13.1.5.6 The completed Payroll Tax Return together with the cheque will be remitted to the State Taxation Office within seven days of the close of each month, (see section, 10.3).
	13.1.6 Payment of workers compensation premium 13.1.6.1 An invoice will be received each quarter from UNISURE. 13.1.6.2 The premiums are paid in advance and will be authorised for payment by the Director, Financial Services. 13.1.6.3 The payment will be debited to Workers Compensation Clearing Account.
	13.1.7 Deadline for processing of payment for salaries and deductions 13.1.7.1 Documentation and authorisation for the payment of taxes are to be received from the Payroll Section on Monday of pay week. 13.1.7.2 The data will be input into the Accounts Payable module not later than noon Wednesday of the pay week so that cheques can be drawn in the Thursday cheque run.
	13.1.8 Account reconciliations 13.1.8.1 Salary clearing accounts will be kept to record the transactions arising from the payroll interface from the HRMS and from the payment of salaries, taxes and deductions. 13.1.8.2 The clearing accounts will be reconciled every four weeks to ensure correct accounting entries are made and action taken for adjustment of incorrect accounting transactions. 13.1.8.3 The following clearing accounts are currently in use for salary accounting:   TABLE 13 Clearing accounts for salary accounting Clearing Account Account Number Workers Compensation Clearing   Group Tax Clearing 000–0000–7070–000–0–01 Salaries Clearing 000–0000–7071–000–0–01 Payroll Tax Clearing 000–0000–7072–000–0–01 Salaries Tax Garnishee 000–0000–7073–000–0–01 Child Support Agency 000–0000–7074–000–0–01 Manual Pay Advance 000–0000–7076–000–0–01 DEST Garnishee 000–0000–7077–000–0–01 Superannuation Clearing various
	13.1.9 Workers compensation claims 13.1.9.1 Workers compensation claims accepted will be prepared and submitted to UNISURE Claims by the Occupational Health and Safety Section. 13.1.9.2 UNISURE will process the claims and forward cheques for payment. 13.1.9.3 Payment is credited to account 000-0000-5143-00-1. 13.1.9.4 Payroll Section will reconcile payments made by Unisure with claims made. 13.1.9.5 The data on the claim form and the details of payment as supplied by the Cashier will be entered in the 'Debtor Control' Sheet, Payroll Debit Account 000-0000-5143-000–0–01 and credit individual cost centres gross salary accounts through the payroll system. 13.1.9.6 At the end of each period, the balance as shown in the ‘Debtor Control’ sheet will be reconciled with the debtor balance for the Workers Compensation Claim UNISURE Account in the Debtors Ledger. 13.1.9.7 The Invoice History Report from the Revenue module will be produced for the purpose of the month end reconciliation. 13.1.9.8 A list of outstanding claims stating details of employees, date of claim, amount and balances will be prepared from the ‘Debtor Control’ sheets for the purpose of following up outstanding claims with UNISURE.