Payroll Auditing

1. Payroll Auditing • SOLUTION Alternative Auditing Approaches to Tumultuous Thursday’s Chaos Audit evaluation must begin with clear definition of the work to be audited Visit our website for other items of interest www.sru.edu/payroll Margie Riddell, Payroll Manager This presentation addresses auditing approaches to biweekly payroll processing in an effort to stimulate thinking about how universities can address internal auditing issues

2. Payroll Best PracticesFor people who pay people Payroll Auditing • SOLUTION What is Payroll Audit? Payroll audit is a formal process used to establish internal controls of your payroll Why Review Best Practices? Discover how to simplify and improve the payroll audit review process Visit our website for other items of interest: www.sru.edu/payroll

3. Techniques for reducing the workload and error rate of the HR/Payroll staff Payroll Auditing • Best Practice Are the proper tools in place? Wage Type Reporter for pre and post audits Cost Distribution Report for post audits Why Review Best Practices? To consistently account for all payroll expenses and ensure payments are properly allocated Payroll Best Practices - For people who pay people

4. Payroll Auditing • Best Practice Wage Type Reporter Payroll Best Practices - For people who pay people

5. The Additional Pay Report is used to audit any payment beyond regular earnings. For example, department chair pay, sabbatical pay, out of class pay, summer school payments, dual compensation, overload, individualized instruction, independent study, etc. Payroll Auditing • Best Practice Additional Pay Report Supplemental pay Payroll Best Practices - For people who pay people

6. Payroll Auditing • Best Practice Wage Type Results Additional Payments Report Identify supplemental payments Organize payments by category Quick reference for additional pay Reduces errors during trial payroll

7. Report used to audit and identify any outstanding claims owed to university. For example, the Art Department secretary falls and breaks a bone but the HR/Payroll Office doesn’t get the injury call until 3 weeks after the fact. Payroll Auditing • Best Practice Outstanding Claims Report Identify all claims Payroll Best Practices - For people who pay people

8. Payroll Auditing • Best Practice Wage Type Results Outstanding Claims Report Identify outstanding claims Organize by category Quick reference guide Reduces errors during trial payroll Payroll Best Practices - For people who pay people

9. Used to Audit deferred holidays & compensatory leave being taken and paid in a current pay period Payroll Auditing • Best Practice Deferred Holiday/Comp Leave Used Report Identify used deferred holiday & comp leave Payroll Best Practices - For people who pay people

10. Payroll Auditing • Best Practice Wage Type Results Deferred Holiday/Comp Leave Used Report Identify deferred holiday and compensatory leave payments Organize payments by category Quick reference for leave usage Reduces errors during trial payroll

11. Leave Payout Report:Audit leave being paid out in the current period; comp, sick, annual, etc.Leave Without Pay:Audit any employee not receiving pay Payroll Auditing • Best Practice Leave Payout & Leave Without Pay Reports Identify specific leave payments Payroll Best Practices - For people who pay people

12. Payroll Auditing • Best Practice Wage Type Results Leave Payout Report Leave Without Pay Report Audit any employee not receiving pay Organize payments by category Quick reference Reduces errors during trial payroll

13. Audit all miscellaneous transactions with positive or negative results to an employee's pay. Payroll Auditing • Best Practice Miscellaneous Pay Report Identify misc. pay Payroll Best Practices - For people who pay people

14. Payroll Auditing • Best Practice Wage Type Results Miscellaneous Report Audit any employee receiving miscellaneous pay Quick reference Reduces errors during trial payroll Payroll Best Practices - For people who pay people

15. The Net Compare Report created by Dave Kleman, compares current net pay to previous net pay in order to check any major changes from one period to another Payroll Auditing • Best Practice Net Compare Report Audit for major percentage changes in regular pay Payroll Best Practices - For people who pay people

16. Payroll Auditing • Best Practice Wage Type Results Net Compare Report Identify huge payment changes Identify zero payments Quick reference for CC changes Reduces errors during trial payroll

17. The Retroactivity Report calls attention to any payments or deductions occurring from a previous period, paying in the current period Payroll Auditing • Best Practice Retroactivity Report Identifies prior period(s) payments and deductions Payroll Best Practices - For people who pay people

18. Payroll Auditing • Best Practice Wage Type Results Retroactivity Report Identify payments from other periods Quick reference for retro pay Alter to review Payroll Journal Reduces errors during trial payroll

19. The Garnishment Report identifies all employees with wage attachments Payroll Auditing • Best Practice Garnishment Report Identify wage attachments Payroll Best Practices - For people who pay people

20. Payroll Auditing • Best Practice Wage Type Results Garnishment Report Identify wage attachments Organize payments by category Quick reference for IRS levy, etc.

21. The Overtime Report is used to audit all overtime situations. V.P.’s receive a copy of the Overtime Report reflecting the overtime earnings paid within their specific areas Payroll Auditing • Best Practice Overtime Report Identify overtime Control overtime Audit overtime Payroll Best Practices - For people who pay people

22. Payroll Auditing • Best Practice Wage Type Results Overtime Payments Report Identify overtime Organize payments by category or EE Quick reference for overtime pay Reduces errors during trial payroll

23. The Wage Report is used to audit the hourly wage payroll Payroll Auditing • Best Practice Wage Report Audit hours work for temporary employees Payroll Best Practices - For people who pay people

24. Payroll Auditing • Best Practice Wage Type Results Wage - Hourly Report Identify hourly payments Audit temporary employees Quick reference for hourly Reduces errors during trial payroll

25. Individual timekeepers in all University Departments enter leave, overtime and hours for wage employees into SAP’s CAT.Each pay period timekeepers submit leave slips to HR where they are audited using the CADO Report. Overtime and Wage Timesheets are submitted to PAYROLL where the Wage Type Reporter is used to audit and check all overtime situations Payroll Auditing • Best Practice De-Centralization Leave & Overtime Payroll Best Practices - For people who pay people

26. The process provides at least a two part check for accuracy. Timekeepers check their own work while the staff in HR/PAYROLL provide a double check for all entries.This is where the Wage Type Reporter supplies valuable, easy to audit information. Payroll Auditing • Best Practice De-Centralization Leave & Overtime Payroll Best Practices - For people who pay people

27. Questions? • Audit Process • Reports in an hour or less . . .