Paying your employees fairly, on time and correctly is one of the most important things you can do as a business owner.
But payroll and the Holidays Act 2003 can be complicated, and sometimes things go wrong. Issues with your payroll not only cause problems for your employees, but they can also cause problems for your business.
Serious payroll issues can result in your business being investigated by the Ministry of Business, Innovation and Employment (MBIE) or Inland Revenue (IRD) and can end in fines or even prosecution.
Even MBIE – the agency responsible for overseeing this area – was caught out underpaying staff over several years! As a small business owner trying to do all the paperwork yourself, it can be easy to make a mistake inadvertently and wrongly pay an employee.
So, how do you make sure your business doesn’t get caught out?
One thing you can do is to carry out a payroll audit which will check for any issues and set you up for the future. In this blog, we’ll walk you through what a payroll audit covers and how we can help you do one.
Why Get A Payroll Audit?
There are several benefits to undertaking a payroll audit, both for your and your staff.
The audit can:
- Highlight any historical errors so you can rectify them.
- Highlight any overpayments or underpayments that have been made to employees.
- Provide transparency within your organisation for both company owners and staff.
- Highlight where you need help and connect you with third parties to review Employment Agreements and policies.
- Put you on the right path to creating processes that ensure payroll is compliant moving forward.
What Can A Payroll Audit Look At?
The scope of a payroll audit can be very wide and will depend on the issues that you think have arisen. However, there are usually several key areas that will be covered, including:
- Leave entitlements and accruals
- Leave rate of payments to employees
- Confirmation of backpay calculations and other payments made to staff
- Review of tax and leave treatment of payments processed
- Assessment of payroll records and compliance with relevant acts
Worried Your Payroll Processes Aren’t Quite Right?
If you think something has gone wrong with your payroll, talk to Admin Army about an audit. We’ll highlight any issues and advise you on how to deal with them. Our audit service is tailored to each client, but the process usually includes:
An initial discovery session
During this session, we’ll work to get to know your situation and understand any risks or issues that you’ve already identified.
Comprehensive review
Following the initial session, we’ll review all of your company’s historical data, payroll records and request any source documents or clarification as needed.
Identification of issues and development of a plan
Once the review is completed, we’ll highlight any areas of non-compliance or other issues. Then we’ll help you develop a plan to rectify these issues. We can connect you with third parties, such as HR specialists if you need to review employment agreements or other documents.
We’ll also work with you and any relevant third parties to tell employees of any issues and what is being done to resolve them and answer any queries.
Work to prevent future issues
The last part of the audit process focuses on the future. We’ll work with you to develop your processes and pathways to ensure that non-compliance does not happen in the future. This can include training and resources for your staff and adjustments to your current payroll software if required.
Going forward
Once your audit is complete and any historical issues are dealt with, we can assist with your payroll going forward if you wish. We’ll deal with all your pay, tax, KiwiSaver and leave, as well as keep your records up to date. We work with several payroll software options and can help you get set up online to make payroll and accounting easier.
Ready to wage war on payroll? Then, call in our troops! Get in touch to discuss your options.