Payroll Bank Reconciliation Form by smv12802


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									City of Brookfield
Internal Controls Documentation
Payroll Process

                                       Process Documentation                              Control Procedure

          (A)                                     (B)                                              (C)

                            Employment applications and personnel           File cabinets are locked during non-business
                            records are stored in the Human Resources       hours and only authorized personnel have
                            Department in file cabinets or in a secured     keys to the records storage area which is
                            records storage area.                           locked at all times.
                            All personal employee information entered       A Department Head must sign all Payroll/
                            into the HR/Payroll system comes from a         Personnel Information Forms.
                            Payroll/Personnel Information Form submitted
                            by the various departments when hiring new
                            employees or when making changes to
                            existing employees.
                            The Payroll/Benefits Specialist enters this     These forms are retained in the employee's
                            information into the HR/Payroll system.         personnel file in the Human Resources Dept.
                            Employees submit benefit enrollment forms       These forms are retained in the employee's
                            and W-4 withholding forms to the Human          personnel file in the Human Resources Dept.
                            Resources Department.
                            The Payroll/Benefits Specialist enters this
Initiation of transaction   information into the HR/Payroll system.
                            Annual rate adjustments and any rate            Annual rate adjustments for non-represented
                            changes during the year are entered into the    employees and contractual rate adjustments
                            HR/Payroll system by the Payroll/Benefits       are calculated and approved by the Director
                            Specialist.                                     of Human Resources.
                            Department heads, managers, supervisors,        The Accounting Manager is responsible for
                            and other authorized employees have inquiry     user security of the HR/Payroll system .
                            access to the HR/Payroll system. Access to      Users are limited to accessing information on
                            confidential information such as social         employees within their department.
                            security numbers is limited to authorized
                            HR employees and the Accounting Manager.
                            W-2's are run by the Accounting Department      The Accounting Manager compares the totals
                            and given to HR for distribution.               on the W-2 register to an Earnings History
                            Electronic files of W-2 information are sent    Register, Quarterly Wages report, and to the
                            to the SSA and State by the IT Department       Quarterly Payroll Worksheet summary page.
                            under the guidance of the Accounting Mgr.

                            All employees are paid on a bi-weekly basis.    Time sheets/cards must be approved by a
                            Each Department submits time sheets/cards       department head.
                            to HR for processing by the Payroll/Benefits
                            The Payroll/Benefits Specialist enters each     An Hours Register report is run and the totals
                            employees hours into the payroll system.        by department are checked against the totals
                            The Police and Fire Departments enter their     on the time sheets
                            own hours and the Payroll/Benefits Specialist
                            rolls these hours into the payroll system.
                            Once the imputed hours have been verified,      The following reports are run and retained for
                            the Payroll/Benefits Specialist runs an         each payroll: Direct Deposit Listing, Check
                            earnings calculation which creates the direct   Register, Salary & Benefits Expense Listing,
                            deposit and payroll check files, and also       Earnings Register, Hours Register, Benefits
                            generates various earnings, deductions, and     Registers, and Deduction Registers.
                            benefits registers.

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                                      Process Documentation                                Control Procedure

          (A)                                        (B)                                             (C)
                           The Payroll/Benefits Specialist uploads the       The Accounting Manager logs onto the
                           direct deposit file into the Tridata system and   Tridata system, verifies the amount in the
                           gives the Accounting Manager the Direct           pending file with the amount on the Direct
                           Deposit Report to indicate that the file needs    Deposit Report, and approves the file for
                           to be approved for processing by Tridata.         processing. The Accounting Manager writes
                                                                             the confirmation number on the Direct
                                                                             Deposit Report and returns it to HR.
                           The Payroll/Benefits Specialist runs the          Unused payroll checks are kept in a locked
                           payroll checks. The checks are automatically      storage room in the Accounting Department.
                           signed as they are printed. Advices of deposit    Printed payroll checks and advises of deposit
                           are run for those employees who are on direct     are kept in a locked cabinet in HR until they
Transaction recording
   and processing          deposit (these are not signed).                   are distributed.
                           The Payroll/Benefits Specialist uploads the       The Accounting Manager logs onto the
                           payroll check file into the Tridata system for    Tridata system, verifies the number of checks
                           positive pay.                                     and approves the uploaded file.
                           The Payroll/Benefits Specialist prepares the      Payroll deductions are paid to vendors via
                           detail lists for remitting payroll deductions     wire transfers by the Finance Department or
                           such as deferred compensation, union dues,        checks issued through Accounts Payable.
                           flex benefits, child support, and wage
                           The Payroll/Benefits Specialist runs the Pay      The payroll journal entry can only be posted
                           Day Post which updates employee records           by Accounting Department personnel. The
                           and creates the journal entry for posting to      general Accountant is responsible for posting
                           the general ledger.                               this entry. The Accounting Manager reviews
                                                                             and reconciles payroll related G/L accounts.
                           The Payroll/Benefits Specialist completes a       The Accounting Manager compares the totals
                           Payroll Information Worksheet and e-mails it      on the Payroll Information Worksheet to the
                           to the Accounting Manager. The Accounting         totals on the Earnings Register.
                           Manager enters the payroll information into
                           the Quarterly Payroll Worksheet (excel). This
                           worksheet is used to calculate 941 tax
                           The information on the Quarterly Payroll          The Accounting Manager is responsible for
                           Worksheet is used to complete the federal         the payment of federal/state payroll taxes.
                           state payroll tax remittance worksheets.
                           Payroll taxes are filed on-line and payment
                           is done via ACH debit.

                           In general minor errors in the payroll are        Transactions on the HR/Payroll system can
                           corrected in the next payroll. If an emloyee      only be voided by the Accounting Department
                           has been grossly over or under paid the           with the approval of the Accounting Manager.
                           current payroll check will be voided and a new
                           one issued. For a employee on direct deposit
                           an addditional check will be issued or the
                           employee will be asked to return the funds
                           transferred into his/her account and a new
                           check or direct deposit will be made.
   How the incorrect       Corrections to payroll distributions posted to    Adjusting journal entries can only be made
     processing of         the general ledger are corrected through an       by the City's Accounting Manager, Utility
transactions is resolved   adjusting journal entry.                          Accountant, or Accountant.
                           Errors in employee deductions are generally       HR submits a check request for reimbursing
                           corrected in subsequent payrolls. Over            the employee which must be approved by the
                           deductions are reimbursed through the             Accounting Manager.
                           Accounts Payable system.

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   How the incorrect
     processing of
transactions is resolved

                                      Process Documentation                             Control Procedure

          (A)                                    (B)                                             (C)

                           Payroll related general ledger accounts are     These accounts and totals are reconciled by
                           reconciled on a quarterly basis along with      the Accounting Manager when processing the
                           Y-T-D totals on the HR/Payroll system for       quarterly 941 form. Y-T-D totals tied to the
                           gross wages, withholding taxes, and net pay.    Quarterly Payroll Worksheet summary page.
                           The Accountant reconciles the payroll bank      The Accountant has only inquiry capabilities
                           account on a monthly basis.                     for the HR/Payroll system.
                           The year-end payroll accrual is calculated by   The Accounting Manager uses the detailed
                           processing separate time sheets for hours       information on the Hours Register to prepare
                           worked in the current and prior year. A Hours   the year-end payroll accrual entry.
Process for reconciling
 detail to the general
                           Register is run for the hours worked through
         ledger            12/31 which shows the amount to be accrued
                           by department.
                           W-2 and pension information are reconciled      The Accounting Manager reconciles the
                           on an annual basis as a part of the process     totals on the W-2 register to the Quarterly
                           of providing federal and state agencies with    Payroll Worksheet Summary. Pension totals
                           their required information. The files are       are reconciled to the monthly payment and
                           generated through the HR/Payroll system.        transaction reports filed with the WRS. A
                                                                           WRS Annual Reconciliation Worksheet is
                                                                           created detailing the reconciled totals.

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