Payroll Processing System Report

This report analyzes the payroll processing system of Bina Darulaman Berhad, a Malaysian investment holding company. It examines the benefits of using payroll software, specifically Orisoft, and discusses the role of accountants in managing the system. The report also provides recommendations for improving the existing payroll processing system, including embracing new technologies, keeping updated with legislation changes, and involving employees in the process. Desklib provides past papers and solved assignments for students.

Accounting Information

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Payroll processing system..................................................................................................1
2. Discussion on role of accountant in existing software.......................................................3
3. Improvement in payroll processing....................................................................................4
Summary..........................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Payroll software is a tool which is used by the organisation to restructure and automate
the method of paying the employees. This report discusses about, Bina Darulaman Berhad which
is an investment holding entity in Malaysia. The address of business is level 9 & 10, Menara
Bina Darulaman, 88 Lbuhraya Darulaman, 05100 Alor Setar, Kedah, Malaysia. The activities
include investment holding, provision of management services, oil palm plantation and property
development. The firm have the diversify businesses, which helps them to generate more
revenues. It provides services in leisure and hospitality, engineering and construction, road
building. The aim of company is to provide the maximum returns to its shareholder, to ensure
sustainability of core businesses and to create diversify income sources.
This report also contains financial highlights of Bina Darulaman Berhad. For the first
quarter ended 31 March, 2018 company earns revenue of MYR 47,020,744 compare to MYR
63,867,164 a year ago. Loss from operating activities was MYR 9,475,722 compare to profit of
MYR 1,124,864 on 31 March, 2017. Loss before tax was MYR 10,621,936 compare to profit of
MYR 381,832 on 31 March, 2017. Loss attributable to owners of the parent was MYR
10,768,700 compare to profit of MYR 279,129 on 31 March, 2017. Net cash used in operating
activities was MYR 36,636,310 compared to MYR 33,618,322 on 31 March 2017. Purchase of
property, plant, and equipment was MYR 2,165,307 compared to MYR 4,835,298 on 31 March
2017. This company posted lower revenue for the first quarter compared to the 31 March
2017.This project report discuss about a software which is Orisoft (Financial Highlights, 2018).
This software is used by the company for payroll processing system. The role of accountant in
this software and improvement suggestions are also discussed for better payroll processing
system. Benefits of software for payroll processing system in the organisation is also discussed
in this report.
MAIN BODY
1. Payroll processing system
Payroll refers to the total amount of wages paid by company to its employees and other
workers. It includes everything that has to do with the payment of employees and the filling of
employment taxes. In today's time, managing the payroll system is very complicated task. So to
manage the payroll there are software’s installed which is used by the companies. These software
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automates the process of paying salaries, calculating wages and other deductions. This company
is also using the payroll software to make payment of salaries to the employees. The software
that company is using Orisoft, Orisoft provide the human resource solution to the companies to
manage its human capital with dynamic competitive tools that is flexible and easy configurable
for the payroll management. There are various benefits of this software which are as follows
(Bushman and Williams, 2012).
Avoid making mistakes:
The mistakes in the payroll system are consider as big faults and it can increase the total
cost for organisations. For an example, Bina Darulaman Berhad has a number of workers all
working together therefore there can be error in paying their salary so, firm is using Orisoft
payroll system as it has various benefits. It helps this company to reduce the chances of costly
errors which can occur while paying the salary to employees. If company, make a mistake of
being overpaid to employees then business might have to bear huge cost for that particular time.
So the main advantage of this software, can reduce the risk of human error and ensure employees
get the exact pay.
Time Saving:
There is saying “Time is Money”, so the payroll software helps the companies to save
their time from payroll activities and invest that time in business development. The big company
like Bina Darulaman Berhad is also using the Orisoft payroll software for their payroll activities.
As this software automatically process the salary to the employees on time and it also perform
other activities of business like deduction of employees taxes etc. Overall it helps company to
save their both time and cost (Dimitropoulos, Asteriou and Siriopoulos, 2012).
Cost effective:
The software helps in saving the recruitment cost of business. as payroll software itself
manage all the activities of payroll management. By making the switch from a paper based
payroll processing system to a more efficient payroll software system can save huge money for
the company. There is no need for hiring professionals for the payroll software operations so
company can save their recruitment cost also. And they can invest their money somewhere else
to expand their business. For an example, This company is also saving cost by using Orisoft
payroll software for payroll management. The Orisoft manage all the activities of company
related to the payroll management and helps company in cutting excess cost and generate more
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revenues. Preparing accounts for employees using traditional methods requires ample of cost
involvement of accountants and stationary, using this type of software helps in avoiding all those
costs.
Reliability:
The reports that are generated by payroll software are both authentic and highly accurate.
This means that one can rely on those statements that are prepared by the payroll software. The
software prepares the statements like latest tax updates and salary slip etc. The statements are
prepared by software and one can easily rely on the information provided by this software. The
example can be taken of Bina Darulaman Berhad company, as company use the Orisoft for
managing payroll activities. This software provides the authentic reports and statements to the
company regarding the latest taxes and deductions of employees to the management. Using
traditional methods for recording employees’ wages and their status considered to be less reliable
as those accounts are prepared by humans which has high chances of mistakes but using payroll
software this task can be done with high accuracy and reliability.
2. Discussion on role of accountant in existing software
Accountant plays a major role in the software for the payroll processing system in the
organisation. He/she is responsible for taking care of their employee’s finance. This includes
managing payroll for employees in various ways such as preparing taxes, analysing financial risk
inherent in a company's structure and provides advice on financial matters related to the payroll
system. For better distribution of salary and wages manager can use payroll software system.
Accountant of this company has various roles in Orisoft software which are as follows (Enahoro
and Jayeoba, 2013).
Easy Payroll Distribution:
Accountant of Bina Darulaman Berhad use Orisoft software for distribution of payroll.
Payroll distribution should be consistent, reliable and easy for everyone involved. Orisoft payroll
software allows the accountant to offer their employees direct deposit options and paper pay
check options. Employees can count on a pay check being distributed at a specific time, it
improves contentment with the company. It helps the accountant more content with its
accounting services for example: The organisation uses the Orisoft payroll software which helps
in easy distribution of their wages and salaries. And it provides the authentic information of their
pays.
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Accountant payroll programs assist with taxes and compliance:
Taxes are difficult to calculate because it a time consuming process and complicated
process. Chances of mistakes can result in penalties for employees. It can reduce the accountant
credibility and cost money if the taxes are covered under guaranteed services. Orisoft payroll
software is used by the accountant of this company for payroll distribution. Accountant use this
software for better tax calculation. This software can also be used to file taxes with a few clicks.
May provide self-service options for employees:
Payroll software provide all information to the employees and employee can check it on
software. These information includes present, absent, salary, hours of work, incentives, leaves,
deductions, taxes etc. Accountant give excess to employees of payroll software so that they can
check that information which are need by them (Jones, 2011).
Makes adding new hires easy:
Payroll software makes easy to add new hires in the organisation. Orisoft payroll
software makes easy to add a new employee to payroll and according to the need it set rules for
compensation. Accountant of this company add new employee information on software and then
software calculates the payroll of employees. This is the role of accountant to add new employee
information on payroll software. This payroll system even allows human resource manager to
keep functioning of these software on automatic mode. With the help of this mode, salary will
automatically be credited to employees’ accounts.
Other customization options:
Accountant has to maintain information of more than one employees. These information
includes weekly or monthly bonus, commission, pay vacation, pay based on performance.
Through Orisoft payroll software account maintain all this information related to the employees.
It is the role of accountant to maintain it properly. Accountant of Bina Darulaman Berhad has
follow its roles related to payroll processing system. It uses Orisoft payroll software for
distribution of payroll. Pay roll software provides various customisation features such as if
human resource manager of this company wishes to process data in form of graphs than they can
do it.
From the above roles of an Accountant, it can be said that Orisoft is one of the best
software for monitoring and controlling the system of employee payroll. As this helps in bring
efficiency and employee satisfaction. This software even evades the chaos.
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3. Improvement in payroll processing
The improvement is continuous process and it is necessary to keep doing improvement in
business as well as activities of business. To improve the existing payroll system of this company
there are certain ways which are as follows:
Keep updated with legislation changes:
Laws are governed by government and it keeps changing so one should be always keep
updated with these laws for smooth functioning of business. The last few years have seen an
unprecedented amount of legislation changes affecting payroll systems. It is essential to stay on
top of the new law’s requirement, which means a software provider, should have close
relationship with both HMRC and the pension regulators to handle the changes efficiently. So for
this company, it is essential to be updated with the laws and make changes in software
accordingly. For the smooth functioning of Orisoft payroll managers should make changes in
software according to the laws (Kuznetsova, 2011).
Embrace new technologies:
Technology keep changing and by adopting new technology the companies can improve
their workings. As obsolete technology increases the cost of company and new technology helps
in increasing the revenue of the business. The establishment Bina Darulaman Berhad can use
cloud technology in their software Orisoft. The using cloud will help the company to save time
of both employees and payroll managers. Cloud will allow to get all information regarding
payrolls on the smartphone of employees. So it will save cost of company as they will not require
to give paper prints of statements to the employees. It will be easy for employees of this
company, they can access their payroll information from anywhere.
Involvement of Employees:
The employees are the end user and they can help, to identify any lacking, confusion
misunderstanding regarding payroll. The company should ask employees which payroll
processes work for them and whether there are any areas that needs improvements. If any senior
manager is facing the issue of payroll then separate meeting with them can help, to identify the
lacuna in software and then according to that improve the process of software. As the manager
can ask the new suggestion from the employees can help to improve process of software. For
improvement of Orisoft, payroll manager of this company can ask employees to record the task
like attendance hours, verify expenses and sign off paid leaves etc. It will help employees to
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understand the whole process of payroll system and if employees find any mistakes then it can be
rectified (Ruivo, Oliveira and Neto, 2014).
From the above points, it has been determined that company should process various
systems to enhance their payroll processing systems. The selected company should take help of
latest technologies and legislation changes to enhance their payroll processing.
Good integration with other functions:
A good way to ensure payroll is as streamlined as possible is to integrate the payroll
software with other functions like accounting and HR. The integration will help to avoid
duplication of work and provides maximum efficiency. This company perform different function
so it is essential that payroll should be well integrated with the other functions of business. It will
help in improving the process of software and efficiency will also improve.
 HR and Payroll: There should be integration between HR and Payroll as they should
transfer up to date information of employees between each other.
 Finance and Payroll: It is important that payroll and accounts teams work closely to
ensure payroll costs are accurately reported. As data can be transferred from payroll
directly to the nominal ledger of accounts package.
This integration will help this company to ensure accuracy of software and will improve
the process of software (Omolehinwa and Naiyeju, 2012).
Summary
As from the above report, it has been shown that Bina Darulaman Berhad is an
investment holding company in Malaysia. It engaged in the business of investment holding,
provision of management services, oil palm plantation and property development. This company
is engaged in diversified business activities to earn more revenue. This report discusses about the
software for payroll processing system in the organisation. This organisation is using Orisoft
payroll software for distribution of payroll to its employees. Aim of this report to analyse the role
of accountant in payroll software and recommendations for the improvement in payroll
processing system. Apart from this, the report covers the benefits of payroll processing system,
explanation of Orisoft payroll processing system software, role of accountant in Orisoft payroll
software, suggestions for the improvement in existing payroll processing system. Accountant of
this company is using Orisoft payroll software which is very useful for the distribution of payroll
for its employees of organisation. For future improvement organisation can keep updated with
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legislation changes, embrace new technology, involvement of employees and good integration
with other functions. Orisoft payroll software is very useful for the distribution of payroll of its
employees who are working in this company.
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REFERENCES
Books and Journals
Bushman, R. M., & Williams, C. D. (2012). Accounting discretion, loan loss provisioning, and
discipline of banks’ risk-taking. Journal of Accounting and Economics. 54(1). 1-18.
Dimitropoulos, P. E., Asteriou, D., & Siriopoulos, C. (2012). Euro adoption and the quality of
accounting information. Managerial Auditing Journal. 27(3). 299-328.
Enahoro, J. A., & Jayeoba, J. (2013). Value measurement and disclosures in fair value
accounting. Asian Economic and Financial Review. 3(9). 1170.
Jones, M. (Ed.). (2011). Creative accounting, fraud and international accounting scandals. John
Wiley & Sons.
Kuznetsova, S. (2011). The transformation of accounting systems in the chaotic economy
structuring: The synergetic approach. Risk and Decision Analysis. 2(3). 151-160.
Omolehinwa, E. O., & Naiyeju, J. K. (2012). Theory and Practice of Government Accounting in
Nigeria.
Ruivo, P., Oliveira, T., & Neto, M. (2014). Examine ERP post-implementation stages of use and
value: Empirical evidence from Portuguese SMEs. International Journal of Accounting
Information Systems. 15(2), 166-184.
Saleh, F. M. (2013). Critical success factors and data quality in accounting information systems
in Indonesian cooperative enterprises: An empirical examination. Interdisciplinary
Journal of Contemporary Research in Business. 5(3). 321-338.
Ward, K. (2012). Strategic management accounting. Routledge.
Online
Accounting Information. 2018. [Online]. Available Through:
<https://www.stedwards.edu/undergraduate/accounting-information-technology>
Financial Highlights. 2018. [Online]. Available Through:
https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=4484622.
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