How To Minimize Payroll Cycles

Let’s admit that many of us who run small private companies still proceed with the payroll function in house. Nothing is wrong with that; when you have some bright staffs available to handle the task and do some more tasks, that is an efficiency!

But, in-house payroll processing becomes a great time consuming when many different payment cycles are existed in one company. Consider if only two time cycles are exist: one group of employee are paid on weekly basis and the group is paid on monthly basis. It means the accounting staffs have to prepare five times of payroll in a month (4x for weekly basis + once for monthly basis). How if there are also another group paid on biweekly basis? Do you still see efficiency? I doubt it.

Now, how if you can make it once a month—monthly payment? It is a real efficiency for sure. If you plan to do so, discuss it with the other part of the company’s management to make sure there is no significant refusal from the employee. You may not be able to get exactly as what you want, but you can reduce the payroll cycles gradually.

Author: Lie Dharma Putra

Putra is a CPA. His last position, in the corporate world, was a controller for a corporation in Costa Mesa, CA. After spending 15 years as a nine-to-five employee, he decided to serve more companies, families and even individuals, as a trusted business advisor. He blogs about accounting, finance and tax, during his spare time, and helps accounting students (around the globe) to understand the subject matter easier , faster. Follow him on twitter @LieDharmaPutra or add him to your circle at Google Plus Lie+

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