Introduction

One way to process regular wages and salaries is to set up and re-use a Monthly and/or Weekly Journal in the General Ledger. It can be set up with the following details for reuse:

• Gross Wages or Salaries
• National Insurance Contributions
• Tax Deductions
• regular Deductions such as Pension Contributions (both Employer and Employee), or Union Subscriptions 

The Setup Process

First, set up all the required receiving Accounts in the General Ledger. The system comes with a range of standard examples you can modify to suit your needs.

Employee Categories

In the standard General Ledger Coding System supplied with the System, GL Accounts have already been set up in the Expense (X) portion of the Ledger for:

• Direct Staff (2500, 2510, 2520)
• Sales and Marketing Staff (3000, 3110, 3120)
• Directors (3300, 3310, 3320)
• Admin Staff (3400, 3410, 3420) 

You can modify these Employee Category Headings and/or add additional Accounts to reflect the make-up of your own organisation and how you wish to categorise and present these costs in your P & L Reports.

Expense Accounts

The standard Expense Accounts, representing your Company costs, for each of these Employee Categories, are:

• Gross Salaries (e.g., 2500)
• Employers National Insurance (e.g., 2510)
• Employer's Pension Contributions (e.g., 2520) 

You can expand on these to reflect other Employee Wages or Salary related costs such as Car, Travel, or Clothing Allowance that the Company is responsible for. 

Standard Control Accounts

Standard Control Accounts are pre-set in the Liability (L) portion of the GL Coding System. These accounts maintain the Balances on the Expense Accounts: 

• Nett Payroll Control Account (7600)
• Other Payroll Control Accounts (7650)
• PAYE/NI Control Account (7700). 

You can expand on these and should set up additional Control Accounts for Pension Contributions (of which there may be multiple Companies involved). You might want to separate PAYE from National Insurance if there are different agencies involved.

See:

GL Journals (7.2) - AIQ Academy

Preparing the Journal

In the following example we are going to set up an initial General Ledger Journal using the Admin Staff General Ledger Codes:

1. Go to General > GL Journal Manager and select GL Journal from the dropdown. This opens the General Journal Ledger Entry screen. 
2. This screen displays specific entries for each Employee, in this example Admin Staff Employee Trevor Hayes. If you use Business Analysis, you can associate the employee with a code in the Cost Centre column.

You can create multiple Journals, for items such as Monthly Salaries, Monthly Wages, Weekly Wages, or Directors, and recall them for review and further amendment.

Recalling, Amending, and Re-Using the Journal

To copy a Journal:

1. Go to General > GL Journal Manager.
2. Against the relevant journal, go to the Actions dropdown and select Copy.
   
   
   
   
    
3. Amend the Journal, updating the Date field. You can make amendments such as edit Amounts, add new Employees, delete Employees, or make Name changes.
4. Click Process.
5. When the actual Payments are made to Employees, Inland Revenue, Pension Companies, Health Insurance Providers, and others:
   • their respective Control Accounts will be debited.
   • the Bank Account that provided the funds will be credited.

Speeding up the process

If you decide that you do not need these details on each Employee, or that the volumes are excessive, instead of entering each individual Employee you can:

• use Employee Payroll totals.
• departmentalise them using departments such as Office & Admin Wages, Sales & Marketing Wages, or Factory Wages.