PSAB SUPPLEMENT 14 PAYROLL

Transcription

1 PSAB SUPPLEMENT 14 PAYROLL Claire Cieremans Chief Finance Officer Los Lunas Schools Introduction and Payroll Highlights Los Lunas Schools Introduction of Supplement 14 Payroll Prep Internal Controls for Payroll Adjustments to Payroll Training and Experience Index Summer Payroll Fair Labor Standards Act Substitutes Employee vs. Independent Contractor W-2 s Problems/Scenarios Questions 1

2 Introduction PSAB Supplement 14 Salaries, wages, and related expenses constitute the major portion of the expenditures for school districts and charter schools. Accounting for payroll activities is among the most important business functions performed by a school district or charter school. It is imperative that payroll processing comply with state and federal payroll regulations as well as maintain strict internal controls and close supervision. A sound accounting and payroll system can provide numerous benefits including: Providing internal controls and safeguards Providing timely reporting on the status of funds, Allowing systematic disbursements to maximize available funds and provide accurate encumbrances enabling staff to monitor the availability of budget. Local board shall establish written payroll policies Payroll Prep Necessary- Background Check!!!! Basic information n W-4 n I-9 (HR) n Social Security Card n Contract n ERB form Mandatory Taxes n Federal Withholding n State Withholding n FICA/Medicare Mandatory Withholdings n ERB n RTC n Basic Life n Worker s Comp n Unemployment Needed Personnel approval Contract/Timecard Salary Schedules Line item to charge Insurances Voluntary Deductions n 403B plans Garnishments Direct Deposit Form 2

3 Internal Controls Segregation of duties-human Resource and Payroll Changes, revisions or errors shall be thoroughly authorized and documentation for audit purposes. Payroll staff does not certify their own time. Cross checking by two or more staff to ensure accurate reconciliation. Access to payroll files is secure and limited. Procedures exist to record vacation, personal, and sick time. Year-end balances of payroll are balanced, reconciled, to w-2 s. Adequate controls over processing, storing, and issues of checks. Adjustments to Payroll Tax Table Changes Rates of Pay, dates of service Voluntary insurance deductions Retirement Timecard pay Stipends Bank Account changes Leaves- Approved Admin Leave without pay 3

4 Training and Experience Index Reporting Audit SEG formula Very important! Summer Payroll Section , NMSA, 1978 states all certified school personnel shall be paid at least once a month during a school year. The salary may be paid at least once a month during a twelve month period although services are to be performed during a period less than twelve months. therefore, payroll for certified personnel who work nine months can be paid over twelve months. Total salary earned must be paid in current fiscal year. Properly accounted for in year end reports 4

5 Fair Labor Standards Act (FLSA) Exempt and Non Covered Employees Executive Administrative Professionals Non-Exempt Employees Everyone Else.. Anytime worked above 40 hours in a week must be calculated at time and a half. Weighted Average/Blended Rate (transportation) Problems If you Don t have policy or procedures to protect you! Utilize strategies to minimize overtime Coaches Substitutes Working before they are hired Accepting Positions they have not been hired for Leave slips not turned in on time and substitutes not getting paid on the proper paydate Not signing the absence slips Insurance? Time tracking method Background check 5

6 Employee or independent Contractor Behavior Control Financial Control Type of Relationship W-2 and 1099 Test Problems/Scenarios Employee s never starting the year and having signed a contract or they stop coming to work and payroll not being notified. There is a chance of overpayment when leave has been exhausted. Employee s going out on extended leave and PR not receiving notification. WC notification s being received before double payment is made. (WC and school) PR receiving notification when employees return to work after an extended absence. When notification is not received, their first check when returning will be late. Timecards and leave slips not being sent in at the proper time. This can result in the employee not being paid in a timely manner and may result in overpayment if they have exceeded their leave. Site changes for employees without proper paperwork and wrong site being charged. (tracking of FTE) T & E accuracy Increments not being signed by the employee until the end of the year or until the next fiscal year. Employees closing bank accounts and not notifying payroll. Payment for services not rendered. 6

7 Questions?? Thank you! 7