ShelbyNext Financials: Payroll Foundations (Course #N135) Presented by: Mark Fisher Shelby Consultant 2017 Shelby Systems, Inc. Other brand and product names are trademarks or registered trademarks of the respective holders.
Objective This session covers the basic workings of the Payroll application in ShelbyNext Financials. This session presents the following topics: How to set up the Employer Information How to set up Compensations and Deductions How to set up a New Employee How to run Payroll How to run Inquiry and Make Corrections How to run some basic Reports 2
Moving through the program Here are just a few things that might be helpful as you learn how to navigate through this application. While this browser interface feels significantly distinct from the Shelby v.5 environment, many of the terms and certainly the functionality remain the same. You can always use the Help icon to find help about the page you are using. Navigating to the application To begin using the Payroll application, select Applications > Payroll from the Top Menu. Always use this path to move between applications. Note that you can hold the Ctrl key on your keyboard while clicking an application to open that application in a new tab in your browser. Navigating within the Application Use the drop down lists on the top menu to find links that are grouped to help you move about within this application. These links are organized by six categories: Enter (Add new) Manual Check, Employees to Pay Manage (Process existing) Manual Checks, Payment Processing View (Inquire on Processed Items) Earnings Inquiry Reports (All PR Reports) Employer Information, Compensation Information, Deduction Information, Tax Table Information, Employee Earnings, Employee Inquiry, Compensation Deduction History, 941 Summary, Employer Matching Contribution, State and Local Tax Report, Unemployment Tax Report, Workers Compensation Report, W2s, ACA Reporting, Time Off Hours, California Wage and Withholding, Employee Information, Employee Labels, ACH Prenotification Modify (Set up application) Employer Information, Employee Information, Compensation Information, Deduction Information, Tax Table Information, Control Table Information, Project Information Utilities (Run occasionally) Create New Time Off Starting Date, Change Workers Compensation History, Void Checks, TimeClock Plus Export 3
Personalize Navigation (Create favorite tasks or reports) Users often have regularly used tasks associated with their duties. You can save these most often needed tasks or reports in the right navigation bar. To add something to this right navigation, click the link Add to My Tasks in the upper right of your work area. This task is added to your shortcuts found under My Tasks in the right navigation bar. To add a report, click the similar link labeled Add to My Reports after running a particular report. Current Financial Settings In the upper right corner of every Shelby Financials page you have a control that allows you to alter your financial settings. You can control which Company, Fiscal Year, Period, Bank Account, and Credit Card you are set to use. This controls where you post, what shows up on the reports, and what bank account you use. 4
Getting Set Up There is much to set up when you begin in ShelbyNext Financials: Payroll. You need to set up the Employer, the Compensations, the Deductions, check on Tax Table Information, and then set up each Employee. Once you have done this, you are ready for your first Payroll run. NOTE: If you convert from a Shelby v.5 database, then most of the setup is already completed. There are a few things you should adjust because of the different way ShelbyNext Financials uses this information. Setting the Employer Information (Payroll > Modify > Employer Information) Most of the initial setup in each application is found under the Modify drop down on the top navigation. Hover over Modify, and then click on Employer Information to begin your setup. In this section you set up the Federal and State Tax ID numbers, links to the General Ledger accounts for withheld federal, state, and FICA taxes, and the types of Time Off hours used for employees. 5
Basic Information Enter the Federal Tax ID Number and, if needed, the State Tax ID Number on this page. You also make some decisions about using a Cafeteria Plan. (A Cafeteria Plan is a reimbursement plan governed by IRS Section 125 which allows employees to contribute a certain amount of their gross income to a designated account or accounts before taxes are calculated.) Select whether you issue checks on preprinted stock or use ShelbyMICR checks where the magnetic encoding and everything else about the check is printed on special blank stock. (This is helpful if you have multiple checking accounts. This could save time and money because you do not have to keep switching check stock.) General Ledger Interface Here is where you link to the General Ledger accounts to hold the taxes withheld from employees salaries. Liability accounts are the account types typically used. Time Off Hours Here you decide the names of the types used and which types of Time Off Hours you offer. 6
Setting Up Compensations (Payroll > Modify > Compensation Information) Compensations are the means by which employees are paid. Each compensation type is subject to different tax and compensation restrictions. The software comes with the compensation types that most of our customers need already created. While it is possible to create new compensation types, this should only be done in rare situations and in consultation with a trainer or support tech. It is wise to use only those compensations already set by the program. To use a Compensation type, you must set up a Distribution within that Compensation so the program knows where to draw the money for this payment. Whether you need one or many Distributions depends on how you plan to track your employee payments in your General Ledger. Within the Distribution setup, the bottom two account fields are used for the matching FICA payments by the employer (Medicare and Social Security). 7
Setting Up Deductions (Payroll > Modify > Deduction Information) Deductions are the means by which you take out money from an employee s salary for insurance, retirement plans, or even for the employee s tithe to the church. Just like Compensations, it is wise to use one of the preset Deduction types to be sure the taxes are withheld correctly, unless you have already consulted with a trainer or support technician. To use a Deduction, you assign a Distribution to control which General Ledger accounts are used to hold the funds withdrawn from the employee s salary. There is the option to use a Matching Expense Account for some Deductions, such as a 403b or other retirement plans. This expenses the organization for the matching payment made by the organization to this employee s retirement plan. 8
Tax Table Information (Payroll > Modify > Tax Table Information) This is where the user sets up the state and local taxes to be used for Payroll. All state taxes and several county and local taxes are already listed, so for these the user simply opens a single type and sets the account number, which is typically a liability type of General Ledger account. If you need to set up a new County or Local Tax, then you need to click the Add New Tax Table link to open the dialogue box shown to the right. Using the tax code given to you by your government publication, you can input the needed calculations to create the appropriate tax table. The account number you choose is where these funds are held until paid to the government. 9
Setting Up a New Employee (Payroll > Modify > Employee Information) You can either pull in names used by other applications (Accounts Payable or Accounts Receivable), or you can add names that are completely new to the database. Employee Information To add a new employee, fill in the needed fields on the pertinent tabs. There are several tabs: Employee Information Compensations Deductions Taxes Time Off Hours Other personal and contact information 10
Compensations Each employee has at least one or more Compensation and Distribution applied to his or her record. Add more Distributions each year to show the change in salary or change in other Compensation types. The user can then look back over the Compensations from several years that are added in ShelbyNext Financials. 11
Deductions To pull out insurance or retirement payments from salary, you add the necessary Deductions to an employee s record. Like Compensations, each Deduction has Distributions applied to it to determine where the activity is represented in the General Ledger. Add a new Distribution each year to account for changes in rate or calculation. Taxes Select the Federal, State, and Local Taxes to apply to this employee. Tax types are added on the Modify/Tax Table Information page. Add Allowances, Extra Dollars, or Extra Percentages for this employee, as needed. 12
Payroll Processing To run Payroll, you begin by selecting those to be included in the Payroll run. This is accomplished by hovering over Enter on the navigation bar and then clicking Employees to Pay. If you are already in process, you can hover over Manage and then click Payroll Processing to resume. You come to a criteria page where you are able to filter by the number of times paid per year, by pay group, by salaried or hourly or both, and a field to select the date when the Distribution begins. (The Distribution Selection Date filters to the most recent distribution for each active employee that is equal to or older than the date selected.) If you select to pay hourly employees, then you begin with the Time Entry page and add or edit the hours worked by each of the hourly employees in the payroll run. You can click the Next button to advance or skip to an employee by clicking on that name. When the button changes to Finish, you can click to go to the Payroll Processing page. 13
On the Payroll Processing page you can see each of the employees to be paid with a quick summary of each person s hours, compensations, deductions, taxes, and net payment. There are several ways to filter the employees that show on the grid. You can also select additional employees or clear the employees selected to pay. Click the Expand > icon to the left of any name to see more details about that employee s payments for this pay run. Confirm the dates for the check run (these should ALWAYS match your General Ledger period), your first check #, the number of checks and vouchers, and the settings for the check register and the check stub. If you are paying via ACH, you can elect to email rather than print vouchers for those employees. Once you are ready to proceed, click the Payroll Edit Report button to check your work and then click the green Process Payroll button to post this payroll. This begins the check run and the process to post into Payroll history and to add a journal to the General Ledger. 14
The check preview page displays. Click the Printer icon to begin printing checks. If the printer jams or misprints, then click the Reprint Checks button to reprint those checks that did not print correctly. (Be sure your check date matches the period in the Current Financial Settings.) If you are printing vouchers for your ACH payments, then you next see an ACH Verification Report, followed by a voucher for each employee paid by ACH. Once you have printed these, click the Continue button to move to the Payment Register page. 15
On the Payment Register page, there is a summary of the payments to each employee whether payment is by check or voucher. There are also summary pages for Distributions and Deductions. If there are matching contributions for employee deductions for retirement, then a report with that information also shows. Once you click the Finalize Post button, then a popup window allows you to confirm the Fiscal Year, Period, and Date are correct. If everything is correct, then click the OK button to Finalize and finish this posting. 16
Payroll Earnings Inquiry If you need to look up information about a particular check or what has been paid to an employee so far, then hover over View on the navigation bar and click on Earnings Inquiry. You must first use the filters to narrow the search to an Employee and a date range. You can choose from many predefined date ranges or even a specific date. The Earnings Inquiry can be shown in summary Or by check, with the option to click down to detail. 17
Voiding Payroll Checks Hover over Utilities and then click Void Checks to navigate to undo a payroll check that may have been printed in error. Once you have selected an employee, then you can click the search icon to select a check posted to that employee. After you select the check to void, click the Add to Grid button to add it to the checks to be voided. If necessary, you can add several checks to the grid to be voided all at the same time. Once you have the checks added to the grid, then click the green Void Checks button to reverse these entries in Payroll and send entries to General Ledger and Bank Account Management. The Payment Void Check Register and the Finalize Post page are displayed. Print the report and then click the green Finalize Post button to complete this process. 18
Entering and Posting Manual Checks Occasionally, a check is processed outside the system and needs to be recorded. Another reason for entering a manual check is to correct an employee s payment history. To begin, hover over Enter and then click Manual Checks. Add Compensations, Deductions, and Taxes, as needed, to this employee. This is a good tool for entering catch up Payroll History when beginning a new Shelby database and not converting prior Payroll history for the current year. You can enter negative amounts or make entries where the taxes do not match the payments to allow you to make entries to offset errors in payroll history. 19
Running Reports There are many report options in Payroll. Some reports are made to comply with government regulations, while others provide good information or summaries of the payments made to employees. While this class cannot go into detail for all the reports, you can focus on several key reports most customers use frequently. Some key reports are: Employee Earnings Compensation Deduction History 941 Summary W2s ACA Reporting Employee Information Employee Earnings This is a report to show the breakdown of earnings by each employee. This can be run with detail for each check, summarized by check, or summarized by employee. Choose to include/exclude Compensations, Deductions, Taxes, or zero amount checks. 20
Compensation Deduction History This report shows the history of Compensation rates, Deduction rates, or both for each employee. This also allows for a trending report to show salary changes over the years. You can order each employee detail alphabetically by Compensation/Deduction or in date order. This groups the same compensation or deduction for each year together for each employee or groups those compensations and deductions together by each salary change (by date). 21
941 Summary The 941 Summary is a report the IRs requires quarterly. This reports your deposits whether these deposits are made monthly or semiweekly (depending on what the IRS requires of your organization). Shelby provides two formats of the 941 Summary: The IRS Format This provides the actual form that can be filed with the IRS (either in printed form or in electronic form). The Informational Format This provides the needed amounts based on a specific date range and is very helpful in determining your deposit if you are required to be a monthly or semiweekly depositor. IRS Format Filters tab Select the calendar year and the reporting quarter from the dropdown list choices. Options tab Enter the number of employees on the 12 th day of the final month of the quarter. Enter the amount of the deposits for this quarter. Use the fractions of cents calculation. 22
Other Information tab Add the Signer Information, the Preparer Information (if needed), and the Company Information. There is an optional Designee Information section if Third Party Designee is checked on the Options tab. When you click the Run Report button, the program downloads a PDF file for you to print. 23
Informational Format The Information Format provides the tax figures needed for reporting but allows you to select the date range. This report is helpful when confirming the amount for your monthly or semiweekly deposit. While this choice is not formatted for any IRS report, it gives the amounts and the line number where you plug those into any IRS deposit or form. 24
W2s You can print an edit list to confirm your amounts. Then when you are ready to report to your employees and the IRS, you can either Efile (a pay per use service from Nelco) or Print W2s (which generate the needed PDF files for you to download and print). Several choices exist for printing these forms. You can choose the sort order (straight alphabetical or alphabetical grouped and ordered by department). You can choose a preprinted form or a plain paper form where the data prints along with the form on paper that is perforated to fit the size form you choose. The Universal form can also be used to print 1099 forms. All employees are automatically selected, but you can handpick one or several, if needed. Printed forms are downloaded as a zip file that contains several forms as PDF files. This is a portion of a W2 Universal form. 25
Employee Information This is a helpful report to show you the settings for each employee. There are several filters and options to control the individuals and the information that show on this report. The Filter tab controls which employees are shown on the report based on whether they meet the criteria chosen. The Options tab controls the output and allows the user to include/exclude different data. 26
Q&A Class Discussion 27
Mark Fisher Shelby Consultant Mark.fisher@shelbyinc.com Mark has been a Shelby Independent Trainer since 1998 and currently serves Shelby customers as a Shelby Consultant training in Shelby v.5, Arena, and ShelbyNext. He was previously the Business Administrator at Shandon Baptist Church in Columbia, SC where he gained valuable experience with Shelby software programs. Mark s unique blend of skills and experience allows him to not only tell how the software works, but also helps integrate the software into practical accounting solutions and helps improve customers processes.