JoshIf you’ve been running your small business long enough, you know that being a “jack of all trades” comes with the territory. Though you may have the basics of owning and operating a company, there are certain aspects that you may be just learning as you go. When it comes to things like payroll and accounting, trial and error lessons can ultimately lead to serious trouble down the line.
Mismanaged payroll systems can lead to under or over payments, inaccurate record keeping, and IRS trouble. Not to mention that when employees aren’t paid in a timely fashion (and in full), they tend to get disgruntled, which can hinder office morale, slow productivity, and ultimately lead to lost revenue. The best way to ensure that you avoid all of this is to implement changes to your existing payroll strategy. Below are a few suggestions on how you can accomplish this:
Digitize Employee Check-in Systems – Is your staff currently using the dated punch card system to check in and out each day? This requires the cost of physical punch cards along with data entry software to manage payroll. It can lead to significant human errors, which can ultimately mess up your accounting records. Instead, switch to a computerized method of clocking in and out. Employees can have badge cards created, which they scan in and out daily. This information is then electronically generated into the database to be used for further reporting.
Update Payroll Software – Payroll software is something that should be updated on a regular basis. As new developments come forward, payroll processing companies are offering affordable and convenient solutions that can help streamline payroll processes and keep you in compliance. Software solutions such as ADP Business Payment Solutions, for instance, allow small business owners to electronically pay their staff, which saves time and money.
Talk with an Accountant – If you don’t have a designated accounting team on your payroll, you’ll want to consider consulting with an accounting professional periodically. An accountant can help you in recognizing the pitfalls in your existing payroll system, ensure that you’re in compliance with local and federal tax laws, assist you in generating reports, and help you with other accounting tasks you’re not familiar with.
Set Systems in Place and Stick to It – Keeping up with your financial responsibilities is important as an employer. However, it can often get swept under the rug if there is not a system in place. To ensure that you’re in compliance, try to implement new systems that can help. For instance, once a month you need to review payroll and other expenditures and compare it to bank statements. Quarterly you may need to generate reports to comply with tax laws. Create a calendar or set reminders so that you can stay on top of these very important tasks.
Outsource When Necessary – If you simply don’t have the time or you don’t grasp the concept of payroll and accounting for your small business, you need to outsource. There are qualified vendors, like ADP, that are willing to help you set up, monitor, and maintain your payroll system for you. This reduces the chances for errors and frees up your time to focus on core business issues.
It goes without saying that business owners have a lot on their plate. While certain tasks may be able to take a back seat as you learn, others need to be dealt with right away. When it comes to payroll processing it is important to ensure that the process is efficient and simplified. Utilizing payroll software, consulting an accountant, and outsourcing are all viable options that can ensure that you’re in compliance and paying your team in a timely fashion.