AIS+ch13 - CHAPTER13 TheHumanResources...

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CHAPTER 13 The Human Resources  Management / Payroll Cycle 1
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LECTURE OUTLINE Human resources management (HRM)/  payroll cycle Basic business activities and data processing  operations. Decisions needed to be made. Information needed to make these decisions. Major threats. Controls related to those threats.
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THE HRM/PAYROLL CYCLE  A recurring set of business activities and related  data processing operations associated with  effectively managing the employee workforce. The most important tasks performed: Recruiting and hiring new employees Training Job assignment Compensation (payroll) Performance evaluation Discharge of employees (voluntarily or involuntarily)
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PAYROLL SYSTEM One of the largest and most important components of the  AIS Must be designed to meet: Management’s needs Government regulations Incomplete or erroneous payroll records: Impair decision making Can results in fines and/or imprisonment The design of the HRM system is also important because  the knowledge and skills of employees are valuable  assets, so HRM systems should: Help assign these assets to appropriate tasks; and Help monitor their continuous development.
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PAYROLL SYSTEM 5 major sources of input: HRM department  provides information about  hiring, terminations, and pay-rate changes. Employees  provide changes in discretionary  deductions (e.g., optional life insurance). Various departments  provide data about the  actual hours worked by employees. Government agencies  provide tax rates and  regulatory instructions. Insurance companies  and other organizations  provide instructions for calculating and remitting  various withholdings.
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PAYROLL SYSTEM Principal outputs are checks: Employees receive individual  paychecks . payroll check  is sent to the bank to transfer funds  from the company’s regular account to its payroll  account. Checks are issued to government agencies, insurance  companies, etc., to remit employee and employer  taxes, insurance premiums, union dues, etc. Also produces a variety of reports.
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PAYROLL SYSTEM Because employees are so valuable, turnover is expensive Employee morale is also important. Bad morale leads to high turnover. Employee attitudes affect customer interactions and are  positively correlated with profitability. To effectively track intellectual capital and human resources,  the AIS must do more than just record time and attendance  and prepare paychecks. Payroll should be integrated with HRM so management can 
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This note was uploaded on 12/21/2010 for the course ACCT 330 taught by Professor Heidi during the Fall '09 term at Hong Kong Shue Yan.

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AIS+ch13 - CHAPTER13 TheHumanResources...

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