Preparation and Issuing of Receipts
Roles of Wages and Salaries Office
In every establishment, the preparation of the salaries and wages of employees is the responsibility of someone or a group of persons who would collectively be known as being in the wages department, or the salaries section of the accounts department
The wages department is not only concerned with preparing the salaries or wages of workers each month but is also concerned with keeping good accounting records of all the salaries earned by the staff in the organisation over the years. This information is also kept to make available to the government certain payroll information which may be required by it.
Preparation of a Voucher
A voucher is a mechanism by which the account department can register the amount drawn from a fund or money set aside for a project or venture. This system is used by government and private enterprises to pay for work that has been commissioned to contractors, and for additional expenses of their staff.
For example, a manager who takes a visiting overseas partner to lunch will have to claim the money back. How does he do this? He will attach receipt for such an expense to a Claims’ form. This form and the receipt will then be forwarded to the accounts department where a voucher will be raised to pay the manager.
A Voucher
Preparation of Payroll
In most business organisations, especially large ones, all payroll and tax responsibilities are carried out by a payroll staff in the accounts department.
All businesses are required to keep records that show how much an employee has earned and the amount that has been deducted from the pay of such an employee for various purposes. Periodically, the employer will submit reports required by the internal revenue department of the government which is responsible for tax matters.
In the preparation of wage sheet or payroll, it is necessary to calculate the gross salary or wages of each employee (i.e. allowances accruing to the person e.g. science teachers allowance, house mistress allowance, etc) and all the deductions that are made over a year. The largest amount of deduction is usually the income tax. The amount that is withheld will again depend on the employee’s earning and the number of dependant claimed. Other payroll deductions are in the form of union dues, loan payment (e.g. car loan and furniture loan).
Example: If a man earns N12,000 per annum and pays N1,800 as tax per annum and also pays N5 monthly as union dues and his employers deduct N145 and N25 respectively for a car loan and a furniture loan monthly. His net pay will be calculated thus:
Gross = N12,000/12
Monthly gross = N1,000
Tax = N1,800/12
Monthly tax = N150
Deductions per month = N150 + 145 + 25 + 5
= N325
Net pay per month = N675
A payroll register is a permanent record maintained by the employer, to provide a summary of regular and overtime pay, total earnings, deductions and net pay each employee receives for a given period of time.
Preparation of Pay slip/Advice
The employee’s pay slip explains how the net wage or salary was arrived at and it is normally included inside the pay envelope for those paid by hand or put in the pigeon holes of each employee whose salaries are paid into the bank. These pay slips are printed in sets of ten and they have punch-holes along the top edge.
To arrive at the net wage or salary of an employee, the gross salary or wage has to be calculated first and all deductions both statutory (tax) and voluntary (union dues) have to be calculated and deducted. The pay slip is also known as the pay advice.
Stock Records
Stock records are documents which enable the organisation to determine the movement of goods. In other words, it helps the organisation to determine how materials are used up. In the office, stock record enables the office administrator to know how often goods are required.
The records will help the office administrator to determine the rate of stock turnover, i.e. how often each item stored in the store room or warehouse is required. The fast movement of materials would enable the organisation to allocate the money for office materials. Since everything needed or used is recorded, the office is able to regulate usage and minimize wastage.
Requisition Form
In many organisations, stock records include the requisition form. The requisition form is an internal document used by departments to request production materials. Such a document provides the following:
i. Name of department requesting goods;
ii. Name of person in the department requesting the goods;
iii. Signature and date;
iv. Code;
v. Description of goods;
vi. Units of goods issued;
vii. Quantity required;
viii.Quantity issued by store;
ix. Section for store account;
x. Section of store amount;
xi. Ledger logo;
xii.Remarks.
There are sections for approval by the storekeeper and the receiver of the goods issued.
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