Payroll help needed

[LauraG]

I have been helping our Condo Association property manager clean up her books. She has never taken a PT class and is severely computer challenged. The accountant we use also does not like PT nor does he understand it. He'd rather do journal entries to "fix" things rather than correct the errors. arrgghhh. Great pair.

I don't have payroll installed on my laptop at the moment. Right now anytime I try and access the Payroll tasks it prompts me for the registration code. That I can get from the property manager without any problems but I also need to know if I need to install any more software too. My access to her is limited so I want to make sure that I ask for the right things the next time I see her.

I discovered that they are using 2 accounts for the payroll. One is for tax expense and one is for tax payables. The tax expense account needs to be split between the admin and maintenance man's account lines. The payables need to be split between the appropriate federal and state payable accounts. On a quarterly basis the accountant does journal entries to move the dollars to the right accounts. He seems to be also moving dollars between the expense and payable accounts so something is not setup correctly or he does not understand how the PT Payroll module works. I think he may be moving the Medicare_ER, Soc_sec_ER and FUTA_ER to the payable account when they are already being booked there by PT. Does this make any sense?

Can someone give me some directions as to how to correct the employee profiles so that everything is booked to the right account by PT? If we change the employee profiles, can we undo the journal entries and fix the payroll checks so that things are booked for 2004 correctly? I'm not sure if I trust the journal entries that the accountant is making.

thanks,
lauraG

[Holland]

You may want to look at how payroll is set up on the sample companies that Peachtree provides with their software.

Is it possible that the accountant is only making General Journal entries as he pays the taxes each quarter to remove the debit balances from the Payables and credit the cash account?

For one of my small companies that I set up in Peachtree, I do not use the Accounts Payable module because I write so few checks. I just make an entry in General Journal for them. Perhaps that's what he's doing.

I'm not an expert, but I don't think changing existing paychecks is a good idea. I usually enter a "dummy" check to enter adjustments if the employee stub is not correct.

Perhaps you could tell us exactly what kind of entries he's making.

[LauraG]

Part of the journal entry is to split the tax expense between the Admin and Maintenance tax lines on the incomes statements. When I went to calculate the 3Q04 amount I discovered that he was also move $ bwt the expense and payable lines. The property manager writes a check each quarter to send the appropriate taxes to the IRS and State.

[Holland]

I split my payroll similarly between field and office personnel.

The Employee Default section assigns a standard (Std) general ledger acccount for each type of deduction.

However, in each individual Employee Maintenance file you can uncheck the Std box and enter a different GL account number (for the EE or ER section) that corresponds to the proper Maintenance or Administrative tax expense account.

I wouldn't think the payable (liability) account would need to be separated between the two payroll types since it's not on the Income Statement.

[LauraG]

I need to separate the payables bwt Federal and State. I am assuming that I can do that within the Employee Maint file.

How do I get the payroll module to work? Do I need extra software or is it just a matter of registering my copy with the tax service registration code?

[David Palmer]

The payroll module will work without registering for the Peachtree Tax service. Without the tax service you must create the formulas for federal income tax, social security, medicare, state income tax and possibly unemployment and disability costs. With the tax service these formulas (except unemployment and disability) are provided and routinely updated by Peachtree.

With newer versions of Peachtree you may not be able to print w-2's without the tax service.

The payroll system should be set up to record tax withholdings that are liabilities as liabilities and the employer's portion of social security and medicare as both a payroll tax expense and a liability. The liabilities get offset when payments are made to the taxing authorities.

I also suggest practicing with the sample companies to understand how the payroll system works.

Dave Palmer