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Advantages of Using a Payroll System for your Business in the Philippines

advantages of payroll system

Before diving into buying yourself a payroll system for your business, it is righteous enough to know first why you are buying one? Will this be an asset that could help the company’s state? Will this help in a quicker production of payroll?

Here in the Philippines, wages are deducted from taxes and other government requirements as these are mandatory deductions and obligation of a working employee.

Another is to increase in salary due to holidays as the Philippines has quite the list of holidays in a year. Though these movements to your salaries are foreseen changes, having a payroll automatically computes it for you makes production of payroll a lot faster and accountable for little to no human error. But what really is a payroll system.

What is a Payroll System?


It is a software created and designed to not just compute an employee’s salary as well as the deductions such as taxes and government deductions. This also includes the filed leaves of absences whether it is a vacation, sick, or emergency type of leave, it will then be compiled alongside the computation of an employee’s wage.

On a more technical side, the system includes gathering of timekeeping information, computation of wages, disbursement of salaries and pay slips.

Advantages of Using a Payroll System


Accuracy is expected


Initially, a user will need to input a new employee’s information together with their salary without deductions. The system will then compute the wage in a recurring basis minus the deductions to output the deducted salary. The good thing about this system is due to the little interaction of manual actions, accurate outputs are expected.

If for some unknown reason, a system suffers from a glitch, the business could then ask for a refund from the provider as it is an anomaly in their created system and accounts for a money back unlike when it is a manual mistake wherein reimbursement could be done to subordinates.

Lesser cost


How it is less? Simple, compare hiring an accountant who will do the manual monthly computations and produce reports within a certain time though works for a small company but if the company is a bigger one then this could be time-consuming and be prone to human errors unlike having a system to do the job for you.

Operation of this system requires little human intervention as the system is already capable of the complex computations needed in producing an employee’s payroll. To make the investment worthy, be sure to have the produced system be created according to your needs to ensure effective and efficient computations.

Adaptable to change


Since every regime in the Philippines always wants change, it is not a shock that every government deductions will be changed as well. It is good to note that a payroll system provider has the capabilities to deliver a system able to cope with the changes thus making it adaptable to changes.

Promotes higher security


How a payroll system promotes security? A payroll system prevents payroll frauds in such are ghost employees (employees who are included in the payroll system but is no longer or is not working for the business), payment manipulation or data breach.

It is of good note that the system notifies users to update login credentials to avoid data breach. The update could be every month or quarterly or what fits best to the business.

Note: Before acquiring a payroll system, be sure to be knowledgeable of the processes of the payroll system in the Philippines as this is crucial to computing an employee’s salary.

Having a payroll system for your business in the Philippines would enable you to have accurate results in no time enabling the company to focus their time to other business activities.
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Accounting Due Process: FASAB’s Rules of Procedure

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The Federal Accounting Standards Advisory Board since its establishment in October 1990 has devoted itself to serve the public interest by improving federal financial reporting through issuing federal financial accounting standards and providing guidance after considering the needs of external and internal users of federal financial information. It has become a significant entity not just for the accounting industry but also for those other industries that involve auditing, payroll, and taxation in general. The accounting outsourcing industry is also put into a conversation as any movement to the standards of accounting set by FASAB should be reflected in their procedures regardless if they are offshore or within the boundaries of the federal state.

As complex at it may seem to decide on actions on how to keep the accounting standards in good shape, FASAB has been able to stay true to its mission thanks to its rules of procedure which has also been their guideline in adhering to the Federal Advisory Committee Act. Through this, FASAB can ensure that the common understanding of the information provided through financial reporting by participating in educational efforts and that its own accountability through governance practices that are transparent and consistent with the Memorandum of Understanding among its sponsors. This is all while considering the views of other accounting trend-setters (international trend, trends upheld by other industries like accounting outsourcing, the World Bank, and offshore markets) and the stakeholders.

In order for FASAB to conduct a timely, open, and thorough study of the accounting issues that might affect the accounting standards, FASAB acts on the following steps:

1. Identification of accounting issues and agenda decisions. FASAB consults and syncs with the Executive Director to first identity projects that need prioritization among its potential projects. When a new project is decided it is added to the list of active agendas and is weighed by the board on how to deliberate on them. A pre-agenda research should be conducted to ensure that the issue has supporting data before being presented in a meeting.

2. Preliminary deliberations. The FASAB deliberates on active agenda items at its meetings. Through this process, FASAB will able to ensure that all issues are identified and alternatives resolution to issues are developed, assessed, and ranked.

3. Preparation of initial documents. FASAB requires that documents that provide background information about the presented issue, summaries of the concepts being developed, and initial listing of options including the possible impact of the resolution are initially prepared before a meeting.

4. The release of documents for comment (e.g., exposure drafts) to the public, public hearings when necessary, and consideration of comments. 

5. Further deliberations and consideration of comments. As the situation demands, FASAB may go under series of deliberations that will require members of the board to further investigate and schedule a further meeting that requires further preparation of documents to support the proposed solution to the issue. 

6. Voting. When the Board has finally decided to proceed to a final pronouncement due to the lack of further substantive revisions to the proposal in the exposure draft then it will require the approval by at least a two-thirds majority affirmative vote of the board.

7. Submission of proposed Statement to the Principals for 90-day review (45 days for Interpretations). 

8. Publication of final Statement or Interpretation. The final statement is then released for public dissemination.

Accounting will remain as a pillar industry that holds other industries to stay intact. And with the help of the Rules of Procedure, we can make sure that we will be able to uphold a fair and safe system of accounting.

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Keeping Accounting on Top: Midyear Accounting Checks and Reviews on Accounting Stability

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The industry of accounting is one of the steadiest industries in the United States. The revenue it has accumulated in the past years is a reflection of its stability. The revenue of accounting, alongside tax preparation, bookkeeping, and payroll services in the United States reached approximately 137 billion U.S. dollars in 2013. In fact, accounting, tax preparation, bookkeeping, and payroll services lead the market with a net profit margin of 19.8% and remain the most profitable industries in 2015, behind legal services, and oil and gas extraction. A portion of accounting’s profit is thanks to the growing industry of outsourcing. The leading accounting and auditing firms worldwide (Deloitte, Pricewaterhouse Coopers, Ernst & Young and KPMG) alone made around 40 billion U.S. dollars between them in 2013, employing more than 717, 000 people. By 2018, this industry is projected to generate around 160 billion or more.

statistic-annual-revenue
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However, being a giant in the market did not excuse accounting from legal cases involving fraud and the like. In a research conducted by Cornerstone Research in 2014 regarding Accounting Class Action Filings and Settlements, the reviews and analyses show that allegations of accounting fraud increased by 47 percent in securities class-action lawsuits in 2014 compared from the data from 2013. This just shows the vulnerability of accounting in the legal aspects.

This is just one of the main reasons why accounting and tax expenditure are closely monitored by the US government in the past decades. In the midyear newsletter of The Federal Accounting Standards Advisory Board or FASAB, they released a follow up in the Risk Assumed—Insurance Programs. The Program Board has approved edits on the terms of Insurance Program, Exclusions, Incurred but Not Reported, Insurance Claim, Insurance Contract, Cash Surrender Value, and Recoveries. Risk Assumed—Insurance Programs objective is to determine the risks the federal government assumes when it implements policy initiatives to provide safety and stabilize financial markets and the economy. It also aims to update the current standards that are limited to insurance contracts and explicit guarantees.

FASAB is a US federal advisory committee which has been established through the Chief Financial Officers Act of 1990 to develop generally accepted accounting principles or GAAP. FASAB serves the public interest by improving federal financial reporting through issuing federal financial accounting standards and providing guidance after considering the needs of external and internal users of federal financial information. The American Institute of CPAs or AICPA Council designated FASAB as the only body that establishes accounting principles for federal entities. FASAB has scheduled meeting regarding Risk Assumed Insurance Programs on the 24th and 25th of August, 19th and 20th of October, and on the 19th and 20th of December.

Various data and research about accounting will prove that it will continue to be a dominating industry for decades to come. And with the FASAB flourishing it up to make it a stable industry with lesser risk, we can count on accounting to stay on top of the market for a very long time.
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3 Careers In The Healthcare Information Technology That Will Continue To Make Impact In The Future

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Technology and research have both improved the quality of our consumers experience and provided us with opportunities for career and employment. Though it is a considerably huge investment to be up to date with technological trends, they are necessary expenses that have undeniably became integral components of any businesses in today’s time and the healthcare service industry has been one good giant proof.

There is no denying that we have entered the age of information. In order to profit, those who provide services to the consumer need to shift as well to answer to the technology that is continually integrated into daily life. Thanks to this, more careers are being created and the existing ones are being completely diversified. Now, graduates of information technology-related courses have more careers to choose from and can even find a niche in the field of healthcare service not just limited to medical customer services.

Medical Coders--

The transformation of the medical diagnosis, procedures, medical services, and equipment into universal alphanumeric codes has become a career that is pivotal in the field of modern healthcare. Medical coders make sure that patients’ medical records are up to date and consolidated. This helps monitor the condition of the patients to give them the healthcare that they need. These records are also used as a reliable database for more medical studies. Also, it makes sure the stability of the healthcare business by keeping track of the payments made by the patients. The transition to ICD-10 has made this an in-demand healthcare profession in the past years. With this, medical coders are also expected to see through lapses where conflicts between the ICD-10 and the old code occur.


Medical Representatives –

With the boom of offshore outsourcing in the field of healthcare business caused by the implementation of the Obama Care or Patient Protection and Affordable Care Act, the demand for personnel in which patients could contact over the phone or online increased. Medical Representatives or Healthcare representatives are often the key point of contact between medical and pharmaceutical companies and healthcare professionals. They take charge of promoting product awareness, answering queries, and providing advices, introducing new products, and providing medical customer services. They serve as the front line of any healthcare providers since they get to interact with the patient often.

Clinical Informatics –

We have mentioned that research is also an important component in today’s healthcare business. While Medical Representatives take the frontline in providing medical customer services, clinical informatics take the sidelines. Clinical informatics helps make sense of the bigger picture of data gathered by converting them into a collective interpretation. Clinical informatics helps in identifying if there are viral outbreaks or plagues. They also use these data to make healthcare recommendations to improve the patients’ healthcare experience.

These are just few careers that healthcare information technology has made possible through the continuous change in the demand of the patients/consumers. With more medical discoveries and research being put in to work each day, we can only expect that the future of healthcare will continue to evolve to cater to the survivability of business and humanity.
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Identity Theft: A Threat To Business Innovation

identity-theft-threat-to-business

The integration of technology to almost every aspect of life has changed the expectations of the consumers to the quality of services that they deserve. Consumers now prefer convenient and hassle-free services that are readily available almost literally when and where they want. And many businesses recognize that adapting to this kind of market would make them sell more. Some would extend their business hours, even going as far as operating 24/7. Others would take advantage of the use of outsourcing and provide over-the-phone customer services. There are even those who have explored the use of mobile apps and online shops in bolstering their consumer reach. But sadly, these business innovations have also made proprietors vulnerable from threats concerning consumers’ safety—identity theft.

Identity theft is the fraudulent acquisition and use of a person's private identifying information, usually for financial gain. Identity thief often uses the information they have acquired such as social security number to open accounts, file taxes, or make purchases. In 2015, the U.S. Federal Trade Commission has reported 490,000 identity theft complaints. It has inflated by 47% since 2014. The sudden increase can be associated to the rise of consumers that are taking advantage of over-the-phone services and online services that require statement of personal information.

Identity thieves, once they get a hold of personal information, can find a way to drain an innocent user’s bank account, run up charges in credit cards, or get medical treatment using health insurance. There are many ways that identity thieves can get a hold of information: they can skim through trash and look for old bills or financial statement; they can also steal mail and take advantage of pre-approved credit card offers—some may even pose as a credible company and send you an email asking for your personal information.

Recognizing the threat that identity theft poses to the safety of the consumers and the stability of businesses, the House has finally passed the H.R. 3832, or the Stolen Identity Refund Fraud Prevention Act of 2016 this May 15, 2016 for the Senate’s review. The bill has been introduced by Rep. Jim Renacci (R-OH) and was co-sponsored by Rep. John Lewis (D-GA). It includes provisions to both establish a centralized point of contact at IRS for ID theft victims and improve taxpayer notification of suspected ID theft.

Identity theft is a serious issue that poses a threat to consumers and businesses and everyone should be aware of it. It puts businesses in a tight situation that consumers will make them question the safety of their information. If you think that someone has assumed your identity to file taxes, contact the Internal Revenue Services. Follow the instructions that they will provide to address fraudulent complaint. To report other identity theft cases, you may visit the Federal Trade Commission website that has been specified to help identity theft victims and spread awareness about it. The website comes up with questionnaires that will help you state the severity of the case. It also comes with a recovery plan and a walk though program in updating and tracking your progress.
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