Enhanced payroll reporting is important for all businesses. If your business has employees, you will have payroll responsibilities.
Generating payroll means more than simply paying employees or printing W-2 forms at the end of the year. Old methods of tracking payroll expenses and tax reporting with spreadsheets and manually-prepared documents can result in very costly errors and time-consuming processes. Accounting software can take out the risk and provide a much faster approach to payroll through system automation.
As with any business, manufacturing and distribution companies must remain aligned with their senior management team and government agencies which each have specific mandates related to payroll. These stakeholders not only have specific required reports, but also mandate when they need to be generated. Your accounting software should provide payroll reports that meet these needs.
Standard Reports for Manufacturing and Distribution Entities
There are a variety of required reports important to your business:
- Earnings ledgers – what was paid and to which employee, including hours worked and time off
- Deductions – taxes, benefits, and other financial withholdings
- Tax withholding – for individual tax jurisdictions, which may be needed on different schedules (monthly, quarterly, or annually)
- W-2 and 1099 forms for year-end reporting to tax authorities, individuals, and suppliers
These reports are critical for your payroll process and to efficiently run your business. Depending on your needs, you may also need specialized compliance reports, timecard proofs and final reports, and ad-hoc reports that you can customize. Manually delivering such reports is time consuming and expensive. Accounting software enables organizations like yours to effectively run reports so better business decisions can be made.
Additional Reporting Needs for Manufacturing and Distribution
Manufacturing and distribution companies have some unique reporting needs, including:
Project Management – Work in Process for manufacturing contracts and projects to accurately account for labor costs. This information provides supervisors, management, and even investors with critical information to track progress and costs vs. budget.
Auditing – Many companies retain internal and external auditors who demand accurate reporting and effective audit trails. Detailed payroll audit reports showing how much was paid, when it was paid, and any changes or adjustments (including raises, corrections, etc.) are helpful.
Employee Information and Detailed Tracking – Your payroll reports should also let you effectively manage overtime, sick days, leaves of absence, and tardiness. Reports can be generated automatically or as needed. Comparison against previous time periods is can help identify trends and opportunities.
Historical Reports – Payroll budgeting usually begins with information that covers past periods. Reports related to payroll expenses including overtime, time off, and benefits, can provide insight into company expenses and can also be utilized for estimating future project costs.
Payroll Reports and Timing
Some payroll reports will be needed for each payroll cycle, other reports may be required by internal departments or external jurisdictions on a quarterly or annual basis, and still others must be available on demand.
Examples of payroll report cycles:
- Earnings and Deductions – if questions arise from any specific employee or legal authority, you will need documentation to support payroll entries. This could include such items as taxes collected, insurance premiums deducted, or legal obligations such as child support. This would typically be required each pay cycle.
- Project Tracking – labor costs charged to a specific contract or project. Typically, a monthly or quarterly report, with the capability to run any time.
- Tax Reporting – Most tax jurisdictions require reporting at least annually, but many demand quarterly reporting.
- Audit Reports – Audit reports can be run for many specific purposes, whether to track deductions, pay adjustments and who made them, or time tracking of employee project hours. These reports can be run any time.
Accounting software should help automate payroll reporting and drive efficiency and accuracy in payroll processing. Solutions such as Cougar Mountain Software’s Denali not only can help with payroll processing, but can enhance all of your accounting processes.
Do you manufacture and distribute a product? We’d love to hear about some of your greatest challenges. Please take a moment and share below.