CFO’s Guide to Payroll Management: 3 Key Factors for the Best Solution
Outsourcing your payroll management and processing is a good option for businesses who do not have the in-house talent to do so. However, not all payroll outsourcing providers are created equal. Some may only offer cost-cutting solutions but are not aligned for your long-term goals.
To help you find the right payroll processing partner, here are the key factors that you should take into consideration when choosing a solutions provider:
1. Cost of Services
With payroll being one of the largest expenses of a company, it is important that you should already know how much your payroll solution should cost annually.
These include the operating costs, as well as costs of software license and other tools that you will use. All these figures should be taken to consideration early on. Study the different kinds of software and delivery models (on-premise, managed hosting, fully outsourced, or partially outsourced), know the pricing schemes for each, and figure out what setup will be most appropriate for your company.
Though payroll services providers may charge for either every pay run, pay slip, or pay reports, it would be better to have an all-inclusive price to pay annually.
2. Technology Compatibility
Choose a payroll solution that’s truly compatible with your organisation in many aspects. First, it should be compatible with your current accounting/financial solution, for easy posting to the payroll general ledger and for your payroll general ledger accounts to always be up-to-date.
Secondly, your HR team should be able to easily make sense out of the workflow and streamline their employee-monitoring activities. This will help them draw insights on the administrative process easily and generate real-time data reports anytime requested.
The most important of them all is that your payroll solution software should be easy to use. When payroll software is easy to navigate, employees get the motivation to provide the most accurate data each time, and management is also empowered to share this precise information throughout the company. This will lessen the time for verifications and will totally improve the efficiency of your entire payroll process.
Leading Australian payroll software are now compliant with the single touch payroll regulation set by the ATO. This helps businesses report payroll activity to the ATO every pay run in the specific format required.
When choosing a payroll solution, it is always best to think ahead and opt for a scalable one that can be easily configured to meet any business changes that might take place.
Your payroll solution should fit into your business seamlessly (including its growth), not the other way around. An outsourced payroll processing is the best solution for immediate expansion (or downsizing) needs, without liability on the company’s part. Why carry the burden of staffing when you can go for an outsourced payroll provider to take care of your immediate demand for extra staff to do payroll should the need arise?
Having payroll done by an outsourcing firm doesn’t necessarily mean that you should bend to their ‘one-size-fits-all’ schemes. It’s just finding the right payroll partner for your business, who will work with you hand-in-hand in modifying your payroll system to fit your goals.
Looking for an outsourced payroll processing and management provider? Download our “Australian Payroll Made Easy” white paper and learn how our Aussie payroll experts can help you handle your payroll processes.
This article was first published 09 August 2016 and edited 10 November 2020.