At each important BAS or Tax reporting period (such as Financial Year End) it is important to reconcile your payroll. We do this by comparing two or more sets of records to check that figures agree. Essentially confirming that the accounts in the general ledger are consistent over time, are accurate and complete.
The common approach to do this (please seek advice for your specific circumstance) is to compare some key reports in Saasu to final payslips and STP numbers. We are working out what was lodged and comparing it to what was reported and observing any difference.
Compare these reports for the accounting period concerned:
- Profit and Loss Summary: Annual Leave + Personal Leave + Base Pay = Payroll Summary Report: Gross Pay.
- Profit and Loss Summary: Employee SGC Super = Pay Item Summary Report: SGC Super.
- Payroll Summary Report: YTD numbers = Payslip: YTD sections.
- Payroll Summary Report: Tax = BAS Report: Tax in W1 and possibly W2 if it applies (NB: at year end use the Full Year filter).
Variances to be expected
- Reporting amounts for the ATO and STP are based on Pay Date and not Pay Period. This is a common misunderstanding.
- STP does not include RESC Salary Sacrifice amounts in Gross Payments numbers (Reportable Employer Super Contributions). RESC amounts are reported in your STP Finalisation submission at year end. RESC is not reported in normal STP Pay Events (the ATO does not require that as yet).
- STP Gross Payments relates to Wages and Salaries items but excludes Deductions such as Salary Sacrifice (These are reported as RESC).
Some other things worth checking
- Reviewing a General Ledger report on each wages account to check for incorrect postings.
- Check for payroll entries that have been entered as Journals as these won’t flow through to STP reports or Payslips.
- Check BAS payment transactions are coded to the correct PAYG Payable account. i.e. PAYGW versus PAYG Instalments (income tax).
- Check allowances posted to accounts other than wages look correct.
- The PAYG balance shown in the Balance Sheet report should be the unpaid PAYG for the quarter (if quarterly reporter, else month).
- Salary Sacrifice amounts typically appear in deductions and not Employer Contributions section of payroll.
- That you have accrued for Long Service Leave and Unpaid Leave in your Balance Sheet if required (your accountant may do these things).