BSBFIM502A: Assessment 1 Establish and Maintain a Payroll System

Introduction 
This assessment covers all sections in your Learning Resource and your textbook. 
This assessment requires you to set up and maintain a payroll system for a small company, Smith & Jones Pty Ltd. You will be creating the data file, setting up the payroll information and then processing the payroll based on the information provided. 
When you have completed the assessment you are required to send your completed answers electronically via the Assessment Information tab on the OLS website (www.oten.edu.au/ols) 
Business Information 
Smith & Jones Pty Ltd is starting to use a computerised payroll system, MYOB. The payroll is to commence at the beginning of the month you are currently in. Remember to ensure that your payroll year reflects this. 
The details of the business are outlined in Attachment A. It is important to read through the whole assessment and particularly the company details in Attachment A prior to setting up your company in MYOB. 
Task 1 
Download and save the Award for employees to refer to in this assessment task. 
Employees are employed under the General Retail Industry Award. You will find this on www.fairwork.gov.au. You should save this award onto your computer. 
Task 2 
Using the data in the following table, set up the data file for your company 
Company Name Smith & Jones Pty Ltd 
ABN 11 234 567 899 
Address Enter your name 
Sydney NSW 2000 
Accounting Year Information Accounting Year - Current year 
Payroll Year – Current year 
Last month - June 
Conversion month – July 
Accounting periods - 12 
Account List As supplied by MYOB 
Industry classification – Other 
Type of business – Retail Business, Other 
File Name Smith&Jones YOURNAME.myo 
Save the file to a suitable location on your computer. 
Task 3 
Create and/or modify (if necessary) the following accounts. 
Account Name Account No 
ANZ Cheque Account 1-1110 
Caledonia Medical Fund 2-1430 
Dedicated Workers Union 2-1450 
AMP Life Superannuation 2-1460 
Child Support 2-1470 
Sick Leave 6-1960 
Overtime x1.5 6-1970 
Holiday Leave 6-1980 
Task 4 
Ensure the following payroll accounts are linked. 
Type of Account Account Number & Name 
Bank account for cash payments 1-1120 Payroll Cheque Account 
Bank account for cheque payments 1-1110 ANZ Bank 
Bank account for electronic payments 1-1190 Electronic Clearing 
Default employer expense account 6-1920 Superannuation 
Default wages expense account 6-1930 Salaries and wages 
Default tax/deductions payable account 2-1420 PAYG withholding payable 
Task 5 
Using the information in Attachment A, enter opening bank balance. 
Task 6 
Load Tax Tables & complete general payroll information setup (using Attachment A). 
Task 7 
Using the information in Attachment A & B, create and/or edit payroll accounts including:- - Holiday & personal leave and accrual 
- Superannuation categories 
- Entitlement & deduction categories 
- Tax categories 
- Employer expenses 
Task 8 
Using the information in Attachment A, enter business banking detail in MYOB 
Task 9 
Using the information in Attachment B, create employee cards and enter employee payroll information. You should also enter the pay history details for each employee. 
Task 10 
Produce and save Employee Employment Details Report. 
Check details carefully before processing any pays. Make any necessary corrections. 
Task 11 
Produce and save the Register Summary Report @ 1/July to check all entries are correct 
Task 12 
Process pays for week 1 (current month) 
- Process the weekly pay for all employees 
- Sandy Brown only worked 8 hours this week 
- Fred Jones had 7 hours sick leave this week 
- Julie Simpson has put in for 3 hours overtime 
- No pay slips need to be printed 
- Produce and save the payroll advice for the all employees for the week 
Task 13 
Process pays for week 2 (current month) 
- Process the weekly pay for all employees 
- George Smith is to be paid 4 hours overtime (x1½) 
- Julie Simpson is to be paid one day sick Leave (7¾ hours) 
- Sandy Brown got a wage increase to Level 2 from the beginning of week 2 pays. 
- Fred Jones takes 38 hours long service leave 
- No pay slips need to be printed 
- Produce and save the payroll advice for the all employees for the week 
Task 14 
Process pays for week 3 (current month) 
- Process the weekly pay for all employees 
- Fred Jones is to be paid for 2 hours sick leave 
- George Smith is taking 1 week Holiday Leave 
- Sandy Brown worked 12 hours this week 
- No pay slips need to be printed 
- Produce and save the payroll advice for the all employees for the week 
Task 15 
Reconcile the liabilities, superannuation and PAYG tax and pay these on the appropriate date. 
- Produce and save the payroll liabilities by category for each 
- Produce and save a bank register report for the period 1/current month to 30/next month. 
Task 16 
Produce and save the following Payroll Report reports 
- Register summary at the end of the current month 
- Entitlement balance (summary) at the end of the current month 
- Audit trail report for 1/current month to 30/next month 
You are required to save your files into one folder. Ensure you have included the following documents:- 
Employee Employment Details Report Register Summary Report @ 1/July 
Payroll advice for the all employees for week 1 
Payroll advice for the all employees for week 2 
Payroll advice for the all employees for week 3 
Payroll liabilities by category – deductions 
Payroll liabilities by category – superannuation 
Payroll liabilities by category – taxation 
Bank register report for 1/current month to 30/next month 
Register summary @ end date/current month 
Entitlement balance (summary) @ end date/current month 
Audit trail report for 1/current month to 30/next month 
Attachment A – Payroll Procedures Smith & Jones Pty Ltd 
Security 
• Payroll records are to be kept for 7 years and are open to inspection during the employer’s business hours by an inspector of the Department of Industrial Relations. 
• The MYOB data file is backed up daily with a copy being kept on the business off-site drive. The MYOB file is password protected. 
• All payroll records are stored in locked filing cabinets to protect privacy of information. 
• The MYOB system audit trail is turned on. 
Bank Accounts 
• The business maintains an account with the ANZ Bank. o BSB – 111-333, Account number – 52395425 o Name – Smith & Jones Pty Ltd o Trading Name – SmithJones o Opening balance $30,000 
• There are no other assets or liabilities 
Employment Arrangements 
• Default superannuation fund is AMP Life. Employer membership number 11223344. 
• The business lodges the Business Activity Statement monthly and includes the monthly payment of PAYG withholding. 
• All employees are covered by work cover insurance (2% of gross wages) which is an employer expense. Use the WorkCover Insurance Account as the liability account. 
• Pays are processed for the working week (Monday to Sunday) on the following Tuesday. 
• All employees are paid weekly by cheque. 
• Do not round pays as you will be using cheques. 
• All deductions from payroll are made by the 7th of the following month by cheque. 
• Overtime is paid at time and half (x1½) during the week and double time (x2) on the weekends. 
• Employees are not entitled to Leave Loading. 
• Employees who are entitled to long service leave accrue 2 months leave for the first 10 years service and one month’s leave for each 5 years after that (0.867 weeks per year). 
• The MYOB data file is password protected with the password “diploma”. 
• Employees must provide the Tax File Number Declaration Form containing their Tax File Number, full name, address and date of birth. 
• A file is kept for each employee that contains all of the above information as well as leave information, medical information and emergency contact details. 
• All employees must undertake an induction session which covers Workplace Health & Safety obligations and organizational policies and procedures. 
Payroll Enquiry Guidelines 
• The bookkeeper can answer all queries with the information provided. Any queries outside of this information should be referred to the Supervisor. 
• Do not advise employees about Medicare Levy, Superannuation, salary sacrifice or matter relating to non- residents. This requires specialist advice and employees should be advised to consult with their accountant regarding such matter. 
• All enquiries should be considered in line with Privacy Laws and no personal information can be provided to anyone without the express consent of the employee. 
Attachment B - Employee data & year to date figures 
Name Fred Jones George Smith Julie Simpson Sandy Brown 
Card Number 001 002 003 004 
Address 197 Station St 
Flemmington 
NSW 2221 1 Bun St Sydney 
NSW 2000 1 High St Castle 
Hill NSW 2154 10 George St 
Sydney NSW 
2000 
Phone Number 2222 3211 2222 3331 2222 5291 2222 6621 
Date of birth 16/11/1955 6/2/1960 18/3/1982 29/3/1988 
Start Date 16/11/1970 1/10/1992 6/5/2001 7/8/2008 
Gender Male Male Female Female 
Tax File Number 111 456 897 111 588 999 111 000 777 111 123 456 
Super Employee Member no. 1456781 1456783 1456784 1456785 
Status Full time Full time Part Time Casual 
Hours/week 38 38 20 10 
Pay details $85000 pa salary Level 5 Level 3 Level 1 
Long service leave Yes No No no 
Overtime No Yes No No 
Deductions 
Child Support $150/week - - - 
Extra Super $120/week - - - 
Medical Fund $65/week $45/week $30/week - 
Union Fees - $15/week $8/week - 
Tax Tax Free Threshold Tax Free 
Threshold + 
HELP Tax Free Threshold No Tax Free threshold 
Superannuation AMP Life 
Superannuation AMP Life 
Superannuation AMP Life 
Superannuation AMP Life 
Superannuation 
Holiday & sick Leave Yes Yes Yes No 
YE AR TO DATE FIGURES 
Base Pay $52,009 $25,200 $10,200 $2,890 
Overtime (x1.5) - $1,542 - - 
Holiday Pay - $800 - - 
Sick Pay - $290 $280 - 
Medical fund $780 $540 $360 - 
Extra Super $1,800 - - - 
Workers Union - $180 $96 - 
PAYG paid $18,113 $9,267 $5,331 $520 
Accrued holiday 20 28 10 - 
Accrued Sick 12 12 8 - 
Long service 51 - - - 
Superannuation $4,680 $2,268 $918 $260 
Work Cover $1,040 $504 $204 $58 
Child Support $600