As soon as the payday starts coming near, employees not just assume they would receive the correct amount but also start making spending plans. Any goof up in payroll processing can result in unhappy employees and non-compliance with tax, labor laws. Absorbing the cost of such errors can be an unpleasant experience for top management. Several small and medium-size enterprises face such issues due to a lack of professional human resources to manage accounting and payroll processing. Thankfully, virtual accounting firms are offering a helping hand. Here’re tips that can help select the best outsourcing partner for managing payroll.
Create a checklist
Payroll processing, executive payroll processing, payroll accounting, payroll data maintenance, HR services such as onboarding, benefits, and payroll advisory are some of the most sought-after services.
Some online accounting companies also provide services like generating customized reports concerning pre-tax deductions for insurance, retirement plans, and other employee benefits.
Experts recommend companies to create a checklist of services that they need on a weekly, monthly, or quarterly basis. Every state has a different set of labor laws, taxes. Ask if the provider can handle state-level deductions and filings. In case if the organization needs assistance in multistate payroll, and managing different state taxes, it would prove ideal to go for a firm that has experience in the same.
Security standards at the data center
Managing payroll means handling confidential data like addresses, PANs, tax information, PF account details, and bank account numbers. Thus, the firm offering virtual accounting services should have the necessary data security measures in place.
Most of the companies that offer payroll processing services provide the best possible security measures. Besides firewalls, firms maintain restricted access to sensitive data and Transport Layer Security (TLS) encryption for websites, portals. Virtual connections are established only when the employee accesses the system using a highly secured internet connection. Accounting outsourcing firms use cloud-based secured servers. Most of them also track the location and dissemination of data.
While getting a quote from the service provider, ask for a detailed demo on how the data is securely stored, transferred, and accessed. It is advisable to check the outsourcing company’s policies concerning data breach.
The payroll team performs several significant tasks in the background before handing out paychecks on the salary date. Issues in the payroll service’s timeliness can lead to delayed payroll tax submission and create legal problems. So, go for an outsourcing firm that assigns a dedicated client servicing representative to monitor the payroll service’s timelines for various tasks.
Ability to access the payroll service platform from any location
Most firms offer exclusive access to customized software developed by their in-house team. These cloud-based systems can also be accessed via a ‘registered’ smartphone or tablet PC.
The feature helps management to track payroll processes using the device of their choice. It’s crucial during the current COVID-19 crisis as most of the people prefer working from home.
But remember, the software should be easy to use and operate, unlike DOS-based systems. Service providers often help clients with a system training session for employees and help them if they face issues during the initial stages.
Asking the sales representative to give a demo for the same can be a good idea.
System integration assistance
Small and medium enterprises working in heavily regulated vertical often use sophisticated selected sets of software solutions due to their contractual obligations. Thus, such organizations need assistance from virtual accounting firms in integrating payroll software with the existing suite of programs. Quick integration helps in saving crucial time and money. System integration eliminates the possibility of duplicate data entry and reduces paperwork. Fortunately, outsourcing agencies do assist in the same.
Check the available packages
Payroll service providers charge a monthly fee, depending on the client’s size, the number of employees, salary payment method, and other services requested by the client. The service provider’s sales representative can provide details for various packages after considering the firm’s requirements.
The process of migration can be lengthy and complicated. Thus, selecting the right package is crucial while you outsource payroll services to the chosen firm.
Should be able to offer a high degree of visibility into the business
Studies conducted around the world suggest a considerable percentage of small businesses prefer relying on such service providers.
A customized report with deduction related details for employees working at various levels can make the auditor’s life easy. The extensive detailed payroll reporting gives the organization exposure to actionable insights about financial and people data. Access to such information can help with a high degree of visibility in the business.
Dedicated account manager
Choose a service provider who provides support via email, chat, and telephonic helpline during business hours. Support requests should be responded within a minimum number of hours. Make sure the company assigns a dedicated account manager and a team that has professional payroll certifications.