I'm new to Reckon and looking for some help with payroll
Hi, I am new to the Reckon Accounts Premier Accountant edition, and overall Reckon is new to me anyways. I just wanted to ask a very basic Payroll related question and hoping to get some help.
when we record the payroll, the accountant here has been doing a debit to salary and credit to payroll clearing. I want to make it more transparent and I think I should debit the Gross Wages and debit the PAYGW (expense ) and credit the Payroll clearing . when paying, I will debit the payroll clearing and credit bank. but then it will leave the PAYGW as an expense, is that right approach?
What i think is that it should be a debit to PAYGW expense and credit to PAYGW payable (Current Liability) and when i pay this it will go debit PAYGW Payable (current liability) and credit the bank.
In doing so, it will still leave the PAYGW expense in the PnL, but i think that will be below the line (EBITDA) but I am not sure if this approach is correct. please help me. the previous accountant just debited the gross salaries and credited the payroll clearing and then debit the payroll clearing and credit cash.
please guide me. thanks
Best Answer
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you are not using the super payable anywhere doing it my way, it goes to super expense and accounts payable. If you do a journal you will debit super and credit super payable (a liability account) and when the payment is made it will go to the super payable account. Entering a bill is the normal way to use Reckon Hosted but both ways will get you there. It’s just that unless you have bookkeeping or accounting experience journal entries are a little daunting. Reckon Hosted is designed to simplify things, like using a cheque to enter a payment and a bill to enter a bill, invoice etc. all the windows are familiar.
Many users never need to enter journals
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Answers
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Hi @Prateek
Is there a reason why you’re not using the payroll feature ? This is necessary for STP, leave tracking & payslip compliance. It also solves all of those issues mentioned, as the debits/credits get posted automatically in the background for you 😬
Feel free to email me direct if you need assistance to get this setup correctly 😊
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if you’re using the payroll part of the program all of that is done for you. Have you setup the payroll items with the STP2 codes and the employees details? It sounds like you might benefit from some one on one training, @Acctd4 can help you with that, you will find her details on this forum.
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sorry, but we do our Payroll processing through a third party so STP and other compliance things are all good.
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I just want to understand the journal entry bits because that is confusing me. Specially when we record payroll, we debit the gross wages and then we credit all the current liability account like PAYGW payable and credit the payroll clearing. and when we pay, it is debit the payroll clearing debit the PAYGW withholding payable and credit the bank. I just want to know if i am on the right track in terms of the journals that I should be doing from a payroll perspective. The Super is done in house so i record that as Super expense debit and super payable credit, when paid it is super payable debit and bank credit.
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There are many ways, but this would be what I would do
1st is as you said
Debit Gross to expense account
Credit PAYG to liability account
Credit clearing account (Net)
2nd
When you pay the wages (net amount) post to the clearing account which results in zero
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When you pay the BAS the PAYG amount offsets the liability account which results in zero
4th
You could enter a bill for the super to the expense account instead of a journal
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Thanks for that.
on the 4th point, when you do a bill and debit the expense, but when i do the journal for super i do super expense debit and credit super payable. now if i debit when i do the bill, then it will double count it, wont it. or is there a smarter way
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I think what you are doing is sort of the same, but a bill is simple, the expense goes to super account and the credit goes to Accounts Payable, when you pay the bill it clears out accounts payable and credits the bank
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Right, I saw the bill entered in reckon today by the AP lady. I am still learning the Reckon. so how will I know by looking at the bill if that has been just entered or also paid. thanks
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To Pay it you go to pay bills and tick it and enter the date of payment - I always enter the bill at the end of the period it represents. If you go back to the bill after payment it will have a big PAID stamp across it
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ok, thanks. so in my process, I am using the super payable (current liability) and when I do the bill it debits expense and credits the AP and then later clears the AP. like I would clear the Super Payable . I think I am understanding you.
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yep that’s it …………..
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thanks a lot for your help.
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You’re very welcome, any time.
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Hi Experts in Reckon, another silly one. When entering expense which attracts GST , the previous accountant used NCG as the code which is including the GST, is there another smarter way specially for things which not necessarily have GST. like in a expense claim I might have some items which do not attract GST , so how can i break it down. thanks
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NCG is correct on expenses with GST, GST code is only used on invoices and cash sales. NCF is used for expenses without GST and FRE for income without GST
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Hi Experts, another query, this time still it is Reckon, but I am going to record the payroll Journal. my understanding is it will be
Debit the gross wages
credit the PAYE
Credit the Kiwisaver employee payable
Credit the Kiwisaver employer payable
credit the Kiwi saver employer contribution tax payable
credit the payroll clearing
once it is paid then
debit the payroll clearing and credit the bank with net pay
and subsequently when current liabilities are paid they get debit and credit bank. I want to record the journal in the right way so we can see all the current liability with the amounts and later we can see them go once paid.
please let me know if I am on the right track, dont have anyone to guide me. the last accountant somehow had kiwisaver set up as expense accounts. which i dont think should be the case. thanks
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another question from me. somehow the previous accountant had super account set up as expense. should they not be current liability account as they are not a business expense. please let me know, thanks
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the super expense is just that but the credit should be a liability account which will be cleared when the super is paid. Super is a business expense, just like wages
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You really should get some one on one training from one of the accredited trainers on this forum
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i would love to have that, what is the cost involved.
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Check with @Acctd4 to start with and she can advise you. Where are you?
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Happy to provide some customised 1-on-1 training @Prateek, either on-site or remote, depending on your location.
Feel free to shoot me an email direct ☺️
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