Are you really thinking of using Excel as your payroll? Excel spreadsheets are superb tools for charts, to store and retrieve numerical data and do complex calculations, but they aren’t the greatest for employers needing to process salaries. Excel might be able to do complex calculations, but do you trust it enough to handle your payroll?
You probably already have Excel installed on your system, have found numerous templates online and are a genius at using VLOOKUP.
But have you thought about what will happen when your company grows; you might only have three staff members currently so using Excel as your payroll is working perfectly, but Excel won’t be able to keep up with the growth of your business.
If you want to use Excel as your payroll, do you want to risk the following?
- Time wasted struggling with formulasPeople tend to struggle with adding formulae and rules to rows and rows of a spreadsheet. Just one misplaced click and everything goes awry, resulting in hours of work wasted and incorrect figures.
- Inaccurate figures and regular errorsA lot of spreadsheets contain errors on account of, among other things, human contact. Data, formula and format errors are the common ones. Copy-paste is another one. Errors in spreadsheets and wrong calculations can end up costing an organization money. Keeping accurate records is non-negotiable in a business, especially with payroll figures.
- Not finding an Excel expert (someone who knows and understands VLOOKUPs like you do). Processing payroll in Excel does need someone skilled – all those formulae and VLOOKUPs require someone knowledgeable and highly trained about the functionalities and shortcomings of spreadsheets.
- Not having a seamless payslip processAs an organization grows, so too do the number of employees, and the number of payslips required. This can get very complex and time-consuming to generate and distribute payslips from multiple files. Payslips are important to employees, as they provide employees with proof of income and are documentation for their own records.
The list can continue, but rather look at what a payroll system will do for you that an Excel spreadsheet won’t.
It’s not what you can do for your payroll but what your payroll can do for you
As a business owner, you need to manage and process your employees’ pay, their taxes, leave days and any other pay related details.
Doing this manually requires a lot of time and concentration, and extra effort to avoid the human error that is probably going to occur.
Using a payroll system has some benefits over a manual spreadsheet.
Not only will a payroll software system, particularly an automated system, reduce time spent on processing salaries, taxes and other employee information, but you can integrate a payroll system into other systems used in a company. Systems like time-keeping, performance reporting and other HR reporting and tracking systems can be integrated, thus ensuring efficient information processing.
Using Excel would not allow for this kind of integration or efficiency.
Easy tax compliance
Using a payroll software system will allow you to easily export employee and company tax information through to the tax authorities.
Without a software payroll system, submitting tax information would not be as quick and easy as hitting an export and submit file button – in fact the process would probably make life very inconvenient for the person in charge of this task.
Keeping employee records safe is of utmost importance. Most (if not all) payroll software systems back up their information, either off-site or in the cloud, depending on the software agreement.
The business and employee personal, financial, payroll and tax information needs to be safeguarded – something to consider if using Excel as your payroll system.
Employers with a manually run payroll system would be hard-pressed to come up with a better reason for not going the automated payroll system route, than for the safekeeping of their personnel records. Imagine losing your business and employee financial, payroll, and tax information?
Securing sensitive information and not allowing unauthorised persons access to data including ID numbers and banking details should be emphasised. Payroll software solutions offer a password protected environment where personal and financial data related to employees can be stored at low risk of being accessed by the wrong people. Obviously you also need to ensure the computers on which the data is stored has been secured against hacking attempts and virus attacks, and things like firewalls and antivirus software are always current.
The safe storage, backup and protection of data are non-negotiable. If using Excel spreadsheets for your payroll how are these backed up and secured? Hopefully you aren’t only relying on unencrypted email or basic password protected content.
Keeping up with the jones, or at least the digital world and the increasingly automated processes and systems out there is important.
Not adopting automation in your payroll process will ensure you get left behind and be very inefficient.
No guru required
Using payroll software does not require an Excel expert proficient in formulas and spreadsheet related business. Sure, you still need and want smart people to manage your business, but using payroll software, an automated payroll, will save you time and money.
Other reasons why you shouldn’t use Excel for your payroll
Increased risk of fraud and human error
Non payroll solutions – aka spreadsheets – need an incredible amount of manual input. More data to input means there are more chances for errors to occur.
Incorrectly entered details, figures and tax codes, means additional workload in finding and rectifying errors.
Using spreadsheets also places a business at more risk to fraud. There are unscrupulous employees out there, and using spreadsheets increases the chances of those kinds committing fraud.
Software payroll has built in processes that prevent duplications and other funny business from occurring.
Bottlenecks, manual processes and wasted time
Manual data capture and repetitive tasks involved with capturing data in spreadsheets often means employees wait right up until the deadline before submitting. This can also lead to missed deadlines, and missed payments.
Waiting until the last moment can create bottlenecks in the payroll workflow. This is not such a big deal for a small business, but as a business grows, it means more data to capture.
Excel doesn’t provide reports as a payroll software would. It takes effort to design the reports with the information you need – no automated reporting for Excel.
The same goes for dashboards that give you real-time information of your company. Also, it is rather difficult to project and manage cash flow accurately in Excel.
What nuQ payroll software can offer you
Xpedia offers you nuQ payroll software.
nuQ payroll software is an intelligent payroll that thinks for you. It is easy to use and requires no extensive training. nuQ also boasts superior payslip and reporting structures – something that Excel cannot.
nuQ allows payroll to be run in the cloud. This payroll database is held on a server which is accessed via the internet.
nuQ is based on Microsoft .NET and MS SQL and was one of the earlier adopters of this technology – a decision which has stood the product in good stead. This is illustrated by the advanced easy to use program structure under which nuQ runs. This has also made it possible for nuQ to easily incorporate new developments brought out by Microsoft.
- Access your nuQ payroll from anywhere
- Faster support response time
- Scheduled daily backups
- Access limited through the use of a secure socket layer and digitally signed certificate.
A few of the other features offered by nuQ Payroll include:
- A tax query reportSince most queries received from employees in connection with their pay relate to the amount of tax deducted, this report displays everything that can affect a tax calculation.
- A payslip that can be issued in various file formats.
Check out the rest of the features (there are lots).
Why waste time?
Why would you want to do something in a manual, time consuming and inefficient way, when there is an easier, faster, more efficient way.
Some statistics say that it takes seven or more days to process payroll if using Excel.
If you will still continue to use Excel for your payroll, ensure you follow these best practices:
- Ensure your spreadsheet is from a reliable source
- Check for accuracy and statutory compliance
- Keep your spreadsheets up-to-date
- Backup your data regularly
Know that using payroll software will save time, give you peace of mind knowing your records are accurate and secure, and offer you flexibility as your business grows. This will give you the time to focus on more important things in your business, and less time on laborious admin.