Dept. of Education > Administrative Services > Finance, Facilities and Business Strategy Branch > Payroll Accounting Policy

• Overview
• Coverage
• Policy
  • Payroll Distribution Processes
  • Salary Overpayments
  • Transfer of Leave Entitlements
• References
• Internal Controls / Responsibilities
• Monitoring of Compliance
• Related Topics

Payroll is administered and managed centrally by the Human Resources Management Branch (HRMB) through the payroll system EmpowerHR.  Enquiries relating to salary polices, practices and procedures should be directed to HRMB.  

This policy outlines the Departmental processes for the transfer and disbursement of fortnightly salary expenditure to the Finance One general ledger; and procedural requirements for dealing with salary overpayments and the transfer of leave entitlements.

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This policy primarily applies to the Finance and Procurement Services (FPS) and Human Resources Management (HRMB) staff in Corporate Office, responsible for processing and importing payroll information to the Department’s accounting system; the recovery of salary overpayments; and the transfer or receipt of leave entitlements where employees have been promoted to or from another agency.

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• Department payroll is run on a fortnightly basis. Payroll transactions are processed and recorded in the EmpowerHR payroll system by HRMB.
• Employee PAYG tax withholding instalments, superannuation contributions, deductions and other salary related on-costs such as payroll tax and employer superannuation contributions, are processed and calculated from the fortnightly payroll file.
• HRMB forwards a fortnightly payroll summary file extracted from EmpowerHR, to FPS for processing and import into the corporate finance system, Finance One.
• From the payroll extract, FPS generates journal entries to allocate salary expenditure to the general ledger and to enable the disbursement of; net pay to the Department’s salary bank account; PAYG tax instalments to the Australian Tax Office; payroll deductions and superannuation contributions to various creditors.
• Salary payments are made via electronic funds transfer through banks and financial institutions nominated by employees.
• FPS will process a journal and complete a payroll tax return online, with payment remitted to the State Revenue Office within 7 days of the close of the month, based on the taxable salary and wages for the month.
• Each fortnight FPS undertakes a reconciliation of all salary payments, refunds, stop pays and any other associated adjustments. From this reconciliation an appropriate journal is prepared and either a credit note or an invoice to the payroll account.

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Where an employee or former employee has received an overpayment in salary or allowances, the following processes should take place:

• Once it has been discovered that an overpayment has been made, the employee should be immediately advised by HRMB in writing that an overpayment has been made. The letter should state that a repayment from the employee is required.
• Management of the collection of salary overpayments is the responsibility of FPS. Guidelines for the recovery and write-off (if required) of the overpayment can be found in the Department’s Account Receivable policy.

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When an employee is transferred or promoted to or from another State Government agency, the following processes should take place:

• The amount to be transferred to the receiving agency is the total accrued annual and long service leave entitlement of the employee as at the date the employee is transferred.  Any leave entitlements accrued through prior service with a recognised organisation (e.g. the Commonwealth Public Service) are to be included in the transfer of leave entitlements.
• When the Department releases an employee it is to make the payment to the agency receiving the employee within 30 days from the date the employee is transferred. In turn, the Department should receive payments within 30 days where the Department receives an employee from another agency.
• Payment is to be made via electronic funds transfer.
• HRMB are to advise FPS in a timely manner when these transfer occur. Advice to FPS should be sourced from relevant employee salary records and include:-
  • Employee name
  • Releasing/receiving agency name
  • Date of transfer
  • Annual salary at transfer date
  • Employer superannuation contribution rate
  • Total accrued recreation leave (day or hours)
  • Years of service
  • Long service leave anniversary date
  • Total accrued long service leave
• FPS will calculate leave liability measurements using various discount and inflation factors. These factors are provided to the Department by Treasury each year. Leave liability measurements are to include on costs for superannuation and payroll tax.
• The transfer of funding for leave entitlements is to be administered through trust account T81C95.  Funds will be receipted to T81C95-1RK003-999-0000 while payment will be made from T81C95-T1ES2A6-999-0000 for annual leave entitlements and T81C95-T1ES2A2-999-0000 for long service leave.
• A regular review of processes should be undertaken to ensure that staff movements to and from the Department are properly advised and funded.

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• Treasurer’s Instructions – 808, 811, 812 & 813.
• Accounts Receivable Policy

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