Benefits and drawbacks of accounting information systems to an organization

by | Nov 24, 2024 | Accounting

 

In this project, you will demonstrate your mastery of the following competencies:
· Analyze the benefits and drawbacks of accounting information systems to an organization
· Explain how business processes function within an accounting information system

focus on analyzing a payroll onboarding process. By using your knowledge of general accounting principles, you will determine what information you will need to perform the analysis. Consider how you review the onboarding documentation to verify it for payroll and determine what information must be input into the accounting information system (AIS) related to the payroll onboarding process.
Scenario
You have recently been hired as a business analyst for the chief financial officer (CFO) of a small direct-to-consumer organization. The company is growing and is looking for ways to gain efficiency by automating some processes. The CFO has asked you to perform an analysis of the current payroll onboarding function within the organization. Through this analysis of the current onboarding functions, you will determine the benefits and drawbacks of how employee information flows through an AIS and how using an AIS will improve the payroll onboarding process.
Using what you have learned from your Milestone One assignment (flowchart) and with your knowledge of inputting data into an AIS, you will analyze the current new-hire procedures to identify areas for improvement and present this to the CFO.
Directions
After reviewing the Scenario and Supporting Materials sections, complete your analysis. Begin by reviewing the current new-hire procedures manual specific to the payroll onboarding process. Using Microsoft PowerPoint, create a presentation including speaker notes, and incorporate the illustration completed in Milestone One (flowchart). This is your opportunity to incorporate feedback you received from your instructor into your flowchart before adding it to your PowerPoint presentation. Remember, the goal of the PowerPoint presentation is to present any findings to the CFO.
You will need to include a dialog of your findings (script) within the Speaker Notes section in your presentation. You will then need to download the Speaker Notes in the form of a PDF file to upload for your submission with the completed PowerPoint presentation. You will have two submissions for Project One: your presentation and your script. Review the PowerPoint Speaker Notes Tutorial in the Supporting Materials section for assistance.
Specifically, you must address the following rubric criteria:
1. Provide a high-level overview of the payroll onboarding process.
2. Illustrate the payroll onboarding process in the form of a flowchart. Include the following details in your response:
1. Post your flowchart within the presentation after incorporating feedback from your instructor on Milestone One.
2. Describe which job function is responsible for performing each task.
3. Explain how the payroll onboarding processes function within accounting information systems.
4. Identify inputs and outputs of the payroll onboarding processes within an accounting information system.
5. Identify how key transaction cycles are automated. Include the following details in your response:
3. Identify steps in the payroll process from paper approval (timesheet) to automated employee paychecks.
6. Identify at least two benefits of automating the payroll onboarding system.
7. Explain your rationale why the identified benefits support automating the payroll onboarding system.
8. Identify at least two drawbacks of automating the payroll onboarding system.
9. Explain your rationale why the identified drawbacks do not support automating the payroll onboarding process.
10. Summarize your findings of the payroll onboarding process. Include the following details in your response:
4. Tasks within a payroll onboarding process
5. Inputs and outputs in the payroll onboarding process
6. Appropriate personnel performing tasks (role)
7. Employee onboarding process documents
8. Approval protocol
9. Benefits and drawbacks of the payroll onboarding process
10. Security protocol
11. Appropriate computerized output with corresponding due dates

 

Understanding the Payroll Onboarding Process

High-Level Overview: The payroll onboarding process involves a series of steps to add a new employee to the payroll system. These steps typically include:

  1. Hiring: The HR department hires a new employee.
  2. Data Entry: HR enters the employee’s personal and employment information into the HRIS.
  3. Tax Form Review: HR reviews tax forms (W-4, I-9) to determine appropriate tax withholdings.

Understanding the Payroll Onboarding Process

High-Level Overview: The payroll onboarding process involves a series of steps to add a new employee to the payroll system. These steps typically include:

  1. Hiring: The HR department hires a new employee.
  2. Data Entry: HR enters the employee’s personal and employment information into the HRIS.
  3. Tax Form Review: HR reviews tax forms (W-4, I-9) to determine appropriate tax withholdings.
  1. Payroll System Input: HR inputs the employee’s information into the payroll system.
  2. Direct Deposit Setup: HR sets up direct deposit for the employee’s paycheck.
  3. Benefits Enrollment: HR enrolls the employee in benefit plans (health insurance, retirement, etc.).
  4. Time and Attendance Tracking: Employees record their time worked, which is then input into the payroll system.
  5. Payroll Processing: The payroll system calculates net pay, taxes, and deductions.
  6. Payroll Distribution: Paychecks are distributed to employees, either through direct deposit or paper checks.

Flowchart: [Insert flowchart here, incorporating feedback from Milestone One]

Inputs and Outputs:

  • Inputs: Employee information (name, address, Social Security number, etc.), tax forms, time and attendance records, and benefit enrollment forms.
  • Outputs: Paychecks, tax forms, and reports.

Key Transaction Cycles:

  • Human Resources Cycle: Hiring, onboarding, and termination processes.
  • Payroll Cycle: Time and attendance tracking, payroll processing, and payment distribution.

Benefits of Automating Payroll Onboarding:

  • Increased Efficiency: Automation can reduce manual data entry errors and streamline the process.
  • Improved Accuracy: Automated systems can ensure accurate calculations and timely payments.
  • Enhanced Security: Automated systems can help protect sensitive employee data.
  • Reduced Costs: Automation can lower labor costs and reduce the risk of errors.

Drawbacks of Automating Payroll Onboarding:

  • Initial Investment: Implementing a new payroll system can be costly.
  • Training and Support: Employees may require training to use the new system effectively.
  • Potential for Technical Issues: System failures or glitches can disrupt payroll processing.

Summary of Payroll Onboarding Process:

Task Responsible Party Input Output
Hiring HR Job requisition, interview notes Job offer letter, background check
Data Entry HR Job offer letter, tax forms, background check Employee record in HRIS
Payroll System Input HR Employee record, tax forms, time and attendance records Employee record in payroll system
Payroll Processing Payroll Employee record, time and attendance records Paychecks, tax reports
Payroll Distribution Payroll/Accounting Paychecks Employee pay stubs, tax filings

Security Protocol:

  • Access Controls: Restrict access to payroll data to authorized personnel.
  • Data Encryption: Encrypt sensitive employee information.
  • Regular Security Audits: Conduct regular security audits to identify and address vulnerabilities.

By automating the payroll onboarding process and implementing robust security measures, organizations can improve efficiency, accuracy, and compliance.

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