Underpayment of wages

bdc

I processed an incorrect payroll of  $869, which I then reversed and processed one for the correct amount of $953.50 ( $84.50 difference).

Unfortunately I forgot to then deposit the difference to her bank account.  I have now picked this up when doing last months bank reconciliation. as it is $84.50 out.

I have now paid the $84.50 to her account and entered as Spend Money from bank account but my reconcilation report is now out by $169.  

STP amount is correct for that pay so doing another payroll would not help.

How do I resolve this. 

Tracey_H

Hi @bdc 

 

Thanks for your post. If I understand correctly, the correct pay is for net amount $953.50 and you transferred $869 to the employee. If this is correct, you would not need to record a Spend money transaction as the pay transaction has the correct withdrawal amount. It's only the actual bank account which has the incorrect amount. A Spend money transaction will also incorrectly impact the allocation account.

 

Your bank statement will have two withdrawals, one for $869 and one for $84.50. The Reconcile accounts window will have the one payroll transaction for $953.50. The two bank statement withdrawals reconcile with the one AccountRight transaction. 

 

Generally we do recommend leaving the original pay as it is and recording an adjustment for the shortpaid amount. This allows you to reconcile those transactions and provides a clear audit trail for the short payment.

 

If the payment for the shortpaid amount happens in the same month you can hide the two bank feed transactions by right-clicking on the transactions and selecting Hide transaction. Then manually reconcile the AccountRight payroll transaction by ticking it in the Reconcile accounts window.

 

When the payment for the shortpaid amount happens in a different month you would need to reverse the second pay and reprocess so that the net amount matches the amount actually paid. Then process an adjustment pay for the shortpaid amount which can be matched with the payment of that amount.

 

Please let me know if you need further help.

 

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.