Payroll system documentation Essay

Payroll is the process by which an employer pays an employee for work performed. If you own business, but don’t have any employees, then you don’t have to worry about payroll. But as soon as you hire your first worker, you have a responsibility to pay that employee on time and the correct amount. An employer uses a payroll system to process its payroll. Consequently, payroll cannot be process without a payroll system. A payroll system allows the employer to pay employees on time and accurately, plus comply with other statutory regulations.

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1.1 Background of the Problem
The grand nova holding corporation was established in the year 2009 and it is currently owned by Mr. Patrick tan. They set their company as contractual construction firm and its main task is the installation of automatic doors and windows. The company has two branches and its main office is located at 71 Jade Building, Aurora Blvd, Sta. Mesa, Manila. The company operates with 158 employees.

The company is still using the manual payroll that another employee within the company calculates the payroll each cut-off period entirely on paper.

Using a pen and a calculator, this process was very popular for payroll. The payroll master needs to calculate all the taxes, and any other applicable deductions such as PAG-IBIG, PHILHEALTH, and insurance like SSS. Allowances, meals and transportation are also computed in addition to each employee’s actual earnings.

First common problem of the company is the tallying the time card is done manually. The speed in processing of payroll tends to be slow and makes the searching for a particular detail more difficult because of the volume of the records needs to be double check for verification and consistency during the cut-off period. Another common problem of the company is having enormous mistakes or having inaccurate result in every cut-off period of payroll. The calculation is done manually by using a pen and a calculator. It is prone to mathematical errors that could consume much time than it should and could cause financial or legal trouble. Also the storage of files is susceptible to be damaged as well as lost of data. After the payroll has done, those records are place in the filing cabinet for the storage. The company wants to have security regarding the time keeping of the employees. They want to have authentication and verification if the employee really registers his own time.

The proponents decided to propose a computerized payroll system with time keeping using finger print scanner that could help to improve the company that can produce accurate and fast results.

1.2 Overview of the Current State of Technology
The Grand Nova Holding Corporation is currently using Time Card for the time keeping of their employees. The employee gets the time card and put it on a time register for the time in and time out. Every cut-off period, Saturday for weekly based and 15th and 30th day of the month for monthly based, there are two people who are in-charge in the payroll process. The first one is the checker that is in-charge of checking and verification of consistency of the records. The other one is the payroll master or the accounting officer of the company who is in-charge of the computation. During the cut-off period, the checker will collect all the time cards and check it, after the checking, it will be given to the payroll master for the computation.

Using a pen, ledger and a calculator, the payroll master will now compute the total gross income or the basic pay of the employee. It is the product of the employee’s rate per hour and the total work time consumed by the employee. The payroll master also checks the Withholding Tax, PAG-IBIG, PHILHEALTH, SSS and other deductions like cash advances to be totaled and deduct it from the basic pay of the employee. The overtimes and other allowances such as Meals and Transportation will be added on the basic pay or the gross income of the employee. After the whole computation was made and getting the net income of the employee, the payroll master will now put in on a request form to be submitted to the Finance Department for the overall expenses that is needed for the salary. After the request is approved by the finance department, next to that is the distribution of the salaries of the employees. The records of the payroll will be placed on a file cabinet for the storage.

1.3 Project Rationale
This study will benefit the following:

The proposed system helps us to enhance our knowledge in programming using Visual Basic 6.0 and MySQL database. This also gives us the opportunity to be much familiar with the business logic that we might encounter in the near future. This will also widen our understanding to the full cycle of Software Development. Company

The proposed system provides faster in every transaction. It also benefits the company because the generation of the required reports and monitoring the time will be accessible.

The proposed system is beneficial to the accounting department because it lessens their manual works and they can process their transaction in an appropriate way.

Future Researcher
The proposed system will be beneficial to the future researcher as their reference.

2.1 Problem Statement
2.1.1 Major Statement
How will the proponents create a Payroll System with time keeping using Finger Print Scanner for Grand Nova Holding Corporation?

2.1.2 Minor Statement
How will the proponents create a module

That is capable of managing the security module?
This is capable of managing the user’s account module?
That is capable of managing the records of employees?
That will monitor the time records or the time keeping of the employees? That will automatically compute the salary of the employees? That will handle the records of the computed salary of the employee? That will handle the reports
of the employee’s records and salary of the employee?

2.2 Proposed Project
2.2.1 Objectives General Objective
To be able to create a Payroll System using a Finger Print Scanner for Grand Nova Holding Corporation. Specific Objective

To be able to create a module:

That will manage the security module.
This module contains Employee Number, Family Name, Given Name, Position and the Department. The Username, Password and the Finger Print Scanner. Also the restriction or the areas or modules in the system that a certain user can access depending on the user level they have. This module contains security for the verification of the employee’s time registry in the help of the finger print scanner.

That will manage the user’s account module.
This module contains the adding of the user’s account for the system and the restrictions for a certain user depending on its user level.

That will manage the list of employees.
– This module contains Employee Number, Family Name, Given Name and Profile of each employee, Position, Department and Credentials that is needed.

That will monitor the time records of the employees.
This module contains Employees Number, Employee name, Position and Department, Date, Time in, Time Out, Overtimes, absences.

That will automatically compute the salary of the employees. This module contains the cut-off period of the salary.

This module contains the total working time of the employees, Overtimes,
allowances, Total deduction of the salary, Total Amount of the Net Income.

That will handle the records of the computed salary of the employee. This module contains the result of each computed salary.

That will handle the reports of the records and salary of the employee. This module includes Employee records or the HR-201 File

Total Amount of Salary Expenses report for the Finance Department. Date and time, Total Amount of the Gross income, Overtimes, Deductions, Net Income, Pay Slip ID, Transaction ID, Employee Number, Date and Time, and the Total Amount of Net Income.

2.2.2 Scope and Limitations
The proponents will create a program that contains the following: Security Module
User Account Module
Employee Record Module
Daily Time Record Module
Payroll Manager Module
Payroll Records Module
Reports Generation Module

The proponents will limit a program that contains the following: This system is not capable of handling transaction through DEBIT CARD AND CASH CARD.

The proponents used these methodologies

Systems development life-cycle (SDLC)

Proponents used this methodology to develop and also to maintain the friendly user of our system. The proponents use this to process the developed the system through planning, analysis, design, coding, and testing by gathering
data and information through conducting interview with the person who is in-charge of the payroll. The proponents also use questionnaires to acquire data from the company.

The proponents define its priorities for the system, the objectives to be met and the specification of system scope. Also the assignment of each member was established in this phase.

The proponents identify the problem that occurs to the company. After that we conduct our own brainstorming to think what will be the possible problem and features that will help the company to make their system faster than to the previous one.

The proponents process of defining the components, modules, Interfaces and data for the system. The proponents structured design a data flow methodology.

The proponents started creating a documentation knowing the history of the company. We must know all the necessary backgrounds for us to create the documentation. We design the system that will suit to the company about on its background and how the company works.

The proponents also use the method of prototyping or creating an early sample or model to build to test a concept or process. The proponents analyzed the flow of the payroll system. The proponents came up with this design based on the information and data gathered.

2.2.4 Definition of Terms
Technical Terms
Visual Basic – a programming language interface designed by Microsoft
Corporation to allow users to modify codes written in the simple programming language known as basic. Data Base – an organized collection of data for one or more purposes, usually in digital form. Front End – is responsible for collecting input in various forms from the user and processing it to conform to a specification the back end can use. Back end – application for program serves indirectly in support to the front end services, usually by being closer to the required resource or having the capability to communicate with the required resource. Query- is more often used in Computers, often in the field of programming and software. Queries are used or typed to get the desired results on the software or applications. SWOT – situation analysis in which internal strengths and weaknesses of an organization, and external opportunities and threats faced by it are closely examined to chart a strategy. SWOT stands for strengths, weaknesses, opportunities, and threats. Prototype –An original Model or type of the System to know the flow.

Business Terms
Daily Time Record – it is the everyday time record which is the time in and time out of a certain employee or worker. Deductions – the amount of money that will be subtract on the total gross income of the employee or worker. It usually the SSS contribution, PAG-IBIG and PHILHEALTH, LIABILITIES TO THE COMPANY like CASH ADVANCES. Salary – The total amount of money given to a employee as their payment for their work. Payroll – The list of employees and their actual wages.

Overtimes – The additional amounts paid to hourly employess who works than 40 hours in a workweek. Net Income –It is computed as the residual of all revenues and gains over all expenses and losses for the period. Gross Income –The total amount paid to an employee each pay period. Gross pay includes regular pay, overtime pay, and other taxable earnings.

3.1 Calendar of Activities
3.1.1 Description of Activities
The following activities give the proponents the information from the data gathering that they undergo.

System Proposal
The proponents looked for companies to be the beneficiary of the proposed system. The proponents offered the project that provides better insight to the store business helping them to improve their company operation.

Conducting an Interview
The proponents interviewed those personnel who are in charge of conducting the payroll to their employees. The proponents have to identify the problems of the company that needs to be developed accordance to the details and information that they have gathered.

Data Gathering
By the first week of January, the proponents undergo and perform with the following activities. The proponents gathered relevant documents regarding the employee records and the sample of the payroll records such as pay slip.

The proponents analyze the details and information that they gathered from the previous steps and after that, they were able to established the major and minor problems of the company that are need to be solve.

Creating an Outline of the System
The proponents created an outline for the system flow based on the data and information they gathered. The layout will be the initial step for the development of the system.

Development of the System
The proponents are now developing the system for the company.
The coding of the system include in this phase.

3.1.2 Calendar of Activities

1st week
2nd week
3rd week
1st week
2nd week
3rd week
4th week
1st week
2nd week
3rd week
4th week
I. System Proposal

Deciding what company to work

Schedule data gathering

II. Data Gathering

Conduct Interview

Interview the owner

III. System Analysis

Analyzing the problem

Deciding what system development

Make a list of data activities

IV. System Design

Make an outline of the develop

Create prototype

V. Coding

Creating the document

Designing the system


VI. Testing

Finalizing the document

Finalizingssssssssssssssss the System

3.2 Resources
3.2.1 Development Hardware
During the System Development period, the proponents used the following Hardware:

Desktop Computer
Flash Drive Software
During the System Development period, the proponents used the following Software:

Microsoft Excel
Visual Basic 6.0 Enterprise Edition
Windows XP
Windows 7
Adobe Photoshop CS3

3.2.2 Implementation Hardware
During the System Development period, the proponents used the following Hardware:

Desktop Computer (Php. 17,000.00)
Laptop (Php. 20,000.00)
Flash Drive (Php. 500.00) Software
During the System Development period, the proponents used the following Software:

Microsoft Office 2007
Adobe Photoshop CS5
Visual Basic 6.0 Enterprise Editon
Windows XP
Windows 7

IV.1 Screen Shots

IV.2 Source Codes
IV.3 References

IV.4 Resources Persons

Carlo Diño Santos
MIT Professor in Information Technology
Colegio de Sta. Teresa de Avila Foundation Inc.,

Harold R. Lucero
MIT Professor in Information Technology
Colegio de Sta. Teresa de Avila Foundation Inc.,

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