3 Reasons You Need a Payroll Audit

Payroll Audit

Fourlane’s biggest monthly expenditure is payroll. That’s pretty typical for many companies, especially those that don’t keep inventory. For us, it’s crucial to keep our payroll accurate and up to date, and I’m sure it is for you, too. If you outsource your payroll, an audit from an outside vendor provides checks and balances to ensure that your vendor is providing accurate service and meeting your goals.

Here are 3 reasons we do an internal payroll audit and recommend our clients perform one, too:

1. Accuracy. With so much of our monthly revenue on the line, we need to ensure our payroll is accurate and up to date. For example, a recent client audit found incorrect agency rates. Without an audit, that error would have continued and could have cost the company thousands of dollars.

2. Compliance. Payroll is monitored by state and Federal tax entities. Federal laws require all employers to maintain accurate records to verify they are making the correct contributions. Ensuring your FICA, withholding, state or local taxes, and unemployment taxes (in some states) calculate properly is important to avoid penalties. Our payroll audits frequently turn up errors in AFLAC deductions and Health Savings Account setup, for example, that could end up costing the company a lot of money.

3. Accounting. Errors in accounting, incorrect recordkeeping and inefficiencies can thoroughly mess up your bottom line. Incorrect QuickBooks setup is a big culprit in many of the common errors we see when performing payroll audits. Checking your QuickBooks setup will save you trouble, now and in the future. Incorrect mapping of payroll expense accounts and liabilities accounts in QuickBooks is a typical error we see. Recently, a client was making double payments on his liabilities inside of QuickBooks. Ouch!

Fourlane’s Luciana Fortune-Bass is certified in payroll audits by the National Association of Certified Public Bookkeepers, and performs all of our client audits. She provides clients with a comprehensive breakdown of payroll errors, recommendations for correcting the errors and a list of penalties the client will incur if the errors are not fixed.

Payroll audits are just a part of best business practices. Contact us today to schedule one.


About Marjorie Adams

Our head QuickBooks trainer and guru, Marjorie Adams, is Founder and CEO of Fourlane, Inc., an award-winning consulting firm and Intuit’s #1 QuickBooks Reseller Partner. Fourlane’s team of experts offers several QuickBooks oriented services including consulting, training, programming, integration, and more. Over the years, Fourlane has helped over 10,000 customers across many different industries with their QuickBooks accounting software. Marjorie Adams is considered one of the top QuickBooks trainers in the country. She was listed on CPA Practice Advisor’s 40 Under 40 in 2014 & 2015, and has been recognized as Intuitive Accountant’s 2015 QuickBooks Desktop ProAdvisor of the Year. Marjorie sits on Intuit’s VIP Program, is a frequent contributor to Inuit Accountants News Central, and has developed Intuit’s QuickBooks Enterprise Certification training. She has also been published in The Wall Street Journal, Forbes, BusinessWeek, American Express Open, the Huffington Post, and Inc. Magazine.

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