ASSESSMENT
Qualification: FNS40615 Certificate IV in Accounting
Unit of Competency: FNSBKG405 Establish and maintain a payroll system
Student Name:
Student ID:
Assessment Due Date: Assessment 2

FNSBKG405 Establish and maintain a payroll system
This unit describes the skills and knowledge required to record and prepare payroll documentation, respond to enquiries and process accurate payroll data for manual and computerised systems.
Elements Performance Criteria
1. Establish payroll requirements 1.1 Apply knowledge of relevant legislation in relation to employment standards, and other legislative requirements in regards to payments
1.2 Seek instruction from authorised parties in relation to relevant state and modern awards regarding details to be set up within payroll system for individual employees
1.3 Establish payroll set-up for salary packaging
1.4 Assess scope of payroll services BAS agent can provide and identify need for independent expert advice providers
2. Record payroll data 2.1 Ensure payroll system includes complete and accurate employee data
2.2 Review payroll data and clarify discrepancies with designated persons
2.3 Enter employee pay period details, deductions and allowances in payroll system in accordance with source data
2.4 Calculate payment due to individual employees to reflect standard pay and variations in accordance with employee source data
3. Prepare and process payroll 3.1 Conduct payroll preparation within designated timelines in accordance with organisational policy and procedures
3.2 Calculate, record and reconcile employee in accordance with legislative requirements
3.3 Reconcile total payments for pay period, and review and correct irregularities or refer them to designated persons for resolution
3.4 Obtain authorisation of payroll and individual pay advice in accordance with organisational requirements
3.5 Make arrangements for payments in accordance with organisational and legislative requirements
3.6 Produce, review and store payroll records in accordance with organisational policy and security procedures
4. Handle payroll enquiries 4.1 Respond to payroll enquiries in accordance with organisational and legislative requirements
4.2 Provide information in accordance with organisational and legislative requirements
4.3 Refer enquiries outside area of responsibility or knowledge to designated persons for resolution
4.4 Provide additional information or complete follow-up action within designated timelines in accordance with organisational policy and procedures
5. Maintain payroll 5.1 Maintain all information and record keeping relating to payroll function in accordance with relevant legislation and regulations
5.2 Produce and reconcile month-end and year-end checklists to ensure compliance with relevant legislative and management deadlines
5.3 Update records and systems in line with salary reviews and other changes in employment status
5.4 Establish back-up and disaster recovery systems
5.5 Generate and distribute payroll reports in line with organisational policy
5.6 Extract and apply business activity statement (BAS) and instalment activity statement (IAS) data in accordance with relevant legislation and regulations
Performance Evidence
Evidence of the ability to:
• accurately identify, calculate and input data for payments into manual or computerised payroll systems
• produce payroll reports in accordance with organisational and legislative requirements
• present payroll report for verification and approval
• maintain all records in compliance with organisational and legislative requirements that relate to security and confidentiality of information
Knowledge Evidence
To complete the unit requirements safely and effectively, the individual must:
• explain the scope of services appropriate for a business activity statement (BAS) agent providing payroll services
• explain the application of award and enterprise agreements and relevant industrial instruments to payroll maintenance responsibilities
• identify and explain organisational policy and procedures that affect payroll, including the structure of authority in organisations
• explain industry codes of practice relevant to payroll operations
• compare and contrast manual and computerised payroll systems
• identify relevant legislation and record-keeping requirements from all levels of government that affect business operation and reporting requirements, especially in regard to:
o Fair Work Act
o National Employment Standards
o Superannuation Guarantee (Administration) Act
o corporations law
o workers compensation and work health and safety
o tax related to payroll activities
o Privacy Act (confidentiality and security of records)
o Higher Education Loan Program (HELP)
o Medicare levy
o Tax Agent Services Act (TASA)
o current state, territory and Commonwealth industry and modern awards, and enterprise bargaining agreements
o individual employment contracts
o Commonwealth, state and territory leave Acts including annual, sick and long service
o Australian Bureau of Statistics (ABS) Act
• describe current Australian Tax Office (ATO) requirements such as:
o Australian Business Number (ABN)
o employment declaration
o tax file number (TFN) declaration
• identify the Tax Practitioners Board (TPB) requirements, including:
o registration and scope of services documentation requirements for BAS agents
o Code of Professional Conduct
• explain relevant taxation law, including:
o pay as you go (PAYG) withholding tax
o fringe benefits tax (FBT)
• outline the key aspects of routine and non-routine requirements for payroll, including:
o routine: award payments, salary amount, salary packaging, superannuation guarantee and super reporting
o non-routine: termination payments and super guarantee charge
Foundation Skills
Reading • Reviews and compares details of information to meet requirements, and interprets and analyses an extensive range of structurally intricate texts to inform actions
Writing • Records detailed information accurately in required formats for individuals
• Prepares, produces and updates accurate payroll record information in a range of report formats to meet organisational requirements
• Produces logically sequenced texts in response to enquiries
Oral Communication • Participates effectively in exchanges of information using questioning and active listening to clarify details, and clear and direct language to refer problems to supervisor
• Clearly articulates responses to enquiries using language, tone and pace appropriate to the audience
Numeracy • Uses calculation skills and mathematical formulae to accurately prepare, record, reconcile, check and report payroll data in a range of formats
• Defines timeframes in accordance with schedule requirements
Navigate the world of work • Takes responsibility for adherence to organisational policy and procedures, and legal and regulatory requirements
Interact with others • Cooperates and collaborates with others as part of familiar routine activities and contributes to activities requiring joint responsibility and accountability
Get the work done • Plans, organises and completes work according to defined requirements, taking responsibility for sequencing tasks to achieve efficient outcomes
• Uses systematic analytical processes in complex, routine and non-routine situations, gathering information, reviewing and reconciling data, and identifying and evaluating potential solutions
• Uses digital tools to conduct research, design work processes and to complete work tasks

ASSESSMENT INFORMATION:
To be deemed competent for this unit of competency, you are required to satisfactorily complete two (2) assessment tasks:
• Assessment Task 1: Written Questions
• Assessment Task 2: Skills Assessment
Assessment Instructions
Your assessment will be required to be typed in Arial font size 12 only. You will provide your completed assessment for all of questions in one document and MUST be uploaded into MOODLE (No other method of submission will be accepted).
You are required to professionally format your document including spell-check and indicating each Task answer [e.g. Task 1 (a.) then the answer, Task 1 (b.) then the answer etc.] according to this Assignment requirement. You may lose marks if you have not spell-checked your document (as this is a professional formatting requirement, a business skill).
This assessment can be completed in one of several ways. Assessment candidates may identify unit requirement within their own work environment or organisation, or with reference to a scenario provided by the trainer/assessor.
Be sure to properly reference your sources of information using the Harvard referencing system. For more information go to:-
• Student Handbook - latest version
• Ask your Trainer/Assessor to provide you with this information
In order to determine if you are addressing this assignment adequately in terms of competency/comprehension (prior to due date) a draft copy of your assessment should be discussed during class time in consultation with your Trainer/Assessor. For this feedback/ support from your Trainer/Assessor, you will need to bring to class your “draft copy” with any evidence of the research you have conducted to produce the assessment.
If, as a student you feel you have special needs that require your Trainer/Assessor to apply a reasonable adjustment – please discuss this with your Trainer/Assessor at the beginning of the subject studies.
Your Assignment must:
a. Be of a professional standard (spelling, grammar, punctuation)
b. Size 12, Arial Font
c. 1.5 Spacing
d. All pages must have a Header/Footer with the following details:
o Name
o Student ID
o The course & unit of competency
o Date
o Page numbering
e. Title page
f. Index page
g. Body of work
h. Referencing
How to upload your answered assessment into MOODLE
To upload your assignment into Moodle, follow these steps.
1. Log-in to Moodle and access the subject that you will be submitting the assignment in.
2. Locate the assessment you will be uploading into by scrolling down to the week that the assessment is due in and then click on the assessment submission link.
3. Click on the name of the assignment.
4. Click the Browse button.
5. Select the file and click Open.
6. Click the Upload this file button.
7. If you have more than one file, repeat the process (steps 4-6) to attach additional files up to the assignment's limit.
8. Once happy with your submission click the Send for marking button. The files are locked and the student can no longer delete, or upload more, files.
Note: The date and time of the submission is recorded when the files are sent for marking, not when they are first uploaded.

ASSESSMENT TASK 1: WRITTEN QUESTIONS
1. What types of employee data need to be entered into a payroll system?
2. How is the hourly rate of pay calculated for an employee?
3. If there are any discrepancies in calculations or an employee has an enquiry that is out of your level of responsibility, who would you refer them to?
4. Prior to completing a pay run there are things that must be completed. What are they?
5. What are some of the requirements when handling payroll enquiries?
6. What information in relation to payroll must be kept?
7. What types of reports should be generated at month and year end?
8. Updating and backing up data is important. Why?
9. Mary is a shop owner. She plans to hire her first sales assistant.
Where can she find out what to pay her employee?
A. She can use the Pay Calculator on www.fairwork.gov.au
B. There's no need to find out – it will depend on what she and her new employee agree to.
C. She should ask around and get the ‘going rate’.
10. Catherine has started a new business. She has checked www.fairwork.gov.au and discovered that her industry isn’t covered by an award.
If Catherine decides to hire an employee, is there a minimum pay rate that she will need to pay them?
A. Yes
B. No
11. Andrew operates a garage and employs 2 mechanics. He heard a story on the radio that the national minimum wage had increased.
When Andrew engaged his employees, they agreed to work for a particular rate, which at the time was above the minimum award rate. Andrew made it clear to them at the time that he couldn’t afford to pay anything higher.
Now their minimum award rate is higher than what Andrew is paying them.
What should Andrew do?
A. Nothing — the employees had previously agreed in writing to work for the lower rate so he doesn’t have to increase their pay to the minimum award rate.
B. Pay the new minimum rate from the date it became effective (making back-payments if necessary).
12. Jake has hired a new employee.
Under the National Employment Standards, what document must Jake give to his new employee?
A. A copy of the relevant award or registered agreement.
B. A Fair Work Information Statement.
C. A letter of engagement.
13. Jamie has 2 casual employees who only work a couple of hours each week. Neither have computers and both told her that they aren’t interested in receiving printed pay slips. As such, Jamie has stopped giving them pay slips and got them to sign their records to acknowledge that they don’t want them.
Is it okay for Jamie not to issue her employees pay slips?
A. No – she still needs to provide them with a pay slip within 1 working day of their pay day.
B. Yes – her employees have told her that they don’t want them.
14. Elizabeth has just opened an ice cream shop and she wants to know how she should issue pay slips to her employees.
How can Elizabeth provide pay slips to her employees?
A. Either on paper or electronically.
B. Electronically.
C. On paper.
15. Alex is in payroll and has been asked to do the pay slips for staff.
Which piece of information does Alex not need to include on the pay slips?
A. The employer’s business name.
B. The employee’s manager’s name.
C. The employee’s name.
D. The employer’s Australian Business Number (ABN).
16. Richard wants to know how much annual leave and sick (personal)/carer’s leave he has accumulated. A friend has told him that this information should be on his pay slip.
Is Richard’s friend correct?
A. No
B. Yes
17. Mick has decided to give his employees unlimited sick (personal) leave. He trusts his employees, and thinks this is a good way to show it. Under the Fair Work Act, employers have to keep written records on employee leave balances.
Since Mick’s employees have unlimited sick leave, does he still need to record the sick leave days his employees take?
A. Yes
B. No
18. Michelle asks her boss Bill for a copy of her employment details. Bill hasn’t kept any records.
Which 4 of the following should Bill have kept on file?
A. Michelle’s superannuation details.
B. Michelle’s name.
C. Michelle’s start date.
D. Michelle’s employment status.
E. The names of Michelle’s children.
19. Sally stopped working for Frank 8 years ago. She rings to ask for her final pay rate and date of termination. Frank has already destroyed her files.
Are Frank’s actions:
A. Okay
B. Not okay
20. Colin’s employee Jacinta thinks he is paying her less than his other employees for doing the same work and approaches him about it.
Can Colin show Jacinta the wage records of his other employees to prove he isn’t paying her less?
A. Yes
B. No

ASSESSMENT TASK 2: SKILLS ASSESSMENT
Task 2 (a) – Establish Payroll System and Process Payroll
For this Assessment Task, you will be processing the pays for employees of ABC Pty Ltd.
Carol Wall is the manager and there is also 2 staff:
• Adam West (full-time payroll clerk)
• Linda Watson (casual).
Check the payroll year
Use your current month in this exercise:
Your current month is: ......................................................................................................
Check if the company file you are using is in the Current Payroll Year. If not correct, start a new payroll year.
Enter your business details
So that your printouts can be identified, enter your details, e.g. Your Initials Pty Ltd in
Company Information.
You should also check if the financial year is correct according to the month you will be using.
Start a new financial year if required.
Read payroll procedures – ABC Pty Ltd
• Employees work under the Clerks – Private Sector Award 2010.
• Employees work a 38-hour week over 5 days.
• Adam sometimes works overtime. He is allowed a 30 minute tea break after the normal
finishing time and paid a meal allowance.
• The first 2 hours overtime worked are paid at time and a half.
• Double time is paid after 2 hours.
• All employees are paid fortnightly by electronic funds transfer.
• Payroll is processed by the payroll clerk (Adam); however the manager of the business (your trainer for this workbook) will approve and transfer the bank file to the bank for processing and will be responsible for assisting in handling employee enquiries.
• Adam and Linda must complete time sheets to be handed to the payroll clerk (Adam) by 1
pm on pay day.
• The default superannuation fund is Sunsuper; however Linda’s superannuation fund is AMP
Superannuation.
• The business lodges the business activity statement monthly and includes the monthly payment of PAYG Withholding.
• All deductions from payroll are made by the 7/next month by cheque.
• The company file is password protected so that only Adam has access to the file.
• All employees have provided a tax file number declaration form with tax file Number, address, date of birth and tax scale details.
• A file is kept for each employee. This file contains the above information plus details of leave taken, medical conditions and emergency phone numbers, time sheets, medical certificates, payment summaries and other personnel information.
• All employees have undertaken an induction training session covering work health and workplace safety, obligations and organisational policies and procedures.
• Staff sponsor a child with World Vision Australia.
Read employee details
ABC Pty Ltd employs the following people:
Enter all required data into an electronic payroll system (such as Xero) to complete a payroll run for the current fortnight. Calculate all requirements on each employee including PAYG Withholding and superannuation. Ensure you print all required records including pay slips, end of pay period reports, end of month reports. Ensure you meet all the requirements of ABC Pty Ltd as specified above and ensure each entry and all the payroll data and settings comply with legislative requirements. At the end of the payroll run, extract and apply business activity statement (BAS) and instalment activity statement (IAS) data. Back-up all relevant data.

Task 2 (b) – Establish Payroll System and Process Payroll
Scenario:
You have been employed by Future Wealth Accounting Company to manage the HR department. This role includes managing the payroll system for a staff of 24 people. You have been working for 2 weeks and have had a great deal of trouble using the manual system they have implemented (you are used to an automated system).
Your task is to research electronic systems and develop a report that you can present to Management as a proposal for the new system. You will be required to present the following information:
• The systems you have researched that seem appropriate for the organisation
• The features and benefits of the system
• Advantages and disadvantages of the system
• Costs involved in implementation
• Modifications to current technology required
• Benefits to the business
• Timeline for implementation
• Discuss the relevant legislation impacting on your decisions
As part of the research, assess the scope of payroll services BAS agents can provide and identify need for independent expert advice providers. What can BAS Agents contribute to the business? Identify at least 2 BAS Agents that you would be able to access and describe their services on offer.
Please remember this presentation will need to be formal and accurate. You are trying to convince Management that this is necessary for the organisation.

OVERALL ASSESSMENT RECORD
Student Name:
Student Number:
Unit of Competency: FNSBKG405 Establish and maintain a payroll system
Assessor Name: Jahangir Alam
Assessment Date Assessment 2
Assessment Task 1:
Did student satisfactorily answer the following questions? (tick if yes; cross if no)
1 2 3 4 5 6 7 8 9 10
11 12 13 14 15 16 17 18 19 20
Assessment 1 Outcome: 0 Satisfactory
0 Not Satisfactory
Assessment Task 2:
Task 2 (a)
Assessment Criteria S NS
Applied knowledge of relevant legislation in relation to employment standards, and other legislative requirements in regards to payments
Sought instruction from authorised parties in relation to relevant state and modern awards regarding details to be set up within payroll system for individual employees
Established payroll set-up for salary packaging
Assessed scope of payroll services BAS agent can provide and identify need for independent expert advice providers
Ensured payroll system included complete and accurate employee data
Reviewed payroll data and clarify discrepancies with designated persons
Entered employee pay period details, deductions and allowances in payroll system in accordance with source data
Calculated payment due to individual employees to reflect standard pay and variations in accordance with employee source data
Conducted payroll preparation within designated timelines in accordance with organisational policy and procedures
Calculated, recorded and reconciled employee in accordance with legislative requirements
Reconciled total payments for pay period, and review and correct irregularities or refer them to designated persons for resolution
Obtained authorisation of payroll and individual pay advice in accordance with organisational requirements
Made arrangements for payments in accordance with organisational and legislative requirements
Produced, reviewed and stored payroll records in accordance with organisational policy and security procedures
Responded to payroll enquiries in accordance with organisational and legislative requirements
Provided information in accordance with organisational and legislative requirements
Referred enquiries outside area of responsibility or knowledge to designated persons for resolution
Provided additional information or complete follow-up action within designated timelines in accordance with organisational policy and procedures
Maintained all information and record keeping relating to payroll function in accordance with relevant legislation and regulations
Produced and reconciled month-end and year-end checklists to ensure compliance with relevant legislative and management deadlines
Updated records and systems in line with salary reviews and other changes in employment status
Established back-up and disaster recovery systems
Generated and distributed payroll reports in line with organisational policy
Extracted and apply business activity statement (BAS) and instalment activity statement (IAS) data in accordance with relevant legislation and regulations
Task 2 (b)
Assessment Criteria S NS
Applied knowledge of relevant legislation in relation to employment standards, and other legislative requirements in regards to payments
Assessed scope of payroll services BAS agent can provide and identify need for independent expert advice providers
Provided information in accordance with organisational and legislative requirements
Referred enquiries outside area of responsibility or knowledge to designated persons for resolution
Assessment 2 Outcome: 0 Satisfactory
0 Not Satisfactory
Assessor Feedback:
Overall Assessment Outcome: 0 Competent
0 Not Yet Competent