Pastel Payroll allows you to automatically create the GL Journals for accounting. This is a standard feature in Pastel Payroll and does not cost extra and only needs you to set it up. The integration to Pastel Partner is totally automatic if the Payroll PC can see and has access to the Pastel Partner Data, is it locally or via a mapped network drive. You can export the Journals as well if you are unable to see the accounting data and this is ideal for payroll burro’s to email journals to there clients or if the Payroll PC is standalone or not connected to the network.
I will mainly demonstrate the automated integration and will show you the export ability at the end of this manual.
Firstly you need to switch on the GL Integration on each data set (1 data set per company). If you have 1 x Company with both Monthly salary and wages, which is one data set. If you have 1 x company split over salaries and wages, this will compromise 2 x datasets. The setup and implementations shown in these examples is for 1 x dataset only.
To switch on Pastel Accounting integration you need to go to Setup and click on Company Parameters.
The following screen will appear and you need to click on the Accounting TAB.
The GL Integration works on the accrual accounting system that will accrue a payment as a liability in the balance sheet and all payments for net pay, SARS, Provident, Pension, Medical aid etc are all done off the Balance Sheet Control Accounts to Zero them out as you do the payments.
In the first TAB in the Accounting TAB shows the GL setup which requests for the Global NET PAY Account. You will see that ALL Income will Credit this account and Debit individual appropriate Expense Accounts. All Deduction will Credit this NET PAY account and credit individual appropriate Balance Sheet control accounts (Will become zero when paid)
So in this first setup screen type in the appropriate NET PAY Account as you would have created in your accounting package. As per example to do enter the / that shows in accounting (9100/100).
I will create one GL Transaction per Payroll transactions and the reasons both the balance sheet and Income Statement is set to Transaction.
There is the possibility of splitting by Cost Centre in Payroll. So in Basic Salary is only the Main Account GL section, 4000 of 4000/100 and the Cost Centre in Payroll represents ALL sub account 100 you are able to split this. I will only demonstrate the Transaction only option. If you want to explore the possibilities then click on GL Code Setup assistant.
Now Click on the Integration TAB.
If you are able to see the Pastel Accounting data from your PC and want to integrate without exporting and importing then you need to enter information here.
All the fields that needs to be captured is choises from a drop down or zoom screen. Once you choose the point to the data directory of where Pastel Accounting data resides the drop down for Entry Type journals comes from that Pastel accounting data.
The cash book is one line per employee net pay and does have the names of each employee per line per net pay value.
Unless you are the only one using Pastel Accounting this is not recommended as drill dowsn will show other employees with access to GL this confidential information.
We recommend that Cash book Batch creation should be switched off.
If you cannot see the Pastel Accounting data from your PC then Un-tick both options but make sure the NET PAY GL account is captured. In the General Ledger TAB
Pastel Payroll then requires every Income, Deduction and Company contribution transaction that you use (No need to setup ones that you do not use) with the appropriate GL Account from your accounting System.
Some notes on how and what GL Accounts to use.
- ALL Income Transactions requires only the DEBIT to the Expense Account.
- The Contra for ALL Income transactions will be a CREDIT to the NET PAY GL Account.
- ALL deduction Transactions requires only the CREDIT GL Account mainly to a Control account in the balance sheet. Interest and or expense recovery could be a credit in the Income Statement “Other income or Expense account.
- The Contra for ALL Deduction transactions will be a DEBIT to the NET PAY GL Account.
- You can create multiple separate GL accounts for every separate income Transactions and have a GL account for Overtime, Basic, Commission, leave pay etc etc. Or can lump all Income into one GL Expense Account.
- Company Contributions requires both the DEBIT and the CREDIT. The DEBIT will be an Expense account in the Income Statement and the CREDIT will be the appropriate Control account.
- Tax Benefits are only amounts to calculate tax effect tax to be paid and does not affect a payslip otherwise and do not need GL Accounts. Both the Debit and Credit for Tax benefits are Greyed out.
Note how a Deduction Transaction SETUP has a GREYED out DEBIT block and that the Income transaction has a greyed out CREDIT block. So you only need to enter the other white available block and the contra will ALWAYS be NET PAY for Income and Deductions.
As per the above examples the / is left out when capturing GL accounts so 9100/200 is captured as 9100200
Examples of Income Statement GL Expense Accounts in Pastel Accounting
Examples of Balance Sheet GL Control Accounts (Liabilities) in Pastel Accounting
I have created a Main Account of all Current Liabilities so that the Salaries Control Account should Zero before running the next payroll. So only add Control accounts that need to be paid within that month. I then create a separate Main Account called Long term Salaries Control of all accounts like OID (Workmen’s compensation that gets paid once a year and long term loans for staff that takes a few months to pay off.
Note how Company Contributions requires both the DEBIT and CREDIT account.
You only need to capture the GL account numbers for all transactions that you use in your payroll. All the above examples have shown the GL account numbers captured in the MONTHLY tab. If you run WEEKLY and or FORTHNIGHTLY then your also need to capture the GL account numbers in those tabs.
Once you have done all the payroll runs for that period that you need journals for, you can run the Payroll Journal report as shown in the picture.
This report will show you each rand value and its debit and credit GL account. If any debit or credit GL account is empty then go and check the relevant transactions.
There are TWO methods at this point to send the journals to the accounting package. The first is to export the journals as you do not have access to the accounting data and want to email the journal to relevant person or want to import manually the journals. The second uses the Pastel Partner SDK (Software Development Kit) that automatically send the journal to the accounting package without exporting and importing. This method needs you to have access and be able to see the Pastel Accounting data.
This method is used to not only send the journal in a text file to your accountant as you might not be able to see the accounting data on your PC but this is also the only method to export and integrate to :
- Pastel Evolution
- Pastel Premier
- And even Others.
From the file menu after you have finished your Payroll run but before you run your pay period update click on Import / Export.
Choose the appropriate export method (Note that you do have CB (Cash Book) export facilities as well but as previously mentioned due to confidentiality I prefer not doing these.
Make sure you choose the “Payroll Journal” option for your package.
You will see that there are different versions of Pastel Partner and you need to choose the correct one as the file format is different between them.
In the screen above choose the appropriate directory and file name to export to. The Journal Reference must not be greater than 8 characters long.
When ready export the file by clicking on process. Email the file or take file to PC that has the accounting package and import the file into the appropriate journal batch.
- SDK – Automated Journal
This method needs you to have access to the Pastel Partner / Xpress data on your PC and the appropriate settings as shown at the beginning of this manual in terms of path and journal entry type.
The Integration happens when you do a pay period update and has an extra screen in the pay period update when GL Integration is switched on.
Because you cannot reverse a pay period update you have to make a backup if you need to REDO this process if you find errors in your integration.
Do your pay period update and you will be asked for the Payroll Journal Reference number whicgh you will enter with a relevant number like PR-NOV09.
Once you have completed the pay period update you need to logon as the supervisor (User 0) in Pastel Partner or Xpress and go to the relevant Journal you chose in the GL integration setting. Check the journal and update when ready.
- The exported method journal also has a separate Journal line for every debit and credit whereas the SDK integration uses one line per journal debit and credit (Uses the contra GL account method)
- The evolution GL Integration has a separate journal per employee whereas the Partner journals consolidates figures together.