Hi all Does any one have the details regarding salary accounting and audit notes. Please share..... Regards Amar:icon10:
From India, Mumbai
From India, Mumbai
Salary accounting is the part of financial entries for the salary payable recognition and salary payment made to the employees. The financial entries can be as follows:
1. Salary payment made simply and directly
Salaries & Wages A/c Dr
To Bank/Cash A/c Cr
2. Salary accounting where liability is recognised on end of the salary due period and payment is done on a different date.
I.Salary accounting
Salaries & Wages (a) A/c Dr
To Salaries Payable (b) A/c Cr
II.Salary payment
Salaries Payable A/c Dr
To Bank/Cash A/c Cr
(a) Salaries & Wages is the aggregate of salary components to be paid to the employees.
(b) Salary payable is the accounting entry recognising the salary payable liability.
3. Salary accounting and payment entries in cases where there is PF payable and others like Sodexho e.t.c which are to be paid to third parties but expense has to be recoginsed at the time of salary accounting consolidatedly.
Salary accounting - expense and liability recognition
Salaries & Wages A/c Dr (including PF and sodexho part)
To Salaries Payable A/c Cr
To PF Employees Cont.A/cCr
To PF Payable A/c Cr
To Sodexho Payable A/c Cr
Salary and other payments
Salary payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying salaries to employees)
PF payable A/c Dr
PF Employees Cont. A/c Dr
To Bank/Cash A/c Cr
(When actually paying to the PF authorities)
Sodexho payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying the Sodexho/contractors)
4. Salary accounting and payment entries in cases where there is PF payable and others like Sodexho e.t.c which are to be paid to third parties but expense has to be recoginsed at the time of salary accounting seperately.
Salary accounting - expense and liability recognition
Salaries & Wages A/c Dr (excluding PF and sodexho part)
PF Employer's contrib. A/c Dr
Sodexho (Meal Voucher) A/c Dr
PF EDLI & Charges A/c Dr
To Salaries Payable A/c Cr
To PF Employees Cont.A/c Cr
To PF Payable A/c Cr
To Sodexho Payable A/c Cr
Salary and other payments
Salary payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying salaries to employees)
PF Employees Cont.A/c Dr
PF payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying to the PF authorities which includes Employees contribution, Employers contribution and EDLI and other charges)
Sodexho payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying the Sodexho/contractors)
From India, Madras
11. Salary payment made simply and directly
Salaries & Wages A/c Dr
To Bank/Cash A/c Cr
2. Salary accounting where liability is recognised on end of the salary due period and payment is done on a different date.
I.Salary accounting
Salaries & Wages (a) A/c Dr
To Salaries Payable (b) A/c Cr
II.Salary payment
Salaries Payable A/c Dr
To Bank/Cash A/c Cr
(a) Salaries & Wages is the aggregate of salary components to be paid to the employees.
(b) Salary payable is the accounting entry recognising the salary payable liability.
3. Salary accounting and payment entries in cases where there is PF payable and others like Sodexho e.t.c which are to be paid to third parties but expense has to be recoginsed at the time of salary accounting consolidatedly.
Salary accounting - expense and liability recognition
Salaries & Wages A/c Dr (including PF and sodexho part)
To Salaries Payable A/c Cr
To PF Employees Cont.A/cCr
To PF Payable A/c Cr
To Sodexho Payable A/c Cr
Salary and other payments
Salary payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying salaries to employees)
PF payable A/c Dr
PF Employees Cont. A/c Dr
To Bank/Cash A/c Cr
(When actually paying to the PF authorities)
Sodexho payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying the Sodexho/contractors)
4. Salary accounting and payment entries in cases where there is PF payable and others like Sodexho e.t.c which are to be paid to third parties but expense has to be recoginsed at the time of salary accounting seperately.
Salary accounting - expense and liability recognition
Salaries & Wages A/c Dr (excluding PF and sodexho part)
PF Employer's contrib. A/c Dr
Sodexho (Meal Voucher) A/c Dr
PF EDLI & Charges A/c Dr
To Salaries Payable A/c Cr
To PF Employees Cont.A/c Cr
To PF Payable A/c Cr
To Sodexho Payable A/c Cr
Salary and other payments
Salary payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying salaries to employees)
PF Employees Cont.A/c Dr
PF payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying to the PF authorities which includes Employees contribution, Employers contribution and EDLI and other charges)
Sodexho payable A/c Dr
To Bank/Cash A/c Cr
(When actually paying the Sodexho/contractors)
From India, Madras
The information is given from simple to complex cases. The complexity increases as the number increases. It is possible that the first case itself suits some people. So there is no need to understand everything. There are more complexities involved in the process of salary accounting when it comes to high level accounting practices like providing for retirement benefits to employees based on actuarial valuation e.t.c.
From India, Madras
From India, Madras
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