Most small to midsized companies have HR and payroll information that are kept separate from the finance system. Unable to take advantage of automation, HR teams connect employee and finance information manually — mostly in the form of spreadsheets — spending hours entering data multiple times and manually reconciling HR expenses with finance. This delays postings to the general ledger (GL) and slows period-end close processes, and incomplete records introduce unnecessary risks to compliance and audit reporting.
These delays and incomplete records can have a real impact on the bottom line and a business’s ability to grow and adapt. But it doesn’t have to be that way.
Let’s start by outlining some of the areas where separate systems create errors and cumbersome, manual work.
Business Processes That Benefit from Unified Workforce and Financial Data
1. Payroll. Payroll and related expenses represent one of the largest expenses, if not the largest, on any company’s income statement. Processing payroll outside of your finance system becomes problematic when payroll information needs to be imported or rekeyed into the finance system for posting to the general ledger (GL). Depending on the level of detailed required, this could add hours or days to the payroll process. Additionally, reports are delayed, and the chance of payment errors increases.
Once payroll is run, earnings and payroll liabilities like taxes must be paid and reflected in financial reports. This entire process must be executed a couple of times a month with no room for errors in payment, tax filing or reporting.
2. Employee Records. Keeping employee records up to date can be a time-consuming process. For example, address changes are common and seem simple enough, but if not done in a timely manner they can create additional work for both the HR and finance teams if payroll taxes are withheld incorrectly. Without an effective dated system, tracing the change back to its origin can then take additional time to correct.
Similarly, paid time off represents both a benefit to an employee and a liability to the company. Noy only does getting the proper approvals and keeping balances up to date present a significant workload for an HR department, if not kept up to date, the company could pay out more in PTO liability than required when an employee leaves the company. Accurate employee records also form the basis of many compliance and audit reports.
3. Workforce Performance. Finance and HR leaders often discuss workforce performance as well as their future needs. This partnership keeps the company’s two most important assets, people and cash, aligned. With workforce information in multiple places, assembling the necessary information to get a single view of workforce performance is cumbersome and time consuming. So much so, that often it doesn’t get done at all, leaving leaders to make half informed workforce decisions like promotions, headcount budgets and controlling expenses. Without a trusted source for workforce information, planning and budgeting for future headcount needs becomes impossible.
Unify. Automate. Relax.
To address these challenges, more companies are turning to a single solution for their HR, payroll and finance needs. In doing so they can automate more HR-to-finance processes, gain valuable insights into workforce performance in a single view, remove initial and ongoing integration costs, and spend less time preparing compliance reports and for audits.
NetSuite brings HR, payroll and finance together in one suite, treating cash and people as equally important to company success. HR information is woven into the fabric of NetSuite, providing HR and finance teams access to the same set of real-time data to improve communications and accelerate decision making. Common processes like requesting time off, address changes and payroll are fully automated, removing the need for spreadsheets or additional staff to enter information in multiple places. Payroll expenses can update the general ledger in real time, while tax filings are done for you, saving many hours of reconciling to close the books on time, each accounting period. Less time is needed to prepare compliance or audit reports, because effective dates are used throughout one system. Employees and managers enjoy secure, self-service capabilities, improving HR service and reducing administrative tasks for the HR team.
A centralized data model also provides more complete views of HR and financial performance using leading practice KPIs for a better understanding on how the business is doing without the need for spreadsheets, integrations or manual data imports. Unified finance and HR information can be used to plan and budget the future workforce. Full automation provides less data entry, more accurate and auditable records, real time information, clearer insights and better communications.
Register for the SuiteFundamentals webinar to learn more about NetSuite’s unified finance, HR and payroll solution and get a peak at the HCM enhancements in 2020 Release 2.