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CHAPTER ONE

INTRODUCTION

1.1

BACKGROUND TO THE STUDY

Payroll encompasses every employee of a company who receives a regular wage or other compensation. It is the sum of all financial records of salaries for an employee, wages, bonuses and deductions. Some employees may be paid a steady salary while others are paid for hours worked. All of these different payment methods are calculated by a payroll specialist and the appropriate paychecks are issued. By law, employers are required to pay employees for their services rendered; through the payroll system, the processing of this payment is possible. (Macesay, 2013) . Payroll has been designed to remove the time and effort that is normally associated with payroll and to provide a direct and seamless operation that enables the employer to handle all staff and payment processes in a simple and accurate manner. Payroll software allows organization to generate pay slips and salary register, based on the attendance of the employees taking care of leaves, overtime, allowances, loans, advance, bonus, encashment and other standard deductions. By definition, management consists of all activities undertaken to secure the accomplishment of work through the efforts of other people. Both large and small firms require good management in order to achieve success. In the typical small business that entails group effort, the manager provides direction by activities that are described as management functions (Drucker, 1985). Theres no other business process thats more unfavourable towards employee satisfaction than incorrect and improper payroll management. And this very same business function can help reduce the impact on the environment through a paperless system. Introducing electronic or online payroll programs does not only make your payroll management more efficient, it is also a move to go green. With an online payroll solution, you ensure timely processes and become more earth friendly, aside from increasing staff productivity and cutting costs.

Shifting to an online payroll service offers many benefits to the employees, the employers and the environment. Whether youre a big enterprise or a small and medium business with several staff on the payroll, an electronic payroll management system is a good investment for you. Information and database system projects are initiated to improve the accuracy of the processing data and ensure the procedure prescribing how to do a specific task. A computer program can maintain accurate and consistent database, hence resulting in an improved performance (Niemec, 2007).

The program efficiency can be increased considerably by including automatic calculations and fast data retrieval capabilities. This will dramatically reduce the manual error and permit more study at lower cost and effort. The administration section of any organization is responsible for maintaining the pay records of all the employees. One of the main jobs of administrative section is to generate pay roll for all the employees and their payment reports. Due to the non-availability of a proper database management system all the data is handled manually. Because of large volume of payroll data and calculations, it is very difficult to handle the data manually and delayed the pay roll process. This created an immediate need to develop a new computer based pay roll data base system to avoid the delay in generating pay bills, loan schedules, payment reports, pay slips and so on. So this new Pay roll Management System (PMS) is developed.

1.2

STATEMENT OF THE PROBLEM

Preparation of payroll manually as earlier said is a cumbersome and boring task encountered by the account personnel in the account department of any organization due to the calculations involved and its repetitive nature. After an extensive interview with an account personnel on the existing payroll system, I discovered the following problems within the system: Calculating salaries through manual operation is burdensome and stressful. Errors such as transposition of figures in the journal Overpayment/Underpayment of salaries

Delay in payment of staff salaries because too much time is spent in preparation of the payroll. The use of paper to keep pay details about each employee which results in too much paper work. There is less security in the manual system

1.3

OBJECTIVES

In the course of this project, I intend to; Build an electronic payroll management system using the incremental development lifecycle model. Implement the electronic payroll management system, using Visual studio as frontend, and MySQL as backend.

1.4

SIGNIFICANCE OF THE PROJECT

Not so long ago, all payrolls used to be calculated manually, without any help from a computer. Professional accountants invested a lot of time and energy into keeping track of all employee data, files and information, calculating monthly salaries, hourly remunerations, bonuses, sick leaves, benefits, taxes, deductions and so on. And they did this all by keeping numerous files filled with track records for each and every person employed.

Nowadays, however, things are far more simple than they used to be. Because technology is always dedicated to making things easier and better, quite a wide variety of computerized payroll systems is available to save us from this tedious task. Now, instead of keeping dozens of files and spending endless hours calculating, all you have to do is get a payroll software system and let it do all the nasty work.

1.5

SCOPE OF THE PROJECT

Electronic payroll management system is the heart of any Human Resource System of an Organization. Efficiently manage employee information with easy to use interfacing and process monthly payroll shortest time frame and keep employees up to date on the statutory obligation.

The system is designed to improve on the manual method of payroll processing. It includes the features that can add employees record, edit employees information, delete employees record, print / save the pay slip of each employee and updating employees information.

1.6

LIMITATIONS OF THE PROJECT

On the other hand, this study limits only to the proposed automation of a basic manual payroll management system. A proposed system which can only be accessed by authorized persons. It does not support network topology implementation, online program or online transaction.

1.7 METHODOLOGY MATERIALS AND METHODS This project work will be carried out as a sequence of events. The following steps will be taken in the development of the ELECTRONIC PAYROLL MANAGEMENT SYSTEM. Project planning Review of existing system and requirement gathering Design and development of proposed system Testing and maintenance