A STUDY TO ANALYSE THE SALARY MANAGEMENT SYSTEM AT

CBitss Technologies

PROJECT REPORT

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE

AWARD OF THE DEGREE OF

BACHELOR OF BUSINESS ADMINISTRATION

DEPARTMENT OF BUSINESS ADMINISTRATION

NSCBM GOVT COLLEGE
HAMIRPUR (H.P)

SUBMITTED TO SUBMITTED BY

PROF. CHANDRESH SANJEEV KUMAR

SIGN. BBA 6TH SEM

541

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 DECLARATION

I SANJEEV KUMAR hereby declare that the report titled “Salary Management” is an
original piece of work carried out by me under the guidance and supervision of Mr. Kishore
Kashyap. The information has been collected from genuine & authentic sources. Any,
literature, data or works done by the others and cited within this dissertation has been given
in due acknowledgement and listed in the reference section. The work has been submitted in
partial fulfillment of BACHELOR OF BUSINESS ADMINISTRATION of NSCBM
Govt. College Hamirpur (H.P.).

Signature of the student

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 CERTIFICATE

This is to certify that the report work entitled “SALARY MANAGEMENT”, is a bonafied
work carried out by Sanjeev Kumar, a candidate for the BBA(2014-2017) of NSCBM Govt
College Hamirpur(H.P.), approved by H.P.U. under my guidance and direction.

Mr. Kishore Kashyap

CBitss Technologies

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 ACKNOWLEDGEMENT

First and foremost my heartfelt thanks to God for helping me in all my ways. I would like to
add a heartfelt word for the people who have helped me in bringing out the creativeness of
this report.

To commence with things I would like to take this opportunity to gratefully and humbly
thank to Mr. Navneet Sharma: Director, Mr. Kishore Kashyap: Project guide, CBitss
Technologies (a units of Sukrala IT Services Pvt. Ltd.), Chandigarh, for being appreciative
enough by giving me an opportunity to undertake this study and also all the staff members
who helped me in the best possible way to complete this Project report and this report in
CBitss Technologies.

My Parents need special mentions here for their constant support and love in my life. I also
thank my friends and well wishers, who have provided their whole hearted support to me in
this exercise. I believe that this Endeavor has prepared me for taking up new challenging
opportunities in future.

My gratitude to all those, who responded to my questionnaire in a well defined manner and
helped me acquiring knowledge.

Lastly, I thanks all those, who have directly or indirectly, helped me in this report.

SANJEEV KUMAR

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 TABLE OF CONTENT

CHAPTER NO. PARTICULARS PAGE NO.

CH 1. INTRODUCTION 7

1.1 Salary Management 8

1.2 Benefits of Salary Management System 10

1.3 Features of Salary Management System 10

1.4 Salary Management Process 11

1.5 Salary Management Process Methods 12

1.6 Brief Profile of the Company 13

CH 2. REVIEW OF LITERATURE 23

CH 3. RESEARCH METHODOLOGY 27

3.1 Objectives of the Study 28

3.2 Need of the Study 28

3.3 Scope of the Study 28

3.4 Meaning of Research 28

3.5 Research Design 29

3.6 Population 29

3.7 Sample Size 29

3.8 Sampling Unit 29

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3.9 Sampling Technique 29

3.10 Data Collection 29

3.10.1 Primary Data 29

3.10.2 Secondary Data 30

3.11 Sampling Tools 30

CH 4. DATA ANALYSIS AND INTERPRETATION 31

CH 5. FINDINGS, SUGGESTIONS, LIMITATIONS & 50

CONCLUSION

5.1 Findings 51

5.2 Suggestions 52

5.3 Limitations 53

5.4 Conclusion 53

REFERENCE 55

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 INTRODUCTION

1.1SALARY MANAGEMENT

The salary management system concerned with the financial aspects of employee’s salary,
allowances, deductions, gross salary, net pay. It also deals with the generation of pay-slips.

An organization is composed of number of departments and each department has a salary

section which manages its salary processes. Each salary section has to perform activities like
data collection and preparation, entry, updates, monitoring and reporting of data. Many of the
existing processes and procedures are required to be updated according to changing demands
of employees and changing technologies. Salary system would be able to keep a record of
employees including their personnel data, allowances, deductions, leave, savings, taxes and
pay slips.

Net pay of all employees is calculated separately according to company rules considering
their allowances and deductions. If employee wants to get a printout of pay slip, then it is
printed out as a receipt. Pay bands, allowances, deductions and tax info are updated according
to changes in salary structure.

It is the sum total of all financial records of salaries, bonuses, wages & deductions. It deals
with the payment to employees at regular intervals & on time without any delay. Salary is
paid to them according to their services provided during a certain period of time.

Salary management is further classified into two parts or processes i.e. Salary Accounting: It
concerned with calculation of employee’s salaries, allowances & deductions. It also dealswith
the activities like maintaining salary records, preparation of tax returns, etc.

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Salary is important from the accounting perspective because salary & salary taxes affects the
net income of the organizations. The main motive of the salary department is to ensure that
all the employees are paid their salaries on time with the correct allowance benefits

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1.2BENEFITS OF SALARY MANAGEMENT SYSTEM

● It has a user friendly interface. It can be executed easily.

● It helps to save time by doing calculations quickly.
● It lowers the error ratio by do calculations accurately.
● Payment info is entered quicker by it as compared to a manual system.
● Tax calculations are simplified by computing data.
● It eliminates the stress of processing all the records of workers.
● One can get old salary reports when required in just a click.
● All the information related to salary transfer is maintained by the system.

1.3 FEATURES OF SALARY MANAGEMENT SYSTEM

● Accuracy: Salary system must be able to make compatible employees & their working
times. If the system is accurate then it becomes very easy to keep records of working
hours of employees &chances of occurrences of error is minimized.
● Deductions Support: Salary system must set up for deductions. A substantial
calculations are needed for Medicare, social security or any benefit plan contributed
by each employee.
● Record-Keeping: It is used to keep accurate records. It helps to monitor that how
much overtime is done by employee and how many employees are participating in
retirement plan etc. Detailed record keeping would help to make salary details of
employees easily.
● Tax Calculation: Basic salary function is to determine tax amounts for each employee.
It helps to calculate taxes to be deducted from every employee’s salaries.
● Employee Management: It is helpful to make employee management. All the
employees are managed with their detailed records. It is used to maintain salary
history after closing the year. Reports can be printed from history.
● Budget Management: It deals with tracking annual and periodic accounts. Budget
tracking is done here.
● Generate Pay Slips: Pay slips of the payment done to employee is generated as
receipt. It acts as a record of payment of salary.
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1.4 SALARY MANAGEMENT PROCESS

Salary management process is composed of various steps as discussed below:

1. Identify Employees: Proper identification of all the people working in

organization is required as not all workers are employees. Employee’s
designation, his work profile, his department etc are identified properly. Proper
identification of qualified workers as employees also reduces fraud and waste.
2. Employee Records: Proper records of all employees are created including his
personal details, department details, his contribution in the form of allowances,
tax deduction details and other salary details.
3. Update Employee Master File: The salary clerk will receive the notifications
related to changes made in employee profile like promotion etc, has impact on
salary processing. All the changes would be updated in employee master file in
salary software.
4. Attendance Records: Daily attendance of all employees is recorded under
overheads like present, absent, casual leave, sick leave, overtime, late hours
etc. It is helpful is making salary details as salary is created according to the
working hours of employees.
5. Enter Time Worked: Enter the working hours of each employee in the salary
system including his regular and overtime hours worked.
6. Calculate Termination Pay: Calculation of amount payable to those employees
who has left the job. This is usually done in case of those employees who left
the company voluntarily.
7. Alter Allowances and Deductions: Any type of alterations in the standard
allowances and deductions of employee pay are entered.
8. Calculate Pay: Calculation of net salaries paid to the employee is done after all
the steps are covered mentioned above. Tax tables provided by the state
governments are used to determine the proper amount of tax withholdings.
9. Record the Salary: All the calculated salaries are to be recorded properly and
accurately.
10. Review Reports: All the created reports are then reviewed to determine
transactions for errors.

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 11. Issue Management Reports: Salary reports are then issued to management that
are related to the salary management just completed. Management reviewed
these reports to issue payments to workers.
12. Issue Payments: When no errors are found on the analysis of reports, payments
are issued to employees.
13. Investigate Errors: If there is a problem in salary processing, investigate all
transaction errors encountered and correct these errors to eliminate their
continued occurrence.

Salary Process

1.5 SALARY MANAGEMENT PROCESS METHODS

There are different methods used to manage salary processing of employees. Main methods
are discussed as follows:

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 ● Manual System: Manual salary system is the traditional salary system. It involves pen,
ink, adding machine, etc. instead of any computerized aids. It was popular when there
was no salary processing software available. But now in these days, there is only a
few small scale organizations that use the manual salary system. It can be used by the
construction and manufacturing industry for contractual labour, as these contracts are
on daily/weekly basis. This process is risky as it is more prone to errors and is time
consuming.
● Accountant: Accountant is a professional having degree in accountancy. He/she is
responsible for all the activities related to salary accounting and has the sound
knowledge of accounting principles and accounting standards. He is responsible for
calculating the salaries of employees and he is paid for it.
● Salary Software: It deals with calculating the payable amounts and deductions quickly
and easily. Pay slips are also generated by it in lesser time. It automatically validates
data and calculations done by it results no errors. Professionals are required to execute
the software for its efficient working.
● Salary Outsourcing: It involves third party/an outsourcing company in the calculations
of salaries and deductions. All the activities of salary accounting are done by this
party. It results into time and cost saving for the organization. In case of more number
of employees, salary outsourcing would be very much beneficial.

1.6 Brief Profile of the Company

For the past few decade, information technology has massively been accepted and gained
popularity beyond its intended expectations in the technology world. Today, information
technology stands as firm proprietor of computer world both in domestic and global areas. It
has not only created economic growth but has enormously enhanced the fast pace of universal
development. In their quest to uplift this standard development, CBitss Technologies has
undertaken the tasks of equipping students, working professionals and trainees in various
fields of technology. Candidates are posed with various live experiences of industrial fields
so as to eliminate the fear of industry etiquette while getting their first job. Since international
standards are of a higher demand in this era, it’s the sole aim of CBitss Technologies to
produce numerous qualified candidates that can suit these demands both in the domestic and
international cites.

CBitss Technologies poses as an intermediate between the demands of information

technology and corresponding readiness of students to learn, even beyond their expectations.
The well-experienced staffs in CBitss Technologies are always ready to take the students
tothe zenith of IT industry with their world class teaching techniques. However, in order to
achieve these goals, it is paramount for students to avail themselves to this

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yieldingopportunity. Convincingly, CBitss Technologies believes in making candidates for
feeding the nation and world at large not just making the arrangements for today only.

E Services:

Online Business
CBitss Technologies offers online business for its clients.

1. Dedicated Servers- We have dedicated servers which provide powerful and secure
web hosting solutions for clients with more sophisticated needs.
2. VPS (Virtual Private Server) – Using this enables you to have higher control and
access over accounts and applications of your website.
3. Shared Hosting – It includes hosting many websites on the same server. The websites
of many clients are hosted on similar resources.
4. Affiliate Marketing – It is basically revenue sharing between online advertisers and
online publishers whereby compensation is based on performance measures in forms
of clicks on client’s website. This is a combination of unique content writing, good
links and revenue share of associates who are working for this.
5. Online Classifieds Sites – The loudest way to draw attention to our client’s website is
through classified ad posting. We use this strategy to create awareness among people
about specific service delivered by client’s website.
6. Job Portal – We run a website for jobs in which companies can post their requirement
for resources free of cost and our students can post their resumes to the companies
without any charges.
7. Tourism Portal – Some of our most popular tourism web sites are there. These sites
are mostly visited by tourists across the world to find the best services to enjoy the
vacations.

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Search Engine Optimization

Creating presence by designing a web site is not enough in this era; it is only beneficial if
expected potential customer is visiting our site. And this goal can be achieved if our web
site/blog is ethically listed in all major search engines with the help of various white hat
search engine optimization techniques. We are a dedicated SEO team in bringing actual
consumer traffic in your website for your products. No doubt our services are more in to
client satisfaction by providing daily work report, traffic graphs dedicated geographical
traffic. Moreover, we believe in customer delight by following hi-tech approach to bring
actual consumers. We assure our client’s for these deal line results because right people
from beginning..

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Linux

What is open source: Open source software means the software in which the source code
(code in which program is actually written under set syntax of any programming language) is
made available to the general public for use and/or modification from its original design free
of charge for the customized or better functionality of the program. Open Source Software
are formed when programmers write and improve source code as collaborative efforts &
share the changes within the community.

Benefits of Open Source Software: It is mostly used as being secure, powerful & free of
charge. Linux is open source operating software. It is very robust and known for security
features. Companies are migrating to Linux as it is Virus FREE OS & Cost cutting.

Availability of Open Source Software: There are plenty of open source software available for
communication, Engineering, Education, Finance, Productivity, Management & Multimedia
etc. Linux is free to use, modify and distribute. We have made it free to learn as well.

PHP
CBitss Technologies is fully open source technology based company. We do website
development in PHP, MY SQL and variety of CMS & frameworks like: Word press, Joomla,
Magneto, Smarty, Cake PHP, etc. We train the aspirants of PHP technology not only to make
them capable enough to get good job but they can start their own freelancer work at home as
well along with their job.

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Benefits of PHP from us:
● Training from team of professional PHP developers with years of experience
● Training on core Live Projects to get practical exposure of programming
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● Small Batches with early morning, late evening & weekend batch timing availability
● Get free personal domain & hosting as have our own dedicate Web servers
● Dumps available of more than 2000 solved PHP interview question answers

Tally

When the word tally comes in our mind, the wave automatically goes to the main build of the
world which is accounting.

What is Tally?
Tally is related to the word accounting whereas in tally itself can be defined as a complete
business solution for every kind of business enterprise i.e. for both national and international
companies. Basically tally is accounting software which is done online (computers, laptops),
no paperwork is require in tally.

Need of Accounting Software?

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 ● Tally deal in various price list and many products and also handles various vouchers
and ledgers.
● Groups are automatically created in tally which is referred as the gateway of tally
where all the accounting terms are properly organized.
● Tally is very economical in terms of time, money and efforts and is very easy to use.
● In tally, all the accounting reports are summarized properly and all the data for one
particular company is kept in one drive or directory.
● It is very easy to find all the entries of the required company.
● No sticking or attaching of pages is required.
● No case of theft or fraudulent occurs as all the data can be kept by giving password
for any company which is called as tally vault password.
● Tally accounting software is capable of understanding financial analysis and financial
management.
● It provides information for cash flow statement, activity consolidation and all small
concepts of accounting.
● In tally, a single connection can support multiple users and can also be connected with
all the Microsoft applications.
● Tally is cheap and easy to afford as compared to other accounting software and it also
helps in decision making for all financial conditions.
● With tally, accounts can generate all type of VAT through e-return.
● Tally help in making reports which is impossible to prepare in manual accounting.
These reports are mostly used to find out the frauds and all entire illegal adjusted
amounts but internal auditors of the company.

QuickBooks
QuickBooks is simple online software for business owners to organize business finances in
one place and make informed decisions anytime, anywhere. It also helps you to work more
effectively with your accountant. This is the only device dependent accounting software
which gives cloud based 128 bit bank level encryption. That’s why over 1.3 million
businesses use QuickBooks.

Why Should You Learn QuickBooks?

● QuickBooks is device independent only accounting software which can be accesses

anywhere any time.
● It generates 60+ simplified business reports online to have a looks on business
activities from every corner.
● It gives Cloud based 128 bit bank level encryption which means total security and
privacy of your business activities.
● Its most adorable feature is that it easily manages sales, payrolls, payments along
with creation and sending customized invoices online.
● Anyone who does not know account technically can track his/her sales, expenses &
income online.

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 Accounting

Accounting is the flow and combination of all the business operations. Every business
enterprise follow the system of accounting and the main agenda of accounting is that the
business owners use this information to create budget, prepare profit and loss account,
balance sheet for their company so that the financial accounts are maintained properly.

Accounting also helps in development of any business by recording all the transactions in
significant manner and then analyzing their profit and loss with the help of accounting.
Preparing proper accounts can also help as a proof in future in case of any fraudulent or any
dispute regarding profits of the company between two or more parties. Also, it helps in
preventing black money or hoarding if all the records of the company are maintained
correctly.

Every type of business whether small business or long term business prepare accounts so that
it becomes easy to judge the amount of profit earned and loss suffered. Accounting itself
gives very easy concept of defining expenses, incomes or any other assets or liabilities and
also sub-dividing them under various groups. No misconduct occurs if accounts are properly
maintained.

The turning point for every BBA, BTech, BCA or MCA student is his/her project In this age
of computer, it is nearly impossible to get job with just degree or diploma. One must have
deep knowledge at least in one of these technologies that lies under networking,
programming & internet technologies. So for aspirants, it is very important to choose the
right technology module which can be considered as career option and one more important
thing which one must not take lightly that is choosing the right organization from where
candidate should take lightly that is choosing the right organization from where candidate
should take training in 6 months industrial training program.
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As this is the matter of candidate’s career therefore only professional trainer who has good
industrial knowledge can treat the candidate well as per the industries man power
requirements. We CBitss Technologies are Chandigarh based company, leader in its class to
provide best technical training to the students who want to undergo 6 months/6weeks
industrial training. Along with the technical training, we have world class techniques to
patronize the candidates for interview with our personality development training modules that
are complimentary with the technical modules and such modules do not help only in getting
good job but also this reflects in their real life.

The well experienced staffs in CBitss Technologies are always ready to take the students to
the zenith of IT Industry with their world class techniques. However, in order to achieve
these goals, it is paramount for students to avail themselves to this yielding opportunity.
Those who are aspirants to become independent IT professionals, I strongly recommend them
to career counseling from our representatives.

Seminar & Workshop

We deal in free seminars and workshops based on awareness of open source technologies.
Open source is term which defines the liberty of using the software freely. We are full
fledging open source Software Company. We give awareness about free open source
software and cyber law for piracy. Along with this technical stuff, personality development
modules and interview preparation methodology will be contemporary.

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 Web Development

Web development and designing our company is specialized in PHP, Smarty & Cake PHP
with Zed Framework development. We provide cost effective solutions for the advances
internet projects. This is an excellent opportunity for start-up companies or for projects with a
small budget that require an advanced solution. We offer complete spectrum of services and
are ready to take care of your project up to your ultimate satisfaction. We provide rich,
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major emphasis is in providing cost effective and secure web services to our clients who can
be achieved by using open source technologies and PHP is best and most widely used
development language.

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 Mobile Application

Android Application Development: Android an open source and Linux kernel based mobile
operating system available with java programming interface, developed by open handset
alliance, now led by Google with large community of developers is one of the most liked
mobile OS by the mobile users. Android phones compatibility is versatile. Thus, enterprises
can build own robust, secure & custom Android Application Development according to their
business needs. It is expected that there are around 200 million devices using android because
it support 2D and 3D graphic animation using open GL libraries and for data storage, it use
SQL database. As our expertise domain is open source technologies and android is also an
open source technology so we are offering following Android Application Development. We
can understand the needs and importance of the Android Application Developments for users
& we strive for providing them the services that enable them to have the Android
Applications that they want according to their need. Our Android developers are proficient in
using the latest android development tools and advance object oriented methodologies to
design, develop sophisticated fully functional application as well as to market it once it’s
launched.

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 Network Solutions

We are offering versatile range of hardware, software & network services and solutions like
network design, annual maintenance contract, peripheral integration and open source
migration services in all major industry segments along with technical support for various
number of computers/networks worldwide. We have almost all the solutions for desktop
based requirements and server based requirements. We are skilled in windows to Linux
migration for client’s network security and company cost cutting. Our team is expert in
providing mail server, web server, LTPS, thin client, online ghost, database, proxy server &
network monitoring solutions, web hosting services etc. CBitss Technologies is continuously
expanding and enhancing its services. We would be happy to discuss the requirements with
you in the above said field of expertise.

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 CHAPTER -14

Robert Leach (2011)reviewed the overall subject of payroll, from setting up a payroll in
the first place, calculating gross pay and net pay, to the payment of salary to employees. He
makes the whole payroll process clear. He studied that payroll is a specialized function,
requiring specialized and trained staff. The main functions of payroll are summarized as:
calculating gross pay for all employees, calculating statutory payments, determination of
payments which are subject to income tax, making all deductions from pay, calculating net
pay and paying all employees. All these are minimum requirements. Salary must have
complete knowledge of an employee.

Timothy F. Carse (2008)suggested the concepts and procedures related to operating a

payroll for a company. Ways to approach to the basics of payroll accounting and payroll
administration. The process of hiring employees, laws affecting payroll accounting and
administration is explained. Calculation of gross pay, social security and Medicare taxes,
withholding taxes and other various deductions are described. Instead of it, description of
concepts related to accounting journal entries for a pay period, as well as the various payroll
accounting records and documents that must be created, updated and retained by a company
is given.

Vicki M. Lambert (2014) studied that a good payroll is essential for running an efficient
department. Salary management is a system including payroll department, different payroll
systems, and management issues, staffing, reporting and paying employees, etc. Salary
department is responsible for management of payroll functions with the maximum efficiency
and within compliance requirements. It will explain the optimal methods for the basic
functions of payroll.

Vivek Jain (2012) studied that the role of payroll in any business is very vital for the
efficient running of it. Roles of a payroll are to define a new payroll, running a payroll run,
balance dimensions, element entries, costing etc. It also includes recording employees,
creating pay heads and attendance records of all employees accurately, make their salary
details including all allowances and deductions, payment of salaries to employees, issuing
payroll reports to management, generation of pay-slips if required and maintenance of
complete payroll data so that it can be used in future whenever required. It also tackles with
the occurrences of errors and their salvation.

Steven M. Bragg (2005)observed that how to maintain and improves the efficiency of an
existing payroll system. Salary system is comprised of set of policies, procedures and
practices. It addresses the processing of specific transactions, taxes, deductions. It includes
the process of creating employees, accumulating time worked, payroll procedures and
controls, payroll best practices and payments to employees. Inevitable variety of
compensation, tax, deduction and record-keeping issues related to payroll are causing

23
inefficiency of the system. Various appropriate tips and techniques are there that offer
guidance on how to handle specific payroll situations.

Speedy Publishing LLC (2015) suggested that management of time and payroll
processing is must to ensure that employees get paid for the job done when the pay is due.
Salary management ensures that the accurate and on time payments are one of the major
causes for loyalty of employees and they stick around longer. A “Salary Accounting Book”
of Speedy Publishing LLC is the best used to manage the time and payroll processing.

Louise Vidler (2012) reviewed that a good payroll management function lays good audit
trails, through the use of sound business systems. To successfully manage a payroll system
i.e. to acquire and exceed all of the requirements, utilizing all of the skills and attributes that
are must for a payroll system to make it efficient. Risks are identified by a professional
payroll manager, reported these risks to the management and address them within the scope
of their role. Salary process can result in zero errors, if these are properly managed and
addressed. Salary also includes the motivation, management of payroll team, develop and
implement effective policies, identify and manage risks, managing employee relation’s
issues, manage salary packaging etc.

Frances P. Robinson (2013) observed that payroll system is a place for business owners
to keep track of employee payroll. The risk of computer crashes or interned damages makes it
important to have a hard copy of records as a backup in the form of payroll record book. It is
composed of employee personal and official details, regular hourly worked time and rates,
overtime rate, late hours, attendance, salary details etc. it is helpful to keep records safe and
accessible whenever required.

Debera Salam (2015) examined that payroll administration is the principle of blending a
historical perspective on public policies and laws. It is affecting payroll with a full
explanation of the subject matter. It is a valuable research tool for payroll professionals.

Bob nelson (2012) reviewed that payroll deals with rewarding employees according to
their performances and work done. How the employees are inspired to deliver the best
performance everyday with no cost. System need new and fresh ideas to bring up talent and
keeps employees in mind. They are rewarded on the bases of their contributions to the system
either financially or by providing non-financial benefits.

Stone (2005)investigated that many factors affect how payroll is managed and maintained.
It also affects the setting of wages and salaries. Affecting factors depend on the area of living,
minimum wages and government ability of the employer to pay etc. Stone indicated that
people are motivated by money. Most of the people are motivated by providing basic
necessities of life. Some people takes money as an instrument to satisfy their non economic
needs like power, status etc.

24
Isaacashraff (2012) studied that payroll is major consideration in human resource
management. It provides employees with a tangible reward for their services. It leads to job
satisfaction of employees. Salary system means to pay employees for the services provided
by them with their full satisfaction. Employees desire compensation system that they perceive
as being fair with their skills and expectations.

Marcus Buckingham (2008) examined that payroll system means to compete to find,
select and keep the best employees. This is done by pay, benefits, promotions and training.
Employees are selected for the talent rather than for skills or experience. Selected best
employees are paid for their workings.

Rebecca A. Mazim (2010) reviewed that payroll management is to complete your

payroll, i.e. to create and keep proper employee payroll records. Employee payroll record
include his personal details (name, social security no., address, date of birth ,gender and
occupation), time and working times, regular hourly rate of pay, total overtime earned, all
allowances, all deductions from employee’s wages, total salary paid, date of payments and
pay period covered etc. All of these records are kept by the payroll management system.

Smith Elliott Kearns (2015) observed that the changes among staff would not cause
any variations in the quality and speed of payroll processing. Needs of the employees are
fulfilled by providing payroll services. Management of journal entries is comply with general
ledger requirements.

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3.1 OBJECTIVES OF THE STUDY
● To study and understand the role of Salary Management.
● To study and understand the measurements of salary in Salary Management.
● To study and understand the benefits of Salary Management.

3.2 NEED OF THE STUDY

Salary system is required for the proper maintenance of employee’s personal, official &
salary details.

If there is lack of proper payroll system in the organization then it becomes very difficult to
maintain salary details. Errors are occurred in payroll operations which results into
employee’s dissatisfaction & frustration towards the job because every worker wants that he
would be paid on time & with adequate amount according to his efforts put into the work,
including all allowances and deductions. It also becomes difficult for the organization to have
complete records of its employees required for salary payments.

So it is very vital to study the payroll management system properly so that payroll functions
become easy to operate for the organization and it would not tackle any problem/errors in
payroll operations.

3.3 SCOPE OF THE STUDY

The present study on payroll management has been limited to analyze the payroll
management in CBitss Technologies, Chandigarh only. Due to shortage of time and other
resources, it was not possible to cover the large part of the universe. As such the conclusion
drawn is based on a very small sample size which may not fit into the universe.

3.4 MEANING OF RESEARCH

Research as the “manipulation of things, concepts of symbols for the purpose of generalizing
to extend, correct or verify knowledge, whether that knowledge aids in constructing the
theory or in the practice of an art. Research methodology is a way to systematically solve the
research problem. The purpose of methodology is to describe the research procedure. This

26
includes the overall research design, the sampling procedures, and the data collection
methods.

3.5 RESEARCH DESIGN

Research design is a basic plan which guides the collection of relevant information accurately
and economically for the objectives set up for the report. A research design is the
arrangements of condition for collection and analysis of data in a manner that aims to
combine relevance to the research purpose with economy in procedure.In this research,
research has been used.

3.6 POPULATION:
The study was carried out in general with the special reference to selected employees of
CBitss Technologies in Chandigarh.

3.7 SAMPLE SIZE:

The sample size is restricted to 50 selected employees from CBitss Technologies,
Chandigarh.

3.8 SAMPLING UNIT:

The basic unit containing the elements of the poplation to be sampled. In this report,
sampling unit is employees of CBitss Technologies, Chandigarh.

3.9 SAMPLING TECHNIQUE:

Sampling was used to carry out the research.

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3.10 DATA COLLECTION:
After identifying and defining the research problem and determining specific information
required solving the problem the task is to look for the type and source of data which may
yield the desired result. Two types of data are collected i.e. primary data and secondary data.

3.10.1 Primary Data

These are the data that are freshly collected from the employees so as to find the way of
operation of payroll in the organization. The primary data was collected by the means of
structured questionnaire.

3.10.2 Secondary Data

The process of secondary data collection and analysis is called desk research. It includes
those data which are collected for earlier research work. Thus officious use of secondary data
can save both money and time or the research company was the main source for secondary
data which provided the material for the research study. The secondary data was collected
through company website and brochures.

3.11 SAMPLING TOOLS:

Sampling tools are used which are suitable for the research i.e. Percentage method, Column
chart method and testing.

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1. Number of employees think payroll management system is clearly
defined in their organization.

S. No. Particular Number of Percentage (%)

Respondents

1 Yes 40 80

2 No 10 20

Total 50 100

(Table 1)

(Chart 1)Interpretation The above chart represents that 80% employees thinks that
payroll management system is clearly defined in their organization, whereas 20% employees
are not agree with the fact.

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2. Technique used to service payroll operation in the organization.

S. No. Particular Number of Percentage (%)

Respondents

1 In-House 35 70

2 Fully Outsourced 2 4

3 Hybrid 9 18

4 Others 4 8

Total 50 100

(Table 2)

(Chart 2)

Interpretation
The chart shows that 70% employees says that in-house technique is used for serving
payroll operation in the organization, while 18% are in the favored of hybrid
technique. 8% replied for other techniquesfor serving payroll operation and the rest of
them are replied that fully outsourced technique is followed.

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2. Method used to record employees personal and salary details.

S. No. Particular Number of Percentage(%)

Respondents

1 Manual System 0 0

2 Salary Software 43 86

3 Salary 2 4
Outsourcing

4 Accountant 5 10

Total 50 100

(Table 3)

(Chart 3)

Interpretation
Most of the employees are viewed that payroll software is used to record personal & salary
details, while 10% are agreed with accountant and least 4 % are replied for payroll
outsourcing.

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3. Calculation and payment of salaries are done on monthly basis
including all allowances and deductions.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 12 24

2 Agree 19 38

3 Disagree 17 34

4 Strongly Disagree 2 4

Total 50 100

(Table 4)

(Chart 4)

Interpretation
The chart concludes that 38% of employees are agree and 24% are strongly agree with
the fact that calculation & payment of salaries are done including allowances and
deductions, whereas rest of them are not agreed with the same.

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4. Timesheet calculations are done using a standard payroll rounding
model.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 11 22

2 Agree 29 58

3 Disagree 7 14

4 Strongly Disagree 3 6

Total 50 100

(Table 5)

(Chart 5)

Interpretation
The chart describes that more than half (58%) of the employees are agreed that time
sheet calculations are done considering a standard payroll rounding model. 22% of
them are strongly agree, 14% are disagree and rest of them are strongly disagree with
the fact.

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5. Calculation of employee’s net pay periodically checked on test basis.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 7 14

2 Agree 13 26

3 Disagree 22 44

4 Strongly Disagree 8 16

Total 50 100

(Table 6)

(Chart 6)

Interpretation
44% employees said that checking of calculation of payroll/net pay is not done
periodically on test basis, but 26% of them are agreed that payrolls are checked
periodically, 16% employees are strongly disagreed. On the other hand, 14% are
strongly agreed.

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6. Alterations done in employee details when required results accuracy.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 31 62

2 Agree 7 14

3 Disagree 11 22

4 Strongly Disagree 1 2

Total 50 100

(Table 7)

(Chart 7)

Interpretation
The chart represents that 62% employees are strongly agree and 14% are agree with the
question, which means alterations are done in employees details when required, whereas 22%
are disagree and 2% are strongly disagree with the same, means according them to no
changes are done in details.

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7. Organization’s work and pay policies are fully documented.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 4 8

2 Agree 27 54

3 Disagree 12 24

4 Strongly Disagree 7 14

Total 50 100

(Table 8)

(Chart 8)

Interpretation
The chart depicts that 54% employees are agree and 8% are strongly agree that the
organization’s work & pay policies are fully documented. On the other hand, 24% are
disagreed and 14% are strongly disagreed with the concept.

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8. Appropriate regulations are being followed in regard to payroll
withholding, wage, hours and other requirements concerning
employment.

S. No. Particular Number of Percentage (%)

Respondents

1 Yes 31 62

2 No 19 38

Total 50 100

(Table 9)

(Chart 9)

Interpretation
The chart shows that 62% employees are agree that appropriate regulations are being
followed in regard to payroll withholdings & other requirements concerning
employment, whereas 38% are not agree with the fact.

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9. Persons performing functions like approve hours worked, prepare
payrolls, distribute the pay, personnel record keeping are independent.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 7 14

2 Agree 13 26

3 Disagree 27 54

4 Strongly Disagree 3 6

Total 50 100

(Table 10)

(Chart 10)

Interpretation
The chart represents that most of the employees i.e. 54% are disagree with the
statement means according to them, persons who performs the functions like approve
hours worked, prepare the payrolls, distribute the pay, personnel record keeping are
not independent of each other, while 26% are agree and 14% are strongly agree with
the statement, rest of them are strongly disagreed.

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10.Distribution of payroll charges is checked by second independent person
and aggregate amounts are compared to the approved budget before
disbursements are made.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 25 50

2 Agree 23 46

3 Disagree 2 4

4 Strongly Disagree 0 0

Total 50 100

(Table 11)

(Chart 11)

Interpretation
The chart shows that half (50%) of the employees are strongly agree and 46% are
agree that the distribution of payroll charges is checked by a second independent
person & aggregate amounts are compared to the approved budget before
disbursements are made, whereas 4% are disagree with the fact.

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11.Reports providing details of payroll amounts charged to the
department’s accounts reviewed and compared to a copy of approved
Standard Time Report by someone who did not prepare it.

S. No. Particular Number of Percentage (%)

Respondents

1 Yes 31 62

2 No 19 38

Total 50 100

(Table 12)

(Chart 12)

Interpretation
The chart depicts that most of the employees have positive response towards the
statement that reports providing the details of payroll amounts, are reviewed
&compared with the approved standard time report by someone who did not prepare
it, whereas 38% of employees have negative views towards the fact.

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12.Employees are reimbursed for the cost of entertainment of business
purposes.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 5 10

2 Agree 23 46

3 Disagree 15 30

4 Strongly Disagree 7 14

Total 50 100

(Table 13)

(Chart 13)

Interpretation
The charts represents that 46% employees are agree and 10% are strongly agree,
while 30% are disagree and 14% are strongly disagree with the fact that employees
are reimbursed for the cost of entertainment of business purposes.

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13.According to day-to-day experience, most frequent payroll error
occurred.
S. No. Particular Number of Percentage (%)
Respondents

1 Incorrect tax- 19 38
withholdings

2 Under-payments 11 22

3 Over-payments 5 10

4 Something else 15 30

Total 50 100

(Table 14)

(Chart 14)

Interpretation
The charts shows that 38% employees says that incorrect tax-withholdings error is
most occurred payroll error, while 30% are in the favored of some other errors, 22%
replied for under-payments error and rest of them (10%) are replied that over-
payments is the most occurred payroll error.

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14.Salary software system results into time save, minimizing error ratio,
minimizing stress and proper maintenance of required details.

S. No. Particular Number of Percentage (%)

Respondents

1 Strongly Agree 17 34

2 Agree 29 58

3 Disagree 4 8

4 Strongly Disagree 0 0

Total 50 100

(Table 15)

(Chart 15)

Interpretation
The chart concludes that 58% employees says that payroll software system results into
time save, minimizing error ratio & stress, proper maintenance of details, 34% are
again strongly satisfied with the statement, while rest of them are not agreed with the
fact.

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15.Satisfaction towards the way of operation of payroll system.

S. No. Particular Number of Percentage

Respondents

1 Yes 37 74

2 No 13 26

Total 50 100

(Table 16)

(Chart 16)

Interpretation
The chart represents that most of the employees i.e. 74% are satisfied with the way of
operation of payroll system in the organization, but 26% of them are not satisfied with
the fact.

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16.Your contributions in payroll management system are recognized.

S. No. Particular Number of Percentage (%)

Respondents

1 Always 11 22

2 Most of the time 25 50

3 Never 14 28

Total 50 100

(Table 17)

(Chart 17)

Interpretation
The chart shows that 50% employees are viewed that most of the time their
contributions in payroll management system are recognized, 28% are replied that their
contributions are never recognized, while 22% says that their contributions in payroll
system are always recognized.

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17.Rating payroll management system.

S. No. Particular Number of Percentage (%)

Respondents

1 Outstanding 8 16

2 Good 11 22

3 Satisfactory 11 22

4 Below Average 15 30

5 Unsatisfactory 5 10

Total 50 100

(Table 18)

(Chart 18)

Interpretation
The chart represents that more than 60% of the employees rated the payroll
management system outstanding, good or satisfactory. 40% of them rated the system
below average or unsatisfactory.

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 CHAPTER 5

FINDING, SUGGESTIONS, LIMITATIONS AND CONCLUSION

5.1 FINDINGS
● According to employees, payroll management system is clearly defined in
their organization.
● Salary software method is used at large extent in the organization to record
employee’s details.
● Majority of the employees are satisfied with the fact that calculation and
payments of salaries are done on monthly basis including all allowances and
deductions.
● Standard payroll rounding model is used by the organization to do all
timesheet calculations.
● Most of the employees are replied that in-house technique is used to service
payroll operations in the organization and very few are says about other
methods like fully outsources or hybrid (both fully outsourced & in-house) or
any other method except these.
● More than half of the employees are relied that no test basis checking of
calculations of the payroll is done by the organization.
● Any type of required alterations in employees and salary details are done to
get accurate results and records.
● The work and pay policies/procedures are clearly defined and fully
documented in the organization.
● Majority of the employees are agree with the fact that appropriate regulations
are being followed in regard to payroll withholding, wages, hours and other
requirements concerning employment.
● The persons performing different functions like approve hours worked,
prepare the payroll, distribute pay, personnel record keeping are not
independent of each other.
● In the organization, the distribution of payroll charges is checked by a second
independent person & aggregate amounts are compared to the approved
budget before any type of disbursements are made.

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 ● All of the reports that provide details of the payroll amounts charged to
department’s accounts revised & compared with the approved standard time
report by someone who did not prepare it.
● Organization reimbursed employees for the cost of entertainment of business
purposes.
● More than half of the employees are viewed that incorrect tax withholding or
under-payments are the most frequently occurred payroll errors and less
employees are responded for over-payments or some other errors.
● Organization’s payroll software system results into time save, minimizing
error ratio, minimizing stress and proper maintenance of required salary
details.
● Majority of the employees are satisfied with the way of operation of payroll
system in their organization.
● Most of the employees are strongly agreed that most of the time their
contributions in payroll management system are recognized.

5.2 SUGGESTIONS
Following are few suggestions which will help the successful implementation of system in
the organization.

● Conduct Regular, Ongoing Audits:Organization should conduct regular audits of

the entire payroll process. The best way to isolate & identify an issue in the system is
a comprehensive workflow analysis, itemizing each step of the process from
beginning to end.
● Institute a Transparent Salary Policy: If payroll policies are not accessible or
transparent to employees, then problems often come about as a result of employees
misunderstanding of the payroll system. Many payroll issues can be corrected by
instituting a wholly transparent payroll policy. It should include information about
working of payroll process, classification of employees, determination of salaries,
responsibilities of employees, levels of vacation able earnings, way of calculations of
wages & promotions etc. A written policy should be displayed prominently
throughout the workplace & make sure that each employee has a copy of it.
● Seek Employee Input to improve Salary Process Effectiveness: Communicating
with employees can help identify areas of confusion & misunderstanding. Regular all
staff meetings should be conducted to ask employees about their views towards
payroll process and suggestions for improvements. Inviting suggestions on
improvement will encourage support from employees after changes are implemented.

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● Be a Stickler for Detail: Proper records should be set up of employee details on the
payroll system, like start dates, up to date addresses, date of birth, all official and
salary details. Sloppy mistakes will always leads to problem creation.
● Keep Up with Salary Legislations: Changes in regulations with time will affect the
running of payroll, so it is very essential to be up to date with payroll legislations.
● Minimize Pay Cycles: Having different pay schedules for different types of
employees, such as monthly for management or bi-weekly for hourly employees, can
lead to creating errors in the payroll process. Minimizing pay cycles helps to prevent
the duplication of processes, so that the payroll department can operate more
efficiently. Every type of employee should be paid on the same pay schedule. It
results into lessen the chances of errors occurred in the payroll process.
● Keeps Employees Motivated: To keep employees happy & loyal, it is essential to
pay them correctly and on time every month. They also expect the fulfillment of
agreements from organization side, so make it sure that agreements should be fulfilled
towards them.
● Streamlines Cash Flow Management: Streamline of cash flow is possible by
integrating the payroll systems into other accounting systems. Accounting system
document income & expenses and helps to monitor cash flow. Salaries are expenses
and should be documented correctly. By integrating accounting & payroll systems,
there is no need to input employee’s salary details into accounting program. It will
happen automatically at the end of each month.
● Paying the Correct Taxes: Proper calculation and payment of taxes is very
important. Business owners have to pay tax on behalf of their employees and
themselves. If these are not correctly calculated, it would results into owing the
government a lot of money.
● Better Salary Strategy: To make the payroll process efficient, the best payroll
strategy is required. Better strategy would result into advancements and new
developments in the system.
● In order to prevent time theft, implement check in system that automatically records
an employee’s hours when they sign in.
● To make efficiency in the payroll processing, organization should move from manual
to automated system of payroll.
● Make sure that organization should have a good system in place that alerts it to
important dates. Working ahead gives time to sort out any problem.

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5.3 LIMITATIONS
The limitations of the study are the following:

● Limited Time Span: Due to lack of time & busy schedule of the employees, it is hard
to interact properly with them.
● Biases on the Part of Respondents: The responds from the respondents may not be
accurate. They do not reveal the truth.
● Results of the study have been derived to be the parameters included in questionnaire,
so the results may not be accurate.
● The sample taken for the study was only 50, so the results drawn may not be
appropriate.
● Since the organization has strict control, it acts as another barrier for getting data.
● Utmost care has been taken to get the accurate results, but it may not be achieved
because of risk of ambiguities and misinterpretation on the part of respondents.
● Another difficulty can be the lack of experience of researcher.|

5.4 CONCLUSION
The study concludes that the payroll management system in CBitss Technologies is clearly
defined and found effective. The study on employee payroll highlighted so many factors
which will helpful for improvements in the system. The study was conducted among 50
employees and collected information through structured questionnaire. It helped to findings
which were related with employee payroll operations which are provided in the organization.

The payroll management system is based on maintaining each employee records and
calculating his/her salary depending on the work days by including all allowances
&deductions. The first activity is based on saving the employee personal, official and salary
details. Now, based on the number of days an employee attended per month, salary will be
calculated by checking the number of work days of an organization and his/her basic salary.
A separate salary slip will be provided for reference to all employees. Editing in employee
information is done whenever required. Investigation of errors occurred in the system is done
and appropriate corrective actions are taken to minimize these errors.

The payroll management system software developed for an organization has been designed to
achieve maximum efficiency & reduce the time taken to handle the payroll activity. It is
designed to replace an existing manual record system thereby reducing time taken for
calculations and for storing data. The system is strong enough to withstand regressive daily
operations under conditions where the database is maintained and cleared over a certain time
of span. The implementation of the system in the organization will considerably reduce data
entry, time and also provide readily calculated reports.

50
REFERENCE

WEBSITES
● www.google.co.in
● www.ask.in
● www.amazon.com
● www.amazon.in
● www.studymode.com
● www.cbitss.net
● www.cbitss.in
● www.cbitss.com
● www.amazon.ca
● www.researchgate.net
● www.hrpayrollsystems.net
● www.hrmtoday.com

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BOOKS AND JOURNAL
● Frances P. Robinson (2013), “Group Salary Record Book”, Second Edition.
● Diane Arthur (2004), “Fundamentals of Human Resource Management”, E-Book
Edition.
● Debera J. Salam, “Principles of Salary Administration”, 2015 Edition.
● Steven M. Bragg (2005), “Salary Best Practices”.
● Steven M. Bragg (2011), “Inventory Best Practices”.
● Bob Nelson (2012), “1501 ways to Reward Employees”, Kindle Edition.
● Speedy Publishing LLC, “Salary Accounting Book”, [2015].
● Diane Arthur (1995), “Human Resources in Small and Medium-Sized Companies”.
● Isaacashraff (2012), “Wages & Salaries”.
● Robert Leach, “In Ninety Minutes”, series (2011).
● Bob Nelson and Stephen Schudlich (2005), “1001 ways to Reward Employees”,
Kindle Edition.
● Louise Vidler (2012), “The typical Position Requirements of a Salary Manager”.
● Marcus Buckingham & Curt Coffman, “First, Break All the Rules”, Gallup
Organization (2008).
● Rebecca A. Mazin (2010), “An Indispensable Guide For Managers and Business
Owners”.
● Smith Elliott Kearns & Company, LLC, “Salary Services”, [2015].
● Timothy F. Carse, “The Salary Toolkit: Nuts and Bolts Techniques to Help You
Better Understand and Manage A Salary”.
● Vicki M. Lambert &Ioma (2014), “Salary: A Guide to Running an Efficient
Department”.
● Vivek Jain (2012), “Oracle e-Business Suite Salary R12”, Personal Edition.
● Carse (1995), “Salary Acts”, Irwin Professional Publishing.
● Diane Arthur (1994), “An Employer’s Guide to Policies and Practices”, Kindle
Edition.

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