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ICT IGCSE. ICT in Finance, Payroll & Billing. Objectives. Understand the applications of ICT in finance departments, including Payroll Billing Systems Stock control. Payroll Processing. What is 'Payroll'?

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ICT in Finance, Payroll & Billing

  • Understand the applications of ICT in finance departments, including
    • Payroll
    • Billing Systems
    • Stock control
payroll processing
Payroll Processing

What is 'Payroll'?

  • At the end of each pay period (usually weekly or monthly), a company needs to pay its employees.
  • Payroll systems are used to calculate wages and print out wage slips/salary slips.
the traditional way
The traditional way
  • Workers would clock in and out, writing their arrival/departure times on a card
  • Sometimes they forgot
  • Sometimes their writing was hard to read
  • Sometimes they were wrong
modern methods
Modern methods
  • Most places of work automatically record hours worked by the employees using systems such as swipe-cards or fingerprint readers.
  • When an employee arrives at work, they swipe their ID card, and then do the same when they leave.
  • Hours worked = Time out - Time in
how salaries are calculated
How salaries are calculated
  • Sometimes money may be added on to a person's pay (e.g. for working extra 'overtime')
  • Sometimes pay is taken away (e.g. as tax, or health insurance payments)

Employee details from the company database:

  • Employee number (used to lookup the employee's other details, e.g. name, bank account, etc.)
  • Rate of pay (eg $25/hour)
  • Number of hours worked (obtained from timesheet)
  • Any overtime worked (number)

Calculation of :

  • Gross pay (hours worked x rate of pay)
  • Overtime bonuses due
  • Deductions (tax, health insurance etc)
  • Net pay (Gross – deductions)
  • A printed payslip (given to the employee to show how his/her pay was calculated)
  • A cheque, or an EFT payment directly into the employee's bank account
  • Updated Employee file, showing total pay this year
how is a payroll processed
How is a Payroll Processed?
  • The payroll is usually processed once a week or once a month (depending upon how often the business pays its employees).
  • This means that batch-processing is ideal for payroll processing.
what happens
What happens?
  • All the time sheets are gathered together
  • All payroll calculations are done in one go
  • The same calculations will be performed on all the data
  • Usually overnight when the computer system is not being used for other things
    • There is no need for any user input
    • Output is not urgent (eg in a booking system)

The stages in batch processing

Information from Employees file

New information from timesheets

Make backup copy of files

Output reports & error reports

Update Employee file

Output payslips

Batch Processing

billing systems
Billing Systems
  • Because most companies send out their bills/invoices on a pre-determined date, all the information is gathered together and processed in one go.
  • Once again, this means that batch processing is the most appropriate choice.
an electricity billing system
An electricity billing system

The electricity company has a database holding details of all its customers:

  • Account number
  • Name
  • Address
  • Charge per kW unit of power
  • Previous meter reading
  • Bank account details (for payment)

Customer details:

  • Account number
  • Charge per kW
  • Previous reading
  • New reading

Calculation of :

  • Number of units of electricity used (new reading minus old reading)
  • Customer’s bill (Number of units x charge per kW)
  • Outstanding amount owed
  • Any credits due
  • A printed bill showing all the details
  • Updated customer file
  • Request for payment

The stages in batch processing

Information from Customers file

New meter reading

Make backup copy of files

Output reports & error reports

Update Customer file

Output bill

Batch Processing

stock control
Stock control

What is Stock Control?

  • Every business needs to keep track of the items that it manufactures or sells (the stock). The system that monitors the items in stock is called the stock control system.
  • In a store, the stock includes all of the items on the shelves and out the back in the storeroom.
why is stock control important
Why is stock control important?
  • Too much stock costs money as you have to store it all somewhere
  • Too much perishable stock (e.g. food) means that it may go bad before it is sold
  • Too little stock means that you might run out of stock before the next delivery arrives
data in a stock control system
Data in a Stock Control System
  • A stock control system is basically a database.
  • Each record (row) of the database is identified by an itemcode (the primary key).
other fields in each record would include
Other fields in each record would include:
  • Description
  • Itemprice
  • Stock level (the number of items held in stock)
  • Minimum stock level (when stock falls below this, it needs to be reordered)
  • Reorder quantity (how many items we should order each time)
receiving new stock
Receiving New Stock
  • When items are added in to stock (because a delivery has arrived) this is recorded in the stock control system.
  • The code of the new items is input to the system (usually using a barcode scanner, or similar technology). The record for the item is found in the stock database, or a new record is created, and the stock level is increased.
selling delivering stock
Selling / Delivering Stock
  • In many stores, the POS system is directly linked to the stock control system, so that stock levels are adjusted as soon as an item is sold.
  • When items are taken from stock (because they have been sold, or delivered somewhere) this is recorded in the stock control system.
automatic re ordering of stock
Automatic Re-Ordering of Stock
  • Stock control systems make it very easy for stock levels to be monitored, and for stock to be reordered when it is running low.
  • The stock control system regularly goes through all the records in the stock database and checks if the stock level is less than the minimum stock level.
  • Complete the Payroll homework at Edmodo. You will need to use the link on the wiki page to read the required material first.