Chapter 1

PROBLEM AND ITS BACKGROUND

Project Context

An Information Technology nowadays is a fundamental need for businesses or

companies, it developed productive tools that provide timely and extremely good outcome
for the company is a great demand. Its important thing that a company or institution should
implement a computerized system based it helps a lot in many ways such as organizing,
storing and manipulating data. Having technology system may support the company to
advance processing business concept and be competitive in the flow of the business world.

Colegio de Sta. Teresa de Avila is an institution that established in year 2007. The
Institution shows great extensive because of the large population of the student enrolled,
with the huge enrolled students it replicates the demand of new employees for several
departments of the institution. This shows that this year 2018, Colegio de Sta. Teresa de
Avila which has 250 regular and irregular employees in total, respectively. In corresponding
numbers of employees and progress aspect of the institution which may cause a several
figure of problems or complications in handling the accounting office in generating the
employee’s salary.

Over the years, the growth factor of the institution is progressive in accordance with
student population and number of employees. As the institution increases its population
additional employees are needed to be hire in order to copes those changes, expansion and
continuously provide highly satisfaction services for the student. Therefore, the number of
employee’s payroll to be processed with reliable calculation becomes difficult for the payroll
master, especially in their institution process of producing payroll through Microsoft Excel.
It takes time for the payroll master to generate payroll for each employee due to the number
of employees, as well as validating the record of its employees.

In order to provide solutions to the problem, the researchers proposed a design and
development of the Computerized Payroll System. The proposed system will improve the
current payroll process of the institution and lessen the work of the payroll master thus,
eliminating certain user errors in producing payroll.

pg. 1
Objectives

The proposed study aims to generate a computerized payroll system that will
manipulate the information receive and transmitted that produce an efficient and effective
process, thus, to be organized and manage employee information of the institution.

Specially, the researches sought to accomplish the following tasks

1. Collect and generate employee’s information accurately including daily time

record of the employee.
2. Automatically calculate gross pay for hourly employees based on the hours
worked including overtime, benefits and other deductions rapidly.
3. Computerized recording, keeping track of salary payment, printing pay slip, and
updating employee information to provide back office facilities that will enable
users to manage and maintain the system automatically.
4. Create a system that will able to comply on ISO9126 or the International
Standard for the evaluation of software. The system should have standard
characteristic in terms of functionality, usability, reliability, performance and
supportability. (F,U,R,P,S)

Scope and Limitation

The proposed system will be capable to managing employee’s record as well as

reliable and efficient payroll processing. Computerized payroll system holding the data
information that used to compute and to process the employee’s salary such as Daily time
record which is needed for computation of total worked hour. It includes the features that
can add new employee id record, aside from computing total worked hours it also compute
the overtime, benefits, monitoring loans and to compute the deduction such as late and
taxes. And it makes conveniently to the end user when it comes in track down needed
information of its employee’s and its covers the process of preparing and printing the pay
slip of employee’s. The proposed system also helps to organized data, update record and
stored important record of the employee’s safe and secured.

However, if there’s unexpected error to client computer the employees should

manually log in the logbook to have a proof of not being late or absent. The system does not
support online program or online transaction.

pg. 2
 CHAPTER 2

REVIEW AND RELATED LITERATURE

According to Kalaghoda (2013), writer of Busineess Weeks in Dar Es Salaam,

Tanzania the Payroll System saves Tanzania’s Government $927 Million. The government is
currently saving some $927 million (Tsh1.5 billion) after introducing a new payroll system.
Speaking in Dar es Salaam last week, the Assistant Director in the President’s Office, Public
Service Management Peter Mushi said: “We have been able to solve to a larger extent the
issue of ghost workers where the government was losing a lot of monies in salary,” Mushi
said. He said the new system allows managers to monitor any changes that have been made
on an individual’s information. Most countries in the region are battling with the issue of
ghost workers which has been costing governments dearly.
(Tanzania’s Government Payroll System)

As the proponents cited on the website of Solomon Island Government, the

Payroll Section is responsible for processing the payroll for all employees of the Solomon
Islands Government. The current payroll system processes wages and salary payment for the
government’s employees over several different payroll. The Ministry of Finance and
Treasury of Solomon Island is the branch that is responsible for payroll services to all
Solomon Island Government (SIG) employees it is also responsible for revenue collection of
all SIG revenue and ensuring the provision of impress advances to government employees
for the smooth administration of government expenditure.
(Solomon Island Ministry of Finance and Treasury Payroll)

The Federal Personnel Payroll System is used by the United States Department of
Interior. According to the Department of the Interior's Interior Business Center the Federal
Personnel Payroll System (FPPS) is a modern, mainframe-based, portable, integrated, on-
line, and real-time personnel and payroll system. The system provides personnel and payroll
support to numerous agencies. The system is customer-driven, creating and generating the
full life cycle of personnel transactions, enabling agencies to maintain records electronically.
FPPS handles all current regulations including specialized pay, garnishments, special
appointment programs, and more.
(Federal Personnel Payroll System)

According to Japan Management Consulting there are two main payroll taxes in
their country the Social Insurance and Labor Insurance. Social Insurance provides to
employees a Social Insurance card that allows them to visit any medical facilities and pay
only 30% of the total cost. It is government mandated universal coverage for employees and
Japanese employees are usually satisfied with it and do not require additional health care

pg. 3
benefits. Employee National tax liability is calculated by the company and deducted monthly
from the salary. Employee Residential tax liability (local tax or state tax is calculated by the
ward office of the residence of the employee).

According to Paris Cowan the Queensland Government has accepted all four
recommendations of the commission of inquiry into the failed Queensland Health payroll
replacement and is already “well on track” to see them implemented. One of those
recommendations calls upon the state to immediately commence planning for the
replacement of the $1.2 billion IBM-built system, itself a replacement for the LATTICE
system the Department had previously relied upon. The report of the inquiry, lead by
Richard Chesterman, found “the current QH payroll system will require an upgrade in about
a year and replacement within 5 years”. This means that work will take place alongside the
remediation of the current system, which has been funded out to 2016-2017.
(Queensland begins planning new Health Payroll System)

A Payroll System designed to produce payroll checks with appropriate withholdings,

benefits, allowances, and deductions for employees in multiple companies, departments,
and/or sub-departments. It has been designed to handle up to 1,000,000 employees in 100
companies, 1,000 departments in each company, and 36 sub-departments in each
department.
(Titus Information Payroll System)

The Computerized Payroll System of Department of Health is a window based

program especially designed to facilitate and simplify the monthly preparation of general
payroll and related reports such as Standard computerized payroll system for use in all DOH
offices. It allows faster and more accurate computation of monthly gross income, deductions
and net salary, less-resource-consuming generation of General Payroll and other payroll
related reports and security and integrity of payroll data and information. The features of
computerized payroll system of DOH are graphical user interface interactive and menu-
driven program, systematic maintenance and retrieval of employee records.
(Computerized Payroll System of Department of Health)

According to Philstar.com (July 30, 2013 - 6:28pm) Manila, Philippines -

Government employees soon receive digitized versions of their payroll in a bid to increase
efficiency and transparency in government offices, Department of Budget and Management
(DBM) Secretary Florencio Abad said. “As a fully automated and digitized system, the NPS
(National Payroll System) will play a central role in ensuring greater efficiency, transparency
and accountability in the government’s human resource processes. And because the system
will be completely electronic, all payroll-related activities will be implemented more quickly
and with better accuracy, whether we’re talking about the distribution of monthly salaries

pg. 4
due to government workers, or the regular monthly remittances that are made out to our
employees’ social security and health insurance accounts”.
(Payrolls in Government Agencies go to Digital)

Based on Philippine Long Distance Telephone Company (PLDT) the Human

Resource and Payroll System is an easy to use application that help the business organize,
manage and monitor employee’s information and process employee’s payroll. The website
stated the features of the HR and Payroll System of PLDT. These are the following: (1) User
defined defaults (compensation and benefits, employee types, deductions, holidays), (2)
Employee’s information, time keeping and attendance logs, (3) payroll processing with
government mandated deductions (4) Web access for filling leaves and online pay slips.
(PLDT Human Resource (HR) and Payroll System)

Referring to sunstar.com the City Accounting Department of Cagayan De

Oro City has introduced an upgraded computerized payroll system for permanent
employees in a bid to improve its services and maximize resources. “This project, which was
conceived two years ago, basically aims to improve our services particularly in the processing
of payrolls for permanent employees”, City Accountant Wilma Polley-Rugay told payroll in-
charge of the different departments and offices at City Hall during a briefing and orientation
on the concept of the one-month payroll system held Friday last week at the City Council
session hall in Cagayan de Oro City. With the added features of the new computerized
payroll system, Rugay said the preparation, processing and payment of payroll system to
permanent employees would be hastened and fast-tracked.
(Cagayan de Oro City Hall Computerized Payroll System)

According to Philippine Daily Inquirer published on July 25, 2011 the Bureau
of the Treasury will gradually take over the payroll of all government agencies in a bid to
address existing inefficiencies such as failure of some entities to remit pension-fund
contributions of state workers. National Treasurer Roberto Tan said concerned economic
officials have agreed to transfer the payroll systems of all line agencies under the Treasury
over a three- to five-year period. Tan said the assumption by the Treasury of the payroll of
government agencies was part of the reform road map being established by the economic
team.
(Treasury to Handle Payroll of All Government)

Manila, August 15, 2013 -- Through partnership between the Pulilan Local
Government and the U.S. Government, the residents of Pulilan, Bulacan will have the
convenience of receiving salaries and paying bills by using their mobile phones. Pulilan has
been selected as a pilot area for U.S. Embassy Manila’s United States Agency for
International Development’s (USAID), Scaling Innovations in Mobile Money (SIMM)

pg. 5
Project, which will enable 280 government employees to receive their salaries and more than
500 households to pay their utility bills using mobile phones.
(Pulilan LGU Pioneers Mobile Money Payroll and Utility)

So Cantier Created a HRMS it is an integrated HR and Payroll system that

manages the personnel-related tasks for managers and individual employees. Our HRMS
supports Personnel management, Employment management, Benefit management, Daily
Time Record Management (Integrated with Bio-Metric Devices), Shift Management, Payroll
management, Leave Management, Training Management and Performance Evaluation. It has
self-service features as well for employees to interact with their HR department on line and
thus reducing much of HR Personnel manual work.
(The Cantier Solution)

According to the article of Ms. Felice Grazille M. Adlaon, the aim of this project
is to identify and solve the problems concerning the Payroll and Daily Time Record System
of DBA enterprise – a fast growing company which caters direct selling of AVON products
throughout Mindanao. The company experiences some concerns on monitoring the
attendances of their employees and the computation of the payroll of each employee. The
traditional payroll and daily time record system could no longer cope with the number of
branches they have all over Mindanao. Through the analysis made by the proponents, it has
been found that Payroll System with Daily Time Record using Biometric Authentication may
solve the current problems of the company.
(Payroll System with Daily Time Record Using Bio-Metric Authentication)

pg. 6
 Chapter 3

TECHNICAL BACKGROUND

Technicality of the Project

Figure 1.0

The Diagram shows the process of the company data comes from client pc where
the employees log their time in and out. Data that comes from client pc will transfer to the
server and send to database for backup which will hold the backup of the employee’s data.
Admin get data from server to generate the data of employee to compute the salary base on
worked hours and other computation. Admin send the updated data to server and last
process is print the report and payslip.

Details of the technology to be used

CLIENT COMPUTER can access the information of database such as transferring data.
The client computer will serve as the log IN and log OUT of employees.
SERVER performs tasks such storage, data manipulation, and it provide the database
services to other computer
ADMIN COMPUTER will serve as the computer of administrator or the person in charge
or who can make changes on system. Computer administrator can change security settings,
access all files on the computer, database, and make changes such as editing, deleting records
of employee.

pg. 7
BACKUP COMPUTER will be the backup of all data if the system will have a malfunction
to able to secured the data.
SWITCH this will be the main connection of all computers to send and submit data to the
corresponding computer.
PRINTER use to print the pay slip of employee and the other information about their
payroll. It is a device that accepts text and graphic output from a computer and transfers the
information to paper, usually to standard size sheets of paper.

How the System will Work

To implement the system properly the firm must provide four computers for client
computer, server computer, backup computer and admin computer. The computers will
connect through LAN-based network connection in order to connect all computers that will
transfer and retrieve data on each. With the integration of the daily time records from the
client computer and employee information in the proposed system, the payroll master
should be able to generate a payroll summary and produce a hardcopy of each employee.
And the updated data from the payroll master using admin computer will send to server and
backup computer for the saving the record of the employees.

pg. 8
System Flowchart

Figure 2.0

The flowchart diagram shows how the system works, the admin should login in the
system and if the employee is new admin will create an employee data record in the system.
The system will generate the old and new employee’s Daily Time Record after generating the
DTR the system will summarize the data to be able to compute total hour rate, overtime,
benefits and deductions. The updated employee record will save and produce a payslip for each
employee.

pg. 9
pg. 10