Payroll in a small brokerage: who approves
How a small brokerage can meet the rule that the person who prepares a pay run cannot approve it, including runs that pay the approver and bank checks.
By Achekam · · 4 min read · For Insurance businesses in South Africa, Nigeria, Kenya
In a small brokerage, payroll is usually one person's job. The office administrator works out the month's pay, including the brokers' commission, and the principal glances at a total before the payments go out. It is quick, it relies on trust, and it is exactly the arrangement Achekam's payroll will not accept.
Achekam requires a pay run to be approved by someone other than the person who prepared it, and nobody may approve a run that pays themselves. In a large company that is easy. In an office of a handful of people, it takes some planning. This article explains the rule, why it exists, and how a brokerage in South Africa, Nigeria or Kenya can work with it.
Why preparing and approving are split
Payroll is one of the most common places for money to go missing in a small business, and rarely through anything dramatic. A salary increase entered a month early. A former employee left on the run. A commission figure keyed with an extra digit. A preparer checking their own work sees what they meant to type.
Achekam's rule is simple: a pay run is approved by someone other than the person who prepared it. An approved run is never recalculated, so what the approver saw is what was approved. In practice, that means a business needs at least two people in payroll roles to run payroll at all. The principle is segregation of duties: assigning the steps in a process to different people, so that no one can both commit and conceal theft or error.
The run that pays the approver
The second half of the rule catches small offices out. Nobody can approve a run that pays themselves.
Picture a brokerage where the administrator prepares payroll and the principal approves it. If the principal draws a salary through the same run, the principal cannot approve that run. Neither can the administrator, who prepared it and is also paid by it.
Work this out before payday, not on it:
- List everyone who can prepare or approve payroll.
- List everyone the run pays.
- Check that at least one person can approve without being the preparer or being paid by the run.
If nobody fits, that is a structural question for the business, and worth talking through with your accountant well before the first run.
A second person checks bank details
Changing an employee's bank account is the classic payroll fraud: an e-mail, apparently from a staff member, asking for salary to go to a new account. Achekam requires bank details entered or changed by one person to be verified by another before that account is paid in the payment schedule or a bank file.
The same applies when staff use self-service. A staff member can submit a new bank account for payroll to decide, and even once payroll approves the change, a second person must still verify it. The verifier should confirm the change with the employee directly, by phone or in person, never by replying to the e-mail that asked for it.
Commission, corrections and the next run
Brokers' pay moves every month. Each period's overtime, commission, allowances, reimbursements and unpaid leave are entered as variable inputs on the run, so the preparer types this month's commission figures rather than changing anyone's salary.
Because an approved run is never recalculated, a mistake found after approval is corrected on the next run. There is no separate correction, bonus or final-settlement run; these go in as variable inputs on the regular run. Keep a short note of each correction, so the approver of the next run knows why a figure looks unusual.
After approval: payslips and payment
Payslips are PDFs with the business's logo and details. They can be downloaded or e-mailed one per person, and an employer setting sends them automatically when a run is approved, with a delivery log. E-mailing needs an e-mail service configured on the server.
Automatic sending has a useful side-effect: approval becomes the moment staff see their pay, so it is less tempting to approve a run that has not been properly checked.
Achekam records the payment; your bank makes it
Each approved run has a payment schedule that can be downloaded as CSV. Marking it paid only records the fact: Achekam moves no money.
In South Africa, a wages file for the bank can be produced for an approved run, in FNB's import layout or as a column-mapped CSV for Standard Bank, Absa, Nedbank or another bank. A new layout is marked untested until someone confirms a test import. In Nigeria and Kenya, no bank-file layout ships yet, and every payment in a bank file needs a six-digit branch code, so most brokers will pay from the payment schedule through their bank's own process.
The person who releases the payment at the bank is ideally neither the preparer nor someone paid by the run.
Who does what
| Step | Who | Why |
|---|---|---|
| Enter commission and other variable inputs | Preparer | Knows the month's figures |
| Approve the run | Someone else, not paid by this run | Achekam requires it |
| Verify a new or changed bank account | A second person | Achekam requires it |
| Release payment at the bank | Ideally a third person | Keeps the money step separate |
| Mark the schedule paid | Whoever confirmed the payment | Records the fact |
Commission income from insurers has its own monthly check, covered in reconciling commission paid by insurers. If a payroll-related figure lands in the wrong account, correcting a journal posted to the wrong account shows how to put it right.
Name your preparer and approver, check the approver is not paid by the run, and agree who verifies bank changes. With those three decisions made, the two-person rule stops being an obstacle and becomes a control you would have wanted anyway.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
