Running the firm's own staff payroll
How an accounting firm runs payroll for its own staff beside clients' payrolls, who may approve partners' pay, and what staff can see for themselves.
By Achekam · · 5 min read · For Accountants & audit firms in South Africa, Nigeria, Kenya
The cobbler's children go barefoot, and the accounting firm's own payroll is often the least tidy one it runs. Clients' payrolls follow the procedure manual. The firm's own runs on goodwill: the office manager prepares it, a partner glances at the total, and staff ask the office manager for copies of their payslips whenever the bank or a landlord wants one.
There is a better way to do it, and it is the same way the firm already runs clients: as a separate employer, with a preparer, an approver who is not paid by the run, and staff who can help themselves to their own documents. This article sets that out, including the two questions firms usually get wrong: who approves the partners' pay, and what Nigerian and Kenyan staff can see.
The firm as its own employer
In Achekam, a firm sets up its own staff and each client whose payroll it runs as separate employers, each with its own employees, earnings, deductions and pay settings. The firm's own payroll is one more employer in the list, beside the clients.
Setting it up like a client has a practical advantage: the firm's own payroll gets the same controls. A pay run is approved by someone other than the person who prepared it, nobody can approve a run that pays themselves, an approved run is never recalculated, and a change to someone's bank account must be verified by a second person.
Approved runs are posted as a wages journal. Posting writes it into the firm's own books, so the firm's payroll flows into its own ledger without a manual journal.
Kept apart from clients
Because each employer has its own settings, nothing done for the firm's payroll changes a client's, and the reverse. An earning the firm invents for its own staff, say a professional subscription allowance, does not appear on any client's payslips.
The more delicate separation is between colleagues. The people who prepare clients' payrolls usually prepare the firm's own as well, which means they see their colleagues' pay. Decide deliberately who that should be. In a small firm it may be one trusted person and a partner. In a larger one, the firm's own payroll may be better kept with a different preparer from the client team. On South African payroll, only the Partner, Admin, Payroll, PayrollAdmin and FinanceManager roles can change payroll at all, so the circle of people who can touch the firm's own salaries can be kept small.
My Payslips & Leave
The firm's own staff do not need to ask anyone for their documents. They see their own payslips, IRP5s and leave under HOME > My Payslips & Leave. A staff member whose login is linked to their payroll record can:
- download their own payslips;
- apply for leave;
- submit expense claims for payroll to decide, with an approved claim repaid on the next run;
- submit changes to their details, or a new bank account, for payroll to decide.
An approved bank change still needs a second person to verify it, which matters as much for the firm's own staff as for clients'.
Leave follows the same separation of duties: a line manager approves their own team's leave, and nobody approves their own. Partners' leave therefore needs another partner, or the managing partner's leave needs a colleague, to approve it.
Clients' employees are different. They have no login, so their payslips reach them by e-mail only. Self-service is something the firm offers its own people, not its clients' staff.
For a South African firm, the IRP5s that staff see in self-service are the same certificates that the firm's year-end reconciliation must agree with. SARS's page on completing and submitting employer declarations gives an overview of the monthly EMP201 and the EMP501 reconciliation that matches PAYE, SDL, UIF and ETI to the IRP5/IT3(a) certificates issued for the year.
Who approves the partners' pay
The rule that nobody can approve a run that pays themselves has a direct consequence for firms whose partners or directors are on the payroll.
In a partnership, partners usually take drawings rather than a salary and are not on the payroll at all, so a partner can approve the staff run without difficulty. In an incorporated practice where the directors are salaried, every director on the run is barred from approving it. If every person in a payroll role is also paid by that run, nobody can approve it.
Work this out before the first run, not on the day. Write down, for the firm's own payroll:
| Question | Answer to record |
|---|---|
| Who prepares the run? | A named person with a payroll role |
| Who approves it? | A named person not paid by that run |
| Who stands in for the approver? | Another named person not paid by that run |
| Who verifies bank changes? | Anyone other than the person who captured them |
| Who approves the managing partner's leave? | A named colleague |
If the answer to the second question is nobody, the firm needs to arrange an approver before payday. The general principles are in splitting pay run preparation and approval.
Nigerian and Kenyan staff
Firms with staff in Nigeria or Kenya should know two current limits.
First, self-service shows only South African IRP5 and IT3(a) tax certificates. A Kenyan employee's P9A, and a Nigerian employee's annual figures, are available only on the payroll side. Payroll has to download them and give them to each staff member, and should record when it did.
Second, leave days are counted against South African public holidays, and the built-in leave entitlements follow South African law, even for a Nigerian or Kenyan employer. A firm with staff in those countries should keep its own leave policy beside payroll and check balances against it.
Neither limit stops the firm running its Nigerian or Kenyan payroll. Both mean a person has to do something self-service would otherwise do.
The way clients sit beside the firm's own payroll is covered in running clients' payroll as separate employers.
Before the next payday, link each staff member's login to their payroll record, tell them where to find their payslips, and name the approver for the firm's own run in writing.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
