Payroll accounting is essential for two reasons: financial management and compliance with existing laws. In a nutshell, payroll accounting is done so that a company is able to pay its employees accordingly. Among the tasks under it is making sure that employees receive correct remuneration, deductions are accurate, and that payroll expenditure is not spent on unnecessary costs.

At the same time, every organisation has to adhere to tax laws and other regulations imposed by the government related to employee wages. By means of payroll accounting, you become more capable of reporting wages paid and taxes withheld during internal and external audits.

What payroll accounting does

Basically, payroll accounting involves documenting all transactions related to payroll, including:
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