Not All Payroll Software Is Created Equal

The payroll landscape is rapidly shifting from smaller, on-site solutions to larger, cloud-based systems. This shift can significantly impact a firm's accounting and payroll departments. Cloud-based payroll software offers more automated processes, improved accuracy, and seamless integration with other business software, such as human capital management (HCM) systems. However, not all payroll software is created equal. Here is a comparison of payroll software to aid in the decision-making process for your organization.

Accounting Software ≠ Payroll Software

For this discussion, it's important to note the differences between accounting software and payroll software, as these labels are sometimes used interchangeably. While general accounting and specialized payroll software are both important for any accounting firm, they are very different tools.

General accounting software tracks all expenses across an organization, including inventory, accounts payable, and accounts receivable. It helps accounting departments generate financial reports and manage the budget. The software also provides a bird's-eye view of the financial health of a company.

Specialized payroll software serves completely different functions. It calculates pay for all employees and includes tax withholdings. This can be an incredibly complex process as a company upscales because it might be dealing with multiple tax jurisdictions. Advanced payroll software can also be used by a business to manage its workforce with tools for employee onboarding and apps to record time and attendance.

Perhaps most importantly, payroll software stays up-to-date with changes in labor and tax laws to ensure compliance. Many of these features are not included with accounting software.

Not All Payroll Software is Built the Same

Client-Facing Features

The best payroll software offers individualized, secure, and cloud-based client portals. The software allows an accounting firm or payroll service bureau to manage complex payroll tasks while maintaining flexibility to control every payroll and tax function if necessary. Custom reporting is also a built-in feature. From your client portal, you can verify that employees are paid on time, accurately, and in compliance with tax laws.

Ease of Use

Outdated interfaces and over-complicated processes are real pain points when it comes to payroll software features. The best payroll software provides a user-friendly interface that makes sense and is easy to navigate. A user-friendly payroll system reduces training time whenever a new team member is onboarded. The best software should be a major time-saver because it streamlines operations and makes life easier when it comes to the sometimes-redundant tasks that payroll involves.

Real-Time Compliance Updates

Labor and tax laws are subject to change at any time and often do. The best software offers real-time payroll compliance updates.

If tax reporting and compliance laws change, your payroll software provider updates the system for you. The software administrator constantly monitors legislative changes and updates the platform to ensure your real-time compliance.

The best payroll solutions have a team dedicated to researching new legislation and ensuring the platform accurately calculates pay and taxes accordingly, making payroll a seamless process that you don't need to worry about.

Automated Processes

Automated payroll processing should be a feature that you expect from a payroll software system. The best systems should be able to handle all of the following automatically:

• Direct deposit of employee paychecks
• Payroll taxes
• Child support
• Wage garnishment
• E-filing tax forms and W-2s

You should expect guaranteed accuracy from a payroll software solution. The system should also be able to minimize data entry time and the effort that it takes to print and mail paychecks (if you use a paper check system). Automated payroll processing reduces errors, and more importantly, it's a big time-saver for your team. This frees them up to focus on more high-level functions related to growing your business.

Industry-Leading Support

Few things are more frustrating than payroll delays due to software issues. The best payroll software should include a robust customer support system. You should expect 24-hour, U.S.-based customer support that can resolve issues quickly.

Comprehensive training and support for your team are must-have features. A dedicated support team can even help with real-time migration and conversion assistance when you upgrade to a new payroll software platform. This ensures operational continuity and no downtime for your business when you make an upgrade.

Why the Right Payroll Software Matters

The payroll software solution that an organization chooses can have a direct impact on growth, profitability, and client satisfaction.

Payroll needs become far more complex as a firm scales up. For example, if a business based in Minnesota adds a new location over the border in Wisconsin, it suddenly deals with two different tax and compliance jurisdictions. Accuracy in time and attendance tracking becomes even more critical.

A firm's clients may want to offer employees more diverse and complex benefits to attract the best talent, which adds even more complexity to the mix. If you want to meet the needs of larger and growing clients, you need a payroll software solution that can also grow and meet those complex requirements.

Many payroll processes can be redundant, which makes them more prone to human error over time. The best payroll software can automate many of these processes and improve accuracy. They save time by minimizing data entry tasks. You can process payroll faster and easier while eliminating compliance and reporting headaches. All these factors can improve a company's bottom line, offering a clear ROI on a payroll system.

Your clients expect excellence from you, which you can deliver with the right payroll solution. Onboarding new clients becomes easier than ever with the right software. When you improve service delivery, client satisfaction is almost certain to improve.

Client Success Stories and Case Studies

Better Business Payroll, Inc. was an established bookkeeping firm that grew over 30 years to include tax, accounting, and payroll clients. Managing end-of-year paperwork for their growing client base became more complex. From October through the end of the year, team members from every department were needed to meet deadlines, often working on weekends and holidays. A massive amount of manual data entry led to increased human errors and added extra hours to make corrections.

Better Business Payroll made the switch to IRIS Payroll and no longer struggles with manual data entry. Now, the firm automates payroll taxes and IRS payments entirely. The result? Happier employees accomplishing more with less work—and happier clients with timely, error-free payroll.

Sharp Payroll Service, LLC, was a small bookkeeping firm that added payroll to its service offerings a few years ago. The outdated software they were using was time-intensive, labor-intensive, and lacked basic but necessary features like client self-service. The old software became a bottleneck to the firm's success.

IRIS Payroll Solutions offered the software that Sharp needed to get out of that bottleneck. The IRIS software was intuitive and easy to learn without cutting into Sharp's bottom line to pay for it. After switching to IRIS, the firm increased its client base 600%, from 100 clients to more than 700. Payroll used to be just 20 percent of Sharp Payroll Service's gross revenue but now accounts for 70 percent.

These are just two examples of how IRIS customers have managed to increase revenue while reducing labor, which was the ultimate key to their success.

Conclusion

Payroll software solutions should help firms streamline payroll, human capital management, and client services. The right software solution will be easy to learn and  use and will save time and money by automating many HCM and payroll tasks. Your organization can accomplish more work with less labor with the help of IRIS Payroll Solutions.

For a deeper dive into finding the right solution for your needs, download our comprehensive Payroll Software Buyer's Guide. For a consultation with a payroll expert or product demo, contact us today.