Chapter I

INTRODUCTION

Rationale of the Study

In this new generation the technology must have been upgraded. When it comes to the
business world, they are also facing the rapid change of the technology. They are more
competitive in business. Most of them are using some of high technology. As part of the
business, Payroll is one of the important bodies in the company.
A computerized payroll system, the employer invests in computerized payroll software.
Using software such as quick books allows the employer to enter the wages into the system after
he has manually calculated them. The payroll and check printing are processed through the
system. The employer has access to payroll reports that he/she can print and use to double-click
against what she has entered before printing the checks. This allows his/her to correct any
detectable errors beforehand. Computerized payroll system allows you to process all your normal
payroll task via a computerized system, rather than by hand. Essentials like name, address, Social
Security number and withholding rate for each employee are automatically filled in for every pay
period until you make an employee’s record inactive. Many different vendors offer computerized
payroll system. Like different word processors or other computer programs, they largely offer
the same types of features with slightly different interfaces. Payroll is essentially how employees
are paid. It’s the legal paperwork involved. There’s more to payroll than just handing out cash or
checks, However, after gathering data on what the employees did and compared it to their
salaries, some simple payday mathematics will let the employer hand out the dough.

Payroll systems is generalized to compute the wages of the working staff in order to have
accurate computation on the wages and at the same time keeps the employment record of the
working staff. In case of errors, there will be a database to check the records of every working
staff and their work done.

In line with this, the researchers (we) proposed a computerized payroll system to minimize
the time of the manual payroll system.

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 Our motivation on their existing system is to improve it, secured the backup files and
records. Because, this factors will lead to faster, shorter and lessen of processes and organized
of important data. Our focus is become user-friendly to the user, effectiveness, simplicity,
accuracy and attractiveness

In an organization, there are many departments and eachdepartment has a payroll section
to manage its payroll activities. Each section has to perform necessary operations like data
collection and preparation, entry, updates, monitoring and reporting of data. Many of these
existing practices and procedures need to be reassessed at this time of changing needs, changing
demands of employees and changing technologies. With this payroll system, payroll section
would be able to keep a record of employees including their personnel data, payslips,
allowances, deductions, leave, savings and taxes etc.

Net pay of each employee is calculated by his allowances and deductions mentioned
according to the company rules. The individual pay slips are printed out as a receipt if employee
wants to get a print out. Pay bands, grade pay, allowances, deductions and tax information are
updated ifthere is any amendment in salary structure.

All establishment are becoming modernized, they use modern technologies to make their
transaction fast, easy, and accurate in order to avoid waste of time and for the sake of safety and
security. Payroll is one of the difficult work things to do, because they are the one handling the
reporting, salary for the employee, wages, bonuses, deduction and depositing payroll taxes to the
appropriate agency in an accurate and timely manner is vital to the businesses. Late and
inaccurate deposits may result in penalties and interest charges.

A Computerized Payroll System will not only provide accurate calculation and fast
process of Payroll transaction but it also secure data through security implementation and
accordingly arrange files provided by a well-designed database that will produce a paperless
environment. The advantages of a Computerized Payroll System improve accuracy and minimize
errors because most computations are done by a system.

Department of Public Works and High Ways ARMM Jolo is a government agency. They
are using manual process on their Payroll System.

The term “payroll” encompasses every employee of a company who receives a regular
wage or other compensation. Some employees may be paid a steady salary while others are paid
for hours worked or the number of items produced. All of these different payment methods are
calculated by a payroll specialist and the appropriate paychecks are issued. Companies often use
objective measuring tools such as timecards or timesheets completed by supervisors to determine
the total amount of compensation due each pay period.

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 The advantage of using a manual system is that it is very inexpensive, with virtually no
start- up costs.The disadvantage is that whatever you save on start-up costs will probably be
eaten up by the amount of time it takes to process payroll.

In addition, it’s very easy to make mistakes when processing payroll manually, and the
penalty for mistakes, especially mistakes in taxing, can be very costly.

There are at least free payroll templates out there, but it still difficult to do manual payroll
and processing. The study is located at Department of Public Works and Highways ARMM 1 st
District branch on Jolo, Sulu has a dedicated manual Payroll Branch within the Financial
Services Unit that is responsible for the payment of salaries and wages, and the management of
related functions.

It provides a centralized, consistent approach to the management and processing of all

Payroll related transactions for the duration of a staff member’s employment with DPWH
ARMM.

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Statement of the Problem

In this modern day, the Department of Public Works and Highways ARMM Jolo is still
using a manual system for their payroll system and keeping track of their previous records still
having a manual system can prove useful, but, as for a country in which effectiveness and time is
a golden factor, computerized payroll system, and the DPWH ARMM Jolo can operate with
much more ease and store/speed-up information. The following problems are encountered in the
said government agency.

1. Because of manual system it consumes a lot of time than usual, due to modernization
today, effectiveness of a system is also measured by its time and effectiveness while
producing a report, the manual system they are using makes it hard for the accountants to
effectively search, edit, and produce reports through a vast amount of data.

2. Errors in computation of payroll are most likely to happen, since the payroll officer that is
assigned is prone to make some mistakes in computation because of the computation
system being manual.

3. Files and database are not secured and the present system does not have a back-up and
can restore files in case of loss of data. 

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Objectives of the Study

General Objective
The main objective of the study is to design and develop a Computerize Payroll
System for Department of Public Works and Highways ARMM Jolo. Data that fast
transactions, minimize the manual checking of employees, monitor the status of
employee’s charges, deductions and generate essential reports. A computerized payroll
system must be able to keep and generate accurate reports on employee income. An
equally important objective of any payroll system is to generate paychecks and pay stubs.
Computerizing this task saves managers and business owners time and money; rather
than reviewing time cards manually and calculating a check amount based on the hours
worked. the payroll system should be designed to automatically calculate these figures. A
computerized payroll system must automatically factor in the overtime pay. This helps
DPWH employer stay within the law when it comes time pay overtime. Additionally,
since an employer can use the system check the number of hours an employee works, the
employer can shift schedule to avoid paying additional overtime.

Specific Objectives
 To develop that will automatically compute and monitor the status of employee’s
loan and other deductions such as cash advance and charges.

 To develop a module that will generate essentials reports.

 To help the DPWH ARMM Jolo and the employee to make their work secured,
faster and shorter.

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Scope and Limitations of the Study

Scope
The study will cover the process of preparing the pay slip of each employee, monitors
loans, cash advance, charges, keeping the records and easily computers the basic pay, regular
overtime pay, pay during day off, special and legal holiday pay, gross pay, SSS contributions.
Phil Health contributions, Pag-Ibig contributions, cash advances, charges, deductions, and net
pay.

Limitations
The study does not cover any other not employee of the DPWH ARMM Jolo, 1st District.
This is not a group pay slip. This system is not cover by any deduction that may not belong to the
pay slip. And also the other income that not belong in DPWH ARMM Jolo, 1st District.

Significance of the Study

This part of the study discuses about the importance of creating computerized payroll
system. A computerized Payroll System has direct deposit capability, which saves money spent
on live checks and reconciliation. Moreover, paycheck and pay stub generation occurs rapidly,
regardless of quantity, developing a computerized system and prints payroll reports. If you want
to double-check before printing Payroll stubs paychecks/pay, just refer to the corresponding
report. A computerized payroll system allows hard-copy printing of Payroll registers pertaining
to each pay period. Also saves its information systems without boundaries.

The main importance of this payroll system, it generates reports to ensure compliance
with tax Payroll tax. This includes quarterly and annual wage reporting and development of
employee forms. If a related department such as accounting office holding Payroll taxes and
reconciliation of the company, print the required reports would require the department through
the computerized system. Furthermore, these days, such as vacation and personal time, taken and
paid to benefit the track system.

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Definition of Terms

Operational Terms

 Computerized Payroll System. A computerized payroll system has many

prominent advantages over paper systems. They prevent clerical error in
calculating gross payment. They also automatically deduct taxes based on the
gross payment.

 Income Tax – is a government levy (tax) imposed on individual or entities

(taxpayers) that varies with income or profits (taxable income) of the taxpayer.
Details vary widely by jurisdiction. Many jurisdictions refer to income tax on
business entities as companies’ tax or corporation tax.

 Deposit – account is a savings account, current account, or other type of bank

account, at a banking institution that allows money to be deposited and withdrawn
by the account holder.

 Paychecks – is traditionally a paper document (a cheque) issued by an employer

to pay an employee for services rendered. In recent times, the physical paychecks
have been increasingly replaced by electronic to bank accounts. Such employees
may still receive a pay slip, but any attached cheque is marked as non-negotiable
and cannot be cashed.

 Pay slip – a slip of paper included with your pay that records how much money
you have earned and how much tax or insurance etc. has been taken out.

Technical Terms

 Data – is a set of value of qualitative or quantitative variables; restated, dataare

individual pieces of information. Data in computing or data processing are
represented in a structure. Data consists of a series of facts or statements that may
have been collected, stored, processed and/or manipulated but have not been
organized or placed into context. When data is organized. It becomes information.
Information can be processed and used to draw generalized conclusions or
knowledge

Chapter II

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REVIEW OF RELATED LITERATURE AND STUDIES
Payroll System, in the broadest sense, involves the computation of the employee’s salary
in a faster way. It is mostly integrated with the Information System to automatically generate the
necessary data needed by the Human Resource Department. Large companies are using this kind
of system, since computer is known for its powerful and complex computation. Errors would be
minimized in integrating a system like this. In this chapter, the proponents will be presenting a
brief review of related literature and studies, both local and foreign that is related to these
studies.

Theoretical Background
“An economic theory that stipulates that the value of a good service is dependent upon
labor used in its production.” The theory was first proposed by Adam Smith (1723-1790), the
founder of modern economics, and was an important concept in the philosophical ideals of Karl
Marx. The labor theory of value suggests that goods which take the same amount of time to
produce should cost the same.

Related Literature
Foreign
Tanzania’s Government Payroll System
According to Kenan Kalagho 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 Dares 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.

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 Mushi said the money saved is being used for other government
development projects. The system has helped the government to eliminate and
save cash in terms of salaries to some 34, 645 public servants from government
payroll who were either already retirees’ or were already demised but had their
monthly salaries updates in the former system.

The Information and Communication Telecommunication (ICTT)

infrastructure that has been improved in the country in the recent years has helped
to a larger extent to make sure that personal data information is easily accessed at
the central point thereby minimizing fraud that might be associated tampering
with one’s account. He said the government did recruitment of some 16,000
teachers early this year and entering all of them on the government payroll system
has reduced fast tracked access to information from the newly employers than if
government officers were to bring the files at the head offices in Dar es Salaam.
According to PriscusKiwango, the Director of Information Resource
Management in the Presidents’ Office, Public Service Management a number of
government offices at the districts level were already using the new payroll
system using the National Information Communication Technology Broadband
Backbone (NICTBB).
He said there has been a lot of new development in most of government
offices including access to internet resulting from the mushrooming of mobile
operators in the country and thus lessening the time to enroll a new employee with
the government payroll which currently serves only 478,000 public servants.
This also means that the newly introduced system will mean that most
government workers who have been enrolled with the system will be able to get
their salaries on time upon being employed.

National Aeronautics and Space Administration (NASA) Personnel

and Payroll Systems

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 As cited by the proponents on the website of NASA their personnel and
payroll system maintains information on present and former NASA employees.
The data contained in their system of records includes payroll, employee leave,
insurance, labor and human resource distribution and overtime information.
The following are routines used to maintained the system including the
categories of users and the purpose of such routines: (1) To furnish to a third party
a verification of an employee's status upon written request of the employee; (2) to
facilitate the verification of employee contributions and insurance data with
carriers and collection agents; (3) to report to the Office of Personnel
Management (a) withholdings of premiums for life insurance, health benefits, and
retirements, and (b) separated employees subject to retirement; (4) to furnish the
U.S. Treasury magnetic tape reports and/or electronic files on net pay, net savings
allotments and bond transmittal pertaining to each employee; (5) to provide the
Internal Revenue Service with details of wages taxable under the Federal
Insurance Contributions Act and to furnish a magnetic tape listing on Federal tax
withholdings; (6) to furnish various financial institutions itemized listings of
employee's pay and savings allotments transmitted to the institutions in
accordance with employee requests; (7) to provide various Federal, State, and
local taxing authorities itemized listings of withholdings for individual income
taxes; (8) to respond to requests for State employment security agencies and the
U.S. Department of Labor for employment, wage, and separation data on former
employees for the purpose of determining eligibility for unemployment
compensation; (9) to report to various Combined Federal Campaign offices total
contributions withheld from employee wages; (10) to furnish leave balances and
activity to the Office of Personnel Management upon request; (11) to furnish data
to labor organizations in accordance with negotiated agreements; (12) to furnish
pay data to the Department of State for certain NASA employees located outside
the United States; (13) to furnish data to a consumer reporting agency or bureau,
private collection contractor or debt collection center in accordance with section
3711 of Title 31 of the United States Code; (14) to forward delinquent debts, and
all relevant information related thereto, to the U.S. Department of Treasury, for

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 collection; (15) to the Office of Child Support Enforcement, Administration for
Children and Families, Department of Health and Human Services, National
Directory of New Hires, part of the Federal Parent Locator Service (FPLS) and
the Federal Tax Offset System, DHHS/OCSE No. 09-90-0074, for the purpose of
locating individuals to establish paternity, establishing and modifying orders of
child support, identifying sources of income, and for other child support
enforcement actions as required by the Personal Responsibility and Work
Opportunity Reconciliation act (Pub. L. 104-193).

Local
Cagayan de Oro City Hall Computerized Payroll System
According 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.
Adopting of the one-month payroll system is also beneficial, not only to
the City Accounting Department, but also to the payroll-in-charge as it would
save time, energy and resources. “Employees who handle payroll preparation and
processing can now attend to other office needs and concerns as the new payroll
system will lessen their workload,” she added. Under the new payroll system,
preparation of payroll, this reflects the accrued, amount payable every 15th and
30th day of the month, done only once. Unlike the time-consuming old payroll

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 system, preparation and processing of payroll is done twice a month covering the
first half and second half of the month.

Computerized Payroll System of Department of Health (DOH)

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.
It is flexible as it provides options to include additional fields for other
compensation and deductions unique to an office or unit and could do automatic
computation of monthly net income, GSIS, PAG-IBIG, Withholding Tax and
other deductions, Y2K compliant, Fast and easy generation of the General Payroll
and all other payroll related reports which include Monthly reports like GSIS and
PAG-IBIG remittances, Denominations Report and Leave Credits Report and
annual Year-end Tax Reports.
It has password security to ensure the integrity of data. General payroll
reports such as Payroll Summary sheet, pay slip, Leave Credits Report,
Withholding Tax Statement (W-2), BIR Remittance Reports, GSIS Remittance
Reports, PAG-IBIG Remittance Reports, Other User-defined Reports (PERA,
ACA, PNB, etc..) could be generated by this system.

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Related Studies
Foreign
HP mastermind’s complex new payroll data infrastructure
According to Robert Elsen, director, Secretariat of the Belgian Integrated
Police “HP has provided us with an efficient and transparent solution that has
been welcomed by our staff and ensures that they are all paid the correct amount,
on time.” When several police organizations were amalgamated into one national
force, the Belgian government needed a new, centralized payroll system for its
48,000 police employees. This large and complex solution was successfully
implemented by HP Enterprise Services. The results include more accurate
accounts, improved management and improved staff morale. It also allows for the
smooth integration with other public sector departments.
In 2001, the Belgian government called for a complete overhaul of the
country’s policing system, replacing the former Gendarmerie, Criminal
Investigation Department and Municipal Police with a unified force. This
integrated police service employs 48,000 people and is made up of the Federal
Police and 196 local divisions that operate autonomously but share common
services.

Queensland begins planning new Health Payroll System

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 2016-17.

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 Minister for Science, IT, Innovation and the Arts (DSITIA) Ian Walker
confirmed to parliament this morning that a Queensland Health payroll planning
group would be established, chaired by the Queensland Health Director-General,
to begin this process. The group will also feature representatives of Mater
Misericordia Health Services, whose successful payroll replacement was singled
out by the commission of inquiry as a model that Queensland Health would do
well to follow.
It cited the ICT Audit’s revelation that 40 per cent of the Queensland
Government’s significant applications are either past their due date for
replacement, or will be within the next two years, but for more than 50 percent, no
consideration had been given a replacement process. Inside DSITIA work has
already begun work to list and document the lessons learnt during the payroll
saga. It aims to release a report to agencies by 15 September to inform their IT
planning.
The government also hopes that a new project approval framework,
introduced by the whole-of-government ICT Strategy in July, will plug some of
the accountability gaps that allowed the Health project to go off the rails. New
requirements include ministerial sign-off for high-risk projects and gateway
reviews designed to identify and halt troubled implementations early.
These accountability measures pre-empted the third recommendation of
the report, but don’t fully address Chesterman’s less formal suggestion that
specialist project managers be appointed to every large IT procurement or
implementation.

Clark Payroll System will save Time and Money

According to the article “Clark Payroll System will save Time and
Money” written by Michael Cooper of Springfield news that the auditor of the
Clark country said that the new accounting and payroll systems of the county will
be more efficient, replacing some work done by hand and save taxpayers money.
The systems could cost $1 million to $1.5 million, but bids recame back lower

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 than expected. Officials want to have the systems ready sometime next year,
Federer said. “It’s going to save lot money,” Federer said.
Federer said the county government currently includes paper-based
systems. Some departments are still handwriting payroll sheets and purchase
transactions, and in some instances data is being entered four different times.
They’re currently inputting payroll for 1,200 employees every two weeks using
paper time sheets. “It’s not efficient and it’s not effective,” Federer said.
The current method is not compatible with any type of modern software,
such as Microsoft Windows. The system is also on a non-standard server that
doesn’t even have parts available if they need to be replaced, said county
administrator Nathan Kennedy. “If the server goes down, so does our software,”
Kennedy said. “If that happens, we’re handwriting checks … It obviously needs
to be replaced.”
The new system will provide processes for accounting, payroll and
accounts payable. The system will work with the county government as well as
other agencies such as the Dept. of Jobs and Family Services, the Transportation
Coordination Committee, Mental Health and Recovery Board and even the West
Central Corrections Facility in Marysville.
Federer said departments and agencies often come to the office physically pay
bills. The new system will make the process much easier. “You won’t have
people driving down here,” Federer said.
Developmental Disabilities of Clark County comptroller Ravi Shankar
said the system needs to be revamped. Shankar said payroll is done in-house at
their office, but the same information is being entered at the auditor’s office.
“It’s a lot of duplication,” Shankar said.
Federer is partnering with agencies that will use the software such as
Developmental Disabilities of Clark County, the county sheriff, treasurer and
Community Development department, among others, to decide how the software
can best be implemented.
“I want to make sure that what we buy satisfies them, too,” Federer said.
“We’ve developed partnerships that have never existed before like they have

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 today.” The agencies also use different systems that have to mesh with other
systems. “We have to be real sensitive that our system will talk to their system,”
Federer said. Shankar said there will be a learning curve and training will be
required for all the agencies involved, but it’s “the right time to move on” from
the old system.
County officials are expecting the project to cost upwards of $1 million.
The initial bids will be analyzed to make sure they’re complete, according to
county administrator Nathan Kennedy. “If they are complete, these are real good
bids,” Kennedy said. “We were anticipating something far, far higher.”
Federer believes the bids did not include important details, such as
hardware. He expects the system to cost more than the bids discussed at the
commission meeting. Kennedy said 12 vendors asked for a copy of the request for
proposals, but only two returned bid packages.County Commissioner Rick
Lohnes said the auditor’s office performs tasks for all local agencies, including
township governments and others — making the system important for the entire
county. “Everybody has to go through the auditor,” Lohnes said. “It’s going to
take training, but it’s going to be a good system.”

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

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 USAID Deputy Mission Director Reed Aeschliman stated, “The U.S.
Government is pleased to support Pulilan in becoming the first Local Government
Unit (LGU) in the Philippines to shift to mobile money payments for payroll. This
will encourage greater transparency, accountability, and efficiency in governance
and enhance public service delivery to citizens.”“This is a testament of our shared
commitment to achieve broad-based and inclusive growth in the Philippines,”
Mission Director Gloria D. Steele said in a message.
Pulilan Mayor Vicente Esguerra Sr. said, “This is a milestone for Pulilan
as we lead the way in making government payroll disbursement more efficient
and safer, and expanding financial services that are convenient to our local
residents.”
In partnership with the country’s first mobile-based savings bank, Bank of
the Philippine Islands (BPI) Globe BanKO, USAID helped streamline
government and business processes by automating its payroll and payment
systems. “BPI Globe BanKO is honored to be part of the pioneering efforts of the
Municipality of Pulilan and USAID in introducing the mobile money payroll
system to its LGU employee.
Through SIMM, USAID is assisting Philippine Government agencies to
enable mobile money for payroll disbursement, distribution of social welfare
stipends, and payment of government services including utilities, real property
taxes, business permits, and other local government fees. The project is aligned
with the Philippine Government’s thrust of promoting financial inclusion by
expanding citizen access to formal financial services.

DBM: Digitized Government payroll will promote Transparency, Efficiency

MANILA, July 31 — According to PCOO, The Department of Budget
and Management (DBM) Secretary Florencio Abad today highlighted the role of
the National Payroll System (NPS) in the Aquino administration’s drive for
increased transparency and accountability in the Philippine bureaucracy, adding
that the move to reform the existing payroll system will also facilitate the quick
and efficient processing of employee salaries and benefits across government.

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 “As a fully automated and digitized system, the NPS 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 due to government workers, or the regular monthly remittances
that are made out to our employees’ social security and health insurance
accounts,” Budget and Management Secretary Florencio “Butch” Abad said. The
Administration’s Public Financial Management (PFM) Committee of which the
Department of Budget and Management is a member—has been tasked to develop
the centralizing software for the NPS, which will be pilot-tested in select agencies
at the end of the year. The NPS is also a component of the larger Government
Human Resource Information System (GHRIS), which will harmonize and unify
all human resource management operations in government, from the recruitment
phase all the way to retirement. Completion of the GHRIS is expected in the
second quarter of 2014. “We want to make it clear, however, that the DBM will
not exert control over the personnel requirements of agencies. Together with the
other members of the PFM Committee, we are only developing the software that
will make payroll reform possible in the bureaucracy,” Abad added.
Under the reformed and digitized payroll system, agencies will continue to
have discretion over their respective human resource and personnel requirements.
This will be expressed in a Monthly Cash Plan relating to Personnel Services that
will be submitted to the Bureau of Treasury (BTr), which will in turn provide a
payment file to the proper bank for the timely processing of employee salaries.
According to the DBM, agencies will be asked to establish Automated Teller
Machine (ATM) payroll accounts for all their employees to allow for the
electronic distribution of monthly salaries. Government servicing banks—such as
Land Bank and the Development Bank of the Philippines (DBP)—will be
prioritized, although other banks may also be proposed should Land Bank or DBP
ATMs be unavailable for use in a particular area.

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Comparative Matrix

In a company, payroll is the sum of all financial records of salaries for an employee, wages,

bonuses and deductions. The primary mission of the payroll department is to ensure that all
employees are paid accurately and timely with the correct withholdings and deductions, and to
ensure the withholdings and deductions are remitted in a timely manner. This includes salary
payments, tax withholdings, and deductions from a paycheck(http://en.wikipedia.org/wiki/Payroll).

The proponents believe that each and every literature and studies stated in this research is
similar on the proposed system. The proponents compared, relate and differentiate the research
based on the flow of their existing system from the proposed payroll system. The existing system
of the companies both foreign and local is efficient and effective to use but as the technology
grows enterprises should also upgrade their existing system to be more reliable and effective to
use.

The proponents will create payroll system for local government unit that is user-friendly,
accurate, reliable and effective to use than the existing system of both foreign and local
companies stated on this research.

Chapter III

RESEARCH METHODOLOGY

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Environment

In this phase gives a general overview of the Research Methodology for the
Computerized Payroll Management.
Payroll management is concerned with all aspects of the arrangements that are in
place to ensure that employees of an organization receive remuneration which is in
accordance with their terms of employment, is lawful and is appropriately recognized in
the financial statements of the organization.
. The payroll activity includes all processes required to pay salaries and wages in
accordance with organization policies, by its nature, payroll processing is considered by
management as a lower risk area given the prevalence of routine transactions associated
with such processing. Notwithstanding this risk assessment, payroll management
arrangements have not been exempt from the drivers of change within the public sector
which present challenges for Chief Executive Officers (CEOs), relevant management and
other staff concerned.

Software Engineering Methodology

The proponents decided to use some methodologies that will help to understand
more the process of payroll. One of basic methodology that use in developing software is
the System Development Life Cycle (SDLC). We also use some diagram like use case
diagram, Entity Relationship Diagram (ERD).

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Gantt Chart
March April May
13 20 27 4 11 18 25 2 8 15 22 30

Research

Functional Specification

Design Specification

Interview

Prototype Designing

Coding

Assembly/Testing

Documentation
& Thesis Write-Up

Analysis-Design Phase

Login
o Use Case Diagrams

Registration
Process

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Selection of Different
Categories

Administrator Employee
 View the time & Date
of Joining

View Reports

Exit

Use Case Diagram of the Proposed Payroll System (Administrators)

Data Flow Diagrams

Loan

Management

Computerized
Employee
Payroll System
Reports
of DPWH

Leave
Accounts

Level 0 DFD

Employee Allowances
Detail
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 Salary
Category Processing
Information
of Salary Processing of
Information Allowances
Leave Calculation
Detail

Over
Time
Gross Salary

Present
Detail

Processing
Gross Salary
of
Net Salary
Deduction
Advance
Salary

Loan

Reports

Salary Statement or
Deduction
Reports

Level 1 (High Level Diagram)

Level 2 DFD

Leave

Advance
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 Processing
Category of Salary
Information
Overtime

Department

Present
Detail

Level 2 DFD

Basic Salary
Daily
Allowances

Processing
of
Travelling
Allowances
Allowances
Calculation

HRA

Medical

Level 2 DFD

Professional
Tax
Provident
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ge

Processing
 Cross
Salary

Loan
Detail
Advance
Detail

Loan
Master Loan
Advance
Transaction

Database Designs

Employees information table

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 E-ID No. Employees Name Address ContactNo. E-mail Address Date of Birth
01 Abdugafar, Walid U. Jolo, Sulu 09668767875 @yahoo.com mmddyy
02 Akbara, Bennajir K. Jolo, Sulu 09668743875 @gmail mmddyy
03 Halbi, Minjamin S. Jolo, Sulu 09766767875 @yahoo.com mmddyy
04 Halil, Nelda S. Jolo, Sulu 09986767875 @gmail mmddyy
05 Pijah, Sandra Jolo, Sulu 09798767875 @yahoo.com mmddyy

Generalpayroll table
E-ID No. Employees Name Designation Rate Per Month SIF Ins Prem Personal Ecard Plus ELA
01 Abdugafar, Walid U. SPL Agent I 16,121.00 12,526.81 1,426.81 0.00 655.56
02 Akbara, Bennajir K. Clerk III 14,602.00 10,009.39 1,209.39 0.00 655.56
03 Halbi, Minjamin S. Electrician II 14,731.00 11,268.13 1,168.13 0.00 655.56
04 Halil, Nelda S. Dis. Officer II 15,818.00 9,482.84 1,182.84 0.00 655.56
05 Pijah, Sandra Bookkeeper 17,943.00 13,349.53 1,849.53 0.00 655.56

Consolidated Policy Housing Educ Personal MPL Housing Loan 2

Loan Loan Loan 1 Assistant Share

2,115.67 300.00 None 300.00 100.00 None None
3,335.67 400.00 None 400.00 100.00 None None
1,115.67 500.00 None 500.00 300.00 1,972.74 None
1,675.67 200.00 None 200.00 200.00 220.74 None
2,115.67 300.00 None 300.00 100.00 2,581.03 None
Gender GSIS No. TIN PHIL HEALTH PAG-IBIG Designation Picture
Male 11-0431-2223 872-211-232-000 21-212897463-0 1211-0431-9043 SPL Agent I 00234501.jpg
Male 34-0431-1119 151-411-232-000 11-212897463-0 1211-0431-9043 Clerk III 00234503.jpg
Male 12-0431-4446 342-511-232-000 41-212897463-0 2234-0431-2119 Electrician II 00234502.jpg
Female 22-0431-6663 122-611-232-000 81-212897463-0 7312-0431-2319 Dis. Officer II 00234506.jpg
Female 89-0431-3334 112-711-232-000 71-212897463-0 5322-0431-8719 Bookkeeper 00234508.jpg

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 Housing Loan 3 PS TaxW/Held Net for the Month Picture
None 150.50 425.99 3,841.547 00234501.jpg
None 200.50 1,314.58 4,582.190 00234503.jpg
None 110.50 33.22 3,444.900 00234502.jpg
None 162.50 111.60 6,876.800 00234506.jpg
None 162.50 365.88 4,593.475 00234508.jpg

Entity Relationship Diagram

Last
First Name Name
ID
Name

ID DOB CP
Emp- Designation
Number
Name

CP No.

Employs Employee
Employee

Department

Designation Pays
Gets

Salary

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 Medical DA
Allowance

Basic TA

Data Dictionary

Field Name Data type Field size Description

For the employees
Full name Varchar 60 Full name of the employee
Address Varchar 80 Address of the employee
Phone number Integer 20 Phone number of the employee
Email Varchar 40 Email address of the employee
Date Date 20 Date request of the employee
Gender Varchar 10 Gender of the employee
Dependents Varchar 20 Dependents of the employee
TIN Integer 20 TIN Number of the employee
Phil Health Varchar 20 Phil Health of the employee
GSIS Varchar 20 GSIS of the employee
HDMF Varchar 20 HDMF of the employee
Birth Day Varchar 10 Birth Day of the employee
Employee Type Char 20 Type of the employee
Salary I.D Integer 10 Salary of the employee
Position Char 20 Position of the employee
Amount Integer 20 Amount of the Salary
Integer 8 Total amount of the employee’s
Total salary
For the admin
User name Varchar 30 Unique identification of the
admin
Password Varchar 20 Admin security password

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Network Design

- Network Model

Network Topology

- We use Bus Topology for our proposed Computerized Payroll System.

- Bus Topology is a type of network topologies that each computer and
servers and other peripherals are attached directly to common cable.
This topology most often serves as the backbone for a network in some
instances, such as office workgroups.

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Development/Construction/Build Phase

o Software Specification

System Software : Windows Operating System (XP,Vista,Win 7)

Application Software : Microsoft Office Any Version
Driver Pack Solution 14up to latest version
Adobe Reader

o Hardware Specification

LCD Flat Screen Monitor (14 to 17 inch wide preferable)

For PC’s (Core Series to iSeries Processor)
Hardware Drive 500gb or more
For Laptop (Any brands, Notebook Type)

o Program Specification

Microsoft Visual Basic 6.0

Net Framework (3.5, 4.0 and 4.5)
DXSDK Installer (data libraries needed by the system)

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