A year ago, payroll processing remained a class of software striving to serve both accountants and their customers. Still making the transition from service bureaus to the desktop and on to the Internet, the focus was less on how to help accountants than on how to get directly to their clients.There were exceptions, of course - AccountantsWorld, which worked only through accountants, and Payroll CS. But for the most part, the software reflected the ambivalence of the accounting industry itself in approaching payroll. For many accounting firms, payroll was a mechanical, time-intensive and low-margin business that was best outsourced. Three factors changed all that.
* The move to the Internet. The move to the Internet changed payroll processing from an exercise in data entry and check-signing to an interactive, customer-focused service that could enhance client relationships while requiring less data handling. And it pushed the pricing down into the range that accountants and their clients could afford.
* Payroll got interesting. No more a matter of simply adding up the time and cutting a check, payroll today encompasses direct deposits, debit cards, complex deductions, 401(k) distributions and other programs that require the fine touch of an accountant.
* Payroll got serious. Not only did the Internal Revenue Service and the states begin to implement electronic filing and reporting, they started to crack down on even minor delays. Late-filing penalties have become substantial areas of risk, and companies simply can't afford to get the payroll processing wrong. It was a natural area for growth among accountants.
Payroll processing is emerging as a major revenue center for most accounting firms due to the combination of these three factors. Once a minor bookkeeping chore, payroll has been elevated to the center of client service and relations, and accounting firms that ignore the potential of this market do so at their own risk.
For 2006, we surveyed an expanded field of 10 payroll-processing systems, the largest number we have covered in recent years. All are strong competitors, with most offering flexibility in the blend of service bureau services, desktop applications and Web-based services. The trend toward this diversity - and a strong focus on selling through accountants - should hold for many years.
Abra Payroll
Sage Software
Sage Software offers two payroll solutions for mid-market companies with under 50 to over 1,000 employees - Abra Payroll as an economical in-house payroll management system, and Sage Payroll Services as an outsourcing solution.
A powerful Windows-based application, Abra Payroll is designed to easily handle unlimited earnings, taxes and deduction types, multiple user-defined pay groups, and customizable transactions, and offers a full range of tax management capabilities, including all standard federal, state and local tax tables, compatibility with EFTPS, and electronic media reporting for all states.
Additional features include the ability to process a "trial" payroll; the ability to create NACHA-compliant files for electronically processing employee direct deposits and payroll tax deposits; the ability to print to several different types of check stock, including MICR encoding; and automatic time sheet entry. Abra Payroll provides complete integration with Abra HR, Sage Abra Attendance and Abra ESS, and interfaces with many major general ledger and timeclock systems.
The Abra ESS module, when used with Abra Payroll, provides secure, online information to employees, including pay stubs, payroll history details, W-4 changes and W-2 copies, and helps enable paperless payroll.
Organizations wishing to perform payroll in-house, but outsource payroll tax compliance, can use the Sage Tax Compliance Service to extract all the necessary data from Abra Payroll, complete all necessary forms, and send all tax liability payments to all federal, state and local taxing authorities.
Built on 20-plus years of experience, and boasting a strong national network of certified business partners, Abra Payroll is notable for its focus on the mid-range business, its power and its flexibility. Few payroll solutions in its class can offer the same ease of navigation, customization features, economy and return on investment.
EasyPayNet
ADP Employer Services
ADP has undergone a significant transformation in the past year, more strongly embracing the active participation of accountants, enhancing the interface and usability of the EasyPayNet hosted service, and introducing wholesale pricing that makes its small business products more competitive in the accounting workspace.
Under the EasyPay system, accountants serve as the focal point for client payroll data. This data is then forwarded to ADP for processing via phone, fax, desktop software or over the Internet. Additional options provide for W-2 and 1099 processing; direct deposit; a TotalPay feature, in which ADP debits the payroll from the client bank account, issues the paychecks and manages bank reconciliation; paycheck signing and stuffing; and a Check View system for online review of pay histories and paychecks.
Among the recent changes to EasyPayNet are an adjustable workflow checklist that prompts users with the steps needed to complete a simple payroll in just five clicks; a customized pay input screen for more flexibility and control over the format of pay inputs; and an on-screen audit feature that allows for a quick review of the payroll before processing for quality control.
Also new is the EasyPay Client Center, an online resource that enables the accountant to access electronic reports for the current pay period and up to 13 months of history, with remote access available the same day that the payroll is processed. The client center also supports the export of client employee and employer data, including gross-to-net payroll, tax and personnel information, into an Excel spreadsheet for further analysis.
ADP's move to embrace accountants as partners in the payroll process - and the attendant enhancements in the user interface and support services for accountants - place it squarely back in contention as a resource for the accounting industry. This accounting focus, the economy of the service and its small business focus make it an excellent choice for client payroll processing.
Paychex Online
Paychex Inc.
In 2001, Paychex successfully transitioned from a service bureau to an online site.
Paychex Online is a tightly integrated suite of Web-based services capable of handling everything from a simple, straightforward payroll to a more complex payroll with multiple rates of pay, complex deductions, and integrated 401(k) and workers' compensation. It offers integration with a host of other accounting applications, including an interface to post payroll data into popular general ledger programs such as Accpac, Creative Solutions, MYOB, Peachtree and QuickBooks.
A customization option lets clients tailor the download file so that payroll data appears directly in the QuickBooks check register, showing each individual paycheck separately. It also posts bank debit amounts for payroll tax payments into the check register, simplifying the process of balancing the check register to the bank statement.
To enhance customer service, each new Paychex Online Payroll client is assigned a dedicated payroll specialist, personally assigned to respond to clients' needs and questions, in addition to providing quality control and external review of transactions. The client is provided with the name and the direct extension of his specialist. In addition, companies can give their accountants access to the online data at no extra charge.
Finally, Paychex Online offers an array of services for small businesses and accounting firms - from assistance in electronic payment of payroll taxes to handling of 401(k) plans and workers' comp. For accountants, a wealth of reference material is supported by educational programs. There are even referral sources for employee assessment, pre-employment screening, health insurance and other services.
Aimed at small and midsized businesses and their accountants, Paychex Online is a smart, flexible service that offers high value and exceptional customer service in a simple, easily navigated package.
PayCycle Wholesale Program for Accounting Professionals
PayCycle Inc.
The PayCycle 2006 Wholesale Program for Accounting Professionals is an economical, Web-based solution designed to make payroll a profitable accounting service. By making payroll less complicated and time-intensive, it allows accountants to realize profit margins as high as 80 percent on payroll services.
PayCycle lets accountants manage multiple payroll clients from within a single dashboard accessible with a single login. It also permits accountants to decide whether they or their client will perform the necessary employee set-up and data entry. And the program exports paycheck and tax payment data to most small business accounting packages, including QuickBooks, QuickBooks Online, ATX's accounting products, CCH ProSystem fx Write-up, Microsoft Money and Microsoft Excel.
Over the last year, PayCycle has launched paperless state tax payments and filings in New York, Massachusetts, New Jersey, Tennessee and Oregon. It also supports electronic state tax payments and filings in California, Texas, Florida, Illinois, Connecticut, Pennsylvania and several other states to cover half of the U.S. small business population. In states where electronic payments and filings are not available, PayCycle provides complete tax filing assistance (in all 50 states and the District of Columbia), including signature-ready forms and e-mail reminders for payment and filing deadlines.
Accounting professionals get a company-branded Web site that prominently displays their name and is accessible by clients at no extra charge. PayCycle offers a master "Tax To Do" list to help keep accountants organized, with all client payroll tax deadlines on one screen. A new employee Web site provides password-protected access to payroll data and pay stubs for all employees.
PayCycle 2006 is a product aimed at making payroll profitable for accountants by reducing set-up and processing time and keeping its array of services economical. Its success in a relatively short time is testimony to the company's customer service, flexibility and accounting-centric vision.
Payroll CS
Thomson Creative Solutions
Payroll CS is a flexible, accounting-focused payroll application that works well both as a part of the CS Professional Suite and as a stand-alone application. It is also available in an ASP version that takes Payroll CS online without sacrificing the power and flexibility of the desktop application.
Payroll CS is designed to use the Internet to more easily conduct remote payroll entry and remote check-printing services with clients, fostering a "paperless" payroll. In addition, NetClient CS private portals give the client access to their accounting and payroll data in a secure environment, and individual employees can use the Web Employee option for read-only access to electronic copies of their payroll information, including W-2s, W-4s and personal earnings history.
The payroll compliance module supports a multitude of day-to-day tasks, as well as quarterly and year-end processes, including the preparation of federal employment tax forms and quarterly and year-end reports that comply with federally mandated formats. State payroll tax modules are linked directly with Write-Up CS and Payroll CS software, and use data already entered to create quarterly reports for filing, without having to re-enter employees' Social Security numbers, names or total wages for the quarter.
The direct deposit module enables accountants to process and manage electronic payroll check deposits for their clients. In addition, it offers the convenience of making electronic payments to vendors, tax deposit agencies, 401(k) plan administrators and others. Planned for the October 2006 CD release is the ability to provide direct deposit for child-support payments.
With its steady but easy migration to the Internet, Payroll CS offers a "best of all worlds" solution that can also enhance profitability for firms that provide payroll services to their clients. It is a well-crafted solution that is scalable up to 1,000 employees per company.
Payroll Relief AC
AccountantsWorld
Of all of the payroll solutions aimed at the accounting market, Payroll Relief AC is a Web-based payroll service bureau that focuses just on accountants. Payroll Relief AC was one of the first dedicated accounting-centric Web services to work for, and not compete with, accountants.
Designed as part of the AccountantsOffice Web site, Payroll Relief is available only to accountants. Its objective is to help boost the revenue of accounting firms by $400 to $2,000 per client per year through steeply discounted pricing and streamlined features.
At the heart of the system is the Payroll Center for Accountants, which offers reminders of pay and filing dates, as well as payrolls in progress and helpful links; and the Employer Activity Center, which provides a detailed overview of the active employer's tasks, including current payroll status, payday reminders, tax due dates, taxes paid, forms filed, general reminders, and critical diagnostics, if any.
Key features include calculations and payment coupons for all 50 states and localities, the District of Columbia and Puerto Rico; the ability to handle multiple pay schedules and multiple states, including multiple unemployment states; fast data entry either via spreadsheet format or one-employee-per-page format; the use of 22 pay types, including tips and reimbursement; and support for third-party sick pay, dependent care benefits, health insurance for 2 percent shareholders, and handwritten checks.
New to Payroll Relief AC in the past year is the AccountantsWorld Electronic Payments System (AW-EPS), a partnership with Chase that brings electronic tax payments in-house, rather than using third parties. The service has also enhanced its ability to deal with multiple client locations, beefed up electronic payment of taxes - including child support and 401(k) - for more than 30 states, and added a feature that allows the import of data from an Excel spreadsheet.
QuickBooks Enhanced Payroll for Accountants
Intuit Inc.
Intuit has built an impressive set of four payroll solutions for the more than 900,000 small and midsized companies that are built around - but not exclusive to - its QuickBooks accounting platform.
Enhanced Payroll for Accountants is a dedicated solution for accountants built on the QuickBooks platform to perform payroll for clients, with full support for state and federal tax filings, workers' compensation management, local check-printing, integrated direct deposit (an add-on service) and payroll reports. As many as 50 clients can be managed from a single subscription. Intuit also offers the QuickBooks Employee Organizer and HR Assistant employment tracking and compliance services to round out its offering of human resources solutions.
QuickBooks Enhanced Payroll for Accountants works directly in QuickBooks to automatically calculate earnings, deductions and net pay after entering employee information just once. The information will transfer accurately for each payday to automatically calculate deductions and prepare paychecks to print. It compiles the payroll data for employee 940, 940EZ, 941/Schedule B, W-2, W-3, 1099-MISC and 1096 forms, and carries data directly into a business' quarterly federal and state filings, leaving only the signature section blank and ready for printing. QuickBooks Enhanced Payroll for Accountants also provides the option of direct deposit, in addition to allowing accountants the choice to print paychecks directly from their PCs.
New for 2006 is a Payroll Center that simplifies payroll management by allowing small business owners or accountants to handle all payroll activities - from paying employees, taxes and liabilities, to filing tax forms and tracking payroll expenses - from a single screen. In addition, the general ledger set-up to banking and general business data results in less set-up time, because all payroll data is in one place.
QuickBooks Enhanced Payroll for Accountants is the most accounting-centric of the payroll solutions available from Intuit. Aimed at firms in the small to mid-range markets, its ties to QuickBooks offer an obvious advantage in integration and ease of use.
SureChoice for Accountants
SurePayroll Inc.
SureChoice for Accountants is a branded extension of SurePayroll's Custom Payroll Service, offering either a branded accounting service or pass-through referral system built on a simplified three-screen Web-based payroll system.
Designed for accountants, it offers two distinct options: The accountant can run payroll for their clients, or the accountant's client can run payroll directly with both parties accessing the data. Access is through a single user name and password, whether the accountant is performing the payroll or referring the client. Both systems offer accountants the ability to monitor and ensure delivery of checks, payment of taxes and other critical client services.
SureChoice for Accountants provides a turnkey solution that lets accountants offer a branded, Web-based payroll service to their clients - licensing and remarketing the service under their brand and pricing. The solution is ideal for accountants who don't offer payroll services, and the pricing includes direct deposit, all tax filing and tax payments (federal, state and local), quarterly returns, unlimited customer service, and employee self-service functionality.
Streamlined navigation is at the core of the system. Navigation is via five tabs along the top of the site or by links along the left side of the page. Calling up payroll information allows the administrator to adjust and preview the payroll, then see the payroll cash requirements and the date that the money will be withdrawn from the company bank account prior to approving the payroll.
SureChoice for Accountants builds on the stability and maturity of SurePayroll, but is far more than a rebranding of the product for the accounting market. The company has significantly enhanced its services to accountants with a strong set of collaboration and processing tools - all within a simplified system that will be attractive to accountants and their clients.
TimePlus Payroll
TimePlus Payroll
For the past 17 years, TimePlus has delivered human resources and payroll solutions to businesses and their accountants through a network of 200 offices nationwide. That network is extended with two services aimed more directly at the accounting industry, a licensing option for accountants and a hosted payroll service.
Host Payroll is a hybrid desktop/Web-based solution designed to allow accountants to increase revenue while maintaining control over the clients' payroll functions. It provides the option to use either the TimePlus CheckConnect software or CheckConnect Online to handle all of the back-office transactions related to federal, state and local tax deposits and filings, as well as direct deposit and other electronic services.
The accountant can print checks and reports or have them delivered directly to clients from the nearest TimePlus processing facility. The TimePlus Payroll system can invoice and ACH transfer fees for services directly from the client to the accounting firm.
The second option allows accountants to manage the complete payroll process by licensing TimePlus Payroll for Windows. In addition to the desktop software, the platform provides advanced online payroll services, including timekeeping, tax impounding, direct deposit, workers' compensation, HR administration, and a general ledger interface with popular small business accounting applications. It includes a fully integrated timekeeping module for use with electronic clocks, online timekeeping or an interface with a third-party timekeeping system.
TimePlus Payroll offers three formats for export to either Peachtree or QuickBooks: Payroll, Tax and Check Register. This enables clients to export detailed payroll information, making general ledger input seamless and straightforward for accountants. Any date range can be used for the export, giving accountants or their clients the flexibility of the specific information they need.
TimePlus Payroll is a veteran payroll service bureau on an expansion path due to an infusion of capital and recent acquisitions. Its increasing attention to the accounting market, combined with a strong strategic position and a tradition of strong customer service, make it a welcome competitor even in the crowded market of accounting payroll services.
UBCC Payroll
Universal Business Computing Co.
UBCC is a classic software and computing firm that cut its teeth on high-productivity software for accountants in 1981. Even today, the firm extends software beyond the standard Windows interface to a variety of platforms, offering users its own set of keyboard shortcuts and other options in a true multi-user, multi-tasking system that is at home in both PC and mainframe environments.
Payroll processing is integral to UBCC's three major packages - Client Data Center, a complete write-up solution that includes live payroll and after-the-fact payroll; the Payroll Service Bureau, with real-time payroll that includes MICR check-printing on blank stock, direct deposit and automatic billing; and the commercial business package directed toward midsized-to-large enterprises.
The payroll packages have a number of features that will make them attractive, including customizable screens and menus and an e-Stub feature that permits e-mail notification of direct deposits. Also of interest is the "One Minute Payroll," in which employee time is imported from an Excel spreadsheet, CSV file or timeclock system to automatically generate current time period entries.
UBCC's strength is not its numerous advanced features, though, or its straightforward interface and processing. Its strength is its ability to deftly handle the wide array of hardware that is not PC or Web-based - including Unix, Linux, IBM TX-Series, Sun MTP/MBM systems and others. It is also able to interface with C, Java and XML, and fully supports connectivity to leading relational databases and ISAM data sources. It can also be deployed in ASP environments.
It's not a program for the casual payroll processor, or for accounting firms with a relatively small and simple payroll practice. But for firms that need a processing powerhouse that's flexible enough to handle challenges outside of the box, UBCC's payroll programs are an excellent choice.
Dave McClure is the president of Kent Associates, in Alexandria, Va., an independent testing laboratory and evaluation service.
Vendor information
* Abra Payroll
Sage Software
888 Executive Center Dr. West,
Ste. 300
St. Petersburg, Fla. 33702
(800) 424-9392
www.sageabra.com
Pricing: License fees - start at $2,115 for a 75-employee payroll.
* EasyPayNet
ADP Employer Services
71 Hanover Rd.
Florham Park, N.J. 07932
(877) 623-7729
http://sbs.adp.com/
Pricing: Varies based on feature set, location and pay frequency. Five employees, biweekly - averages $24.
* Paychex Online
Paychex Inc.
911 Panorama Trail South
Rochester, N.Y. 14625
(800) 322-7292
www.paychex.com
Pricing: Five employees, weekly - averages $23.87.
(c) PayCycle Wholesale Program for Accounting Professionals
PayCycle Inc.
210 Portage Ave.
Palo Alto, Calif. 94306
(866) 729-2925
www.paycycle.com
Pricing: First five employees and/or contractors - $14.99 per client per month, plus 25 cents for each additional employee.
* Payroll CS
Thomson Creative Solutions
7322 Newman Blvd.
Dexter, Mich. 48130
(800) 968-8900
www.creativesolutions.thomson.com/payroll/
Pricing: First 20 clients - starts at $1,500; additional clients in groups of five - $200. Requires $275 compliance module each year for 940/941/1099/W-2 processing.
* Payroll Relief AC
AccountantsWorld
140 Fell Court
Hauppauge, N.Y. 11788
(888) 999-1366
www.accountantsworld.com
Pricing: Weekly - $5.95 up to five paychecks; all others - $9.95 up to five paychecks, plus $1.00 per paycheck for six to 50 paychecks, 75 cents per paycheck for 51 to 100 paychecks, or 50 cents per paycheck for more than 100.
* QuickBooks Enhanced Payroll for Accountants
Intuit Inc.
2632 Marine Way
Mountain View, Calif. 94043
(650) 944-6000
www.intuit.com or www.payroll.com
Pricing: Subscription - $299 per year.
* SureChoice for Accountants
SurePayroll Inc.
4709 Golf Rd., Ste. 900
Skokie, Ill. 60076
(847) 676-8420
www.surepayroll.com
Pricing: Monthly - $40.45, plus $1.66 per employee; biweekly/semi-monthly - $27.85, plus $1.66 per employee; weekly - $17.05, plus $1.35 per employee. W-2s - $36, plus $3.82 per employee.
* TimePlus Payroll
TimePlus Payroll
500 Colonial Center Pkwy., Ste. 650
Roswell, Ga. 30076
(770) 998-5790
www.timeplus.com
Pricing: Host Payroll - starts at $23.80 per pay period per client. Licensing - starts at $20,000.
* UBCC Payroll
UBCC
P.O. Box 768
Taos, N.M. 87571
(800) 827-8610
www.ubcc.com
Pricing: Starts at $2,800 for all Windows platforms and includes installation and training. ASP delivery available. Payroll package - starts at $245 a month, includes software and ASP services.
