Payroll reports, bank withdrawals and general-ledger entries should tell the same story. Differences commonly arise from mapping changes, off-cycle payrolls, voids, benefit deductions or tax payments recorded to the wrong account.
Monthly reconciliation points
- Gross wages by payroll register and GL account
- Employer payroll taxes and benefit expense
- Employee withholdings and deductions
- Payroll clearing and liability balances
- Tax-agency and benefit-provider payments
- Payroll cash withdrawals and returned items
Document unresolved differences with an owner, cause, amount and expected resolution date rather than carrying unexplained balances forward.