Accounting procedures for payroll and payroll deduction at binh minh joint stock company

LIST OF TABLES...iv LIST OF DIAGRAMS...v INTRODUCTION...1 CHAPTER I: FEATURE OF LABOR AND PAYROLL AND MANAGEMENT OF LABOR AND PAYROLL AT BINH MINH JOINT STOCK COMPANY...2 1.1 Features of

NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ACCOUNTING AND

I would like to express my deepest thanks to my instructor,Assoc.Prof Nguyen Thanh Hieu Who supports and guides meenthusiastically She provided me a lot of useful knowledge aboutthe topic of accounting for payroll, followed me step by step in theprocess of conducing this thesis She also carefully reviewed eachpart of the thesis and gave me a lot of high valuable advice

In addition, I want to give my thanks to National Economics University and School of Accounting and Auditing With the knowledge I have learned, I had ability to complete the internship course As an accounting student, I have an opportunity to approach the reality in Binh Minh Joint Stock Company During the accounting Internship, I can apply the theory in practice to have a better understanding about the accounting work of enterprises in aspecific business sector Finally, I would like to express my sincere thanks to the Board of Director and the accountant at Binh Minh Joint Stock Company for letting me do as an internship in the company as well as guiding and supporting during my internship atthe company Although, it is not a long period, I have chance to learn more about accounting for payroll, which helps me to develop

my career ladder in the future

LIST OF TABLES iv

LIST OF DIAGRAMS v

INTRODUCTION 1

CHAPTER I: FEATURE OF LABOR AND PAYROLL AND MANAGEMENT OF LABOR AND PAYROLL AT BINH MINH JOINT STOCK COMPANY 2

1.1 Features of labor and payroll at Binh Minh Joint Stock Company 2

1.1.1An overview of the company and company human resources 2

1.1.2 Employee classification by age and gender 4

1.1.3 Employees classification by educational level 5

1.1.4 Employees classification by nature of work 5

1.2 The forms of payment for salaries and wages applied in Binh Minh Joint Stock Company 7

1.2.1 The form of salary payment 7

1.2.2 Support fees 10

1.2.3 The days off with full salary 11

1.3 Policy of payroll deduction applied at Binh Minh Joint Stock Company 11

1.4 Feature of management of labor and payroll at Binh Minh Joint Stock Company 14

1.4.1 Binh Minh Joint Stock Company organization structure 14

1.4.2 Labor management organization at Binh Minh Joint Stock Company 16

CHAPTER II: CURRENT SITUATION OF ACCOUNTING PROCEDURES FOR PAYROLL AND PAYROLL DEDUCTIONS AT BINH MINH JOINT STOCK COMPANY 17

2.1 Accounting for payroll at Binh Minh Joint Stock Company 17

2.1.1 Accounting documents 17

2.1.2 Method applied for payroll calculation 29

2.1.3 Account used 33

2.1.4 Accounting procedure for Payroll at Binh Minh Joint Stock Company 33

2.2 Accounting for payroll deductions at Binh Minh Joint Stock Company 38

2.2.2 Account applied: 42

2.2.3 Accounting procedure 42

2.2.4 General accounting of salary and payment situation with employees 45

2.2.5 Accounting for deductions for social insurance, health insurance, unemployment insurance, trade union fees 45

CHAPTER III: IMPROVEMENT OF ACCOUNTING PROCEDURES FOR PAYROLL AND PAUROLL DEDUCTIONS AT BINH MINH JOINT STOCK COMPANY 55

3.1 Assessing the current accounting procedures for payroll and payroll deductions at Binh Minh Joint Stock Company 55

3.1.1 Strength 55

3.1.2 Weakness 57

3.2 Suggestions to complete accounting procedures for payroll and payroll deductions at Binh Minh Joint Stock Company 58

3.2.1 Management of payroll and deductions 58

3.2.2 The organization of the accounting apparatus 59

3.2.3 The management of labor 59

3.2.4 Accounting documents and documents transfer 60

3.2.5 Accounts used 60

3.2.6 Conditions needed for implementing proposed solutions 60

CONCLUSION 62

REFERENCES 63

Table1 1: Number of employees at Binh Minh Joint Stock Company

Table1 2: Labor’s age and gender classification of BMJSC

Table1 3: Employee’s educational level classification at BMJSC

Table1 4: Employee’s classification by nature of work

Table1 5: Salary scale by job title

Table 1.6: The employee’s 13 th

-month salary at BMJSC

Table1 7: Proportion of salary deductions from 1/1/2021 to 30/6/2021

Table 1.8: Proportion of salary deductions from 01/07/2021 to 30/09/2021 Table 1.9: Proportion of salary deductions from 01/10/2021 to 30/6/2022 Table 1.10: Proportion of salary deductions from 01/07/2022 to 30/09/2022

Table 1.11: Labor contract of Binh Minh Joint Stock Company

Table 1.12: Timesheet in December 2021

Table 1.13: Timesheet in October 2021

Table 1.14: Monthly overtime timesheet in October 2021 Table 1.15: The payroll sheet in October, 2021

Table 1.16: Statement of salary and salary deductions allocation in total

Table 1.17: Bonus payment sheet for new year vacation

Table 1.1.8: Salary slips in March 2022

Table 1.19: Detailed books of account number 334

Table 1.20: Certificate of sick leave

Table 1.21: Social Insurance payment voucher

Table 1.22: Social insurance sheet

Table 1.23: Detailed book of account number 3382

Table 1.24: Detailed book of account number 3383

Table 1.25: Detailed book of account number 3384

Table 1.26: Detailed book of account number 3385

number 338

Table 1.28: Ledger of account number 338

LIST OF DIAGRAMS

Diagram 1: Labor’s age and gender classification of BMJSC

Diagram 2: Employee’s classification by nature of work

Diagram 3: Chart of firm organization

Diagram 4: Procedure of salary calculation and paymentDiagram 5: Accounting Procedure for payroll

1 Format các đề mục, chữ nghiêng thì nghiêng hết, giống nhau chứ

2 Em đánh lại số cho Diagram nhé Phải là 2 chữ số giống như Table

In an economy, people are important factors, who are themain driving forces to create the productive forces Peopleare also considered a decisive factor affecting the speedand sustainable development of the economy, bring a lot ofvalue to the businesses One of the ways that thebusinesses commonly apply to attract and retain talents is

to set a reasonable salary and regime, suitable to thecapacity of employees

For employees, salary is a factor that helps to maintainemployee’s motivation to work, helps them to preserve and

to work more effectively For businesses, accuratelycalculating and allocating wages and salary deductions toproduction costs will help businesses offer more reasonableproduct prices, thereby creating competition in the market.Therefore, accounting for payroll and deductions play animportant role in accounting practices in any businesses From these points of view, I realize the importance of theaccounting for payroll and deductions I decided to choosethe topic “Accounting procedures for payroll and payrolldeductions at Binh Minh Joint Stock Company” for mythesis

The thesis includes three main parts as following:

Chapter 1: Features of labor, payroll and management oflabor and payroll at Binh Minh Joint Stock Company.Chapter 2: Current situation of accounting procedures forpayroll and payroll deductions at Binh Minh Joint StockCompany

payroll and payroll deductions at Binh Minh Joint StockCompany.

CHAPTER I: FEATURE OF LABOR AND PAYROLL AND MANAGEMENT OF LABOR AND PAYROLL AT BINH MINH

JOINT STOCK COMPANY

1.1 Features of labor and payroll at Binh Minh Joint Stock Company

1.1.1An overview of the company and company human resources.

Labor is an essential element in the process of productionand business activities of enterprises If an enterprise doen’ttake care of managing its labor which causes production andbusiness activities inefficiently Binh Minh Joint StockCompany (Binh Minh JSC) was established on 14 June 2007.thBinh Minh Joint Stock Company has its head office at theaddress: Group 8, Le Hong Phong ward - Phu Ly city - Ha Namprovince, main business lines are: mining and processingstone under business license number 0700249761 was firstregistered on June 14, 2007, and changed for the 5th time onJanuary 25, 2018, by the Department of Planning andInvestment of Ha Nam Province Up to now, there are 40employees divided into different departments suitable foreach specialist

Employees at Binh Minh Joint Stock Company are stable andwork full-time in accordance with Vietnamese law Each laborcontract between the company and the employee is required

to last for at least one year, if there is any termination of thelabor contract before the signed time between the twoparties, the employee and the employer will have to pay

labor at the company is quite young and have good health.The quarry manager must have a university degree or higher

in the technical discipline: chemical, ammunition, chemicaltechnology in propellants, explosives, engineering, mining,mining engineering, geology, construction Furthermore,miners must have worked in blasting service for at least 6months In general, workers and employees are eager towork, and comply with the regulations of the company

In recent two years, the Covid-19 epidemic has affected theoperation of the company Therefore, the revenue and theprofit have slowed down significantly However, the firm alsotried to pay and maintain the salary for employees Thedetail of employee numbers is represented as below:

Table1 1 : Number of employees at Binh Minh Joint Stock Company

The classification of department plays an important role inoperating and managing Each department will work moreefficiently and make better use of human resources Inaddition, the division of specific department will help theboard of directors to manage the business more effectively From table 1.1 above, we can see that the division of labor isbased on the nature of the firm's operations The enterprise

construction materials Therefore, the number of employees

at production engineering department are largest whencomparing with other departments in the company Theproportion of the numbers in delivery department stands atthe second position with ten workers The employees working

in these two departments are the workers working at thequarry They are the main workforce to generate revenue forthe business All of them need to have practical experienceand to be strong enough to work in a harsh environment like

a quarry

1.1.2 Employee classification by age and gender

All employees at Binh Minh Joint Stock company are enough age to workaccording to the prescribed law

Table1 2 : Labor’s age and gender classification of BMJSC

18 to under 30 30 to under 40 40 to under 50 50 and beyond 0

Diagram 1 : Labor’s age and gender classification of BMJSC

According to the table 1.2 and diagram 1.1, the workforce at Binh Minh Joint StockCompany is quite young which is mainly under 40 years old In which, the number

of men is up to 87.5% of the total number of employees In contrast, the proportion

of the female is small, standing at 12.5% They are mainly work in accountingdepartment It is easy to understand that the company operates in the field of stonemining, so it mainly needs male workers The workforce beyond 50 years oldoccupies small percentage as 12.5% They are all the men who have professionalexperience and long- term commitment to work

1.1.3 Employees classification by educational level

Table1 3 : Employee’s educational level classification at BMJSC

From the table 1.3 above, we can see that the classification of labor qualifications isvery diverse, including university degree, college degree and intermediate Withworkers who work directly with machine in the quarry, they must have at least 6-month experience The company only requires them to have intermediate level andabove These workforces mainly are at college degree and intermediate degree

degree is required, for chief accountants, a university degree is required In general,there is no difference in the distribution of labor between the three levels However,the intermediate level still accounts for the highest proportion with 40%, followed

by the university level with 32.5% and finally the college level with 27.5%

1.1.4 Employees classification by nature of work

THE CLASSI FICATI ON BY NATU RE OF WORK

Direct labors Indirect labors

Diagram 2 : Employee’s classification by nature of work

According to the nature of work, the labors at the firm are divided into 2 typesincluding: direct labors and indirect labors The number of direct workers accountsfor 75%, while the number of indirect workers is 25% Direct employees of BMJSCare workers working directly at quarries, material drivers, excavators, blastingworkers

That indirect labor is the cost of the staff that support the production process, butthat is not directly related to the conversion of raw materials into products intoproducts Therefore, indirect employees of BMJSC are employees such asaccountants, supervisors, security guards, cleaning staff…

cost of the firm It helps to organize the appropriate employment, timely pay wagesand salary-related payments to employees As a result, it stimulates employees topay attention to time and labor results, improves labor productivity, contributes tosaving labor costs and lowering product costs.

1.2 The forms of payment for salaries and wages applied in Binh Minh Joint Stock Company

1.2.1 The form of salary payment

Binh Minh Joint Stock company applies 2 main forms of salary payment: +) Time – based salary

+) Product- based salary

Time-based salary

Time-based payment is a form of salary payment to employees based on workingtime, salary grade (title) and salary scale (salary coefficient) This form mainlyapplies to indirect labor such as: accountants, supervisors, security guards, cleaningstaff… It is a form of salary payment to employees based on actual working time,professions and technical proficiency levels of employees

Depending on the industry, the specific nature of the job, the different salary levelsapply Professional technical proficiency is divided into many salary scales, eachsalary level has a certain salary level, which is the basis for salary payment, salaryover time can be divided

The company chooses the regional minimum salary according to the currentregulations of the State: 3,250,000 VND/month according to the Government'sDecree No 157/2018/ND-CP stipulating the regional minimum wage for employeesworking at enterprises, cooperatives, cooperative groups, household farms,individuals and other organizations that employ laborers

The lowest salary in the salary scale and wage table prescribed for workers must be

at least 7% higher than the regional minimum wage prescribed by the GovernmentThe company's salary scale and table for specific positions are as follows:

2 Accountants, workers, driver 1,12 1,18 1,24 1,3 1,36

Table1 5 : Salary scale by job title

Gross salary monthly: standard public day is the number of administrative days in

a month, according to regulations, this number of working days cannot exceed 26

days Monthly salary is calculated according to the formula:

Basic

salary Actual

working days

In a month

Salarypaid inonehour

Weekly salary is determined by the following formular below:

Daily salary: The salary paid to the employee is calculated according to the daily

salary and the actual number of working days in the month Daily salary is usually

applied to pay wages to employees who directly receive salary from time to time or

to calculate salary for employees during days of study, meeting, performing other

obligations as the basis for calculating social insurance

Overtime salary on working days = base rate for 1 hour *150%

Overtime salary on Saturday and Sunday = base rate for 1 hour * 200%

Weekly wage

=

x

Daily wage = Monthly salary

Number of working days in the month

Example: In October 2021, Mr Bui Van Tuan is a security guard at Binh Minh Joint

Stock Company The information about his salary is follow:

+) Daily salary under contract: 140,000 VND

+) In October, he has working days and overtime hours: 26 and 4 respectively.+) Meals: 710,000 VND/month

+) Phone bill: 800,000 VND/month

+) Gasoline fee: 500,000 VND/month

 Gross salary = 140,000 *26 + 4*(140,000/8) * 150% + 710,000+ 800,000 +500,000 = 5,755,000

Product – based salary

The form of product-based salary is the salary paid to employees calculatedaccording to the quantity and quality of the finished product or the volume ofcompleted work that has been tested and accepted In order to conduct product-based salary payment, it is necessary to establish labor norms and reasonable wageunit prices for each type of product and work approved by the competent authority.Gross salary

The form of product wages is divided into two types:

+) Direct product salary: the payment outstanding to workers is calculated directlyaccording to the quantity of finished goods with proper quality and the prescribedproduct salary unit price, without any restrictions

+) Indirect product salary: the indirectly workers are paid in production departmentsuch as the maintenance of machinery and equipment They do not directly createthe product However, they indirectly affect direct labor productivity Therefore,they are included in salary

Example: Mr Nguyen Xuan Duc is a crusher driver The salary’s information about

him in October 2021 is as follows:

+) The basic salary in the labor contract is 6 million VND

+) Product salary is the number of tons of rock he crushes in a month

+) In October 2022, the total tons of rock he completed are 26 tons

+) Meals: 710,000 VND/month

+) Phone bill: 800,000 VND/month

+) Gasoline fee: 500,000 VND/month

+) Paid on the 25 of every monthth

+) Standard working days are 26 days

Therefore, when we calculate the salary of Mr Nguyen Xuan Duc following theproduct- based salary, we have:

Gross salary in a month = 200,000 *26 +710,000+ 800,000+ 500,000 =7,210,000This value of gross salary is lower than the basic salary agreed in the contract,therefore, Mr Nguyen Xuan Duc will receive the gross salary following the terms inthe contract:

+) Phone bill: 800,000 VND/month

+) Gasoline fee: 500,000 VND/month

Furthermore, the employees are equipped with labor protection according toregulations and assigned work Specifically, each year: 02 sets of clothes, 01protective helmet; 01 pair of shoes

For the holidays of April 30 - May 1, each worker as well as employee will receive abonus of 300,000 VND

On Lunar New Year, each worker and employees will receive a bonus ranging from500,000VND to 1,000,000 VND depending on the position and the employees

‘contribution

The employee’s 13 – month salary is calculated according to the table below:th

1 Director, Deputy Director 8,000,000

For example, Mr Nguyen Xuan Duc is a crusher driver From the salary’s

information above, he will receive actual salary 7,380,000 VND per month (aftercalculating the salary deductions)

 The total actual salary he receives for 12 months:

1.2.3 The days off with full salary

Employees who have days off are entitled to full salary according to the provisions

of the Labor Code as follows:

+) National Day: take 1 day off (September 2 of the solar calendar)

+) Lunar New Year: 5 days off

+) Victory day: take 01 day off (April 30 of the solar calendar)

+) International Labor Day: take 01 day off (May 1st of the solar calendar)+) Hung King's death anniversary: take 01 day off (March 10 of the lunar calendar)+) New Year's Day: take 1 day off

+) Marry: take 3 days off

+) Marry children: take 2 days off

+) Birth parents, parents-in-law or parents-in-law die; spouse dies; Dead children get

3 days off

+) 6 months maternity leave

1.3 Policy of payroll deduction applied at Binh Minh Joint Stock Company

Binh Minh Joint Stock company has salary deductions including social insurance,health insurance, unemployment insurance, trade union fees The company'sinsurance deduction rate extracted from 2021 to 2022 is divided into 5 periods asfollows:

Type Charged by

employer (%)

Charged by employee (%)

 According to the provisions of Article 3 of the Law on Social Insurance:

"Social insurance is the guarantee or partial compensation of an employee'sincome when his/her income is reduced or lost due to illness, maternity, oroccupational accident, occupational disease, end of working age or death, onthe basis of contributions to the social insurance fund.”

 Insurance deduction rate in 2021-2022 is divided into 3 periods as follows Inthe period from January 1, 2021, to the end of June 30, 2021, the companydeducts social insurance fund at the rate of 25.5% (In which the company

the company deducts social insurance fund at the rate of 25% (In which thecompany charged 17%) And the last period from July,1,2022, to the end ofSeptember 30, 2022, the company deducts social insurance fund at the samerate as the first period and the company charged 17.5%.

 Expenses of the social insurance fund for employees according to the regimeare based on employee's salary, time off with valid document, and socialinsurance benefit rate

 At the enterprise, every month, the enterprise directly pays social insurancefor employees who are sick, maternity on the basis of valid documents At theend of the month, enterprises must settle with the social insurance fundmanagement agency

Health insurance:

 Health insurance is a subsidy for the prevention and treatment of diseases andhealth care for employees The insurance agency will pay the cost of medicalexamination and treatment at a certain rate prescribed by the State for thosewho have contributed insurance

 Enterprises must make deductions from the health insurance fund as follows:

 4.5% of the total salary fund of employees, in which:

- 1.5% paid directly by employees (deducted from their income)

- 3% to be borne by the enterprise (included in production and businessexpenses)

Unemployment insurance:

 According to Resolution 116/NQ-CP on policies to support employees andemployers affected by the Covid-19 pandemic from the UnemploymentInsurance Fund Following this resolution, the policy on unemploymentinsurance has had some changes The employer will be entitled to a reduction

of the contribution rate from 1% to 0% of the monthly salary fund ofemployees who are subject to unemployment insurance This period is within

12 months, from October 1, 2021, to September 30, 2022

 Unemployment insurance is an amount deducted to provide benefits toemployees who have lost their jobs According to Article 81 of the Law onSocial Insurance, the unemployed are entitled to unemployment insurancewhen fully meeting the following conditions:

- “Having paid unemployment insurance for full 12 months or more during thetwenty-four-month period before unemployment.”

- “Have not found a job after 15 days from the date of unemploymentregistration.”

- According to Article 82 of the Law on Social Insurance, “the monthlyunemployment benefit level is equal to 60% of the average monthly salaryand wages on which unemployment insurance premiums are based for the 6consecutive months preceding unemployment.”

- Employees pay 1% of monthly salary paid unemployment insurance

Trade union fee:

 Trade union funding is an amount which set aside according to a specifiedpercentage of the total actual salary payable to all employees in an enterprise

in order to take care of and protect the legitimate interests of employees and

at the same time maintain operations of unions at the enterprise

 According to the current regime, every month, 2% of the trade union fee isdeducted by the enterprises from the total actual salary payable to employees.Furthermore, the enterprise calculates the entire amount into the productionand business expenses of the employers

1.4 Feature of management of labor and payroll at Binh Minh Joint Stock Company

1.4.1 Binh Minh Joint Stock Company organization structure

Board of director: (BOD)

- BOD usually give independent and diverse perspectives They are responsiblefor performing the duties of strategic planning and oversight Besides, theyplay an important role in protecting the interests of the owners, exercisingcontrol over the operation of the management and administration apparatus ofthe enterprise In fact, in a joint-stock company, there is always a risk ofconflicts of interest between shareholders and managers In general, the board

of directors of a joint stock company will work as supervisor They have themain task of reducing the risk of abuse of power of managers and executives

At the same time, they also protect the legitimate interests of shareholders,especially small shareholders Besides, The BOD has full power on behalf ofthe company to determine all issues related to the goals and interests of thecompany Finally, BOD will control the operation of the enterprisemanagement and administration apparatus

General director: (GD)

- General director works under the authority of the board of directors Theydirectly run all day-to-day activities of the company In addition, GD plan

steps Next, they are also the ones who must ensure that the business operates

in accordance with the provisions of the law

Accounting department: (AD)

- Accountants need to perform economic and financial operations according tocompany policies and laws They also support the business departments interms of finance and accounting to realize the company's business goals.They are responsible for advising General Director in the field of finance andaccounting Besides, AD must collect and process accounting data according

to accounting standards and regimes Furthermore, Accounting Departmentexamine and supervise financial revenues and expenditures; classify andarrange accounting data in a systematic order

Safety committee:

- Urging, reminding and guiding everyone in the team, group, strictly observethe regulations on occupational safety and hygiene at work, while on duty,preserve equipment, use safely equipment, personal protective equipment,remind production team leaders and managers to comply with regulations onoccupational safety and hygiene

- Participating in the formulation of occupational safety and health plans,measures and working plans to ensure occupational safety and health;participate in instructing safe working measures for workers, newly recruitedemployees or workers and employees who have just moved from anotherplace to work in groups

- Requesting employees in the group to stop working to take measures toensure occupational safety and health, if there is a direct risk of causingincidents, occupational accidents or harm to the health of workers

- To recommend to the team leader or superiors to fully implement laborprotection regimes, measures to ensure occupational safety and hygiene, and

to promptly overcome phenomena that have not yet ensured safety andhygiene of the machine, equipment and workplace

1.4.2 Labor management organization at Binh Minh Joint Stock Company

- According to the nature of the business, there only one HR staff that isincluded in the accounting department The company's human resources staffwill conduct a recruitment program by posting recruitment information onwebsites Besides, HR also works as Timekeeper who regularly and periodicdeclare the number of employees and report to the Board of Directors

Chief accountant:

- Manage salary and remuneration fund, monitor activities of salary accounting

- Receive, monitor, check and supervise the determination of salary, bonus,remuneration and overtime funds

timesheets will be gathered at Finance – Accounting Department to calculatesalary and salary deductions for the employees.

Regulations on recruitment, probation and labor quality:

- When the company lack of employees or workers, the BOD will consider andapprove the request of the additional employees depending on the positionthat needs to be added Besides, there are also some requirements about thecandidate’s professional capacity and professional’s qualification It is truethat the company also find the candidates who are suitable for the culture andposition of the company Candidates after passing the interview round willhave to participate in professional training courses Every year, the companywill evaluate the performance of each employee to consider promotion andreward

CHAPTER II: CURRENT SITUATION OF ACCOUNTING PROCEDURES FOR PAYROLL AND PAYROLL DEDUCTIONS AT BINH

MINH JOINT STOCK COMPANY

2.1 Accounting for payroll at Binh Minh Joint Stock Company

2.1.1 Accounting documents

According to Circular 133/2016/TT-BTC issued by Military of Finance, Binh MinhJoint Stock company uses accounting documents for employees ‘salaries as below:+ Form No 01a - LĐTL: “Timesheet”: Timekeeping by factory or departments toprovide details of the number of working days for each employee by month.+ Form No 01b - LĐTL: “Overtime

+ Form No.02 – LĐTL: “Payroll sheet”

+ Form No 03 - LĐTL: “The bonus payment sheet

+Form No 05 - LĐTL: "Product confirmation note or completed work"

+) Form No 06- LĐTL: “Payment sheet for overtime work”

+) Form No 07 – LĐTL: “Payment sheet for outsourcing”

+) Form No 08 – LĐTL: “Contract assignment”

+) Form No 09 – LĐTL: “Minutes of liquidation of the contract assignment”+) Form No 10 – LĐTL: “List of deduction from salary”

+) Form No 11 – LĐTL: “Table of distribution of salary and social insurance”The following are specific examples of using documents related to labor and salary

of the company:

Example: On January 2, 2019, Mr Dinh Khac Lap signed an indefinite labor

contract with Binh Joint Stock Company in the position of mine executive director

the company:

Table 1.14: Monthly overtime timesheet in October 2021

Address: Group 8 – Le Hong Phong- Phu Ly – Ha Nam

overtime Social insurance Health Insurance Unemployme

nt insurance Normal

days Weeken

d days Holidays

1 Dinh Duy Toan 26 26 10,000,000 2,010,000 3 - - 216,346 800,000 150,000 100,000

2 Dinh Khac Lap 26 26 10,000,000 2,010,000 3 - - 216,346 800,000 150,000 100,000

60,790 40 20,176,0 00 3,783,00 0 2,522,000

24

Ha Nam, October 31, 2021

Preparer Chief Accountant

(Signature, name

Table 1.15: The payroll sheet in October, 2021

BINH MINH JOINT STOCK COMPANY

Address: Group 8 – Le Hong Phong – Phu Ly – Ha Nam

e (17%)

Health Insuran Unemploym ent insurance (0%)

Trade unions (2%)

Total (22%) Social Insuranc

e (8%)

Health Insuran ce (1.5%)

Unemploym ent Insurance (1%)

Total (10.5%)

0 5,044,0

00 55,484,0 00 20,176,0 00 3,783,0 00 2,522,000 26,481,0

00

Unit: VND

Ha Nam, October 31, 2021

Preparer Chief Accountant

(Signature name)

( Source: Accounting department of Binh Minh Joint Stock Company)

26

Table 1.16: Statement of salary and salary deductions allocation in total

Binh Minh Joint Stock Company

Sample 03 – LDTL

Accounting (Issued

in accordance with Circular 133/2016/TT-BTC

August 26, 2016, of the Minitary of Finance)

BONUS PAYMENT SHEET

For new year 2022

0

027

(Signature, name) (signature, name) (signature, name)

(Source: Accounting Department of Binh Minh Joint Stock Company)

Table 1.17: Bonus payment sheet for new year vacation

28

There are 7 steps in the procedure of salary calculation and payment:

Step 1: The head of department will work as a timekeeper They are responsible for

monitoring and timekeeping for each worker daily At the end of the month, thetimesheet will be sent by the head of department to the HR staff

Step 2: After receiving the timesheet from the head of department, the HR staff will

check it again to make sure that the total hours worked, and the number of jobs isaccurate Then, the results are sent to the payroll accountant

Step 3: The salary accountant will calculate and make a table of salary payment, bonus

and deductions which are sent to the Chief Accountant

Step 4: There are two cases when the Chief Accountant approves and signs the payable

salary:

Case 1: The Chief accountant checks again the payroll and agrees with it, then the

payroll will be sent to the director for approval

Case 2: If the Chief accountant finds something wrong in the calculation the payroll,

then the payroll will be returned to the salary accountant to modify

Step 5: The salary accountant will make payment vouchers and record salary payment Step 6: The cashier relies on the check and pays employee’s salaries.

Step 7: The salary accountant will keep the payroll sheets and payment checklist in the

accounting storage

2.1.2 Method applied for payroll calculation

As I mentioned in chapter 1, Binh Minh Joint Stock Company uses 2 main methods tocalculate the salary and payroll:

+) Time – based salary

+) Product-based salary

2.1.2.1 Time-based salary

The formula as well as the calculation method I mentioned quite specifically in chapter

1 I’ll go deeper into the advantages and disadvantages of this method

Advantages:

It is easy for accountants to understand, easy to calculate and easy to implement

Applying this form of payment, employees do not have to run following the number ofproducts, so they have more time to be creative, accumulate experience, and invest inthe quality of work

Disadvantages:

In many cases the amount the worker receives is not directly related to his or hercontribution of labor over a given period This shows that the inaccuracy and fairness

of this form of time-based pay may not be guaranteed

Example: Mr Dinh Duy Toan is a manager at Binh Minh Joint Stock Company

+) The basic salary in the contract is 10,000,000 VND/month

+) Meals: 710,000 VND/month

+) Phone bill: 800,000 VND/month

+) Gasoline fee: 500,000 VND/month

+) Paid on the 25 of every monthth

+) Standard working days are 26 days

In December,2021 (Table 1.12), Mr Dinh Duy Toan has actual working days is 26days The formula to calculate the actual salary for Mr Dinh Duy Toan is below:

month

+(Overtimehours

X

Salarypaid inonehour)+ Allowance