Final Settlement Module FAQ#
What is Final Settlement in payroll?#
In payroll processing, when an employee leaves the company he has to get paid for last working month. This procedure of paying or recovering while resign process is called final settlement. Final settlement can be done on the last working payroll month or subsequent months. The employee can be settled first and then resigned or you can resign an employee and do the final settlement at a later date.
How does a employee's name get added in the final settlement module?#
When the employee is marked as Resigned or as Left Organization his name will automatically appear in the list of employees who need to be settled. You can also mark an employee as settled by selecting his name in the Salary Information -> Entry page and marking him as Settled in the Final Settlement page.
Is it possible to do final settlement without resigning the employee?#
Yes. You can mark an employee as Settled without resigning the employee.Is it possible to do final settlement more than once for an employee?#
Yes. This process is called resettlement. This feature can be accessed through the Final Settlement screen.Is the Leaving Date in Final Settlement module different from leaving date of resignation module?#
No. Both date are same. If you change leaving date in one place, then the other one will get updated automatically.What will happen to loan balance of the employees when you settle them?#
Entire loan balance will be deducted automatically during the final settlement process. This amount will appear under the specific loan component under Deductions.Will the income tax module project the tax for the settled employees?#
No. Since the employee is leaving, tax is not projected for him during the final settlement process.What is notice period payable?#
The difference between notice period and number of days worked in the last payroll is called notice period payable. This is applicable to companies that have a defined notice period for resigned employees.What is Leave Encash days?#
If the employee has a leave balance, he can encash that leave. The number of days of leave that can be encashed is called Leave Encash days.Will the final settlement module compute the salary based the number of days in month of leaving date?#
Yes. By default the payroll software is configured to calculate the salary based on the number of days in the month of Leaving.For e.g. If a person has resigned in the month of April and you are processing the final settlement in the month of May, then the salary will be calculated on a base of 30 days.
Why is the leaving date of the employee mandatory while settling the employee?#
Based on the leaving date only, the payroll software will calculate the number of working days, unclaimed balance of Reimbursement components and reimbursement balanceHow do I generate the final settlement report?#
Click on the _Print Settlement_ button on the Final Settlement tab of Salary Information.When we go to final settlement module and try to calculate the number of days worked, the computed value seems to be wrong. For example, if we enter 31 days in the month of August and 12 days in the month of September then the total no of days worked should be 43 days. Instead it is showing 42.8 days.#
The payroll software prorates the days worked on the basis of total number of days in the month (30/31 days). This can lead to fractional values as mentioned above.
Assume an employee has worked 31 days in August and 12 days in September. In Greytip Online, we will be dividing this by number of days, which is either 30 or 31. The decimal is to adjust this. So it is normal for the decimal to appear.
If you are doing final settlement in September and paying for August also, then the number should be less than 43, because if you are doing final settlement in September month, then the division factor is 30, so the number should be less than 43.
If you are doing the final settlement in August itself, but paying for additional days in September in the settlement that you are doing in August, then you will need to manually put the correct working days value.