The risk of making an error in funds held for clients ranks high among the worries that keep payroll business owners awake at night.
There's good reason: regulations are complicated, frequently changing and varying from state to state. Reconciliation is a moving target that you are expected to hit dead on, month after month. And when your clients' businesses grow to include employees working in more than one state, the targets multiply. Deadlines for both reporting and depositing are different from jurisdiction to jurisdiction... plus the penalties for failing to hit any one of these moving targets can be severe.
It's little wonder that so many CPAs and other payroll providers increasingly rely on a combination of specialized software and outside expertise to manage. It's just too easy to make mistakes – to over or under-collect and end up with a funds held for client account that is out of balance.
Do You Know Where Your Client Funds Are?
Not all systems for funds held for clients are equal. Depending on how they are managed, an unbalanced client account can go unnoticed as new funds come in to cover older obligations. Eventually, this can lead to a disastrous shortfall.
If such a scenario falls outside of your tolerance for risk, consider your options. A bank will hold and transmit payments for you, but generally will not reconcile beyond the account level. That creates an opening for unnoticed errors. As long as there's enough money coming in, problems at the level of a specific client can go unrecognized for months or longer. For many payroll providers, that's not an acceptable risk.
What Could You Do if You Didn't Have to Worry about Reconciliation?
That's why we developed Quantum reconciliation solution. Quantum automatically reconciles your accounts client by client – down to the penny.
Quantum accounts are reconciled daily – imbalances have nowhere to hide. Quantum also gives you the control of depositing payments by ACH credit, letting you control when funds are released, as opposed to debit accounts in which agencies reach in and pull funds out.
That can seem like a convenience until a mistake is made and the government accidentally debits too much.
Backed up by top-notch service and our patented double-entry accounting process, Quantum also provides you unmatched visibility into the status of your accounts with detailed reporting, including out-of-balance reporting and notifications. Our Quantum clients also earn credits – typically higher than those offered by banks – to offset fees.
Is Automated Payroll Reconciliation Right for You?
While some restrictions apply, many of our clients find that Quantum is the time and stress-saving solution they need to get back to business and stop worrying about reconciliation. If you could use a reconciliation solution that does more for less, contact us and we can help you determine if Quantum might be a fit for you. Cachet clients also have access to additional solutions provided by our sister companies, Payroll Tax Management, Time Rack and SBS Payroll.