It does not come as a surprise that many small business owners in Singapore tend to merge payroll with account payable of their companies. Both payroll and account payable are the major expenses, a business accrues in an attempt to increase the productivity but has not yet paid to the employees and suppliers or vendors respectively. Despite the fact that these expenses share some common features, they do have some differences. So, savvy business owners with the help of accounting services Singapore keep the both accounts separate to maintain a clear and organized financial record.
What is Account Payable in Singapore Accounting?
Account Payable (AP) is an aggregated amount owed by the business owners to their vendors for the goods and services they had received in advance. It is shown as a current liability in the balance sheet of a company. The balance in Account Payable is a precise amount that accompanies with supporting documents like invoices, agreements, etc.
What is the role of Payroll in Singapore Accounting Services?
Payroll is the cost that is being paid to an employee as remuneration for his contribution towards the productivity growth of the company. The payroll liability includes expenses and payable accounts such as salaries, wages, taxes, and withholdings, etc.
Although you do not need to be an accounting expert to handle payroll activities, it is considered to be one of the aspects of accounting services in Singapore. It involves the tasks such as calculating salaries, tax deduction, CPF contribution, and so on.
Why to Outsourcing Payroll Activities to Accounting Firm Singapore?
Singapore payroll services is not an easy task to handle. You must have an adequate and updated knowledge on the tax laws of the IRAS (Inland Revenue Authority of Singapore). You might have to face penalties of IRAS if it is not done correctly. There is no way to escape from the penalties of the strict authority. So, it is better to do the things in a proper way right from the beginning. You may hire an in-house payroll consultant or outsource it to a good accounting firm in Singapore. Technically, outsourcing has been proved to be more beneficial for small and large organizations alike.
Benefits of Outsourcing Payroll Services to Accounting Services Singapore:
The experts stay abreast with the ever-changing tax laws and help in being compliant with IRAS.
When you entrust your payroll task to an accounting firm, you can rest assured that your payroll processing is in safe hands.
You will have control over the payroll tasks as the experts will keep you in the loop, let to know where you stand.
Outsourcing saves time and cost that you may use in marketing and expansion of your business.
Timely and accurate payment of salaries to the employees will boost their morale and confidence, which will drive them to work more sincerely.
There will be no more fear of getting fines and penalties of IRAS. You will have peace of mind.
Lastly, the possibilities of inaccuracy in payroll increase when you integrate it with Account Payable of your company. It is better to keep both the accounts apart for numerous reasons. With the emergence of accounting services Singapore, the companies are trying to make their financial statement reports more accurate and transparent, by keeping both the aspects separate. It leaves no room for mistakes or errors.