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M
megsyb82
September 6, 2023
Question

Employee's Confidential pay Information in Income statement

  • September 6, 2023
  • 3 replies
  • 0 views

We just started using Quickbooks payroll and noticed that detailed, individual employee gross pay data is reflected in the detailed income statement (as well as taxes and benefits received). This information should not be in an income statement, only a summarized total / nothing personally identifiable. Because these are entries created automatically when payroll is run, I do not know how to change this or even delete the information (and revert to a manual journal entry to get the data into the financial statements without listing personal information). Any tips? I've tried QB Support and contacted our QB Payroll Expert, but no one has any solutions. Thanks in advance for any help!

3 replies

J
JamaicaA
September 7, 2023

A warm welcome from your QuickBooks family, @megsyb82. I understand that you want to remove the employee gross pay data along with their taxes and benefits on an income statement report. I'm here to share some clarification of the information shown and tips for you.

 

The income statement or the profit and loss report forecasts business growth. It contains revenues, gains, gross profit, expenses, losses, and net income or loss. 

 

The entries created when running payroll depend on the information shared in the program. This includes wages, taxes, and contributions. Therefore, deleting or reverting to a manual journal entry to clear the listing of personal details is unavailable.

 

Not to worry, you can consider running a Profit and Loss report to look at your proceeds and losses over any period you like. If you're interested in tailoring it according to your needs, refer to this article: Customize reports in QuickBooks Online.

 

It is important to me that I answer your question and share tips regarding reports in the program. If you have any other concerns related to QuickBooks, you can always return to this thread. 

M
megsyb82Author
September 7, 2023

It is very uncommon for any personal payroll information to be reflected in financial statements. I've been an auditor for 20 years, and not once have I seen a financial statement with this level of detail. All detailed payroll information (like an employees gross pay) should remain in the payroll module / payroll subledger and should never be recorded into an income statement. A typical journal entry to get the necessary information into your financial would be just the totals:

 

Similar to:

Total Employee gross pay (or net pay+ee taxes)

Total Employee Benefits

Total Employer Tax Expense

       Cash - total net pay

       Cash - total tax payment

 

QB does the following:

Joe Gross Pay

Sally Gross Pay

Tom Gross Pay

Joe Benefits

Sally Benefits

Tom Benefits

ER Tax Expense

     Cash - Sally Net Paycheck 

     Cash - Joe Net Paycheck

     Cash - Tom Net Paycheck

     Cash - Tax payment

 

Now any employees who have been granted reporting access in QuickBooks can see everyone's gross pay by running any standard Management reports (Income Statement, Balance Sheet, etc). Note: these individuals were NOT giving Payroll Reporting access in QuickBooks, but because of how QB Payroll is recording the payroll journal entries with individual employee details, they are able to view ALL this information without being authorized to view payroll reports (gross pay, any benefits provided, net pay). This is a pretty fundamental flaw of QB payroll.

C
cpm88
November 21, 2023

Were you able to find a solution? I am experiencing the same problem!

M
megsyb82Author
November 22, 2023

Unfortunately there is still no resolution to this. I've spent hours with their support team to try to find a resolution, but no luck. Mostly they just told me they built the platform intentionally to "have everything easily accessible in one place" - so maybe there isn't a single auditor/CPA/data privacy practioner among them?! 

 

The only solution they really offered was to get training on how to customize the "reporting access" role to greatly limit what reports they could generate to only very generic/high level reports (which is a non-starter as our reporting users need reports with actual details in them...), and also to not give anyone else access to any other roles if they shouldn't see the personal employee pay information (also a non-starter as some folks do need access to financials but should not have access to all employee pay info). Pretty shocked and frustrated at how absurd this is!

R
RO999
January 26, 2024

How did you turn off the automatic journal entry from payroll? I too have spent hours on the phone with help line with no resolution, was thinking I would have to buy a separate instance with payroll and only run payroll through it, then do a journal entry import into the main instance of Quickbooks, thanks

 

AldritchM
AldritchM
January 26, 2024

Hi there, @rafael-allameric.

 

When using the payroll service with the QuickBooks Online program, is a part of how it works. Unfortunately, there's no way to turn it off. Also, QuickBooks will make an automatic journal entry if you make a tax payment, run payroll, and corrections like voiding paychecks. 

 

I'd recommend contacting our payroll team if you need corrections or if the amount is not correct. You can check this article when is the best time to reach them out: Contact Payroll Support.

 

Additionally, Here's an article to know more about payroll accounting: Payroll accounting preferences.

 

If you have more questions about managing your payroll or banking, don't hesitate to click the reply button. I'm always around to help! 

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