Human Resource and Payroll Segregation of Duties Policy

Responsible Unit: Finance |Executive lead: CFO 
Created: 1/1/2008 | Reviewed/Revised: 5/2011; 6/2015; 10/2017; 1/27/2023 | Effective: 1/27/2023  
Compliance: NWCCU 2.F.1
Approving Body: BOT | Classification: Operational  

Policy:  
The purpose of this policy is to address the segregation of duties between Human Resources and Payroll. 

Segregation of duties exists between authorizing/hiring and payroll processing. 

Pay rates shall be authorized by the HR Director.  Any raises outside the standard percentage increase shall be reviewed and approved by the President (or his/her designee) or Compensation Committee. 
  
There are no advances allowed to employees.  Any non-routine payments to employees shall go through the same authorization process as normal increases. 
  
It is also the policy of the University to allow scanned copies of HR and payroll-related records to be considered as the original. 
  
Timecards shall be prepared bi-weekly for all hourly employees and for salaried employees utilizing paid time off (PTO).   Timecards are approved by the immediate supervisor or their designee. 
  
Employees shall authorize all voluntary deductions in writing, by email, or via the self-service portal. 
  
Payroll software will be utilized to accurately calculate gross pay and related employer obligations. 
  
The university shall utilize payroll software that classifies employees based on the department in which they perform services.  All related expenses shall be coded to the appropriate GL account by the payroll administrator. 
  
All payroll payables shall be accrued in the general ledger. The university utilizes appropriate payroll software to calculate employer expenses related to wages, taxes and benefits. 
  
Payroll accounts shall be reconciled monthly by personnel independent of check processing and check signing.  All transactions shall be recorded in the appropriate period. 
Shape 
IC1 – Hiring of employees is authorized by someone other than the individual responsible for changing the payroll master file. 
IC2 – Employee pay rates are authorized. 
IC3 – Advances and non-routine payments to employees are authorized. 
IC11 –     
IC4 – Hours worked (including overtime) are authorized, and the authorization is appropriately documented. 
IC6 – Hours are accumulated accurately, and are accurately processed. 
IC5 – Voluntary deductions are authorized by the employee, and documentation of such authorization is maintained in the employee’s personnel file. 
IC7 – Gross pay and related employer obligations are calculated correctly. 
IC8 – Payroll cost is recorded in the appropriate general ledger account(s), including specific operating expense, inventory, capitalized assets, and other accounts. 
IC9 – Unpaid payroll related amounts are properly accrued in the general ledger. 
IC10 – Payroll bank accounts are reconciled on a timely basis, by someone other than the person responsible for adding new employees or changing the payroll master file. 
 
Definitions: 
N/A 
 
Procedure: 
N/A 
 
Related documents: 
Payroll approved designees 
Executive Compensation Policy 

Policy Resources

For assistance with policies and procedures contact:

Lori Fulton
lfulton@pnwu.edu