Bulk of personnel information is generated by the accounting department and within the personnel department itself. Besides, other departments and the external environment also make their contribution. This information can be generated both internally and externally. Apart from internal generation, the external information sources for the personnel function would include employment agencies, labour unions, various governmental agencies, university placement offices, etc.
The Accounting Information System: Payroll processing is the traditional channel of personnel information. The human resource accounting, through hardly prevailing in the Indian industry, can be another new channel. Finally, cost estimation for wage negotiations is another accounting information for the personnel function.
Payroll Processing: The inputs to payroll processing are the job tickets and the clock cards. The latter indicates the total number of hours an employee spends at work each day. This document serves as the basic input to the payroll calculation and pay slip preparation function. The job ticket is used to reconcile the timing on the clock card and to compute various job statistics discussed below. For payroll of clerical, salaries and sales employees, the job time card is not used as the related expenses are not charged to production in process. However, where it is desired to charges expenses to such specific project as sales promotion, a job time card may used. For salaried employees, the monthly gross pay is a known constant and for salesmen paid on commission basis, sales data are required for payroll processing. Besides, such adjustments as additions, deletions, amendments, etc. constitute another class of input data for payroll processing.
The basic output of payroll processing is pay slip and pay cheques. Reports of statistical nature are also compiled. Take a production operation for example. The average time spent by each employee on it may be computed and the grand average derived there from. This is comparison to the standard time derived by yield – the efficiency with the operation is being performed. Likewise, the efficiency of an individual employee can be established. This would be a weighted average of his efficiency in all of the various operations he has performed. Such statistics when aggregated over a department provides the departmental efficiencies. These measures can be used to evaluate the performance of the departmental foreman. If a standard cost system is in use then labour cost variances can also be computed.
Other types of possible reports and analysis are listed below:
a) Reports on absenteeism
b) Analysis of indirect labour by the cost of inspection, material handling, maintenance, etc.
c) Reports on actual standard costs by department.
d) Analysis of overtime pays by departments, fringe benefits, salesmen commission, etc.
e) Such statistical measures as total number of employees, total hours worked, total labour cost, average wage rate, rate of absenteeism, turnover and total fringe benefit costs. These may be statically analysed for trends and correlation etc.
Cost Estimating/or Wage Negotiations: The management has the choice of trade-offs on the following variables during negations with the labour unions.
Wage raise
Paid holiday
Contribution to employees, insurance and pension plan
Overtime premiums etc.
Cost accounts/payroll accountants would be in the best position to make various estimates for the cost implications of trade-off.
The Personnel Department itself generates a great deal of information in the form of personnel files and job specifications. The former would include such data about each employee as below:
Physical characteristics
Educational background and experience
Payroll information
Quantitative and qualitative evaluations of his past performance
State of health and medical history
Result of tests of ability fund aptitude, etc.
Such information is quite useful for placement of employees for various positions, promotions etc. The job specification, details of the training and experience for each job. Other information generated within the personnel may include aggregate safety and accident statistics, forecasts of manpower requirements by job category within the organization, records and statistics of training programmes, health services, etc.
The departmental supervisors provide useful information about their employees in their merit evaluations, as also information about manpower requirements of their departments. The merit evaluations would throw light on personality, initiative, attitude, judgement, character etc. of the employees.