Académique Documents
Professionnel Documents
Culture Documents
October 2008
i
TABLE OF CONTENTS
Table of Contents i
List of Appendices iv
Acknowledgement v
Abstract vi
1. 0. INTRODUCTION 1
4.3. Inputs 31
4.4 Processes 32
4.5. Files 35
4.6. Outputs 38
5.3. Scope 45
6.1. Inputs 49
6.2. Processes 52
6.3. Files 55
6.4. Output 59
7.0. IMPLEMENTATION 61
7.2.4 Testing 65
8.1 Conclusion 67
8.2 Recommendation 68
Appendices
Bibliography
iv
LIST OF APPENDICES
D. Normalization 81
E. Screen Shots 85
v
ACKNOWLEDGEMENT
The proponents would like to express their deepest gratitude to those who helped
Huge thanks to their parents for a lifetime love and support and for providing
Their adviser, Ms. Sherry Bautista, who has been there from the start to guide,
Ms. Maryli Rosas and Ms. Marilyn Bansagan for their remarks
ABSTRACT
Noveleta Municipal Office is located at Noveleta, Cavite. Currently, the Municipal Office
has 200 employees who are categorized into two types: Regular Employee and Employee with
Job Order. They use manual system for their payroll. Because of the numerous employees
working in the municipality, they have difficulty computing the salary for every pay period.
Thus, an automated payroll system was proposed to improve their manual payroll process.
Network-based Payroll System for Noveleta Municipal Office was developed to provide
accurate and efficient salary computation. It aimed to lessen the work done and time allotted in
doing the payroll. It provides security and easy file maintenance. It also generates necessary
reports.
The proposed system was developed using Microsoft Visual Basic.net programming
language, Microsoft SQL Server 2005 for the Database, and Crystal Reports v.9 for the report
generation.
CHAPTER 1
Introduction
different purposes are used to cope up with the modern world. One of the systems that are being
developed is the payroll system which involves the process of salary computation.
During the early years, Noveleta was a barrio of Kawit. Its restful atmosphere, brought by
the sea, wind and beautiful sunset, and complemented by its warm, hospitable, amiable people
had both attracted vacationers from all places. Through the years, Noveleta’s population
increased considerably. This prompted Gov. Gen. Jose Gandara to have it separated from Kawit
Currently, the Municipal Office has 210 employees who are categorized into two types:
Regular Employee and Employee with Job Order (EJO). Regular Employees are those included
in the Plantilla Positions and receive benefits, while EJO such as the Street Sweepers and Office
Clerks are those who do not receive benefits. Regular employees receive PERA, 13 month pay,
ADCOM, clothing allowance and Productivity Allowance. Added benefits such as the RATA,
Travel Allowance and Cash Gift are given only to the Office Heads. Employees under the offices
of Department of Agriculture, MSWD, and MHO are also regular employees but they have
different computation because their salary is specified by their National Office. MHO receives
Regular employees are given different kinds of leave, namely: vacation leave, maternity
leave, force leave and sick leave. They are allotted with 1.25 days of allowable leave per month.
2
If the point is not fully consumed within the month, it is added to points allotted for the
succeeding months.
The deductions from the salary of each employee are Philhealth, GSIS, Withholding tax,
The current payroll system is done manually. It passes through different offices, namely,
HRMO, Treasury and Accounting. HRMO is in charge of the attendance record of employees.
They compute for the absences, tardiness, over time, and under time of each employee. The
accounting office computes for the deduction of each employee and produces copies which are
given to the treasury office. The treasury office handles the computation of salary and uses MS
Excel to compute and stored data. The basic salary given to the regular employees depends on
their position. For the regular employee, there is a corresponding rate per position. For the
Employee with Job Order, the Mayor approves the submitted proposal of salary rate given to
them. Salary is distributed every 15th and last day of the month. The working days counted for
the computation of salary every 15th day start from the 26th day of the previous month until the
As one of the government offices, Noveleta Municipal Office should offer good service
for their constituent. In order to provide this kind of service, a computerized system is needed.
3
Using the current Payroll System, Noveleta Municipal Office encounters problems such
Attendance monitoring. HRMO uses DTR for attendance to log in and out of work.
Problem arises when employees ask their co-worker to log their name even if they are not yet
really in the office. There is no way to know if employees really work that day and time.
Data redundancy. The current payroll system is done manually, in effect; there is a need
for more paper works. Printed copies of documents are sent to offices involved. Different offices
hold copies of the documents, so that when the documents have to be updated, all the copies
Complicated interface. The Treasury Office uses MS Excel Application in their payroll
system. It is where they input necessary data for the computation of the salary. The complicated
interface of the application plus the large number of data to be inputted makes it hard for the
person in charge to do the work faster. This particular problem results to slow payroll process. It
Miscalculations. The establishment has 210 employees, which means 210 salary
computations. All of their salary has to be manually calculated first using the calculator, before
inputting and saving the data to MS Excel. Calculating all the employees' salary is not easy. It
takes a lot of time and effort. There are times when the person in charge of the computation gets
confused with the numbers or inputs wrong amount, which leads to errors and inaccurate
financial transactions.
4
Maintenance. The treasury office uses only one computer only for data storage. All
computations are saved in that computer without other back up. The problem is, when the
persons can easily view important files from the computer and alter some data without others
noticing it.
General Objective:
The main objective of this study is to develop and implement Network-based Payroll
Specific Objectives
2. To conduct interviews from the persons involved and observations from the
company.
3. To determine the problems of the company regarding their current payroll system.
5. To develop prototype of the system and gather feedback from prospective users
6. To help the municipality become updated to the modern world using the system.
Municipality. The system would help the municipality in coping up with the rapid
advancement and development of technology. It will impose good and high technology.
Treasury Office. It would help the office in monitoring the salary records of all the
employees. Through the use of this system, they can access records, compute salary, update
records, and generate reports easily. It will also help them by saving time and effort.
HRMO. It would lessen the work load of the HRMO. Manual computation of rendered
hours is no longer required because data will be directly inputted into the system. Due to this, the
Employees. This system would help employees in monitoring their salary records. Using
the proposed Payroll System with Online Viewing, they do not have to worry with misplaced pay
Proponents. The researchers will gain knowledge about the business system existing
inside a municipal office, with this; skills in system analysis will be improved. Theories learned
inside the classroom such as DFD, Normalization and Networking will be applied in real setting/
situation.
Future researchers. They would be aware of the recent process in payroll system. Also,
this study would serve as reference for other students and researchers.
6
2
This study deals with the Payroll Processing. It covers up all the transactions for all types
of employees. There will be access level that caters different types of user. Each access level has
its own access rights. Instead of DTR, Biometrics would be used for recording attendance,
through this; attendance can be monitored by the system. Employees would place their index
finger on the scanner to record the time they start and finish work. The scanner would be
connected to the system, to access the attendance record, which would be used for the
computation of salary. The computation of salary would be included in the system. Accurate
calculations would be done in order to come up with the correct amount of salary. Computations
of salary includes Basic Pay and allowances (ADCOM, clothing allowance, cash gift, Hazard
reports, maintenance, back-up and recovery would also be included. Reports given to accredited
agencies such as Unlad Bank, GSIS, BIR, Philhealth and Pag-Ibig are incorporated in the system.
The system that the proponents has to developed does include the hiring of the
applicants. Though, data inputs for new employees will come from the HRMO. Application and
computation for external loan are also not included in the system. The proposed system can not
The system follows a series of step-by-step process in order to finish the system and
attain its objectives. Techniques and tools were used in each step for the development of the
system.
The proponents used the V-Model as guideline to develop the system. The V-model is a
software development model, which can be presumed to be the extension of the waterfall model.
Instead of moving down in a linear way, the process steps are bent upwards after the coding
phase, to form the typical V shape. The V-Model demonstrates the relationships between each
phase of the development life cycle and its associated phase of testing.
The V-model deploys a well-structured method in which each phase can be implemented
by the detailed documentation of the previous phase. Testing activities like test designing start at
the beginning of the project well before coding and therefore saves a huge amount of the project
Model include:
Acceptance
Systems Testing
Design
System
Verify Testing
Program Design
Design
Unit and
Integration
System
Coding
8
2
Requirement Analysis. This phase is concerned about understanding the situation of the
company and identifying its problems that had been the cause for the proposal of a new system.
In this phase, the proponents conducted interviews and observations from the company persons
involved. In doing this, problems encountered using their present system were identified and
System Design. In this phase, the proponents created a system design that would provide
solutions to the problems encountered by the current system of the municipality. This includes
the detailed description of what the system can do. It is also in this phase where proponents used
DFD, ERD and Normalization in order to visual the flow of data and processes.
Program Design. The proponents used VB.net to create a program that would access the
database locally. Then ASP.net will be used by the employees to view their account online. SQL
was used as the database. In attendance monitoring, biometrics using finger print scanner would
be used.
Coding. Next phase would be the program coding. The proponents determined what
modules must be included in the system. One by one, the module was created showing specific
purpose.
Unit and Integration Testing. In this phase, the proponents made an independently
working system module. They followed the concept that the program and data are intimately tied
to each other. They tested each module on its own and see if the modules could work on its own.
System Testing. In this phase, the proponents made sure that there were no conflicting
modules and it ran as one system. They entered sample data and checked if every module
worked as expected.
9
2
Acceptance Testing. In this phase, the proponents will demonstrate to the company how
the proposed system works. They will let them try the system and ask their comments and
feedbacks.
Operation and Maintenance. In this phase, the proposed system is implemented to the
company. The system is in full operations. Transactions and maintenance module is in function.
CHAPTER 2
Related Literature
make it easy for a company to do their internal and external transactions and it can be linked to
other computers. Payroll system is one of the many transactions that are being worked on
computer. The proponents worked on a custom-made payroll system done for the specific need
of the company. The proponents searched on related literature that would aid in developing an
effective payroll system as one of the research processes followed. The related literatures are as
follow.
Dayrit, 2007
AHNEX Builder Network – Based Payroll System was designed for the newly set-up
AHNEX Builders. The company is currently using Microsoft Excel in computing net pay which
is time consuming. This proposed system will help in the work of the users in an easier process.
Visual basic 6, Microsoft Access, and Crystal Report 9 were used for designing and creating the
system. This was designed to meet the requirements of the company for a better and more
enhanced system. Keeping track of record of employees, computing the salary and wages of each
employee and generating reports were included in the proposed system. This automatically
computes the basic pay of each employee. Contributions like PAG-IBIG, Philhealth, withholding
taxes were also included in computing the payroll. The main objective of the proposed system
11
was to develop a system in a more accurate efficient and secured data. The proponents would
like to help the management and accountant for well-organized and efficient payroll.
The proponents found out that computerization of the payroll process of all payroll
transactions in the company including the maintenance module is feasible. The related literature
about AHNEX Builders’ payroll showed a common problem. They use Microsoft Excel in
computing net pay that makes the computations time consuming. The proponents are to design a
system that generates report, keeps track of files and information, and computes employees’
monthly salary. The proposed system includes the deductions of withholding tax and GSIS
contributions/remittances.
A. Reyes, 2000
JBC Engineering specialist’s Payroll System was created by the proponents in order for
the company to have a better way in computing their payroll. The proponents were able to
modernize their system by computerizing their manual tasks such as record keeping and
computing their payroll. A database was added to the system so that the company would not
have to rely on papers to store valuable information about an employee. The database system
interfaces with an operating system to set-up, update and retrieve data items from a database
organized as single logical and physical unit. This also helps them track of the progress of an
employee. Another advantage of the new payroll system is in generating the payroll slips, which
is printed out by the computer. The payroll slip contains all the information on how the
computation arrives on the Net Pay amount an employee receives. The system also boasts of
security maintenance so that only limited people is given access to the files. The proponents’
12
main objective in developing the system is to make the company’s current manual system better
The proponents created a computerized payroll system that will add a database into the
system which is likely the same as with JBC Engineering specialist’s Payroll System. The
system lessens the use of paper outputs and paper filings. The proponents created a database the
can easily be selected, inserted, updated and deleted, so maintaining their system will be a
breeze. They added a print friendly reports generated through the system like pay slip for
example. Included in the system is the security module that gives access to the priority user of
the system and that a certain user will have feature designated to him.
L. Gawaran, 2007
The current payroll system of Citimotors Las Piñas is prepared manually. Noticeably, it
has an array of disadvantages. That is why a Network-Based payroll system for the Citimotors
Las Piñas was proposed to facilitate fast and easy preparation of its payroll. The proponents
made sure that the system would be user friendly. It assures that its features and functions are
simple hence, easy to understand. But it boasts of security maintenance that ensures limited and
regulated accessibility. Furthermore, the proponents’ objective is to make the company’s current
The proponents developed a system that is a network based payroll system that will
link/network 3 offices that handle the whole payroll processes namely the HRMO, Treasury
Office, and the Accounting Office so that it will be easy for the 3 offices to transfer information
and files. In comparison with the system done by J. Gawaran, the proposed system is a
13
networkbased feature and its design is developed with a user-friendly interfaces and has all the
features that meet the specific need of the company. Accessing the system will be easy to give an
efficient help.
L. Lardizabal , 2005
The Dasmariñas Municipality Payroll System (DMPS) was designed to address the
existing inefficiency and inaccuracy of its present system. There are problems encountered like
loss of files and data, slow process of salary computation, difficulty in retrieving and maintaining
of records, vulnerability of the data to be lost or misused, and overall security of the payroll
process. The main objective of the DMPS was to provide the municipality with a more
convenient and more reliable system of recording, storing, and retrieval of data needed to
efficiently run the payroll of the employees correctly and accurately. The advantage of the
system is to set up, update and retrieve data items from organized database. Another advantage
of the new payroll system is generating the payroll report slips and other forms included in the
system, which will be printed out by the computer. The system also boasts of security
maintenance so that authorized people will only be given access to the files. The language used
in making the system was Visual Basic 6.0. The proponents made sure that the system would be
user-friendly, making the municipality’s current system better and more efficient with the use of
the computer.
with Dasmariñas Municipality Payroll system, the system created was from manual to
computerized system. The proponents created a reliable, secured and convenient payroll system
14
from a manual system for a government office need to have this kind of system so that they can
give additional focus on more important activities to be transacted. The system created by
Lardizabal shows common problems with the proposed system that are normally experienced
from a manual system such as loss of files and data, slow process of salary computation and
difficulty in retrieving and maintaining records, vulnerability of the data to be lost or misused,
and overall security of the payroll process. Security is a main function because the information in
http://www.timetrax.com.pk/#, 2007
SoftwareSuite that enables employees to record their arrival and departure providing managers
with detailed information about attendance records, absenteeism, overtime etc. Each individual's
arrival and departure time is recorded automatically via input devices such as Card Readers,
Biometric devices or keyboard, depending upon environment and working practices. Following
are some of the advanced features that TimeTrax has to offer: Hand geometry, Fingerprint, RFID
and Magnetic swipe card devices integration. Centralized payroll processing is for multiple
branches. Track employee attendance from any location, anytime, even from the convenience of
your home. Overtime, late arrivals & early departure reports, automatic calculation of hours,
leaves, taxes and deductions to generate payroll, shift scheduling & rule based penalties are the
features included.
15
Just like Biometrics Time Management and Payroll system, the proponents developed a
system with a biometrics time management. The employee will time in on a finger print scanner
as their Bundy clock and their time will be recorded. The use of DTR is not applicable anymore.
In the system, the computation of absences and tardiness will be computerized. Because the daily
time management is already computerized the transferring of data is easy to access and compute
which provesits feasibility from the Biometric Time Management & Payroll Software.
http://www.spinetechnologies.com/products/payrollindex.htm, 2004
Spine Payroll is very simple, flexible and user-friendly Payroll Management software
especially for INDIA that takes care of all the requirements relating to accounting and
management of employees’ payroll. Spine Payroll stores complete records of the employees,
generates Pay-slips and Attendance Register, computes all allowances and deductions and
generates all Statutory and MIS reports. Spine Payroll is only salary processing software with
good no and wide-industry range of client based in Mumbai, INDIA. It offers very high
flexibility in defining various allowances, deductions, leave rules etc. for the employees and all
formula for P.F, PF TRUST., F.P.F., E.S.I.C., Profession Tax, Income Tax, etc. are definable and
The proponents had an idea in the computerization of the payroll. After analyzing Spine
Payroll, they considered adding complete records of the employees, generating Pay-slips and
Attendance Register, computing all allowances and deductions, and generating all reports.
16
Sure Payroll
http://www.surepayroll.com/default.asp, 2000
SurePayroll is the best way to eliminate payroll worries. Do you have between 1 and 100
employees? Let us prove our passion for payroll to you! Add your payroll to the more than
30,000 we process each month. Payroll systems have changed for the better. With online payroll
systems, like SurePayroll, you can log on to our payroll system anytime, anywhere and you'll be
done with payroll in minutes. If you'd prefer to focus on growing your small business rather than
on the tedious tasks of payroll, consider outsourcing payroll to SurePayroll's online service. As
the nation's leading supplier of online payroll services, we can help you save time, save money
and stay in control of your payroll. Simple, Convenient, Smart. SurePayroll is the national leader
in online payroll processing. We focus exclusively on small business payroll solutions, and we
provide a SIMPLE, CONVENIENT and SMART way to process payroll and file taxes.
This system has a commonality with the proponents proposed system in storing
employee’s record and ways in processing payroll and deductions. The system also generates
Pay slip and attendance Register. The proponents focused on simple and convenient process of
http://www.agilepayroll.com/products.html, 2007
We are building the finest payroll system using state-of-the-art, proven Microsoft
technologies. The Agile Payroll System will change your business, helping you to provide the
highest level of customer service. Let's face it; there are more than a few payroll systems in the
market already. But few were built to address your business needs for scale, efficiency and
17
reliability. We are building our products using the agile software development process that puts
both clients and testing, front and center in the development process. Our system design and
development are client and test driven to ensure that the resulting applications are flexible, meet
our clients' requirements and are of the highest quality. Here are some of the
advantages we offer: An interface designed by users, efficiency in design that allows you to be
more effective in your business, developed in, and for Microsoft's latest .Net technologies,
reliable, scalable and secure Microsoft SQL database systems, the highest level of quality based
on multi-level testing, a team with years of payroll operations, support and development
Agile Payroll Systems has similarity with the proposed system in terms of its features.
The proponents created a network based payroll system with an effective design for business that
is developed in Microsoft .Net application of Microsoft SQL database will address efficiency and
reliability. This will be convenient for employee to view their salary particulars including from
These related literature reviewed by the proponents helped greatly in the long
development of the system. These just proved that the feasibility of the computerized and
Theoretical Framework
• The documents and all the information given to us will reflect the payroll data
needs of the municipality and the problems in their data capture mechanisms.
• The salary of employees is the same according to their rank and position.
their necessities.
• Basic Pay – Monthly rate divided by the number of working days multiplied by
• Cash Gift – An incentive given to an employee during the last week of November
• Clothing Allowance – Given every first month of the year to compensate clothing
cost.
• Cut off period - The span of working days where an employee is paid.
• DTR – Stands for Daily Time Record, a document where the employee’s daily
• DTR File – A file that holds the DTR of each employee for the computation of
• EJO – (Employees with Job Order)The employees who do not have benefits; they
are usually non office workers (except for some clerks). Examples of job order
• Employee File - File about employee information, it also shows their monthly
salary as defined by the plantilla and Mayor for regular and EJO respectively.
• GPR – (General Payroll Report) This summarizes all the details of every
• Hazard Pay – Given every 2nd half of the month and included in the pay slip. It is
environments. Health workers are the major consumers of this benefit because of
the risk that they take when they are working in the community.
20
workers.
• Leave points – It is the amount of leave that an employee can consume without
• Loan File – Stores all the loan information from lending companies and insurance
companies.
• MHO – (Municipal Health Office) – The MHO is under the supervision of the
Department of Health. Due to this, its budget and signatories are different from
separate general payroll report because it has a separate budget and different
signatory.
employee’s salary.
specific period.
department. Department heads evaluate their employee once in every half of the
21
year. Two PEF with a minimum of very satisfactory rating entitles them for a
Productivity Allowance.
• PERA – (Personnel Economic Relief Allowance) This allowance requires that the
employee is at least one year in office. It is given together with the first half of the
monthly salary.
position in the office and the rate by which the employee is paid. When the
and given to department heads and elected officials every first half of the month
For non-Department Head, RATA is only given when a request and travel order is
• Regular Employee – Regular employees are those who are included in the
plantilla. Regular Employee includes the elected officials, department heads and
executives.
22
• Remittance – The amount given to external entities such as BIR and other
given.
expenses.
• Tax table – Shows the deduction to be deducted from the monthly salary as
• Record Daily time – Records the daily time of employees into the DTR
file.
• Calculate net pay – Subtracts all the deduction to the gross pay.
3.3.1 Automation
compute data that are fed to it by programming those machines. Automation of systems
nowadays is dramatically increasing because of the need for speed and reliable information
system wherein the desired information can be obtained without tumbling out files in large data
cabinets and archives. This theory waas used in the proposed Payroll system of Noveleta’s
municipal office. Data inputs in the form of hours and days worked and corresponding
deductions such as tax and individual insurance shares will be introduced to the computers. As
an output, the machine will print pay slips and reports that are ready to be delivered to external
By using this theory, less work will be done by the accounting department because the
reports for the computation of deduction will now be internal to the computerized payroll
system. This technique will greatly increase the speed of calculating each employee’s salary with
utmost minimal human intervention. Minimizing human intervention will most likely reduce the
3.3.2 Biometrics
Biometrics comes from the word “bios” which means life and “metron” which means to
with the term because it typically implies the measure of life. It may be the population density of
biological elements within an ecosystem or it may imply the biodiversity of our planet.
24
Nowadays, the meaning of biometrics evolved with the technology. Biometrics today
refers to gadgets that are used to identify humans physiologically. The most popular biometric
gadgets are fingerprint and iris scanners because the fingerprint and iris are unique for all human
beings that even identical twins do not have the same fingerprint or iris structures.
Through this theory, the proponents can use biometric gadgets to identify the employees
in the municipal office, and doing such things will ensure that no employee will be able to cheat.
For example, an employee can mark a time in to other employee who comes late. When the
system has a biometric strategy of identification, no employees can time themselves in without
The system will be using fingerprint scanner, a biometric gadget that scans fingerprint.
Employees are going to time themselves in or out by scanning their index finger into the
fingerprint scanner.
Data flow diagrams are used to graphically depict flow of data within an organization. It
is very useful because it allows the analyst to visualize the flow of data and track the very details
of the problems being solved. Having a data flow diagram will prevent the analyst from
committing to the technical implementation of his proposed system at an early stage. The system
analyst will free himself from thinking too much because all of his efforts will be focused on
understanding the flow of information within the organization that he/she is analyzing. It will
also help the system analyst to further understand the relation of the studied system to its
subsystem and other external systems. During the analysis of a proposed system, it will also help
to determine whether the necessary data and processes have been defined, thus allowing a
The proponents used data flow diagram to fully understand the flow of data which would
give them a bird’s eye view of the problem. All the information that the proponents had gathered
through interviews were compiled to help determine the necessary business activities within the
existing payroll system. When all the business activities had been identified, the proponents
started drawing the data flow diagram. With this, they were able to see where the data would go
3.3.4 Database
Databases are electronic files saved in the hard disk of computers which holds tables that
are logically associated with each other. These databases are used to store valuable information
that can be accessed or queried by multiple software applications that are used by an
organization. Through the use of database, some issues of confidentiality and data security can
be solved. It can also take part in minimizing data redundancy and maximizing data integrity.
Departments within an organization can share the same information and can manipulate that
The proposed system used this theory to eliminate data redundancy within the organization.
All the information about an employee will be saved in a database. Their log in and log out time
will also be saved on it making it available to programs that need to access those data.
3.3.5 Normalization
tables are divided into a set of simpler tables to eliminate anomalies. Eliminating anomalies will
also protect the database from errors that may result in inaccurate queries and data loss, thus
databases are more stable and easily maintained than the complement.
26
The proposed system used this theory to create a structured data storage method. All the
information requirements of the system are collected first. Second, the gathered requirements or
fields are converted to its first normal form. Repeating groups are removed by separating it as
another table. In the second normal form, all the attributes are functionally dependent on the
primary key. All other partially dependent attributes are separated from the original table. Next
to it is to convert it to the third normal form. A normalized relation is in its third normal form
when all of the non-key attributes are fully functionally dependent on the primary key and there
3.3.6 ERD
model a system and its requirements in a top-down approach. This approach is commonly used
Examples of these are person, place or things which you need to collect data or attributes.
Relationship tells how two or more objects are related to one another. They can be thought of as
2008).
The proponents used the theory to identify the entities and the kind of relationship that
occur between these entities. Doing this systematic approach gave a solid foundation of the
3.3.7 Network
usually passive electronic components that perform a specific function to simulate a transmission
(http://en.wikipedia.org/wiki/Computer_network, 2008)
communication paths. Networks can interconnect with other networks and contain sub networks.
The proponents used the theory of network to let computers within the municipal office
communicate with each other and, therefore, minimize the use of printed reports that is only
The Municipal Office of Noveleta is currently using a manual system on their payroll.
Manual computations used in calculating are calculator and MS Excel. They also use MS Excel
The Treasury Office (TO), Accounting Office (AO) and Human Resource Management
Office (HRMO) are the three offices that handle the payroll process.
Employees record on the Bundy Clock using their DTR. During cut-off period every 10
and 25 of each month, the HRMO computes the tardiness and absences of each employee and
then makes a certificate of absences and late and pass it to the TO. The Treasury is in charge of
all payroll computations. The office computes the gross pay from the basic pay of each employee
and the number of late and absences whatever type of employee he is ( Regular or Employee
with Job Order). The deductions of Withholding Tax, GSIS, Phil Health, Insurances and the like
are sent to Accounting Office by the agencies handling these deductions: BIR, GSIS, PAG-IBIG,
PHILHEALTH, and other Lending Companies like UNLAD Bank, and MPS Lending Company.
The salary of the employees is based on the Plantilla that comes from the CSC and DBM
which state the monthly salary and position to be given to the regular employee and to the EJO
Number of working
4.3 Inputs
Number of Copies: 1
Number of Copies: 2
Number of Copies: 1
Number of Copies: 1
4.4 Processes
4.4.1 Update_employee_information
Begin
End if
End
33
4.4.2 Record_daily_time
Begin
End
4.4.3 Generate_Cerificate_of_Tardiness/Absences
Begin
End
4.4.4 Compute_gross_pay
Begin
End if
Calculate gross pay from monthly salary and total no. of tardiness & absences
End if
End
34
4.4.5 Calculate_deduction
Begin
End
4.4.6 Calculate_netpay
Begin
End
35
Begin
End if
End
4.5 Files
Last name
First name
Middle Initial
Monthly Salary
Net Pay
Loan Balance
GSIS contribution
36
Withholding tax
Dependents
Pag-ibig contribution
GSIS ID no.
PAG-IBIG ID no.
PHILHEALTH no.
TIN
Employee name
Time in
Time out
Absences
Tardiness
Employee ID
Position
Monthly Salary
Gross salary
Adcom
Net pay
Deductions
Employee name
Civil Status
Dependents
Exemption
Withholding tax
Percentage
Employee name
Contribution
Employee name
Contribution
38
Position
Range
Contribution
Loan amount
Loan history
Loan Balance
Range
Base Tax
Bracket
Percent Over
4.6 Outputs
Number of Copies: 2
39
Number of Copies: 2
Number of Copies: 3
Number of Copies: 3
Number of Copies: 3
Number of Copies: 3
Number of Copies: 3
In using their current Payroll System, Noveleta Municipal Office encounters problems
such as problems with attendance monitoring, data redundancy, complicated interface, error in
First, they encounter problem in attendance monitoring. They use DTR for attendance to
log in and out of work. This is a problem because employees can just ask their co-worker to log
their name even if they are not yet really in the office. There is no way to know if employees
Next is the data redundancy. The current payroll system of the municipality is done
manually. Due to this manual system, there are more paper works. Printed copies of documents
are sent to departments involved. Different departments hold copies of the documents so that
when the documents have to be updated, all the copies should also be updated. As a result, data
redundancy is committed.
The Treasury Department uses MS Excel Application in their payroll system. It is where
they input necessary data for the computation of the salary. The complicated interface of the
application plus the large number of data to be inputted makes it hard for the person in charge to
do the work faster. This particular problem results to slow payroll process. It takes the
Another problem is the error in calculations. This establishment has around 200
employees, which means around 200 salary computations. All of their salary has to be manually
calculated using the calculator, before inputting and saving the data to MS Excel. Calculating all
the employees' salary is not easy. It takes a lot of time and effort. There are times when the
42
person in charge of the computation gets confused with the numbers or inputs of wrong amount,
Retrieval and back up of file is another problem. The treasury department uses only one
computer only for data storage. All computations are saved in that computer without other back
up. The problem is, when the computer fails, there will be no other means to retrieve the files.
Another thing is that there is no CD driver installed and the floppy disk is not working. They are
Lastly is confidentiality and security of data. Since the Municipality is a public area,
unauthorized persons can easily view important files from the computer and alter some data
The proposed Network-based payroll system for Noveleta Municipal Office is the
solution to the problems encountered using their current manual process. It provides accurate and
efficient computation of employees’ salary. The computation which includes deductions is error
free and takes less time to accomplish. Attendance recording and monitoring is included in the
system which makes getting the total number of hours worked fast and easy. Files can be easily
manipulated and organized. Important files are secured and can be accessed only by authorized
persons.
The departments that will be given access to the system are the Treasury Office and
Human Resource Management Office. The treasury office is in-charge of the salary computation
and maintenance modules. The HRMO will be responsible for the Daily Time Record, Leave,
and Absences Modules. Files are protected using passwords, so that only authorized users may
The payroll process starts by getting the hours worked by the employees within the cut-
off period, which is done by the Treasury Office. A biometrics system is used to record the hours
worked, instead of the usual DTR. Employees have to scan their finger print on the scanner to
record the time they start and finish working. The attendance record is updated every time an
After getting the hours worked, the system automatically computes salary for the given
pay period. The salary of the regular employees is based on the plantilla while the salary of the
44
employees with job order is based on the mayor’s specification. If approved, absences of regular
employees are deducted from the leave points, which is 1.25 days per month. The computation of
salary also includes deductions such as GSIS, Pag-ibig, Withholding tax and loans. Regular
employees receive PERA, 13month pay, ADCOM, clothing allowance and productivity
allowance. Added benefits such as the RATA, Travel Allowance and Cash Gift are given only to
The system generates necessary reports such as pay slip, remittance report and general
payroll. The pay slips are produced by the system and are given to employees, for them to know
the amount deducted from their salary and the total amount of salary they will get. Remittance
report is given to the Accredited Agencies such as GSIS, BIR, Pag-ibig and Philhealth. General
payroll contains payroll information such as the name, position and address of employees who
receive payroll and the amount of salary they receive for each pay period. It is printed and given
A module for File maintenance is included. It will ease updating and sorting of records.
Transactions for maintenance such as adding, deleting or editing records are easily done, by just
clicking the labeled button for the desired function. Back-up and recovery of files are also
provided so that copies of files may be reproduced when needed or be restored when accidentally
deleted.
users of the system. Through this, users save time and effort in performing tasks. When gathering
data, instead of personally going from one department to another, the users may just access data
The proposed Network-based Payroll System for Noveleta Municipal Office has the
following objectives:
environment.
2. To offer a biometric system using finger print scanner for the Time Management
maintenance module.
5.3 Scope
The proposed system focuses on the payroll of Noveleta Municipal Office. It covers all
the transactions for all types of employees. It has modules for Salary Computation, Daily
Attendance Record, Leave and Absences, Benefits and Allowances, Log-in Log-out, and
Maintenance. Instead of DTR, Biometrics is used for record attendance. Through this, attendance
can be monitored by the system. The scanner is connected to the system, to access the attendance
The computation of salary is included in the system. The system automatically computes
for the salary for a given pay period. The computation includes deduction from GSIS, Pag-ibig,
Philhealth, loan and withholding tax. Accurate calculations are done in order to come up with the
correct amount of salary. Computation for the Benefit and Allowance is also included in the
payroll. Regular employees receive PERA, 13month pay, ADCOM, clothing allowance and
productivity allowance. Added benefits such as the RATA, Travel Allowance and Cash Gift are
given only to the office heads. These benefits and allowances are given to regular employees in
File maintenance is included in the system. Adding, deleting, and editing of records are
easily done using the system. Back up and recovery is also provided.
The system also produces pay slips, General Payroll and Remittance Report. The pay
slips are produced by the system and are given to employees. Remittance report is given to the
Accredited Agencies such as GSIS, BIR, Pag-ibig and Philhealth. General payroll contains
payroll information such as the name, position and address of employees who receive payroll
and the amount of salary they receive for each pay period. It is printed and given to the
For security, the system includes level of access and passwords so that authorized users
are only given permission to access the system. The system is network-based which allows
The proposed payroll system is needed to solve the problems encountered by the current
payroll process of the municipal. Features and benefits are offered to improve their manual
system.
Firstly, it provides accurate computation. The system automatically computes the salary
of employees in every pay period. The formula for salary and for other inputs is acquired and
already programmed in the system, which lessens human errors. The system is also user-friendly.
It is designed with buttons and labels so that functions are easy to know and understand.
attendance of employees. HRMO will not be having trouble manually computing the attendance.
The hardware is already connected to the system which updates the attendance. The scanner
verifies the finger print and saves it to the database. The use of finger print scanner can also
prevent employees from cheating their daily attendance records. When using the DTR,
employees can ask their co-employee to log in their time card when they can’t get to work on
time. This will now be avoided using the finger print scanner.
Records can easily be updated. File maintenance is included so that record can be added,
edited and deleted in less time. Through backup and recovery, files can be copied or restored.
The system includes provided passwords and access level. For security, only authorized
users are given permission to access the system. This makes files and other important documents
protected.
Lastly, payroll process takes less time using the proposed system. It is network-based,
which allows sharing of information in less time. Users are more productive; they lose no time in
performing tasks. Data they need could be acquired through the system, which means they do not
48
need to get inputs or information personally from another office. They access information
System Design
6.1 Inputs
Origin: HRMO
No. of Copies: 1
Purpose: for the information that will be used for the payroll system
Origin: Employee
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
No. of Copies: 1
6.2 Processes
Begin
If New employee
Else
Edit information
End
Begin
If status is out
Record Time in
Else if status is in
End if
End
Begin
Note as Absent
53
Else
End If
End If
End
Begin
Compute Absences
If Leave is applied
End If
End IF
End
Begin
Get Monthly Rate, Allowance Grants Amount and Total Hours Worked
End
Begin
End
Begin
End
55
Begin
End
6.3 Files
Filename: EMPLOYEE
Sex VARCHAR
Address VARCHAR
Phone CHAR
Position VARCHAR
Filename: EJO
Date DATETIME
Filename: REGULAR
ID NO. VARCHAR
TIN VARCHAR
Filename: DTR
Time In DATETIME
Date DATETIME
Status VARCHAR
Amount MONEY
Filename: LEAVE
Type VARCHAR
Date TO DATETIME
Filename: PHILHEALTH
Range to MONEY
Contribution MONEY
Filename: TAX
Bracket INT
58
Range MONEY
Filename: DEDUCTIONS
Filename: LOAN
Description VARCHAR
Principal MONEY
Term INT
Monthlyamortization MONEY
Balance MONEY
Filename: WAGE
Filename: PAYPERIOD
ADCOM MONEY
Date To DATETIME
6.4 Outputs
No. of Copies: 1
Frequency: once
Recipient: HRMO
No. of Copies: 1
Recipient: employee
No. of Copies: 1
Recipient: employee
No. of Copies: 1
Recipient: employee
CHAPTER 7
Implementation
implement the system. These requirements are Software, Hardware and Human Resources.
Software requirements are programs and applications that the computers should have in order to
install the system. Hardware requirements are materials necessary to be able to use the system.
Lastly, human resources are the persons who will use the system. These requirements are all
• Pentium 4 or higher
• CD – Rom
• Keyboard
• Mouse
62
• Printer
• Monitor
• AVR
• LAN Connection
• Router
Human Resources are the persons who will be using the proposed system. There will be 2
Direct users are the persons who will operate and maintain the system. These direct users
Indirect users are the beneficiary of the system. They are the regular and EJO employees
• HRMO will operate the employee update information and the attendance information.
The proposed system should be installed as the training is being conducted. This aids the
direct users to understand the flow of the system and to properly use each transaction they will
encounter.
In the installation process, the proponents would provide all necessary information
The system will be installed in two computers located at the Treasury Office (first floor)
The finger print scanner will be placed near the main entrance of the municipal office so
that employees may log in as they enter the building before going to their respective offices.
The proponents will conduct training for the direct users to familiarize them with the
proposed system. They will be taught enough information regarding the system.
Activities for the training plans are Preparation for training, Installation of the system,
Demonstration on how the system works, and the Training proper. There will be scheduled dates
Direct and indirect users will be taught on the proper usage and maintenance of the finger
print scanner.
64
The proponents will use the parallel conversion in replacing the proposed system from
the manual system. The following are the reasons why the proponents chose this type of
conversion:
With parallel conversion, users will slowly become accustomed to the new system. It will
help them get familiar and adjust to their new working environment. They will be able to learn
Another reason is that users will be able to compare and evaluate results obtained from
both systems. They can compare if the new system is more helpful and convenient to use than
the older version. They can check if the new system really lessens their workload, giving them
7.2.4 Testing
The efficiency of the system will be tested by the proponents. They will check if the
proposed system works better than the old system. It will demonstrate the accuracy of the
The proponents will test each module if it works properly and show appropriate output.
They will also check if the system and hardware requirements are met.
Unit and integration Testing. This testing is done to ensure that all aspects of the program
design have been implemented in the code. These modules are tested to make sure that each
performs right functions individually and as a whole when connected to each other.
This was done by the proponents. They used Bottom-up Approach of Integration. All
lower level modules were tested first until the top level modules were reached. Individual
modules were run and checked if functions were working correctly. Then all the modules were
System testing. System testing is done to ensure that the system does what the customer
wants it to do. The functionality of the system is tested. Modules are checked, making sure that
all processes are complete. The transactions and processes should perform according to the
This was done by running the whole system. The payroll process was performed by
running the modules starting from the DTR, Salary Computation, Maintenance and Report
Generation. Incorrect were inputted to know if the system could really handle errors and faults.
The interface was also checked if all buttons were named appropriately and according to its
name.
66
Acceptance Testing. This is the phase when the system is already complete and ready for
customers’ evaluation. The system’s function and processes are checked if it satisfies the
requirements.
The proponents will present the system to the customer. The customer will test it by
running the system. Customers will input real data to test the system and make sure that it works
properly.
CHAPTER 8
8.1 Conclusion
The use of the proposed Network-based Payroll System would make the municipal’s
The use of innovative products such as the Biometrics helps in attendance monitoring. It
makes maintaining of attendance information easy. Computing of the total number of hours
worked is also accurate and takes less time. The system automatically adds up the number of
hours worked when the employee logs in and out of work through the scanner. It lessens human
The use of salary computation module, maintenance module, and networking also helps
in making tasks easier. The modules are designed to be easily used and understood by users. It
only takes one click of button to do transactions. Networking also allows users to share
information through the computer. It takes less time, and users are able to maximize their time in
accomplishing tasks.
Compuation of deductions for Philhealth, Pag-ibig, Withholding Tax and loan is included in the
computation. Benefits and allowances like PERA, 13month pay, ADCOM, clothing allowance,
productivity allowance and added benefits such as the RATA, Travel Allowance and Cash Gift
Security is provided through the use of passwords and access level. The system can be
accessed only by direct users such as the HRMO and Treasury Office. They are the only ones
68
given passwords to the system. this will keep important files hidden to unauthorized persons,
Generating of reports is accommodated by the system. The users can easily print reports
such as general payroll, pay slip, remittance report and other needed documents.
8.2 Recommendation
For the future researchers who will choose payroll as system study, the proponents
recommend that they develop not only a network-based but online payroll system. In making the
system online, users could work on their tasks at home and even on weekends.
The proponents recommend the computation of loans to be included in the future studies.
advancement for salary distribution. In this method, acquisition of salaries is more convenient
The use of optical scanner is also recommended for attendance monitoring. The use of
this high-tech device will impose high technology advancement to the municipal office.
APPENDIX A
Data Flow Diagram of the Existing System
70
HRMO
PEF Employee
Information
BIR Tax
Remittances
BIR 0
Philhealth
Remittances Lending
Philhealth
Company
Loan Remittances
Pag-Ibig
Remittances
PAG-IBIG
71
Verified
Employee
3.0 Information
Pag-Ibig
Monthly Salary Certificate of Tardiness D8
D2 DTR File Deduction
and Absences 2.0
Pag-Ibig
Recorded Contribution
DTR Record Daily
Time
4.0
Gross Pay 5.0 Loan
Contribution D7 Loan File
Compute
Gross Pay Tax Contribution
Calculate D6 Philhealth deduction
Deduction
GSIS
D5 GSIS deduction
Contribution
6.0 deductions
GSIS remittance
GSIS
Calculate Net
Pay Loan remittance
Net Pay Lending
7.0
Company
Generate
Gross Pay
Report Pay Slip Employee
General Payroll
D3 General Payroll
File
72
Leave
Points
Monthly
Salary
4.3
4.4 Net of Tardiness
and Absences
Deduct Absences
Gross Pay and Tardiness
Calculate
from Equivalent
Gross Pay
Leave Points
73
Tax deduction
Gross Pay
5.1
PAG-IBIG
Gross Pay 5.2 deduction
Compute
PAG-IBIG PAG-IBIG PAG-IBIG
contribution deduction deduction
5.6
Philhealth Total Deductions
Gross Pay
5.3 deduction Compute
Total
Philhealth Compute Philhealth deductions
contribution philhealth deduction
deduction
GSIS
Gross Pay deduction
5.4
Loan
Gross Pay deduction
5.5
DTR Module
Allowance Modules
89
Theses
[REYE00] Reyes, JBC Engineering Specialists’ Payroll System, 2000
Internet
http://en.wikipedia.org/wiki/Entity-relationship_model, 2008
http://en.wikipedia.org/wiki/Computer_network, 2008