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Out-of-date practices and lack of visibility and knowledge of local processes are the biggest potential threats to effective multi-countrypayroll management, according to report. 

  • A quarter of businesses (23.7%) rely on potentially out of date, ‘historic practices’ when choosing a payroll operating model
  • One in five (20.12%) still manage payroll approvals manually, for example by email
  • A staggering 79% of businesses do not have the system capability to consolidate or view a single global report for all their payroll operations.

Released today – 29 November 2016 – the report An insight into multi-country payroll processing seeks to offer a better understanding of the current challenges faced by payroll practitioners in an evolving industry and the methods they employ to achieve greater efficiencies, better organizational reporting and business insights.

Commissioned by TMF Group – a global provider of business services operating in over 80 countries – and compiled by the Global Payroll Association, the survey canvassed the views of 165 payroll practitioners, from Senior Vice Presidents and Directors to operational staff, across a broad spectrum of industries.

Key report findings include: 

  • The risk of inertia: While over a third of respondents (36.5%) claim ‘efficiency’ is a key driver in selecting a payroll model, it was concerning that nearly a quarter (23.7%) also admitted that ‘historical practices’ determined their choice – potentially limiting the range and scope of their delivery capability – and 1 in 5 (20.12%) still manage payroll approvals manually.
  • The value of local knowledge and experience: ‘Knowledge of country legislation and requirements’ was overwhelming rated as one of the biggest challenges when acquiring or divesting payrolls (49%) or when operating payroll across multiple countries (35%). As a result, 70.25% agree that having an in-country contact, able to communicate in local language is very important.
  • Achieving compliance and consistency across borders: Other top challenges of multi-country payroll included ‘the ability to find information on legislation and compliance’ (35.7%) and ‘achieving consistency in policies and processes’ (33.6%). One in four (25.2%) also cited difficulties in managing multiple vendors. 
  • Moving from a local to a global view: Furthermore, around two-thirds of businesses (65%) report that do not yet have the ability to view the payroll processing status across each of their operational markets and, as such, a staggering 79% of businesses do not have the system capability to consolidate a single global payroll report for all their operations

This is borne out by the findings that 1 in 5 companies (20.99/20.73%) do not have any global or multi-jurisdiction payroll processes or policies, instead managing each market on an individual local basis.

Deborah Williams, TMF Group’s Head of Global Business Services, commented: “Global payroll is still a relatively young industry but it is evolving fast. Organizations are increasing going through transformations on a global scale but still trying to manage this themselves at local level.”

She continued: “In truth, what worked for an organization before – manual processing, local-level reporting – just won’t be fit-for-purpose as they seek to consolidate activities and globalize.

“Online technology platforms offer one solution to providing global reporting and analytics, but this must still be complemented with a real understanding and knowledge of local and regional compliance requirements. Having the right people to manage your payroll is still very much key.”

To download the full report, visit http://www.tmf-group-global.com


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