Workflow template for finance and accounting
Payroll register to ledger reconciliation
At period end, the accountant or controller gets one worksheet proving the payroll register against the ledger: gross pay, employer taxes, deductions and net pay. Every difference is sorted as timing, miscoding or unexplained, with a question for each. Nothing is posted.
Listed under
Add it to a workflow in the Fully Powered Planner, beside the teams and roles that will run it. Book a fit call
The outcome
For most companies under 200 people, payroll is one of the largest costs, and it reaches the ledger through a provider's integration that few people check line by line. A run posts two days late, a new deduction code lands on the wage account, an off-cycle check never arrives at all. Each one quietly moves the month's numbers.
This workflow template agrees the two sides before the month is signed off. It first proves that the register adds up run by run and that the payroll accounts add up to their reported balances. It then compares gross pay, employer taxes, taxes owed, deductions and net pay with the accounts they should have reached, checks the provider's tax and deduction payments against the ledger, and works out what each liability account should hold at the period end.
Every difference lands in one of three places. Timing, when the files show the same run or payment on either side of the period end. Miscoding, when the same amount sits on the wrong account in the same journal. Unexplained, for everything else, including anything someone has explained in a note but no file yet shows. Each item carries its evidence, its effect on every line it touches, and one plain question for the person who can answer it.
The controller decides. Any correction appears only as a question, such as whether an amount should move from one account to another. The worksheet names pay runs and headcounts, not people, and shows one person's figures only when a difference cannot be explained any other way. A run for a single employee is treated the same way: its figures appear only when the difference is the whole run, and the worksheet says so.
Who starts the work, and when
The staff accountant, bookkeeper or controller who closes the books starts it at month end or quarter end, once the period's pay runs are paid and their journals should be in the ledger. It runs again after the answers come back, to see that the open items have cleared.
The controller reviews the worksheet and decides every item. The payroll administrator, or whoever deals with the payroll provider, answers questions about the register and the provider's ledger mapping.
What they supply
- Settings: the period, the date the files were run, the tolerance, the account for each part of payroll (gross pay, employer taxes, taxes owed, deductions, net pay), and who the controller and the payroll preparer are.
- The payroll register summary, one row per pay run, from the provider.
- The ledger summary for the payroll accounts: opening balance, debits, credits and closing balance.
- The journal detail: every line of every journal that touches a payroll account, including those posted in the days after the period end.
- The payment report from the provider: the tax deposits and deduction remittances.
- The last reconciliation, and any notes from the payroll preparer.
Each file has set column headers, and the template stops and asks if one does not match. Exports are enough: it needs no connection to the payroll provider or the accounting system, and it never asks for a password or a login code. It does not need employee-level pay data, and asks for it only for one named run when a difference requires it.
What comes out
One worksheet in a fixed order: the checks on both sources; the result line by line, each difference walked through its items to a remainder that is shown even when it is zero; what matched; the timing differences, the miscodings and the unexplained items; the questions in order, unexplained first; the entries that may be needed, written as questions; any employee detail used and why; and what the files did not allow it to assess.
A good worksheet lets the controller follow every figure to a row in one of the files, and see in one line why each item sits where it does.
An invented example
Illustrative example with invented data. The company, the people, the pay runs, the journals and the figures below are all invented. Company M is an invented 60-person building maintenance contractor that pays its staff every two weeks through an outside payroll provider, whose integration posts each run to the ledger. The size, the pay schedule and the integration are framing only; they are not in the inputs. Its controller wants October's payroll agreed to the books before the month is signed off. First come the inputs the staff accountant supplied, in full, then the worksheet the workflow template returned.
The inputs
1. Settings
Company: Company M
Period start: 2026-10-01
Period end: 2026-10-31
Files run on: 2026-11-06
Currency: dollars (all amounts)
Tolerance: 0.00
Gross pay account: 6010 Salaries and wages
Employer tax expense account: 6020 Employer payroll taxes
Tax liability account: 2210 Payroll taxes payable
Deductions liability account: 2220 Employee deductions payable
Net pay account: 1010 Operating bank (a bank account)
Controller: Controller
Payroll preparer: Payroll administrator
2. Payroll register summary
pay_run_id,run_type,pay_date,employees,gross_pay,employee_taxes,deductions,net_pay,employer_taxes
PR-2620,regular,2026-10-02,58,112400.00,24728.00,9850.00,77822.00,8992.00
PR-2621,regular,2026-10-16,58,113050.00,24871.00,9980.00,78199.00,9044.00
OC-1023,off-cycle,2026-10-23,1,850.00,187.00,0.00,663.00,65.03
PR-2622,regular,2026-10-30,59,114200.00,25124.00,9980.00,79096.00,9136.00
3. Ledger summary for October 2026
account,account_name,opening_balance,debits,credits,closing_balance
6010,Salaries and wages,1008350.00,225450.00,1240.00,1232560.00
6020,Employer payroll taxes,98120.00,18348.40,0.00,116468.40
2210,Payroll taxes payable,0.00,101895.00,67635.00,34260.00
2220,Employee deductions payable,0.00,9850.00,18590.00,-8740.00
4. Journal detail, posted 1 October to 6 November 2026
journal_id,posting_date,source,reference,account,description,debit,credit
J-7001,2026-10-02,PR,PR-2620,6010,Gross wages,112400.00,
J-7001,2026-10-02,PR,PR-2620,6020,Employer taxes,8992.00,
J-7001,2026-10-02,PR,PR-2620,2210,Taxes withheld and employer taxes,,33720.00
J-7001,2026-10-02,PR,PR-2620,2220,Employee deductions,,9850.00
J-7001,2026-10-02,PR,PR-2620,1010,Net pay,,77822.00
J-7002,2026-10-02,CB,TAX-1015,2210,Tax deposit,33720.00,
J-7002,2026-10-02,CB,TAX-1015,1010,Tax deposit,,33720.00
J-7003,2026-10-09,CB,DED-1015,2220,Deductions remittance,9850.00,
J-7003,2026-10-09,CB,DED-1015,1010,Deductions remittance,,9850.00
J-7004,2026-10-16,PR,PR-2621,6010,Gross wages,113050.00,
J-7004,2026-10-16,PR,PR-2621,6020,Employer taxes,9044.00,
J-7004,2026-10-16,PR,PR-2621,2210,Taxes withheld and employer taxes,,33915.00
J-7004,2026-10-16,PR,PR-2621,2220,Employee deductions,,8740.00
J-7004,2026-10-16,PR,PR-2621,6010,Deduction code R4,,1240.00
J-7004,2026-10-16,PR,PR-2621,1010,Net pay,,78199.00
J-7005,2026-10-16,CB,TAX-1016,2210,Tax deposit,33915.00,
J-7005,2026-10-16,CB,TAX-1016,1010,Tax deposit,,33915.00
J-7006,2026-10-27,MJ,MJ-0388,6020,State unemployment rate adjustment,312.40,
J-7006,2026-10-27,MJ,MJ-0388,1010,State unemployment rate adjustment,,312.40
J-7007,2026-10-30,CB,TAX-1017,2210,Tax deposit,34260.00,
J-7007,2026-10-30,CB,TAX-1017,1010,Tax deposit,,34260.00
J-7008,2026-11-02,PR,PR-2622,6010,Gross wages,114200.00,
J-7008,2026-11-02,PR,PR-2622,6020,Employer taxes,9136.00,
J-7008,2026-11-02,PR,PR-2622,2210,Taxes withheld and employer taxes,,34260.00
J-7008,2026-11-02,PR,PR-2622,2220,Employee deductions,,9980.00
J-7008,2026-11-02,PR,PR-2622,1010,Net pay,,79096.00
J-7009,2026-11-02,CB,DED-1016,2220,Deductions remittance,9980.00,
J-7009,2026-11-02,CB,DED-1016,1010,Deductions remittance,,9980.00
5. Payment report from the payroll provider
payment_id,payment_date,liability,amount,pay_run_id
TAX-1015,2026-10-02,taxes,33720.00,PR-2620
DED-1015,2026-10-09,deductions,9850.00,PR-2620
TAX-1016,2026-10-16,taxes,33915.00,PR-2621
TAX-1017,2026-10-30,taxes,34260.00,PR-2622
DED-1016,2026-10-30,deductions,9980.00,PR-2621
6. Last reconciliation
Payroll reconciliation at 30 September 2026, signed by the controller:
2210 Payroll taxes payable 0.00; 2220 Employee deductions payable 0.00.
No open items.
7. Notes from the payroll administrator, 5 November 2026
- OC-1023 was an off-cycle correction run on 23 October.
- Deduction code R4 was added in the payroll system on 12 October.
The worksheet
PAYROLL REGISTER TO LEDGER RECONCILIATION: Company M, 1 October 2026 to 31 October 2026
Prepared for: Controller. Files as supplied on 6 November 2026. Runs are taken by pay date within the period.
1. Source checks
Register: 4 runs paid in the period (PR-2620, PR-2621, OC-1023, PR-2622). Gross less employee taxes and deductions equals net pay for every run: yes. Period totals: gross 340,500.00; employee taxes 74,910.00; deductions 29,810.00; net pay 235,780.00; employer taxes 27,237.03. Runs paid after the period end: None.
Ledger: 6010 Salaries and wages, opening 1,008,350.00, debits 225,450.00, credits 1,240.00, closing 1,232,560.00; lines agree to the summary. 6020 Employer payroll taxes, opening 98,120.00, debits 18,348.40, credits 0.00, closing 116,468.40; lines agree to the summary. 2210 Payroll taxes payable, opening 0.00 (agrees to the last reconciliation), debits 101,895.00, credits 67,635.00, closing 34,260.00; lines agree to the summary. 2220 Employee deductions payable, opening 0.00 (agrees to the last reconciliation), debits 9,850.00, credits 18,590.00, closing -8,740.00; lines agree to the summary. Payroll journals balance on the lines supplied: yes (J-7001, J-7004, J-7008). Net pay account 1010 Operating bank is a bank account: only lines in payroll journals are compared and its balance is not proved. Journals posted after the period end: J-7008, 2 November 2026, PR-2622; J-7009, 2 November 2026, DED-1016.
Observations: 2210 Payroll taxes payable closes October with a debit balance of 34,260.00. The deposit TAX-1017 is posted in October and the run it pays, PR-2622, is posted in November (T1).
2. Result for October 2026 (difference = ledger minus register; expense lines as net debits, liability and net pay lines as credits, payments as debits, closing balances credit positive)
L1 Gross pay to 6010 Salaries and wages: register 340,500.00; ledger 224,210.00; difference -116,290.00. Timing -114,200.00 (T1). Miscoding -1,240.00 (M1). Unexplained -850.00 (U1). Remainder 0.00.
L2 Employer taxes to 6020 Employer payroll taxes: register 27,237.03; ledger 18,348.40; difference -8,888.63. Timing -9,136.00 (T1). Miscoding 0.00 (none). Unexplained 247.37 (U1 -65.03; U2 312.40). Remainder 0.00.
L3 Taxes owed to 2210 Payroll taxes payable: register 102,147.03; ledger 67,635.00; difference -34,512.03. Timing -34,260.00 (T1). Miscoding 0.00 (none). Unexplained -252.03 (U1). Remainder 0.00.
L4 Deductions to 2220 Employee deductions payable: register 29,810.00; ledger 18,590.00; difference -11,220.00. Timing -9,980.00 (T1). Miscoding -1,240.00 (M1). Unexplained 0.00 (none). Remainder 0.00.
L5 Net pay to 1010 Operating bank: register 235,780.00; ledger 156,021.00; difference -79,759.00. Timing -79,096.00 (T1). Miscoding 0.00 (none). Unexplained -663.00 (U1). Remainder 0.00.
P Payments: payment report 121,725.00 (taxes 101,895.00; deductions 19,830.00); ledger 111,745.00; difference -9,980.00. Timing -9,980.00 (T2). Unexplained 0.00 (none). Remainder 0.00.
B Closing balances: 2210 Payroll taxes payable: expected 0.00 + 102,147.03 − 101,895.00 = 252.03; ledger -34,260.00; difference -34,512.03 = T1 -34,260.00 + U1 -252.03 + remainder 0.00. 2220 Employee deductions payable: expected 0.00 + 29,810.00 − 19,830.00 = 9,980.00; ledger 8,740.00; difference -1,240.00 = T1 -9,980.00 + T2 9,980.00 + M1 -1,240.00 + remainder 0.00.
3. Matched
Runs agreeing on every line: PR-2620. Runs agreeing except for listed items: PR-2621 (M1). Payments agreeing: TAX-1015, DED-1015, TAX-1016, TAX-1017.
4. Timing differences (proposed; the controller decides each)
T1. PR-2622, regular run, 59 employees, gross 114,200.00. Register: paid 30 October 2026. Ledger: posted 2 November 2026. Effects: L1 -114,200.00; L2 -9,136.00; L3 -34,260.00; L4 -9,980.00; L5 -79,096.00; B 2210 -34,260.00; B 2220 -9,980.00. Evidence: J-7008, posted 2 November 2026, reference PR-2622; it agrees to the register line by line. Preparer's note: none supplied.
T2. DED-1016, deductions remittance for PR-2621, 9,980.00. Payment report: 30 October 2026. Ledger: posted 2 November 2026. Effects: P -9,980.00; B 2220 9,980.00. Evidence: J-7009, posted 2 November 2026, reference DED-1016, same amount. Preparer's note: none supplied.
5. Miscoding
M1. PR-2621, deductions, 9,980.00 in the register: 8,740.00 reached 2220 Employee deductions payable and 1,240.00 reached 6010 Salaries and wages, where the settings name 2220. Effects: L1 -1,240.00; L4 -1,240.00; B 2220 -1,240.00. Evidence: J-7004, line on 6010, credit 1,240.00, "Deduction code R4". Preparer's note: deduction code R4 was added in the payroll system on 12 October (the payroll administrator's statement, not checked).
6. Unexplained
U1. OC-1023, off-cycle run, 1 employee, paid 23 October 2026 (a one-person run, so these are one person's run totals, shown because the difference is the whole run): gross 850.00, employee taxes 187.00, deductions 0.00, net pay 663.00, employer taxes 65.03. No journal with this reference is in the files posted from 1 October to 6 November 2026, and the payment report holds no payment for it. Effects: L1 -850.00; L2 -65.03; L3 -252.03; L5 -663.00; B 2210 -252.03. Preparer's note: OC-1023 was an off-cycle correction run (the payroll administrator's statement, not checked).
U2. MJ-0388, manual journal J-7006 posted 27 October 2026: 312.40 debited to 6020 Employer payroll taxes and credited to 1010 Operating bank, "State unemployment rate adjustment". No pay run reference, no payment in the report, and no support in the files. Effects: L2 312.40. Preparer's note: none supplied.
7. Questions, in order
1. U1, for the payroll administrator: OC-1023 was paid on 23 October (its figures are in U1), and no journal for it is in the ledger files to 6 November. Did the provider send it to the ledger, under what reference, and does the provider show a tax payment for it?
2. U2, for the controller: what supports MJ-0388, 312.40 debited to 6020 on 27 October and paid from 1010, and which period does it belong to?
3. M1, for the payroll administrator: J-7004 sends 1,240.00 for deduction code R4 to 6010, while J-7008 for PR-2622 credits the full 9,980.00 of deductions to 2220. Which account does the provider's ledger mapping use for R4 now, and was it changed between the two runs?
4. T1, for the controller: PR-2622 was paid on 30 October, and J-7008, which agrees to the register line by line, is posted on 2 November. Is it accepted as timing, or should October carry the run?
5. T2, for the controller: DED-1016, 9,980.00, is dated 30 October in the payment report and posted on 2 November as J-7009. Is it accepted as timing?
8. Entries that may be needed (questions for the controller; none prepared or posted)
M1: should 1,240.00 move from 6010 Salaries and wages to 2220 Employee deductions payable for PR-2621 (debit 6010, credit 2220)?
U1: if OC-1023 never reached the ledger, should a journal record it in October on the accounts in the settings (debit 6010 850.00 and 6020 65.03; credit 2210 252.03 and 1010 663.00)? These accounts come from the settings, not from a journal, and the files do not show the net pay was paid from 1010.
U2: not known from the files; it depends on the support for MJ-0388.
T1: should J-7008 carry an October posting date, or stand as timing? No entry if it stands.
T2: none if accepted as timing.
9. Employee detail used
None used: runs are shown by run ID and headcount only.
10. Not assessed
Whether any pay, tax or deduction amount in the register is right for any employee or under tax rules. Agreement with payroll tax returns. The balance of 1010 Operating bank, which is a bank account. Runs paid before 1 October 2026, except through the opening balances agreed to the last reconciliation. Whether the opening balances of the expense accounts are right (nothing is checked against them; only the two liability openings were agreed to the last reconciliation).
This worksheet shows how the payroll register and the ledger differ for October 2026 and what the files say about each item. It does not show that any pay, tax or deduction amount is right, and it gives no tax, audit or employment-law opinion. The controller decides each item and any entry. The worksheet changes no records and sends nothing.
Every figure traces to the seven inputs above. The register's four runs add to gross 340,500.00, employee taxes 74,910.00, deductions 29,810.00, net pay 235,780.00 and employer taxes 27,237.03, and 340,500.00 − 74,910.00 − 29,810.00 = 235,780.00. In the ledger, 6010 holds 112,400.00 + 113,050.00 − 1,240.00 = 224,210.00 for October; 6020 holds 8,992.00 + 9,044.00 + 312.40 = 18,348.40; 2210 was credited 33,720.00 + 33,915.00 = 67,635.00 and debited 33,720.00 + 33,915.00 + 34,260.00 = 101,895.00; 2220 was credited 9,850.00 + 8,740.00 = 18,590.00 and debited 9,850.00; net pay credited to 1010 in October's payroll journals is 77,822.00 + 78,199.00 = 156,021.00. The October payments in the report add to 33,720.00 + 9,850.00 + 33,915.00 + 34,260.00 + 9,980.00 = 121,725.00.
Where it fits
- Finance and accounting, which owns the payroll accounts and the close they feed.
- Construction, where weekly or fortnightly crews and off-cycle runs for missed hours give a run more ways to miss the ledger.
- Professional services, where payroll is often the largest line in the accounts and the partners read it every month.
- Hospitality, where staff turnover brings frequent off-cycle runs and new deduction set-ups.
- Nonprofits, where payroll is charged to grants and a funder's report depends on the payroll lines being right.
- Established businesses, where one long-serving person has always agreed payroll by eye and the method should be on paper.
- Growth & scaling, when a new payroll provider, a second pay schedule or a new benefit starts writing to the ledger.
It stays apart from its neighbours. Payroll preparation and timesheet review checks hours before a run is paid. Bank reconciliation preparation agrees the books to a bank statement. Client schedule to ledger reconciliation agrees a client's subledger to its trial balance. Journal entry preparation prepares the entries that this worksheet only asks about. This one agrees the paid payroll to the company's own ledger.
What has to change for your company
- Your exports. The column headers your payroll provider and accounting system produce.
- Your account map. Which accounts take gross pay, employer taxes, taxes owed, deductions and net pay. If your ledger splits wages by department, or keeps withheld taxes apart from employer taxes, each extra account becomes its own line.
- Your period rule. As written, a run belongs to the period of its pay date. If your books take payroll by the period worked, with accruals and reversals, change that rule.
- Your tolerance and your roles: who prepares, who answers for the register, and who agrees an entry.
- Your privacy rule. Whether employee-level detail may be read at all, and who in finance may see it.
- Your platform. It runs in ChatGPT, Claude, Copilot or Gemini, from files you supply. Decide which exports the assistant may read and where signed reconciliations are kept.
What has been checked
Fully Powered AI wrote this workflow template. It was editorially reviewed on 12 November 2026. It was tried once on its invented example in Claude on 12 November 2026, and the record is published alongside it. A few clarifications were made to the workflow template after that trial and have not been run again. It has not yet been tested in a client environment or as a packaged version in ChatGPT, Claude, Copilot or Gemini.
Testing in your environment means running it on two or three past months your controller has already reconciled by hand, plus hard cases written in advance, each with the expected result: a run posted after the period end, a deduction code mapped to the wage account, an off-cycle run that never reached the ledger, a manual journal with no support, a register exported one row per employee. The controller compares every figure with the signed reconciliation before anyone relies on it. Pilot acceptance-test preparation sets those cases up, and what we test before we call an AI workflow ready describes the record we keep.
Who decides
Your people keep
- The controller decides every item
- Whether any correction is made
- Whether employee-level detail may be read
It does not
- Posts nothing
- Gives no tax, audit or employment-law opinion
- Never asks for a password or a login code
- Shows no one person's figures unless a difference requires it
Questions people ask
Who is this for?
The staff accountant, bookkeeper or controller who closes the books starts it at month end or quarter end. The controller reviews the worksheet and decides every item.
What do I need to supply?
Settings, the payroll register summary, the ledger summary, the journal detail, the payment report, the last reconciliation and any notes from the payroll preparer. Exports are enough.
What do I get?
One worksheet in a fixed order: the checks on both sources, the result line by line, the timing differences, the miscodings and the unexplained items, and the questions in order.
Does it post anything or show employee pay?
Nothing is posted; any correction appears only as a question for the controller. The worksheet names pay runs and headcounts, not people.
What has been checked?
It was editorially reviewed on 12 November 2026. It was tried once on its invented example in Claude on 12 November 2026, and the record is published alongside it. A few clarifications were made to the workflow template after that trial and have not been run again. It has not yet been tested in a client environment.
The full workflow template
Everything above is the outline. The complete workflow template is the working version: the roles, the inputs, the procedure, the exceptions and stop conditions, the output format, the reviewer checklist, the acceptance tests, the instructions for an AI assistant and what to customize for your company. It comes with a download and the link to its folder in Fully Powered’s public repository.
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Next step
Put this workflow template to work for your team: on your plan, or built with you in a sprint.
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In a sprint, Fully Powered adapts this workflow template to your rules, proves it on your own work and puts it in the hands of the roles that own it.
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