TABLE OF CONTENTS

Chapter 1 THE PROBLEM AND ITS SETTINGS

Introduction 3

Background of the Study 4

Objectives of the Study 4

Scope and Limitations of the Study 5

Chapter 2 CONCEPTUAL FRAMEWORK

Review of Related Literature 6

Conceptual Model of the Study 7

Operational Definition of Terms 8

Chapter 3 METHODOLOGY

Project Design 9

Project Development 10

Operation and Testing Procedure 11

Evaluation Procedure 12

REFERENCES 13
 Development of Payroll Management System

in Aldawah Producers Cooperative

Busa, Richer Von E.

Fernandez, John Marvin D.
Florendo, Edrian E.
Loreto, Angela Sophia
BSIS-NS-3C

A Research Title Presented to the

Department of Computer Studies
College of Science
Technological University of the Philippines
Ayala Blvd. Ermita Manila

In Partial Fulfillment of the

Requirements for the Course Subject CC303-M
Methods of Research in Computing

June 2023

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 CHAPTER 1: INTRODUCTION

BACKGROUND OF THE STUDY

The management of payroll is a crucial aspect of any organization's operations, as it
directly affects employee satisfaction, productivity, and overall organizational performance.
With the advancement of technology, businesses are leveraging business intelligence tools to
streamline their payroll processes and enhance efficiency. Payroll management is an essential
function of any organization, and the use of technology can help streamline the process, reduce
errors, and improve overall efficiency.

A payroll system may be a computer program application or framework utilized by

businesses to oversee and prepare worker remuneration, counting wages, salaries, rewards, and
findings. It mechanizes the method of calculating representative pay, withholding charges, and
other benefits such as excursion time, wiped-out take-off, and retirement commitments. It is
responsible for guaranteeing that representatives get their rectify pay on time, and that charges
and other findings are withheld accurately. It moreover creates different reports that aid directors
and employees to screen the monetary well-being of the organization, such as financial cost
reports, assessment filings, and benefits outlines. A great payroll system can offer assistance to
businesses that streamline their finance forms, decrease blunders, and make strides in compliance
with assessment and labor laws. It can moreover progress representative fulfillment by
guaranteeing that they are paid precisely and on time.

The use of payroll systems by businesses is crucial, particularly in regions like Quezon
Province, where Al Dawah Producers Cooperative is a company farm. This firm is headquartered
in the province where payroll systems are utilized. The system's core functionality will assist
businesses in streamlining their payroll procedures, reducing errors, improving compliance with
labor laws and regulations, and paying employees accurately and on time. This can enhance
worker happiness and lower turnover, both of which are positive corporate outcomes. Therefore,
this study aims to explore the impact of using Microsoft Excel as a business intelligence tool for
Al Dawah Producers Cooperative's payroll management and investigate how the use of Excel, a
commonly used spreadsheet software, can be used to manage payroll at the cooperative.

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 Al Dawah Producers Cooperative started on September 20, 2021. This business is one of
the leading cooperatives in the Philippines and one of the leading suppliers and produces
essential oils like citronella essential oils and elemi essential oils. They focus on the production
and distribution of agricultural goods. As the cooperative grew and its workforce expanded,
managing payroll became a complex and time-consuming task. Traditionally, the organization
relied on manual calculations and paper-based systems, which often led to errors, delays, and
inefficiencies. To address these challenges, the cooperative decided to implement Microsoft
Excel as a business intelligence tool for their payroll management.

OBJECTIVES OF THE STUDY

This study aims to develop a reliable and manageable computerized payroll system for Al
Dawah Producers Cooperative, Brgy. Burgos (Poblacion) Lopez, Quezon for a better
manageable business. The said study will give a big relief to the employees and employers as
well.

GENERAL OBJECTIVES

This study aims to create a user-friendly and efficient payroll management system for Al
Dawah Producers Cooperatives which provides a comprehensive solution that saves time,
reduces errors, and meets to improve employee satisfaction through self-service options and easy
access to payroll-related information.

SPECIFIC OBJECTIVES

 To improve the efficiency and accuracy of the payroll process. By automating tasks such
as tax calculations, salary calculation, and salary report, the system can reduce manual
errors and the time required to process payroll.
 To save time and reduce costs associated with payroll management. By automating
repetitive tasks, the system can minimize the need for manual intervention, freeing up
valuable resources and reducing the overall cost of payroll processing.
 To create a user-friendly interface where employees can view their payslips, access tax
documents, update personal information, and request time off. By empowering
employees to manage certain aspects of their payroll, this objective promotes
transparency, engagement, and reduces the burden on HR staff.

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  To provide reporting and analytics capabilities to support decision-making processes.
This objective involves generating various reports, such as payroll summaries, tax
contribution, labor cost analysis, overtime and 13th month pay to provide insights into
the organization's payroll expenses. By using data analytics, organizations can make
informed decisions regarding resource allocation, budgeting, and overall financial
management.

SCOPE AND LIMITATION

This study is focusing on how Excel impacts the payroll management of Al Dawah
Producers Cooperative. This study will be done by conducting an interview with the company in
order to gather information about their system. It also covers the time-in and time-out of
employees through the use of biometrics, the process of preparing the pay slip of each employee
such as cash advances, computations of basic pay, holiday pays, overtime pay, and government
contribution like SSS and Philhealth.

This study will not cover the other problems that are not necessarily connected to the
payroll system of Al Dawah Producers Cooperative. The payroll system that will be proposed by
the researchers will only be used for the payroll management of the company, specifically the Al
Dawah Producers Cooperative, and not be employed in any other company.

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 CHAPTER 2: CONCEPTUAL FRAMEWORK
This chapter discussed the Review of Related Literature and Studies, the Conceptual
Model of the Study, and Operational Description of Terms.

REVIEW OF RELATED LITERATURES

Attendance Monitory

Adlaon conducted study on the DBA enterprise's payroll and daily time record system.
The old payroll and daily time record systems were unable to keep up with the growing number
of corporate branches throughout the area. According to the proponents' study, an automated
Payroll System with Daily Time Record that uses biometric authentication may be able to
resolve the company's existing challenges. It was also determined that the Payroll System with
Daily Time Record is very advantageous to the business. The solution makes it easier, quicker,
and more affordable to generate payroll and track attendance. It could decrease failures in
reporting and analysis, and it might deliver reliable/high-quality reports on time.[1] (Adlaon et.
Al., 2010)

According to Albino (2022), Employee attendance monitoring is a key function in HR

department, without a time and attendance system in place, this can be difficult for the human
resources department to manage and monitor employee attendance. A monitoring system for
employee attendance aids in ensuring that employees and staff are performing their commitments
and tasks. Automated Payroll processing and biometric technologies can take greater control
over payroll computation by removing the need for the manual buddy punching technique.
Numerous studies demonstrate that biometric technology improves payroll computation accuracy
since each person's psychological traits are distinct and impossible to falsify or replicate.[2]
(Albino & Cabulong, 2022)

Payroll Management

Payroll processing is a critical procedure in every business; it entails various duties to

assure correct and timely payments of workforce services, as well as to safeguard the firm's
reputation through good record-keeping compliance with government employment laws. Despite
its critical role in the organizational process, research on payroll processing is sparse when

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compared to other transaction processing systems such as sales and purchases. [3] (Ahmi A.
et.al., 2018)

Pavani conducted a study about payroll management that explained the association
between the Human Resources department and the payroll system should be widen and develop.
Each H.R. departments should be given more regulatory authority to guarantee that the company
pays attention about the welfare of its employees, and therefore the business's productivity can
improve. Employees' personal details and other associated information stored in pay roll system
software should be kept confidential in a company, and H.R. should own responsibility for this
thus, the terms and conditions of the pay roll system should be modified on a regular basis in
accordance with the labour laws established by the HR department. [4] (Pavani T. & Dhanusha
S., 2020)

According to Sethi, 2014, Accuracy is an important goal of a payroll system since

employees have a right to be fairly rewarded for the job they do, and a company's financial well-
being is dependent on not overpaying people for the time they work. Furthermore, firms must
pay payroll taxes on employee earnings as well as repay payroll taxes deducted from employee
paychecks. Payroll accuracy may avoid the inconvenience of time-consuming reconciliations as
well as the cost of fines.[5] (Sethi A.,2014)

Automated Payroll System

The Automated Payroll Management System for Negros Oriental State University – Bais
City Campuses (NORSU-BCC) stated that the part-time instructors process a speedy
and more accurate monthly payroll system. The system is described as an information
management tool that visually tracks part-time instructors’ payroll information, including total
hours rendered and late/undertime, calculated salary, deducted taxes and displays the desired
payroll process. It manages and calculates the payroll of every part-time instructor, for
it gives an automatic calculation. The deductions of tax, including the undertime and the total
number of working hours, will be calculated automatically. This newly created system saves
time and reduces errors of creating payroll using an automated system compared to the excel
process in the Accounting Office due to the connected electronic daily time record system.
Likewise, th9is system promotes better security and helps keep employees’ data confidential.
(Alejo, 2019)

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 According to the researcher (Aguilera, Bronzas, and Marqueses) of automated payroll
system of Pamana Medical Center (2010). A great payroll is really one of the most important
issues to pay attention in almost every company. It is impossible to handle payroll
responsibilities with a pen, ledger sheet and calculator, but nowadays it is more convenient for
most companies to use computerized payroll software. The schools is also not exempted in using
a payroll system namely the study of payroll system for the teachers and staff of Liceo De
Calamba (2010) there searchers (Maligaya, Opeña, James Jordan) viewed that Liceo de Calamba
aims to provide high quality of education for their students and to establish great relationship
with their employees by providing them with the right and appropriate benefits they must enjoy
as population of Liceo de Calamba increases, its system must perform competitively, Payroll
system is needed in order to have an accurate and error free in their payroll process and services.

CONCEPTUAL MODEL OF THE STUDY

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OPERATIONAL DEFINITION OF TERMS

This part consist of definition of different terms that is used in this research project, the
following terms are defined in the context of this study.

Payroll Management System

The process by which employers pay their employees' salary. Additionally, it is how they
uphold their duties to their staff, comply with legal requirements, and maintain accurate financial
records.

Biometrics
A time and attendance tracking system that uses physical traits like fingerprints or iris
scans to identify and track employees' attendance.

Payroll
The compensation that a company owes its workers for a specific time period and on a
specific day. The payroll procedure may involve keeping track of the hours worked by
employees, figuring out pay, and disbursing funds via cheque or direct deposit.

Payslip
A paper provided to an employee that details their earnings and any deductions.

Tax
A required charge that is either added to the price of certain goods, services, and
transactions or imposed by the government as a tax on the income of employees and corporate
profits.

Deduction
An sum deducted from an employee's pay by an employer for income taxes, insurance,
etc., or the act of deducting this amount

Salary report
A procedure for gathering data on employee compensation, including pay and benefits.

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 CHAPTER 3: METHODOLOGY
This chapter presents the methods to conduct the study. It includes the Project Design,
Project Development, Operation and Testing, and Evaluation Procedure.

PROJECT DESIGN

The Al Dalwah Producers Cooperative Payroll System is a payroll management system

that helps the organization to automatically compute the salary and deductions of an employee.
This study is designed to improve the efficiency, accuracy, and compliance of payroll processing
within the organization. The researchers aim is to develop an accurate calculation engine that
automatically calculates salaries, tax deductions, and other payroll components and implement a
reporting module that generates comprehensive payroll reports, including pay slips, tax
statements, and summary reports.

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PROJECT DEVELOPMENT

Design the Database Test individual

structure for payroll and components and Succeed
employee data storin. functionalities

Create a User Interface Conduct Integration System

Design

Develop Back-end Succeed

functionality for Tax
deductions, loans, salary
calculations, and
employee data managing
Conduct Integration System

Implement the Front-end

interface

Succeed

Integrate the Database

Carry out System Testing

Succeed

END
Fix Bugs or Issues

Set up servers, databases, and

Succeed Succeed
necessary infrastructures

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 The Figure shows the flowchart of the development of the application. After the
gathering of information about the topic, it goes to the designing of the system and developing.
Right after that, the said application will undergo a series of tests for the checking of the errors.
When the system is being implemented, the application will be tested by a certain number of
respondents who are knowledgeable in this area via "Convenience Sampling Approach". for
feedback gathering via "Black-box Approach".

OPERATION AND TESTING PROCEDURE

The operation and testing procedure is a comprehensive framework designed to

ensure the smooth and reliable functioning of a system while validating its performance and
adherence to predefined requirements.

The following steps were undertaken to test the system:

Test Module Test Undertaken

Understand the functional and non-functional

requirements of the payroll system, including
Requirements Gathering
features, calculations, data sources, and integrations.

Gather or generate test data that covers various

payroll scenarios, such as different employee types,
Test Data Preparation
pay rates, deductions, benefits, and taxes. Ensure the
data is representative of real-world scenarios and
covers both typical and edge cases.
Validate the individual components of the payroll
system, such as calculation algorithms, data
Unit Testing
validation rules, and data input/output processes.
This is typically done by developers or testers using
appropriate unit testing frameworks.
Validate the individual components of the payroll
system, such as calculation algorithms, data
System Testing
validation rules, and data input/output processes.
This is typically done by developers or testers using
appropriate unit testing frameworks.
Evaluate the system's performance under normal and
Performance Testing peak loads to ensure it can handle the expected
volume of payroll calculations efficiently. Test
response times, scalability, and system stability.

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EVALUATION PROCEDURE

The proposed system shall be assessed by proponents from the Technological University

of the Philippines following the procedure below:

1. The researchers selected the TUP evaluation instrument for prototyped developed for

the assessment.

2. The respondents were composed of (30) individual employees from Aldawah

Producers Cooperative and who used a payroll system as were randomly selected to evaluate the

system.

3. The researchers discussed the functionalities and operating procedures of the system to

the respondents and each selected individuals were allowed to test the system and further

evaluate its features.

4. Each respondent were given a survey form to rate the proposed system based on

Likert scale where 5 is highest and 1 is the lowest.

5. A selected interviewee from the Human Resource Department of Aldawah Producers

Cooperatives were interviewed based to discuss the functionalities and operations of the admin

feature of the system.

6. The selected interviewee were allowed to the test the system and evaluate the features.

7. The proponents collected the results sheet from the respondents and extracted the data

to compute the frequency of responses.

( )

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 The figure shown above is the frequency formula where the N is the number of positive

responses, the P represents the total number of respondents and to be multiply to 100 to complete

the percentage.

REFERENCES

[1]https://ejournals.ph/function/reader1/read2/web/reader.php?id=uploads%2Farchive%2FCLOUD%2FV
ol.+1+No.+1+%282013%29%2FIT%2F43_Adlaon.pdf&di=6128
[2] https://www.studocu.com/ph/document/agusan-del-sur-state-college-of-agriculture-and-
technology/bachelor-of-science-in-information-technology/final-capstone/28644723
[3] https://pubs.aip.org/aip/acp/article/2016/1/020124/725883/Payroll-system-A-bibliometric-analysis-of-
the
[4] https://www.jetir.org/papers/JETIRED06003.pdf
[5]https://citeseerx.ist.psu.edu/document?repid=rep1&type=pdf&doi=34802843e967b28f93e1c4bb64708
26bd268f5f1
[6] Related lit - RRL - RELATED LITERATURE Payroll System The Automated Payroll Management
System for - Studocu
[7] Chapter2 Payroll System | PDF | Payroll | Application Software (scribd.com)
[8] Payroll System: Thesis Documentation Chapter Two | Free Source Code Projects and Tutorials
(sourcecodester.com)

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