A Proposed Computerized Payroll System of GEMPHIL Technologies Inc 1

CHAPTER 1 INTRODUCTION Background of the study Payroll is the sum of all financial records wherein business or companies pay its employees for work performed during a specific period of time. A payroll system involves everything that has to do with the payment of employees and the filing of employment taxes on a computerized manner. A payroll system may be manual or computerized and handle in-house or outsourced to another provider. The payroll process typically includes calculating employee pay, recording payroll transactions and determining and paying payroll taxes. Without implementing this kind of system, the company would have difficulty in computing for payments for services or work done by employees. Payroll system isn’t just a requirement nowadays. It is now essential to companies. Computerization is a control system that manages process in industrial workplace. It reduces human errors and processing time, thus it can boost productivity and resulted into high quality product produce. In Information System (IS), computerization is concerned about interrelating different but interdependent transactions. This can result in a system with well-integrated processes that can perform much faster and more accurate than a manual system.

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The GEMPHIL technologies Inc., is using a system that is out to date, often confusing and sometimes lagging, and that it is not user friendly. The system also is not liable or aware of the changes of the employee’s information.

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Statement of the Problem

General Problem The GEMPHIL Technologies Inc., is using a system that is out to date, often confusing and sometimes lagging, and that it is not user friendly. The system also is not liable or aware of the changes of the employee’s information.

Specific Problem 1. The system of the GEMPHIL Technologies Inc., is not updated. 2. They are using time cards when having a payroll check. 3. They are not aware on the changes of the employee’s information.

Objectives General Objective As the students of Information Technology, we are motivated to build a new Payroll system to replace the existing system that is out to date.

Specific Objectives

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1. The GEMPHIL Technologies, Inc. requires a newly presented system to allow employees to record time card information electronically and automatically generate pay slips based on the number of hours worked. This factor will lead to faster, shorter and lessen of processes and organized of important data. 2. We will develop a system that will improve the GEMPHIL Technologies Inc. payroll system and calculate payroll transaction easily. 3. We are then obliged to make the system user-friendly to the user by making it simpler than the existing, implement effectiveness, simplicity, accuracy and attractiveness of the system. We will implement a system that can update Employee’s information by creating an Employee Information system with add, edit and delete button.

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Conceptual Framework INPUT

PROCESS

OUTPUT

Make a research Conduct an interview Research from: Books,

Systems Analysis using Data Flow Diagram

Internet and Initial Interview

Computerized Payroll System for the employee’s of the GEMPHIL Technologies Inc.

Figure 1.0 This figure shows the conceptual framework or a summary of our proposed system for GEMPHIL Technologies, Inc.

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Significance of the Study The proposed system will truly help the whole company to manage everything faster than the usual. This study will help the employee resulting to a faster way of computing payrolls. The department responsible for time-keeping will lighten their duties as it will handle user-friendly transactions. Payroll system is also providing for the Accountants to improve the preparation of the payments in a timely manner, manage employee services, hours, pay rates, etc. Aside from the company, we are also the benefactors of the system because it will help us to enhance our ability to fully understand on how to create a computerized system that might help use in the near future.

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Scope and Delimitation of the Study Scope of the Study This study is schemed to develop a Computerized Payroll System for GEMPHIL Technologies Inc. It covers the process of preparing the payslip of each employee, the overtime exact wages of each employee, including information such as the daily rate, Gross payment, Net payment, and Deduction of taxes. The system works in multiple computers and sharing same database by which it can be used by different departments. The Proposed system does not support online program or transactions and will only be available for GEMPHIL Technologies Inc.

Delimitation of the Study The system is stand-alone and has no networking capabilities. The system cannot provide an individual print of the employee’s salary.

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Definition of Terms The following are defined operationally and technically for clear understanding of the terms used.

Operational Terms Bundy Clock – This refers to a clock card machine or punch or time recorder is a mechanical (or electronic) time piece used to assist in tracking the hours of an employee of a company. Daily Time Record – This refers to a record of how a person’s time has been spent. It is used to calculate pay, asses the efficient use of time, or charge for work done. Deduction – This refers to business expenses or loses which are legally permitted to be subtracted from the gross revenue of a firm in computing its taxable income. Employee – This refers to a person who is hired to provide services to a company on a regular basis in exchange for compensation. Gross Pay – This refers to total of an employee’s regular remuneration including allowances, overtime pay, commissions and bonuses, etc. Net Pay – This refers to the remaining amount of an employee’s gross pay, after deductions, such as taxes and retirement contributions, are made

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Overtime Hours – is the amount of time someone works beyond normal working hours. Payroll – This refers to a sum of all financial records of salaries for an employee, wages, bonuses and deductions. In accounting, payroll refers to the amount paid to employee for services they can provided doting a certain period of time. Payslip - a note given to an employee when they have been paid, detailing the amount of pay given and the tax and insurance deducted. Regular Hours – considered full-time if they work a standard workweek, which is generally defined as the maximum amount of regular hours per week Report – This refers to give an official account or statement of as treasurer reports the receipts and expenditures Salary – This refers to wages received on a regular basis, usually weekly, bi-weekly or monthly. Work Hours – is the period of time that an individual spends at paid occupational labor

Technical Terms Administrator - somebody whose job is to manage the database Data - individual facts or items of information A Proposed Computerized Payroll System

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Data Entry - encoding data in the computer Database - a systematically arranged collection of data Database Manager - someone that manages or manipulates

the

database MS Access - a relational database management system from Microsoft that combines relational Microsoft Jet Database Engine with a graphical user interface and software development tools Program - The computed salary and wages of the employee Salary - the compensation received by the employee in either 15 TH or 30TH of the month Software - the programs, symbolic languages that organize the performance of the hardware and through its process System - an assembly of computer hardware, software and peripherals working

together

Visual Basic - an object oriented event driven programming language

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CHAPTER 2 REVIEW OF RELATED LITERATURE AND STUDIES This contains the discussion of the review of related literature and studies that has a bearing on the totality of this study.

Related Literature A. Foreign Literature Information system takes a very significant role in management life. It greatly affects and interferes in the management decision, planning, and the development of new products and or services. The increasing range of information system connects to a transformation of an organization from using the traditional or manual information system to a computer base (program and software) system. Mike Johnson (2011) defines information system as a set of interrelated elements that gather, retrieved, process, store, and disseminate information to reinforce decision making and control in an

organization.

This

definition

indicates that the information system is very important organizing data and information of the organization Sherman and Watson (2012) stated that information system as an organized combination of people, hardware, software, communication networks, and data resources that collects, transform and disseminate information in an organization. A Proposed Computerized Payroll System

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The definition indicates that the main focus of the information system or automated system is broadly detailing on the idea, and organizing information pertaining to either individual groups, or organization. Philip Morris (2014) on this part, explains that information system is composed of inputs, processing units (process, store), and output (sources). In a broader sense, the information system consists of operations and management applications to support transactions, processing or decision making activities at different organization level. Automated payroll system is considered an information system for it stores data of the employee receiving its wages and salary, daily time record or attendance, and other benefits which an employee has to received. According to Great Martin (2015), management information system plays a very vital part in making an organization a success or failure. Great Martin (2015) stated that in designing a system, the following should be taken into consideration. It should provide a modular architecture, It should have a coordination of interface, the interface between different modules should be clearly labeled in the terms of content, frequency, and mode of operation. In automated payroll system, the manner of doing such is the same. The program or system should follow a process or a step by step procedure in order to arrive to a specific function within the system. The design of the must be in conformity with the existing tools of information technology.

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In a company, payroll is the sum of all financial records of salaries for an employee, wages, bonuses and deductions. In accounting, payroll refers to the amount paid to employees for services they provided during a certain period of time. Payroll plays a major role in a company for several reasons. From an accounting perspective, payroll is crucial because payroll and payroll taxes considerably affect the net income of most companies and they are subject to laws and regulation (e.g. in the US payroll is subject to federal and state regulations). From an ethics in business viewpoint payroll is a critical department as employees are responsive to payroll errors and irregularities: good employee morale requires payroll to be paid timely and accurately. The primary mission of the payroll department is to ensure that all employees are paid accurately and timely with the correct withholdings and deductions, and to ensure the withholdings and deductions are remitted in a timely manner. This includes salary payments, tax withholdings, and deductions from a paycheck. Companies typically generate their payrolls at regular intervals, for the benefit of regular income to their employees. The regularity of the intervals varies from company to company, and sometimes between job grades within a given company. Common payroll frequencies include: daily, weekly, bi-weekly (once every two weeks), semi-monthly (twice per month), and to a somewhat lesser extent, monthly. Less common payroll frequencies include: 4-weekly (13 times per year), semi-annually (twice per year), semi-monthly, and annually.

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An automated payroll system enables the employer to process its payroll through a computerized system. A manual payroll system requires that the payroll be processed by hand and is therefore a considerably slower procedure than an automated system. The former makes payroll processing simpler, and reduces errors, which are more likely with the manual system.

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Related Studies A. Foreign Studies In the study conducted by George Carlton (2013), it aims to lift up an understanding on the issues and concerns with regards to the management of information and securing information. The study was conducted by assessing the analysis, design, and management of computer based information system in two large organizations like British National Health Service Hospital Trust, and a Borough Council. In this study, George Carlton adopts the research methodology of interpretative mode of inquiry, where the system was evaluated on the context of business environment. The finding in the study shows that computer based information system affects the integrity and totality of the organization. The automated payroll system uses payroll software to compute all wages. Payroll software, such as QuickBooks, Pensoft, Z-Pay, Ultipro and Sage Peachtree calculated gross-to-net earnings based on the data the payroll representative inputs. Thus, if a terminated employee is due severance pay but the payroll representative neglects to make the entry, the system will not pay it. Typically, the system is reliable so long as the entries are correct. The automated system performs all types of payment; hourly, overtime, double-time, salaries, commissions, bonuses, pay raises, retroactive pay, wage deductions, auto payments and tuition reimbursements. Notably, the automated system eliminates manual paycheck writing. The system automatically generates paychecks and stubs and enables direct deposit.

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Salary and wage deduction are a necessary part of payroll processing. The employer must take mandatory withholding from employee paychecks, including federal income tax, Social Security tax, Medicare tax and usually state income tax. These taxes can be time-consuming and perplexing to compute manually. A number of rules are attached to withholding tax calculations. With an automated payroll system, the software has the rates hard-coded in the system. It calculates the withholding tax for each employee based on the withholding condition data input. This reduces the likelihood of payroll tax errors, which can result in fees from the IRS and the state taxation agency. According to the researcher of Nyanmaru Computerized Payroll System (2013) nowadays all establishments are becoming modernized, they use modern technologies to make their transaction fast, easy, and accurate in order to avoid waste of time and for the sake of safety and security. It also helps human to solve and understand complex problem and analysis such us the computational need of humans. Especially to business establishment or corporation processing enormous data and complex transaction. Payroll is an example of a complex transaction because it is a critical business operation dealing with numerous accounts and produce plenty and confidential files. Payroll is encompasses every employee of a company who receives a regular wages or other compensation due to each. Applying manual procedure on a Payroll transaction involving the vast beat answer in that problem would be computer because computers can simulate enormous data and can process complex transaction in a fast and efficient way.

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B. Local Studies In the study conducted by Ron Richardson (2013), she pointed out that information system helps to produce record, administer and corresponds data for the operational and preparation activities of the organization. The likes of automated payroll system is planned, design and developed to convene positive specific actions and is built on the objectives that there are management identification of the need that will sufficiently addressed the problem in manual way of doing the system. John Devin (2015), on the other hand stated that the record management system which also being to the family of information system is an administrative system which seeks to control, distribution, filing, retrieval, storage, and disposal of records which created or received by an organization during the operation. Nowadays, many payroll system implemented in different companies here in the Philippines because payroll system is one of the most important in establishing a business firms on how you provide the right and appropriate benefits for the employees in the company. Business firms must operate within the boundaries of laws and government regulations, Laws have been developed not only to protect consumers but also to promote competition among business and industries. Over half a century on, it’s fair to say that payroll is now one of the most commonly automated business operations; and certainly the most frequently the most used HR Solution that maintaining payroll record is one of the most important financial tasks in any business. A great payroll is really one of the

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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) the researchers (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.

Researchers (Alvarez, Aldrine, Gecolea) of Krizalen enterprises (2014) uses a biometrics with online data analytics dashboard to give Krizalen enterprises an efficient payroll system that can automatically monitor the attendance and trip tickets of the employees, drivers and helpers with the biometrics technology and data analytics that would help them in the security and accuracy of the company payroll and information. Summing up the past situation of payroll inside Krizalen enterprises, there was need for a system that could help them with employee information management attendance, monitoring, payroll processes, and assistance for the manager decision making. With this idea, the proponents conducted a study for the development of software that can minimize data redundancy, inconsistency, and manipulation. Employees can view their current A Proposed Computerized Payroll System

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pay and review their information from the database. And with updating of the reports that can be viewed through the internet, the manager can view the recent activities within the proposed system.

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Synthesis Based on the research or related literature and studies which tackle much on the information system, automated payroll system happens to one in the family of information system that store, organize, and process data. In the same manner, it can be conducted that payroll system implemented for the purpose of automating the payroll system can give or provide benefits to the business organization in the same way that other establishments are benefited with the aid of computer based payroll system. Furthermore, it can also be great help to the payroll personnel since data will be stored confidentially and data will be generated on a printable format. The similarities of the existing and the proposed system are that they contain a data base of salaries computation together with its deduction and others. The difference is that the proposed system will contain the database of the employees and faculty, and also the process of computing a salary based on the generated report taken from the report generated by the attendance monitoring. There are many variations of making a computerized payroll management system on how the client or the owner of the company wants to operate within his business like the study in Krizalen enterprises that they used a Bio-metrics with online data analytics dashboard to view information or save the online studied since 2014 and also the research entitled “intuit payroll of intuit, INC. Since 2013” claims that with the use of payroll systems computations of pay checks or payslips are precise and always on time, taxes are clear and liquefied, and tracking of employee records are easy and organized. The revolutionary systems A Proposed Computerized Payroll System

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regarding payroll helps to eliminate tasks made by man and therefore also eliminating the risk of human errors. As well as payroll outsourcing company, Oasis outsourcing (2013) believes that through web-based payroll systems, the Management can access information from in and out of the office. But with the limited access and multiple levels of security options can provide reliable and accurate updated records and computations. And also the study of payroll entitled “automated daily time record and payroll system of Laguna water district (2004)” recommended to use a hardware such as iris scan, thumb mark scanner and other Biometrics innovation for additional security and further technology advancement should be taken into consideration.

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Chapter 3 Research Methodology

Research Design The research design to be applied in this study is the experimental and descriptive methods. Descriptive research describes and interprets what is. This methodology goes beyond more gathering and tabulation of data and it also involves the interpretation and analysis of the meaning or significance of what is described. The experimental research design is to be used to evaluate the proposed software using questionnaires. All the necessary data and information for this study were gathered from unpublished theses, books, and articles from the Internet.

Method Used in Developing the Software Product The software is to be developed to be used by the GEMPHIL Technologies specifically the person in-charge of the payroll of the employee. The software was intended to run on Windows XP. Visual basic 6.0 will be used in the developing of the GUI while MS Access will be used for its back-end database application.

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Rapid Application Development (RAD) is a software development methodology that uses minimal planning in favor of rapid prototyping. The “planning” of software developed using RAD is interleaved with writing the software itself. The lack of extensive re-planning generally allows software to be written much faster, and makes it easier to change requirements.

Figure 3.0

Four phases of Rapid Application Development (RAD)

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1.

Requirements Planning Phase - combines elements of the system

planning and systems analysis phases of the System Development Life Cycle (SDLC). User, managers, and IT staffs members discuss and agree on business needs, project scopes, constraints, and system requirements. It ends when the team agrees on the key issues and obtains management authorization to continue.

2. User Design Phase - during this phase, user interacts with system analysis develop models and prototypes that represent all system processes, inputs, and output. The RAD groups or subgroups typically use a combination of Joint Application Development (JAD) techniques and CASE tools to translate user’s needs into working models.

User

Design

is

continuous

interactive

process that allows users to understand, modify, and eventually approve working model of the system that meets their needs.

3. Construction Phase - focuses on program and application development task similar to the SDLC. In RAD, however, users continue to participate and can still suggest changes or improvements as actual screens or reports are developed. Its tasks are programming and application development, coding, unitintegration and system testing.

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4. Cutover Phase - resembles the final tasks in the SDLC implementation phases, including data conversion, testing, changeover to the new system, and user training. Compared with traditional methods, the entire process is compressed. As a result, the new system is built, delivered, and placed in operation much sooner. Its task are data conversion, full-scale testing, system changeover, user training.

Method Used in Evaluating the Software Product Descriptive research design will be used to determine the level effectiveness of the payroll system as a tool in easy computing the payroll of the employee in terms of reliability, accuracy, and convenience. Albert Rogers stated that descriptive research design involves gathering data that describe the events and then organize, tabulates, depicts, and describe the data. Actual software demonstration and post interviews will be the most reliable way to identity the quality of the software. Two sets of questionnaires will be given to the respondents for the assessments of the study and the software. These questionnaires will determine whether the software meets the criteria and expectation of the users.

Respondents of the Study A Proposed Computerized Payroll System

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The proposed study covers the administration and the payroll GEMPHIL Technologies Inc. The respondents are selected by means of purpose sampling which is the desired of the proponent’s base on the requirement of the system.

Data Gathered Tools Gathering of information regarding the study was through internet, interview from the actual user, and other related materials for the study. Questionnaires are also to be used to gather data regarding the evaluation of the software, and the manual method.

Instruments Used A two part self-administered questionnaires shall be used to evaluate the software and existing method. Information of the respondents is shall be gathered on the first part of the questionnaires. Data regarding evaluation of the software to determine line accuracy, reliability, and convenience of the software as compared to the evaluation of the existing method based on the same criteria shall be gathered on the second part of the questionnaire.

Administration and Retrieval

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A pretest of the software and the questionnaires shall be conducted to determine if the materials are ready for the evaluation. An actual test was then to be conducted to

show the respondents capabilities of the software.

Questionnaires shall be distributed to the respondents for evaluation of the software and the existing method. The following are the scales of measurements for the evaluation of the software and the existing method. Data Gathering Procedure/s and Output We, the researchers, conducted a paper interview because we can’t manage to do it personally due to hectic schedules and the company is only operating weekdays. The papers were distributed to the respondents and gave them enough time to fill up the questionnaires and answers each questions.

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THE EXISTING SYSTEM Company Background GEMPHIL Technologies, Inc., established on February 12, 1991, is a 100% Filipino owned company. They are the producer and supplier of highly specialize components to major electronics and semiconductor companies with operations in the Philippines, Asia Pacific, America, and Europe. They design and manufactured coils and transformers used in RF hybrid devices applied in the telecommunication and data transmission system, CATV amplifiers, power coils and transformers for AC-DC, AC-AC, and DC-DC converters, EMI and RFI filters, degassing coils for monitors, and into assembly and test of power converters, electronic ballasts, and devastators for industrial motors.

Description of the System Their current system is using a system that is incorrigibly out to date, often confusing and sometimes lagging, and that it is not user friendly. The system also is not liable or aware of the changes of the employee’s information. This leads to wrong details when printing up pay slip forms.

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Problem Areas The GEMPHIL Technologies Inc., is using a system that is out to date, often confusing and sometimes lagging, and that it is not user friendly. The system also is not liable or aware of the changes of the employee’s information.

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THE PROPOSED SYSTEM System Overview The system will start when the admin logs in with his/her admin username and employee password. After logging in, an option will show if you want to choose the Employee management form of the Payroll form. The employee information form lets you add, edit, delete or search for existing employee, While the Payroll form lets you search for the employee with specific work dates, and if found, data will be shown on the data grid system and now lets you process their payroll information and print. The system has the ability to update and maintain employee information and to automatically generate required outputs including pay checks, reports to Admin and Accountants. The system can also compute for the Gross payment, Net income and the salary deductions given the regular overtime and under time hours worked per day.

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Existing System (DFD)

Context Diagram

Fig. 3.0

This figure shows the context diagram of the existing payroll system of the GEMPHIL Technologies Inc. In which, the payroll system flows through a time card, this was generated in the time clock. In the system, the employee will receive the tax form and also the payroll check, and after this process, the payroll report was forwarded to the accounting department.

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Top Level Diagram

Fig 3.1 This figure shows the top level diagram of the existing payroll system of GEMPHIL Technologies Inc. As shown in the process, it is confusing, out to date, lagging, and not user friendly. The system is not updated in terms of employee’s information. Therefore it was not reliable in getting information.

Proposed System (DFD)

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Context Diagram

Fig. 3.2

This figure shows the context diagram of the proposed payroll system for the GEMPHIL Technologies Inc.

Top Level Diagram

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Fig. 3.3

This figure shows the top level diagram of the proposed payroll system for the GEMPHIL Technologies Inc.

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APPENDIX A (Letter)

July 27, 2016

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_____________, _____________ _____________ Dear Madam, We, the Students of ASIATECH College namely, Carl Arvin A. Dimas, Jomar M. Rebulado, Mark Diether G. Tangcalagan and Jonas N. Constantino taking up Bachelor of Science in Information Technology, currently enrolled in System Analysis and Design would like to ask a permission if you may allow us to conduct a personal interviews regarding to the Payroll System of your company GEMPHIL Technologies Inc. The information that we gathered will be a big help in our program System Analysis and Design. Attached here is the list of Interview Questionnaires, Information Data and Registration card that can prove that we are students of Asia Technological School of Science and Arts College. We are hoping for your response on our request, rest assured that the information we gathered is highly confidential and for studying purposes only. Thank you so much and God Bless.

Sincerely Yours, Carl Arvin A. Dimas Mark Diether G.Tangcalagan Jomar M. Rebulado Jonas N. Constantino Noted by:

Mrs. Rozaida C. Tuazon System Analysis and Design Professor

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APPENDIX B (Questionnaires)

PAPER INTERVIEW Name (Optional):________________

Age: __________________

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Gender: _______________________

Occupation: ____________

Please complete the following questions to reflect your opinions as accurately as possible and to answer factual questions to the best of your knowledge. Rest assured that the information derived herein is treated with utmost confidentiality.

1. Company Background: a. What is GEMPHIL Technologies Inc.? __________________________________________________________ __________________________________________________________ _____________________________________________

b. When was the company established?

__________________________________________________________ __________________________________________________________ _____________________________________________

c. How many employees are currently in GEMPHIL? __________________________________________________________ __________________________________________________________ _____________________________________________

2. Brief description of the System: ________________________________________________________________ ________________________________________________________________ ___________________________________________________

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3. What problems do employee encounters when it comes to payroll? ________________________________________________________________ ________________________________________________________________ ___________________________________________________

4. Is there any solution for the problem? ________________________________________________________________ ________________________________________________________________ ___________________________________________________

5. How much is the rate per hour? ___________________________________________________________

6. Is there any allowance? How much? ___________________________________________________________

7. How many percent is the Withholding Tax? ___________________________________________________________

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APPENDIX C (Screen Layout)

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Screen Layout/Specification

Fig. 3.0 This figure show above is the start of the system’s operation. The program will ask for a valid Employee ID and password. Both inputs are in strings format.

Report/ Form Specification

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Fig. 3.2, Fig. 3.3, Fig. 3.4, Fig. 3.5 This figure shows the form of employee’s information. It includes add, edit and delete of the employee’s information.

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Program/ Module Specification

Fig. 3.6

This figure show above is the start of the system’s operation. The program will ask for a valid Admin username and password. Both inputs are in strings format.

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Figure 3.7 Lets you choose if you want to access Employee management form or Payroll management form. Fig. 3.7

The picture shown above lets you manage Employee information. The search button lets you search for existing records saved on the database; the edit button next search button lets you modify information about the employee. Example scenario is when a woman employee gets married, and its middle and last name should be modified as soon as possible to avoid misleading and wrong information printed on the payslip.

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Fig. 3.8 This will show if you choose the payroll picture on the right side of the choose form. To start with the process, you’ll enter the started days until the end work date. Once you clicked the find button, Employee’s information will show up on the left side of the form with their corresponding ID and Name. Once you clicked on the ID, The employee’s payroll information will show up to their corresponding text boxes and data grid view. Rate per hour, Allowance, and withholding tax are constant. (Based on the interview). When you clicked compute button, Gross pay and Net pay are calculated. Then you can print the information now.

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Fig. 3.9 This is now the printed payslip and can now be distributed to the employee.

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APPENDIX B (Feasibilities)

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Economic Feasibility This is where the feasibility could be established by conducting a Market Analysis or Cost Benefit Analysis. The researcher could choose the appropriate tool. If the proposed software is costumed for a particular company and there will a basis for the computation of the operating cost, benefits. Return on Investment (ROI), Payback Period. The researcher should present under this subsection, the formula he/she will use in establishing the economic feasibility of his/her studies.

Operating Costs Operating costs stated the annual of personnel expense, supplies and equipment costs required for the existing and proposed system, the use of this is to compare both of them to analyze which save more. The total annual cost for existing is Php. 387,784.20 and in the annual cost for proposed is Php. 196,703.95.

Development Costs Development cost is incurred during the development of the system are one time investment, it’s include the Adequate Software, Hardware requirements, labor cost, supplies cost, electric consumption, food and transportation cost. And total development cost is Php. 22,956.57.   A Proposed Computerized Payroll System

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Cost and Benefits Analysis Cost benefit analysis (CBA) it is important to identify cost and benefit factors. It’s a technique designed to determine the feasibility of a project or plan by quantifying its cost and benefits. Through this analysis you will be able to compute the total cost saving, payback period and net saving by use of this formulation. Annual Cost

=

Existing Cost – Proposed Cost

Payback Period

=

Annual Cost – Present Value

Net Saving

=

End Cumulative Present Value – Total Development Cost

Return of Investment (ROI) A performance measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. To calculate ROI, the (return) of an investment is divided by the cost of the investment; the result is expressed as a percentage or a ratio.

The return on investment formula:

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Return of Investment (ROI) (5 years) = ((End Cumulative Present Value – Total Development Cost / End Cumulative Present Value) * 100)

The “end cumulative present value” formula refers to the proceeds obtained from selling the investment of interest. Return on investments is a very popular metric because of its versatility and simplicity is a very popular metric because of its versatility and simplicity. That is, if an investment does not have a positive ROI, or if there are other opportunities with higher ROI, then the investment should not be under taken.

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