Voiding a Processed Payroll

This SOP provides detailed, step-by-step instructions for properly voiding a processed payroll in isolved. The goal is to ensure payroll reversals are handled accurately, minimizing the risk of data loss, duplicate entries, or financial discrepancies

Procedure

Step 1: Navigate to the Void Payroll Screen

1. Log in to isolved.

2. Go to Client Management > Client Utilities > Payroll > Void Payroll.

3. The last processed payroll will automatically populate for voiding.

⚠ Important: Always verify the correct payroll is selected by confirming:

• Payroll run number

• Payroll dates (Pay Period Begin/End and Check Date)

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Step 2: Review and Configure Void Payroll Options

Several configuration options are available when voiding payroll. Review each carefully before proceeding.

A. Reschedule Payroll

• Default: Checked ✅

• Function: Retains the payroll schedule so that the same dates can be reused for reprocessing.

• Uncheck this box only if the payroll will not be reprocessed using the same dates.

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B. Restore Pay Transactions

• Default: Checked ✅

• Function: Restores all payroll entry details (earnings, deductions, etc.) so corrections can be made and the payroll reprocessed.

• Uncheck if the entire payroll was incorrect and should be re-entered from scratch.

  • Note: Any manual checks, adjustments, and voids will also be deleted if unchecked.

  • If restoring transactions for prior quarter adjustments, only those transactions will restore — not regular payroll entries.

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C. Restore Accrual History Updates (Keyed/Imported)

• Default: Checked ✅

• Function: Restores accrual updates for reprocessing.

• Best Practice: Leave checked unless accrual entries were incorrect and will be manually re-entered.

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D. Reset Check Numbers

• Default: Checked ✅

• Function: Reuses original check numbers when payroll is reprocessed (for clients printing on their own account).

• Best Practice: Leave checked to maintain consistency unless new check stock or numbering will be used.

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E. Restore One-Time Billing Items

• Default: Unchecked ⬜ (enable as needed)

• Function: Re-adds one-time billing items from the original payroll so they bill correctly on the next run.

• Best Practice: Check this box if billing items were included in the payroll invoice and will need to reappear.

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F. Restore ACH Adjustments

• Default: Unchecked ⬜ (enable if applicable)

• Function: Restores any ACH adjustments for reprocessing.

• Best Practice: Check this box if any ACH corrections or offsets were part of the payroll.

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G. Void Reason

• Action: Enter a clear, detailed reason for the void.
  Include:

  • Who authorized the void (manager or supervisor)

  • The specific error being corrected (e.g., incorrect hours, missing deductions)

  • Any relevant notes about next steps

This information will display on the Payroll Run History screen for audit reference.

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Step 3: Review Payroll Export Status

Each export (e.g., Master Tax File, Direct Deposit ACH, New Hire File) will display a status indicating whether it has been sent or is pending.

If status = Sent:

• Confirm whether the system offers Create Reversal next to the export.

• If available, select this option to initiate automatic reversals.

  • ⚠ Caution: This may cause overdrafts if reversals post before the original ACH settles.

• Notify the Tax and ACH teams immediately:

  • Master Tax files may require netting.

  • ACH files may require reversals or offsets.

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Step 4: Execute the Void

Once all settings and export statuses are verified:

1. Click Void Payroll.

2. A confirmation pop-up will appear:

   • Cancel: Aborts the void (no changes saved)

   • OK: Confirms and executes the void

⚠ Once confirmed, the payroll is officially voided.
The system removes the processed records and updates payroll history to reflect the void.

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Step 5: Post-Void Verification

1. Navigate to Payroll Processing > Payroll History to confirm void status.

2. Review audit trail for:

   • Void date

   • Authorized user

   • Notes entered in Void Reason

3. Verify that:

   • Payroll is removed from Payroll Summary

   • Employee check records show as voided

   • One-time billing items and ACH adjustments restored correctly (if applicable)

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Step 6: Notify Client and Internal Teams

After completion:

1. Email the client confirming the void has been processed.
   Include:

   • Payroll dates and run number

   • Void reason

   • Next steps (e.g., reprocessing timeline)

2. Notify the Tax and ACH teams if reversal files were created or if follow-up netting is required.

3. Log a note in HubSpot:

   • “Payroll [Run #] for [Client Name] voided on [Date]. Reason: [Details]. Authorized by [Name].”

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Quality Control Checklist

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Notes & Best Practices

• Always confirm authorization from a supervisor before voiding any processed payroll.

• If payroll funds have already been distributed, coordinate with ACH or Finance before initiating reversals.

• Maintain documentation (screenshots or email confirmation) for audit trail.