LifeMart ContestMarch 26, 2019
Pinnacle Party at the Huddle!March 26, 2019
SCI has new online software called ProfitKeeper. Team Leaders will be uploading their store financials from the Team Leaders’ own accounting software to the ProfitKeeper online software. TL’s will use ProfitKeeper to “map” the delivery of data from your own internal software, such as QuickBooks, to ProfitKeeper. This is a new requirement by SCI, and Pinnacle is modifying some of our reports to help Team Leaders comply.
One important consideration is that Pinnacle is operating as a PEO (Professional Employer Organization), which means that Pinnacle pays the Team Members under Pinnacle’s Federal Employer Tax ID Number (FEIN), not under your own business’ FEIN. The PEO is considered the Employer of Record for IRS purposes and the PEO is designed as a way to outsource and simplify your payroll accounting.
ProfitKeeper has separate categories in their Chart of Accounts for Employer Payroll Taxes, Workers Compensation Insurance premiums, and Payroll Processing Expense. These expenses are bundled together on Pinnacle’s invoicing and other reports. It is understood by SCI that the best way to report these bundled Pinnacle expenses would be to group them under the category called “Payroll Processing Expense”. Of course, Pinnacle does much more than payroll processing. We have employee benefits administration, HR support, unemployment claims, workers comp claims handling, online systems and other services built into our service package for the PEO. The admin cost is on your Pinnacle invoice as “Payroll Taxes & Fees”, which also includes the employer payroll taxes and the cost of workers comp insurance. This bundled total should be reported on ProfitKeeper under “Payroll Processing Expense” with zeros for the other related ProfitKeeper accounts. That is simpler for you and accurately reflects the business relationship under a PEO co-employer.
ProfitKeeper has separate categories in the Chart of Accounts for different job types, such as Manager, Stylist, Coordinator and Other. In order to use these categories in ProfitKeeper, Team Leaders should create the same categories in your internal accounting system. Once you start using the ProfitKeeper categories (Chart of Accounts) in your own accounting software it becomes an easy process to map those accounts to the matching accounts in ProfitKeeper. Then you go onto the ProfitKeeper website and the upload into ProfitKeeper becomes a simple process. To help with the different job types, Pinnacle has added a new version of the Invoice Component Billing Detail to our invoice report set that you receive every time you run a payroll through Pinnacle. The report is now arranged by job type, with each job in a separate departmental list with a total beneath it.
Other separate categories in ProfitKeeper are tips, incentive pay, vacation pay, employer contribution towards employee benefits, and employer contribution towards 401(k). To help TL’s separate the tips and other pay types, Pinnacle is instituting a new report called the Department Wage and Hour Report. You can certainly obtain this information from your payroll spreadsheet that you used to report the hours to Pinnacle. However, we believe this new report will make it easier to reconcile pay totals by job type and by pay type. SCI considers the correct accounting practice on Reported Tips is to list the tips in your financials as neither revenue nor an expense of your business. Instead, the tips held on behalf of Team Members is shown in your financials as an asset on your balance sheet until paid out with the next payroll run. Some of the new Pinnacle reports are not able to be run retroactively, so estimates of some of the breakouts may be done in ProfitKeeper.