Salary Reconciliation and Verification of the OASI Declaration

When salary accounting is managed on a net basis, the annual OASI declaration cannot be verified by directly comparing the Salaries account with the final statement issued by the OASI Compensation Office. This is because the Salaries account contains the recorded net amounts, whereas the OASI statement is based on the gross payroll calculated by the payroll management software.

To verify the accuracy of the annual OASI declaration and the other year-end statements, it is therefore necessary to reconstruct the gross payroll and carry out a series of reconciliation checks.

The reconciliation process makes it possible to verify the consistency between:

• the accounting records
• the payroll statements generated by the payroll management software
• the annual OASI declaration
• the final statements issued by the social security institutions.

Reconciliation objectives

The year-end reconciliation has two main objectives:

• to reconstruct the gross payroll and compare it with the gross payroll declared to the OASI Compensation Office;
• to reconcile the OASI contributions by comparing account 5700 OASI Contributions with the final statement issued by the OASI Compensation Office.

Required documents

The following documents are normally required to perform the reconciliation:

• the accounting file
• the payroll statements
• the annual OASI declaration
• the final statement issued by the OASI Compensation Office
• the occupational pension (LPP/BVG) statements
• the insurance statements (OAI, daily sickness allowance insurance, etc.).

Verification of net salaries

The first check is to verify that the amounts paid to employees match those shown in the payroll statements generated by the payroll management software.

The total net salaries recorded in the accounting records must match the net salaries shown in the payroll statements.

It is also necessary to verify that there are no missing or duplicate transactions and that all entries have been recorded in the correct accounting period.

Any differences must be analyzed and corrected before proceeding with the reconciliation of the gross payroll.

Reconstruction of the gross payroll

To compare the accounting records with the OASI statement, the gross payroll must first be reconstructed.

The reconstruction must be carried out using the data from the payroll management software, which provides the details of the deductions applied to each employee.

Start from the net salaries recorded in the accounting records and add only the deductions withheld from employees, such as:

• OASI, DI, IC, and ALV
• occupational pension (LPP/BVG) contributions
• withholding tax
• other salary deductions.

The following must instead be excluded:

• family allowances;
• expense reimbursements;
• other allowances that are not subject to OASI contributions.

Verification of OASI contributions

During the year, OASI contributions are normally paid as advance payments. The actual amount due is determined only by the final statement.

For this reason, the balance of account 5700 OASI Contributions must be compared with the final statement issued by the OASI Compensation Office.

The account balance must include the advance payments made during the year as well as any year-end adjustments. The total must match the contributions shown on the final statement issued by the OASI Compensation Office.

Verification of other social security contributions

The same principle can also be applied to other social security and insurance contributions by comparing the balances of the related accounts with the annual statements issued by the relevant institutions.

In particular, it is advisable to verify:

• occupational pension (LPP/BVG) contributions;
• occupational accident insurance (OAI) premiums;
• daily sickness allowance insurance premiums;
• other recorded social security contributions or insurance premiums.

Any differences relating to these institutions should also be analyzed and reconciled before the financial year is closed.

Year-end checks

At the end of the financial year, the reconciliation should confirm that:

• the gross payroll matches the gross payroll declared to the OASI Compensation Office;
• the recorded contributions match the final statements issued by the institutions;
• all advance payments and any year-end adjustments have been recorded;
• there are no differences between the accounting records, the payroll statements, and the declarations submitted to the social security institutions.

A complete reconciliation makes it possible to identify any differences before submitting the declarations to the social security institutions and ensures consistency between the accounting records, the payroll management software, and the annual statements.

FAQ

Why doesn't the gross payroll in the OASI declaration match the Salaries account?

• Because under net salary accounting, the Salaries account records only the net amounts paid to employees, whereas the OASI declaration is based on the gross payroll.

Why is the balance of the OASI account different from the advance payments made?

• Because advance payments are normally made during the year. The actual amount due is determined only by the final statement.

How is the gross salary determined?

• The gross salary is reconstructed using the payroll statements generated by the payroll management software.

How do you reconstruct the gross salary starting from the net salary?

• Start with the net salary recorded in the accounting records and add the deductions withheld from the employee (OASI/DI/IC/ALV, occupational pension (LPP/BVG) contributions, withholding tax, and other deductions). Family allowances, expense reimbursements, and other allowances that are not subject to OASI contributions must instead be excluded.