In order to thrive, businesses must compensate their employees with regular paychecks that reflect a pay scale that was previously agreed upon by both parties. It is a necessary process that all companies have to do if they want to survive. The more hard working employees the company has, the more work can be done and the outreach of the business will expand. However, the amount of money that it costs a business to pay an employee is not limited to the number found on their paycheck. This is where payroll expenses come into play.
Payroll expenses refer to all the costs that a company must pay to keep their workforce employed. This includes gross earnings given to the employee, taxes, and additional benefits paid. On average, payroll expenses can be 10-15% higher than the simplified payroll number. Because of the wide gap that normally exists between these two figures, it is vitally important for a business to have a firm grasp on their payroll expenses. This allows management to make important decisions, such as how many people they are able to employ, when they can afford raises and bonuses, and how their current payroll situation affects their other expenses.
Payroll is usually the biggest expense for a business. Every two weeks it can make business executives sweat, no matter the size of the company. Having an outsources financial consultant can help forecast your businesses 13-week rolling cash flow and give better financial visibility into your companies future.
 wiseGEEK, “What Are Payroll Expenses?” http://www.wisegeek.com/what-are-payroll-expenses.htm