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WC Audit - Payments

Introduction

This procedure outlines the steps to generate a summary report of all payments made to subcontractors, contract laborers, temporary laborers, and day laborers during a specific policy period. This report is required for Workers' Compensation audits to ensure proper coverage calculation.

Policy Period Dates

Workers' Compensation policy periods typically run from July 15th to July 14th of the following year. When running reports, always use these exact dates for accurate audit documentation.

Procedure

Accessing Xero Reports

  1. Log in to Xero

Begin by accessing your Xero accounting software and navigating to the Accounting section.

Login to Xero and access Accounting

  1. Access Reports Section

In the navigation menu, locate and click on the "Reports" option to view available reporting options.

Click on Reports

  1. Select Account Transactions Report

From the available reports, select "Account Transactions" to view detailed transaction data by account.

Click on Account Transactions

Filtering for Subcontractor Payments

  1. Open Account Selection

Click on the account selection field to view the list of available accounts.

Click on account selection dropdown

  1. Select Subcontractors Account

From the account list, select "5300 - Subcontractors" to isolate payments made to subcontractors.

Select 5300 - Subcontractors account

Setting the Policy Period Date Range

  1. Select Start Date

Click on the date range field and enter the first date of the policy period (always July 15th of the starting year).

Enter policy start date - July 15

!!! warning "Date Format" Ensure you enter the date in the correct format (MM/DD/YYYY). Using the incorrect format may result in inaccurate reporting data.

  1. Select End Date

Click on the end date field and enter the last day of the policy period (always July 14th of the ending year).

Enter policy end date - July 14

  1. Apply Date Range

Click the "Update" button to apply the selected date range and generate the report.

Click Update to apply date range

Exporting the Report

  1. Export Report

After reviewing the report data, click the "Export" button in the top-right corner to save the report.

Click Export button

  1. Select PDF Format

    From the export options, select "PDF" to create a document that can be submitted for the audit.

    Select PDF format

Audit Documentation Checklist

Use this checklist to ensure you've gathered all necessary documentation for the Workers' Compensation audit:

  • Generated Account Transactions report for Subcontractors (5300)
  • Verified correct policy period dates (July 15 - July 14)
  • Exported report in PDF format
  • Saved file with descriptive name including policy period (e.g., "Subcontractor_Payments_2023-2024.pdf")
  • Confirmed all subcontractor payments are included
  • Prepared backup documentation for any large or unusual payments

Organization Tip

Create a dedicated folder for each year's Workers' Compensation audit files to maintain organized records that can be easily accessed if the audit is questioned later.