Auto Deposit Update



During the past several weeks and pay periods, I have had a larger than usual occurrence of problems with new accounts set up for Auto Deposit.  Since the majority of the Auto Deposits are for payroll purposes, this creates a fire drill on my part to figure out the problem, contact the bank and State Treasurer’s office to correct the file sent to the bank and have the account funded with the proper payroll amount.  State accounting also has to make the added journal entries to balance the payroll accounts.


The primary culprit has been bad or incorrect account numbers either as a result of the employee not writing the number down correctly or the staff not entering the number into the system correctly.  Accuracy is paramount when setting these payroll accounts.


In an attempt to stem the flow of errors, I am asking that you take one of two steps - either way, the account will be verified BEFORE the funds are sent to the bank.


·         Require a voided check be attached to the Direct Deposit Agreement for verification of the account and double check the account number based off the check, not the employee’s entry.  Deposit tickets for the account should not be used since the number on the ticket is not always the same as the account number at some banks.


·         In those instances when you do not have a voided check to use for verification, flag the account for Pre-note status during the first payroll run after the account is set up.  This way, if the account number is incorrect, the bank will notify you of the error and it can be corrected before removing the pre-note flag. 


The Direct Deposit Agreement form has been revised to request a copy of a voided check from the employee at the time the form is submitted to you.  The revised form is on the web site for employees to print off when setting up the direct deposit.