What Should a Payroll Approver Actually Review Before Signing Off?

It isn’t enough for a payroll approver to simply review the final figure, decide it “looks about right” and approve it. The payroll approval process should be substantive, providing the approver with the data needed to identify material changes, investigate any exceptions and ensure the pay run is consistent with the employee and payroll records on file.

The reason for this rigour is that payroll mistakes can build up before they’re detected. In 2024–25, the Fair Work Ombudsman recouped some $213 million in underpayments from the large corporate sector on behalf of close to 118,000 workers. Typical problems included incorrect overtime and penalty rates, or errors in allowances and leave accruals.

Of course, the approver isn’t expected to recalculate the entire payroll. The job is to focus on the movements and exceptions that suggest an error has occurred.

What Should a Payroll Approver Review?

The Payroll Variance

The first question should be what has changed from the last pay run and why. A variance report will show the changes in total gross and net pay, deductions, employer costs and headcount. There’s no need to review every minor discrepancy as some fluctuation is normal; the objective is to find what doesn’t fit the pattern.

An 8% rise in gross wages is easily explained if a number of staff have received planned increases. But if that same rise is driven by an unexpected volume of overtime, it warrants scrutiny. To do this properly, the reviewer needs to have the current numbers alongside a suitable period for comparison, not just the payroll in isolation.

Additions and Deletions to the Roster

Any change in the employee population calls for closer review. With new starters, the approver must be able to verify that the person is actually starting and that the rate and details match the onboarding paperwork, including any partial-period payments. Terminations are another matter. The final payment might cover ordinary wages and unused leave, so the approver must ensure it matches the termination data provided to payroll.

Under Australian law, employers are required to keep records of an employee’s start date, basis of employment and all manner of pay information, from bonuses and loadings to deductions. That provides the approver with something concrete to work with instead of relying on the system’s output alone.

Individual Payments That Stand Out

The overall total may look fine, but one employee could be paid well above or below expectations. You should look into material variances on an individual basis to rule out any excessive hours, manual adjustments or the like. And while a commission or back payment is entirely in order, there has to be documentation to provide context. For that sort of scrutiny, an exception report is preferable to wading through a long payroll register; it puts the emphasis on the areas that call for some human judgement and can flag up potential duplicate payments.

Overtime and Penalties

One has to look at the volume of overtime as well as the pattern in which it’s worked. There’s a distinction to be made between an isolated spike on one employee’s record and a rise across the department, the latter attributable to factors such as a major project or a staffing shortage.

As for oversight, the approver needn’t sign off on every hour, yet he or she must have visibility into any substantial shifts in variable pay and be satisfied that proper authorisation is in place. The 2024-25 annual report by the Fair Work Ombudsman makes clear why this is important, pointing to large firms where incorrect leave accruals and the non-payment of penalties are all too common.

Payroll Controls and Reconciliation

The responsibility for review doesn’t rest with the approver alone. Before a pay run comes to final approval, the payroll team should have completed their checks. This means the underlying payroll controls and reconciliation have been completed, whether that’s checking the payment file against the approved payroll or verifying PAYG withholding and superannuation figures against the accounting records.

According to the Fair Work Ombudsman’s Payroll Remediation Program Guide, regular reconciliations and internal audits should be conducted, along with risk-based compliance monitoring. The guide is also clear on the need to track trends in pay queries and employee issues, with the assurance process having exception reporting and controls in place.

This helps separate preparation from approval. While payroll staff are responsible for the details of processing and reconciliation, the approver’s role is to review the evidence, focus on any exceptions and determine if the pay run can be authorised.

Leave and Other Variable Payments

An approver should watch for irregularities in leave, for instance. There may be a perfectly valid reason for a sizeable leave payment, but the approver needs to be able to identify the reason. The same applies to back pay, manual adjustments, bonuses or reimbursements.

There’s no need to challenge every variable payment; the point is to make sure material changes are supported by the payroll records and have an identifiable source. This is particularly important when the process depends on manual work. A manual change without supporting documentation is harder to verify than one from an approved employee file.

Resolving Exceptions

The timing of a pay run is no excuse to let unresolved matters remain on the approval screen. If the system flags exceptions, the approver must know what they are and who has reviewed them.

If something can’t be resolved before finalisation, it should be formally escalated and documented, rather than left to appear in the next cycle. In doing so, the approval trail is more useful to anyone reviewing the payroll later; they’ll see not just the authorisation but how any unusual items were handled.

What Does Better Payroll Process Improvement Look Like?

It isn’t about adding checks for the sake of it. Proper payroll process improvement is about making the necessary checks easier to carry out consistently. An effective workflow might run as follows:

• Prepare the payroll from time and employee data that has been approved.

• Run a comparison of totals against the prior period.

• Review headcount and check new starters or terminations.

• Identify any material variances in individual pay.

• Review overtime, allowances and penalties for anything unusual.

• Reconcile with the accounting and payment records.

• Make sure exceptions are resolved, documented or otherwise escalated.

• Have the approver review the variance and exception details.

• Authorise the final payroll.

Automation has its place here in flagging unusual payments and providing variance reports so the approver isn’t left to do the manual work, though it shouldn’t remove the need for judgement.

Consider the case of Southern Cross Care NSW & ACT. In April 2026, the Fair Work Ombudsman reported that underpayments affecting 5,500 staff totalled more than $11.7 million, including interest and superannuation. The organisation attributed the underpayments to its time-and-attendance system and a manual payroll process. A further review identified errors in how overtime, allowances and shift penalties were calculated under its enterprise agreement.

What Makes Payroll Approval a Meaningful Control?

When the person signing off can answer some straightforward questions — what has changed, what appears unusual, is there an explanation, and do the numbers add up — then the control is meaningful. It’s far better than having an approver review hundreds of lines based on intuition alone.

Payroll controls and reconciliation help approvers check pay against the supporting records. Variance reports and headcount checks highlight changes since the previous pay run, so approvers can investigate unusual payments before signing off.