Owner/partner drawings

Owner and partner drawings represent cash or equity withdrawals from the business by the owner(s) or partner(s). These are distinct from salary or wages—they are distributions of profit or owner capital. In Usystems, you record drawings as adjustments in the payroll module to track them alongside other compensation and distribution activities.

Before you start

• You have access to the HR or payroll module and permission to record adjustments
• The owner or partner is listed as an active contact or employee in the system
• You know the draw amount and the date it will be taken
• You understand the business ownership structure (sole owner, partnership, etc.)
• Any partnership agreement or approval documentation for the draw is available

Steps

1. Navigate to HR → Payroll Open in Usystems
2. Find or select the owner's or partner's payroll record (or create one if it does not exist for this pay period)
3. Look for the Adjustments section
4. Click to add a new adjustment
5. Select the adjustment type as Drawing or Owner withdrawal (if available; otherwise use a deduction labeled "Drawing")
6. Enter the draw amount
7. Add a description that clarifies the nature (e.g., "Owner draw — profit distribution," "Partner draw — monthly capital withdrawal")
8. Confirm the date matches the intended draw date
9. Save the adjustment

The drawing is now recorded and will be tracked in the payroll record. It will be reported separately from employee compensation.

Accounting impact

• Owner/partner drawings: debited to an owner equity or drawings account (a contra-equity account); credited to cash (if withdrawn immediately) or accounts payable (if drawn through payroll)
• The drawings account shows the total distributions from the business to the owner in a given period
• At year-end, drawings are typically moved to retained earnings to adjust the owner's equity balance

Tips & common mistakes

• Use a consistent account coding system so that owner draws are always recorded to the same equity account across periods
• Document the approval or authorization for each draw, especially in partnerships where multiple partners must agree
• Do not confuse drawings with salary; salary is paid to an owner who is also an employee, while drawings are pure profit or capital distribution
• Review your business structure (sole proprietorship, partnership, corporation) as the accounting treatment of drawings may differ
• If the business is a corporation, drawings may be recorded differently (as dividend payments rather than owner equity adjustments)