Topic: payroll processing and fixed asset procedureSubject: accounting information system departments. In addition to supervising operations.the supervisors of the departments are responsiblefor recruiting, hiring, and firing workers withintheir areas of responsibility. The organizationattracts casual labor and experiences a 20 to 30 per-cent turnover rate in employees per year.Employees clock on and off the job each day torecord their attendance on time cards. Each departmenthas its own clock machine located in an unattendedroom away from the main production area. Eachweek, the supervisors gather the time cards, reviewthem for accuracy, and sign and submit them to theroll department for processing. In addition, the super-visors submit personnel action forms to reflect newlyhired and terminated employees. From these docu-ments, the payroll clerk prepares payroll checks andupdates the employee records. The supervisor of thepayroll department signs the paychecks, which aredrawn on the general cash account, and sends them tothe department supervisors for distribution to theemployees. A payroll register is sent to the cash disbur-sements department where it is filed.pay-Required1. Prepare a flowchart of the Sherman's payrollsystem.3. PAYROLL-RISKS AND CONTROLS2. Discuss the risks for payroll fraud in theSherman Company payroll system.Sherman Company employs 400 production, mainte-nance, and janitorial workers in eight separate3. What controls would you implement to reducethe risks?

Payroll System: Payroll system is an arrangement within an organization that manages the payment of…

Required 1. Prepare a flowchart of the Sherman's payroll system. 2. Discuss the risks for payroll fraud in the Sherman Company payroll system. 3. What controls would you implement to reduce the risks?

Required 1. Prepare a flowchart of the Sherman's payroll system. 2. Discuss the risks for payroll fraud in the Sherman Company payroll system. 3. What controls would you implement to reduce the risks?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Topic: payroll processing and fixed asset procedure

Subject: accounting information system

departments. In addition to supervising operations.
the supervisors of the departments are responsible
for recruiting, hiring, and firing workers within
their areas of responsibility. The organization
attracts casual labor and experiences a 20 to 30 per-
cent turnover rate in employees per year.
Employees clock on and off the job each day to
record their attendance on time cards. Each department
has its own clock machine located in an unattended
room away from the main production area. Each
week, the supervisors gather the time cards, review
them for accuracy, and sign and submit them to the
roll department for processing. In addition, the super-
visors submit personnel action forms to reflect newly
hired and terminated employees. From these docu-
ments, the payroll clerk prepares payroll checks and
updates the employee records. The supervisor of the
payroll department signs the paychecks, which are
drawn on the general cash account, and sends them to
the department supervisors for distribution to the
employees. A payroll register is sent to the cash disbur-
sements department where it is filed.
pay-
Required
1. Prepare a flowchart of the Sherman's payroll
system.
3. PAYROLL-RISKS AND CONTROLS
2. Discuss the risks for payroll fraud in the
Sherman Company payroll system.
Sherman Company employs 400 production, mainte-
nance, and janitorial workers in eight separate
3. What controls would you implement to reduce
the risks?

Definition Definition Structural system an enterprise uses to collect, store, report, retrieve, and process financial data. Accounting information systems are used by business analysts, auditors, accountants, and consultants for accurate and efficient access to financial data.

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