Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 20, Problem 11RQ
To determine
Enlist the five types of authorizations in payroll and personnel cycle and the type of misstatement that is likely to occur when the authorization is lacking.
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Students have asked these similar questions
Match the four functions of payroll activities with their related internal controls:
a.
An independent employee should sign and distribute the prenumbered checks.
select a function Hiring EmployeesPaying the PayrollPreparing the PayrollTimekeeping
b.
Supervisors should monitor hours worked through time reports.
select a function Hiring EmployeesPaying the PayrollPreparing the PayrollTimekeeping
c.
Human Resources department should authorize employment.
select a function Hiring EmployeesPaying the PayrollPreparing the PayrollTimekeeping
d.
Two or more employees should verify payroll amounts.
select a function
Describe a walkthrough of the payroll transaction flow from hiring authorization to payroll checkdisbursement. (a) What document copies would be collected? (b) What controls should be noted?
What is the purpose of the following control procedures (i.e., what threats is it designed to mitigate)?
a. Compare a listing of current and former employees to the payroll register.
Chapter 20 Solutions
Auditing And Assurance Services
Ch. 20 - Prob. 1RQCh. 20 - Prob. 2RQCh. 20 - Distinguish among a payroll master file, a W-2...Ch. 20 - Prob. 4RQCh. 20 - Prob. 5RQCh. 20 - Prob. 6RQCh. 20 - Prob. 7RQCh. 20 - Prob. 8RQCh. 20 - Prob. 9RQCh. 20 - Prob. 10RQ
Ch. 20 - Prob. 11RQCh. 20 - Prob. 12RQCh. 20 - Prob. 13RQCh. 20 - Prob. 14RQCh. 20 - Prob. 15RQCh. 20 - Prob. 16.1MCQCh. 20 - Prob. 16.2MCQCh. 20 - Prob. 16.3MCQCh. 20 - Prob. 17.1MCQCh. 20 - Prob. 17.2MCQCh. 20 - Prob. 17.3MCQCh. 20 - Prob. 18.1MCQCh. 20 - Prob. 18.2MCQCh. 20 - Prob. 18.3MCQCh. 20 - Prob. 19DQPCh. 20 - Prob. 20DQPCh. 20 - Prob. 21DQPCh. 20 - Prob. 22DQPCh. 20 - Prob. 23DQPCh. 20 - Prob. 24DQPCh. 20 - Prob. 25DQPCh. 20 - Prob. 26DQPCh. 20 - Prob. 27DQPCh. 20 - Prob. 28C
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Similar questions
- Describe a minimum of three ways AIS can help minimize or eliminate inaccurate time and attendance data in a typical company's payroll activity.arrow_forwardWhich of the following activities performed by a department supervisor most likely would help to prevent or detect a payroll fraud?a. Distributing paychecks directly to department employees.b. Setting the pay rate for departmental employees.c. Hiring employees and authorizing them to be added to payroll.d. Approving a summary of hours each employee worked during the pay period.arrow_forwardThe following are typical questions that might appear on an internal control questionnaire for payroll activities: 1. Is there adequate separation of duties between employees who maintain human resources records and employees who approve payroll disbursements? 2. Is there adequate separation of duties between personnel who maintain timekeeping or attendance records for employees and employees who distribute payroll checks? Describe the purpose of each of the above controlsarrow_forward
- The following are typical questions that might appear on an internal control questionnaire for payroll activities: 1. Is there adequate separation of duties between employees who maintain human resources records and employees who approve payroll disbursements? 2. Is there adequate separation of duties between personnel who maintain timekeeping or attendance records for employees and employees who distribute payroll checks? Describe the manner in which each of the above controls might be tested.arrow_forwardPls further explain and describe the diagram above and identify five types of errors that may cause a payroll record to be placed in the error file.arrow_forwardThe Accounting Iinformation System may assist to decrease or eliminate erroneous time and attendance data in a typical company's payroll activity in a minimum of three waysarrow_forward
- Which internal control is not an important part of the payroll system? a. supervisors verify the accuracy of employee time cards b. paychecks are distributed by an independent paymaster c. the accounts payable department verifies the accuracy of the payroll register before transfer-ring payroll funds to the general checking account d. the general ledger department reconciles the labor distribution summary and the payroll disbursement voucherarrow_forwardPls further explain the diagram above and identify types of errors that may cause a payroll record to be placed in the error file.arrow_forwardWhat is the purpose of the following control procedures (i.e., what threats is it designed to mitigate)? e. Cross-footing the payroll registerarrow_forward
- The purpose of separating the duties of hiring personnel and distributing payroll checks is toseparate thea. Authorization of transactions from the custody of related assets.b. Operational responsibility from the record-keeping responsibility.c. Human resources function from the controllership function.d. Administrative controls from the internal accounting controls.arrow_forwardWhich control activity is the entity implementing when at the end of each month, an HR clerk is reviewing the employees hours for payroll calculation ? Select one: a Independent checks on performance b. Adequate separation of duties c. Physical control over assets and records d. Adequate documents and recordsarrow_forwardControl risk is the risk that a material misstatement in an account will not be prevented or detected on a timely basis by the client’s internal controls. The best controlto prevent or detect fictitious payroll transactions is to(1) use and account for prenumbered payroll checks.(2) obtain authorization from human resources for hiring, pay rate, job status andtermination.(3) verify internally authorized pay rates, computations, and agreement with thepayroll register.(4) conduct periodic independent bank reconciliations of the payroll bank account.arrow_forward
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