15.

3 A Question 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

B Question 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Are payroll changes (new hires, salary changes, overtime, bonuses, promotions,) properly authorized and approved? Are confidential payroll deductions and withholdings authorized in writing by employees? Are the employees who perform each of the following payroll functions independent of the other functions? Are changes in standard data on which payroll is based promptly input to the system to process payroll? Is gross pay determined by using authorized salary rates ? Are clerical operations in payroll preparation verified? Is payroll preparation and recording reviewed by supervisors or internal audit personnel? Is access to payroll master data restricted to authorized employees? Are paychecks approved by reviewing the payroll register before payroll checks are issued? 9. Fraudulent paychecks. Is a separate checking account used for payroll? Is the payroll bank account reconciled to the general ledger by someone not involved in payroll or paycheck distribution? Are payroll bank reconciliations properly approved and differences promptly followed up? Is the custody and follow-up of unclaimed salary checks assigned to a responsible official? Are differences reported by employees followed up on a timely basis by persons not involved in payroll preparation? Are there control procedures to ensure proper and timely payment of withholdings to appropriate bodies and to file required information returns?

Reason a 'No' answer represents a weakness There can be risk of unauthorized pay raises thus causing theft If there are errors there can be employee lawsuits and penalties Risk of fraud of and theft of paychecks There can be errors in future payrolls causing fines and penalties Risk of overpayment or underpayment of employees Errors are difficult to detect Errors can be difficult to detect and corrected Changes of pay rates and payments to ficticious employees Fraudulent paychecks. Risk of paychecks being forged and difficulty reconciling payroll Difficult to detect errors Failure to detect and correct problems. Theft of paychecks. Failure to detect fake employees. Frauds can occur more often and can be covered up If returns are filed late, fines and penalties will be incurred.

Yes and approved?

No

ent paychecks.

check distribution?

ll preparation?