Question

As an auditor, you are asked to prepare four interview questions to develop a better understanding of the payroll process for Green Supply Inc. You will be asking the company manager these questions.

Payroll procedures description:

When Green Supply Inc. employees report to work each morning, they are required to punch a timecard to record their hours. The production manager sends this timecard information to the payroll process department on a biweekly basis. There is no supervisor at the timecard station and, as a result, management has been under the impression that some warehouse employees are clocking in for their late or absent co-workers. The production department, which is responsible for submitting the timecard information, also sends summary information to the cost accounting department. The clerk at this department uses the job ticket information to post to the various work-in-progress accounts and create a labor distribution summary, which will later be sent to the accounts payable department.

The personnel action form that is prepared in the production department is sent to the payroll department to be reconciled with timecards and authorize the payment of Green Supply Inc. employees. The clerk in charge at the payroll department sends paycheques to employees and sends payroll summary information to the accounts payable department through the preparation of a payroll register.

The accounts payable department sends the summary labor distribution information to the general ledger department where it is posted. The department uses the payroll register to prepare vouchers. Two voucher copies are prepared, and the payroll register is sent to the general ledger department. One voucher is sent to the cash disbursements department and the final copy is sent with the payroll register to the general ledger department.

In the cash disbursements department, a clerk signs the cheques and sends a copy to his supervisor. The voucher sent over from the accounts payable department is reviewed and used to write an amount for the imprest account, which is then deposited in the bank. Employees cash their cheques upon receipt.

Answer 1

Answer:Can you provide a detailed overview of Green Supply Inc.'s payroll process, including the steps involved from the time employee data is collected until paychecks are issued?

How does Green Supply Inc. ensure the accuracy and completeness of the payroll data? Can you explain the controls in place to validate employee hours, rates, deductions, and other relevant payroll information?

What measures does Green Supply Inc. have in place to ensure compliance with applicable payroll laws and regulations? Are there any specific challenges or risks the company faces in this area, and how are they addressed?

Can you describe the segregation of duties within the payroll process? How are responsibilities divided among different individuals or departments to minimize the risk of errors or fraudulent activities? Are there any additional compensating controls in place to mitigate risks?

These questions aim to gather information about the payroll process, its accuracy and compliance with regulations, and the controls in place to mitigate risks. By asking these questions, you can gain insights into how Green Supply Inc. manages its payroll operations and identify any potential areas for improvement or concerns.

Step-by-step explanation: