Question

8. Written termination notices, with properly documented reasons for termination, and approval by an appropriate official are required. 9. All checks and notices of electronic payments not distributed to employees are returned to the treasurer for safekeeping and follow-up. 10. Online ability to add employees or change pay rates to the payroll master file is restricted via passwords to authorized human resource personnel. a. For each internal control, identify the type(s) of specific control activity (or activities) to which it applies (such as adequate documents and records or physical control over assets and records). b. For each internal control, identify the transaction-related audit objective(s) to which it applies. c. For each internal control, identify a specific misstatement that is likely to be prevented if the control exists and is effective. d. For each control, list a specific misstatement that could result from the absence of the control. e. For each control, identify one audit test that the auditor could use to uncover misstatements resulting from the absence of the control. 12-21 (Objectives 12-1, 12-2, 12-3, 12-6) Lew Pherson and Vera Collier

Answer 1

Part 8

a) Particular Control Action: acceptable agreement of actions and businesses.

b) Operation related audit: Presence of logged transactions.

c) Prevented particular mis-statement: The management avoids research of an unsuitable check for a worker who functioned for the association once.

d) Particular mis-statement in control deficiency: A worker who is previously terminated might still stay on the workforce and somebody else could acquire the payments in his name.

e) Audit test: Amazement payoff ought to be achieved wherever the auditor himself books for and issues the paychecks to the workers when they supply their credentials.

Part 9

a) Particular Control Action: Physical regulator on the archives and possessions, and enough isolation of responsibilities.

b) Operation related audit: Presence of logged transactions.

c) Prevented particular mis-statement: The management avoids research of checks for workers on holiday or absent and missing staffs.

d) Particular mis-statement in control deficiency: If the regulator isn't there the payments ready for absent staff may well be lost or might be taken by the worker chargeable for delivery of the payments.

e) Audit test: The auditor ought to examine the off payments to verify that every payment is supported befittingly, and therefore the worker for who the payment has been ready remains operating for the association.

Part 10

a) Particular Control Action: The transactions are accurately licensed and responsibilities are sufficiently divided.

b) Operation related audit: The logged transactions occur and are expressed at right amounts.

c) Prevented particular mis-statement: The management avoids research of payments within the name of false staff or at unapproved wage charges.

d) Particular mis-statement in control deficiency: If an equivalent staff are particular the duties of record possession and coming into new worker variety into the main file, it's doable that a false bank check is managed within the name of a false worker.

e) Audit test: The auditor ought to conceive to access the staff main file exploitation an illegal parole.