An auditor reviews a client's payroll procedures.The auditor would consider the internal control to be less than effective if a payroll department supervisor was assigned the responsibility for:
A)reviewing and approving time reports for subordinate employees.
B)distributing payroll cheques to employees.
C)hiring subordinate employees.
D)initiating requests for salary adjustments for subordinate employees.

Question

Quizplus · Accepted Answer

Distributing payroll cheques to employees by a payroll department supervisor could compromise the segregation of duties principle. This task should ideally be separated from the payroll preparation and authorization functions to prevent potential fraud or errors.

An Auditor Reviews a Client's Payroll Procedures