An audit team most likely would assess control risk at the maximum if the payroll department supervisor is responsible for
A)Examining authorization forms for new employees.
B)Comparing payroll registers with original batch transmittal data.
C)Authorizing payroll rate changes for all employees.
D)Hiring all subordinate payroll department employees.

Question

Quizplus · Accepted Answer

If the payroll department supervisor is responsible for authorizing payroll rate changes for all employees, then the potential for errors or fraud is high. The auditor would assess control risk at the maximum because this individual has the ability to manipulate payroll rates without oversight or approval from a higher authority. This could lead to inaccurate payroll calculations or improper payments.

An Audit Team Most Likely Would Assess Control Risk at the Maximum