Joel Is the Payroll Accountant for a Company

question 52

Multiple Choice

Joel is the payroll accountant for a company. He has been notified of an impending audit of all accounting records. What is Joel's role in the audit?

• A)He must agree to serve on the audit staff for other companies.
• B)He must be available to answer questions and grant access to payroll records.
• C)He must prevent privacy breaches by disallowing access to payroll records.
• D)He is required to be absent during the audit to avoid influencing the results.

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Definitions:

Legal Reserve Ratio

The minimum fraction of customer deposits and notes that each commercial bank must hold as reserves rather than lend out, often set by central banks.

Reserve Requirement

A regulation that sets the minimum reserves each bank must hold to customer deposits and notes, intended to ensure bank liquidity and financial stability.

Excess Reserves

Funds held by banks over and above the legally mandated requirements to back deposits.

Demand Deposits

Bank accounts from which deposited funds can be withdrawn at any time without any notice to the bank, such as checking accounts.