In an Audit Engagement, a Group of Internal Auditors Used

question 102

Multiple Choice

In an audit engagement, a group of internal auditors used an integrated test facility to test payroll processing. The auditors identified the key controls and processing steps in the computer software, and then developed test data. Over the course of 24 months, they submitted test transactions on a regular basis but did not find any differences between payroll processing and integrated test facility results. Based on the data, what can the auditors conclude?

• A) Payments to employees during the 24-month period were all correct.
• B) The computer application and its control procedures correctly processed payroll over the 24-month period.
• C) Employees are properly submitting their hours to payroll.
• D) The computer software is flawed.

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Definitions:

Deferred Payment Plan

A payment arrangement that allows payment to be postponed for a certain period, often used in loans and purchase agreements.

Finance Charge

The total cost of borrowing, including interest and any other fees, applied to credit or loan accounts.

Home Improvement Loan

A type of loan specifically designed to finance repairs, renovations, or improvements to a home.

APR

Annual Percentage Rate; the annual rate charged for borrowing or earned through an investment, inclusive of any fees or additional costs.