Which of the Following Is the Best Way for an Auditor

question 63

Multiple Choice

Which of the following is the best way for an auditor to determine that every name on a company's payroll for the Rodgers factory is that of a bona fide employee presently on the job?

• A) Examine personnel records for accuracy and completeness.
• B) Examine employees' names listed on payroll tax returns for agreement with payroll accounting records.
• C) Make a surprise observation of the company's regular distribution of paychecks.
• D) Visit the working areas and confirm with employees their badge or identification numbers.

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Definitions:

Stratification

The arrangement or classification of society into different layers or classes based on factors like wealth, income, race, education, and power.

1700s

The 1700s, or the 18th century, was a period marked by significant political, cultural, and scientific developments, including the Enlightenment and the start of the Industrial Revolution.

Gini Index

A measure of income inequality. Its value ranges from 0 (which means that every household earns exactly the same amount of money) to 1 (which means that all income is earned by a single household).

Household

A household consists of one or more people who live in the same dwelling and share living accommodations, which could include families, roommates, or individuals living alone.