A CPA Reviews an Entity's Payroll Procedures

question 46

Multiple Choice

A CPA reviews an entity's payroll procedures. The CPA would consider internal control to be less than effective if a payroll department supervisor was assigned the responsibility for

• A) Distributing payroll checks to employees.
• B) Reviewing and approving time reports for subordinate employees.
• C) Hiring subordinate employees.
• D) Initiating requests for salary adjustments for subordinate employees.

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Definitions:

Computers

Electronic devices that process, store, and output information, capable of executing complex algorithms and tasks.

Tested

The process of examining or evaluating something to determine its characteristics, quality, or performance.

Set Up

The process or action of making something operational or ready for use, especially in a context of preparation or installation.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two goods, given a set of inputs and production technology.