Give an Example of a Test of Controls That Could

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Occurrence-The auditor will want to test for payments made that were not earned. This can be tested by observing and evaluating proper segregation of duties and employees' use of the time clock, reviewing and testing personnel files, reviewing and testing the entity's procedures for changing employees' records and entering and removing employee numbers from the payroll master file, and inspecting the time sheets for approval by the supervisor.
Accuracy-This assertion states that all transactions are recorded at the proper amount. To test it, the auditor could review and test the entity's verification procedures, review the payroll register for unusual amounts, review the entity's budgeting procedures and the reconciliation of the payroll master file to the general ledger payroll accounts, examine the reconciliation of "before and after" reports to the payroll master file, and review and test the entity's procedures for changing employees' records.
Cutoff-To test that all transactions were recorded in the proper period, the auditor could review and test the entity's procedures for changing employees' records, processing time sheets, and recording payroll liabilities.

Give an Example of a Test of Controls That Could

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