Chapter 2 Payroll in Org Structure

Question 1

Differentiate between the different types of business entities. (4)

Answer 1

Sole proprietor - operated and owned by one individual, easy set up, individual is fully liable
Partnership - owned by 2 or more people or an unincorporated company. Each partner is personally liable for debts and taxes. Partnership agreement outlines profit split
Corporation - legal entity separate from owners (shareholders), defined legal rights
Not-for-Profit members restricted from personal gain, profits go back into org to further goals

Question 2

Compare and contrast internal, external and government audits

Answer 2

Internal - usually in house or hired firm to perform, review methods to prevent and identify fraud, management responsibility in controlling and monitoring costs, review of compliance standards.
External - legal requirement for some companies, usually after year end. Accurate reasonable, and representative view of financial position. External auditor must be independent of organization.
Government - Statutory responsibility to administer legislation on behalf of govt. Most bodies have power to inspect payroll and records to ensure compliance.

Question 3

List employee information that is shared between payroll and HR (cupboard)

Answer 3

Charity deductions
Union dues
Policies
Benefits
Overtime
Allowances
Rates of pay
Date of hire

Pension / RRSPs
Bonuses

Question 4

Explain what performance levels are based on for payroll departments ( sear )

Answer 4

Setting performance levels based on:
service
efficiency- reduce time and costs
accuracy 
Response times - inquiry resolve rate

Question 5

Explain payroll’s relationship with internal and external stakeholders with emphasis on the interdepartmental relationships of finance, HR and IT.

Answer 5

HR and Payroll often a dual role, communication must exist throughout the employee life cycle - permanent and temporary changes
IT and Payroll - Payroll could be considered a superuser of the software - use for mgmt reporting. Also quality control with maintenance and upgrades, access to information
Finance and Payroll - Emp related costs for Budget, job costing, legislation changes, audit participation

Question 6

Stakeholders - internal / external / govt

Answer 6

Internal - employer, employees, depts

External - pension providers, benefit carriers, charities, outsource vendors, courts, unions

Govt - federal, provincial