Payroll Cycle

Question 1

What are the Objectives of Internal Controls over Payroll?

Answer 1

1 Payroll withholdings and deductions are based on appropriate supporting authorizations.
2 Compensation is made only to valid employees at authorized rates and for services actually rendered.
3 Gross pay, withholdings, deductions, and net pay are correctly computed.
4 Payroll costs and liabilities are appropriately classified and summarized in the proper periods.
5 Appropriate comparisons are made of personnel, payroll, and work records at reasonable intervals.
6 Net pay and related withholdings are remitted to the appropriate employees and agencies.
7 Access to sensitive personnel files and payroll records is limited to authorized personnel