Problem 15.2 (page 463). Answer requirements a–j and
please describe the internal control procedures. Label each answer with
matching question with question included in answer. Answer should be labeled a
with question then answer to match question a.
15.2.
What internal control procedure(s) would be
most effective in preventing the following errors or fraudulent acts?
·
a. An inadvertent data entry error caused an employee’s wage
rate to be overstated in the payroll master file.
·
b. A fictitious employee payroll record was added to the payroll
master file.
·
c. During data entry, the hours worked on an employee’s time
card for one day were accidentally entered as 80 hours, instead of 8 hours.
·
d. A computer operator used an online terminal to increase her own
salary.
·
e. A factory supervisor failed to notify the HRM department that
an employee had been fired. Consequently, paychecks continued to be issued for
that employee. The supervisor pocketed and cashed those paychecks.
·
f. A factory employee punched a friend’s time card in at 1:00
p.m. and out at 5:00 p.m. while the friend played golf that afternoon.
·
g. A programmer obtained the payroll master file and increased
his salary.
·
h. Some time cards were lost during payroll preparation;
consequently, when paychecks were distributed, several employees complained
about not being paid.
·
i. A large portion of the payroll master file was destroyed when
the disk pack containing the file was overwritten when used as a scratch file
for another application.
·
j. The organization was fined $5,000 for making a late quarterly
payroll tax payment to the IRS.
