Kế toán, kiểm toán - Chapter 15: The human resources management and payroll cycle

Chapter 15The Human Resources Management and Payroll CycleCopyright © 2012 Pearson Education15-1Learning ObjectivesDescribe the major business activities and related information processing operations performed in the human resources management (HRM)/payroll cycle.Discuss the key decisions to be made in the HRM/payroll cycle and identify the information needed to make those decisions.Identify the major threats in the HRM/payroll cycle and evaluate the adequacy of various internal control procedures for dealing with them.Copyright © 2012 Pearson Education15-2HRM and Payroll CycleCopyright © 2012 Pearson Education15-3HRM and Payroll CycleManaging Employees:Recruiting and hiring new employeesTrainingJob assignmentCompensationPerformance evaluationDischarge of employees due to voluntary or involuntary terminationCopyright © 2012 Pearson Education15-4HRM and Payroll Cycle ActivitiesUpdate master dataValidate time and attendancePrepare payrollDistribute payrollDisburse taxes and miscellaneous deductionsCopyright © 2012 Pearson Education15-5HRM and Payroll General ThreatsInaccurate or invalid master dataUnauthorized disclosure of sensitive informationLoss or destruction of dataHiring unqualified or larcenous employeesViolations of employment lawsCopyright © 2012 Pearson Education15-6HRM and Payroll General ControlsData processing integrity controlsRestriction of access to master dataReview of all changes to master dataAccess controlsEncryptionBackup and disaster recovery proceduresSound hiring procedures, including verification of job applicants’ credentials, skills, references, and employment historyCriminal background investigation checks of all applicants for finance-related positionsThorough documentation of hiring, performance evaluation, and dismissal proceduresCopyright © 2012 Pearson Education15-7Update Master File ThreatsUnauthorized changes to payroll master dataInaccurate updating of payroll master dataCopyright © 2012 Pearson Education15-8Update Master File ControlsSegregation of duties: HRM department updates master data, but only payroll department issues paychecksAccess controlsData processing integrity controlsRegular review of all changes to master payroll dataCopyright © 2012 Pearson Education15-9Validation ThreatsInaccurate time and attendance dataCopyright © 2012 Pearson Education15-10Validation ControlsSource data automation for data captureBiometric authenticationSegregation of duties (reconciliation of job-time tickets to time cards)Supervisory reviewCopyright © 2012 Pearson Education15-11Prepare Payroll ThreatsErrors in processing payrollCopyright © 2012 Pearson Education15-12Prepare Payroll ControlsData processing integrity controls: batch totals, cross-footing of the payroll register, use of a payroll clearing account, and a zero-balance checkSupervisory review of payroll register and other reportsIssuing earnings statements to employeesReview of IRS guidelines to ensure proper classification of workers as either employees or independent contractorsCopyright © 2012 Pearson Education15-13Disburse Payroll ThreatsTheft or fraudulent distribution of paychecksCopyright © 2012 Pearson Education15-14Disburse Payroll ControlsRestriction of physical access to blank payroll checks and the check signature machineRestriction of access to the EFT systemPrenumbering and periodically accounting for all payroll checks and review of all EFT direct deposit transactionsRequire proper supporting documentation for all paychecksUse of a separate checking account for payroll, maintained as an imprest fundSegregation of duties (cashier versus accounts payable; check distribution from hiring/firing; independent reconciliation of the payroll checking account)Restriction of access to payroll master databaseVerification of identity of all employees receiving paychecksRe-depositing unclaimed paychecks and investigating causeCopyright © 2012 Pearson Education15-15Disburse Taxes and Deduction ThreatsFailure to make required paymentsUntimely paymentsInaccurate paymentsCopyright © 2012 Pearson Education15-16Disburse Taxes and Deductions ControlsConfiguration of system to make required payments using current instructions from IRS (Publication Circular E)Processing integrity controlsSupervisory review of reportsEmployee review of earnings statementCopyright © 2012 Pearson Education15-17