ACCT5

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.