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Unit 5: Summary The Payroll Cycle, Unit 5 Summary 221141192 - Coggle…
Unit 5: Summary
The Payroll Cycle
5 distinct functions:
HR
Ensures all matters relating to personnel department are properly maintained
Timekeeping
Keeps accurate and complete record of valid hours worked, for remuneration purposes
Payroll preparation
Calculation of gross wages, deductions, & net wages
Payment preparation and pay-out
Ensures employees are paid wages for the hours worked
Deductions: payments & recording
Ensures amounts paid to relevant authorities are correct, and paid in the correct period
Control objective:
To ensure that the organization has sound control payroll system
Internal controls:
The general controls
Validity or authorization
Completeness
Accuracy
Recording
Cut-off
Risk arises as a result of a weakness
Weakness exists due to lack of or poorly implemented internal controls
Recommendation is what should be done to mitigate risks
Example:
Employees not signing payroll or register after collecting they pay packets. They might deny being paid. Company losing money paying employees more than once per pay period.
Unit 5 Summary
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