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Human Resource Function (Payroll) - Coggle Diagram
Human Resource Function (Payroll)
Flow of documentation
Employee’s file;
Payroll amendment forms;
Updated list of employee details
Risks within the function
Unsatisfactory or unnecessary employees may be recruited or retained;
Dismissal of employees for which the correct procedures were not followed;
There may be staff that are not necessarily needed, but are retained because of inefficiencies in the human resources department;
Employee details could be fraudulently amended to include fictitious employees, or to change the rates of pay applicable to an employee.
Internal Controls: Hiring & Termination
Separate human resources department:
This will ensure segregation of duties (SOD).
Formal interview process:
Will ensure that individuals with the necessary required qualifications are hired;
Background checks are performed before an employee is hired.
Letter with terms of employment:
States terms of employment as well as remuneration.
Authorisation (HR manager/director):
All new hires;
Changes to existing employee’s contract
Internal Controls: Changes in employee file
Permanent records for each employees should be kept and include
:
particulars of engagement & termination of service;
authorised rates of pay and changes therein;
authorised holidays and sick leave;
name and address of the employee;
identity number;
income tax reference number.
Changes to details
Pre-numbered change forms - authorised by the HR manager;
Review and segregation of duties (approval – recording – review).