Identify and explain FIVE internal control STRENGTHS in Bronze Industries Co’s payroll system

review the pros and the cons of having such a multinational workforce
July 20, 2019
Discuss, analyse and evaluate the idea that success in business revolves around taking a variety of strategic routes as opposed to following a prescribed path
July 20, 2019

Identify and explain FIVE internal control STRENGTHS in Bronze Industries Co’s payroll system

Identify and explain FIVE internal control STRENGTHS in Bronze Industries Co’s payroll system

You are an audit senior of Scarlet & Co and are in the process of reviewing the systems testing completed on the
payroll cycle of Bronze Industries Co (Bronze), as well as preparing the audit programmes for the final audit.
Bronze operate several chemical processing factories across the country, it manufactures 24 hours a day, seven days
a week and employees work a standard shift of eight hours and are paid for hours worked at an hourly rate. Factory
employees are paid weekly, with approximately 80% being paid by bank transfer and 20% in cash; the different
payment methods are due to employee preferences and Bronze has no plans to change these methods. The
administration and sales teams are paid monthly by bank transfer.
Factory staff are each issued a sequentially numbered clock card which details their employee number and name.
Employees swipe their cards at the beginning and end of the eight-hour shift and this process is not supervised.
During the shift employees are entitled to a 30-minute paid break and employees do not need to clock out to access
the dining area. Clock card data links into the payroll system, which automatically calculates gross and net pay along
with any statutory deductions. The payroll supervisor for each payment run checks on a sample basis some of these
calculations to ensure the system is operating effectively.
Bronze has a human resources department which is responsible for setting up new permanent employees and leavers.
Appointments of temporary staff are made by factory production supervisors. Occasionally overtime is required of
factory staff, usually to fill gaps caused by staff holidays. Overtime reports which detail the amount of overtime worked
are sent out quarterly by the payroll department to production supervisors for their review.
To encourage staff to attend work on time for all shifts Bronze pays a discretionary bonus every six months to factory
staff; the production supervisors determine the amounts to be paid. This is communicated in writing by the production
supervisors to the payroll department and the bonus is input by a clerk into the system.
For employees paid by bank transfer, the payroll manager reviews the list of the payments and agrees to the payroll
records prior to authorising the bank payment. If any changes are required, the payroll manager amends the records.
For employees paid in cash, the pay packets are prepared in the payroll department and a clerk distributes them to
employees; as she knows most of these individuals she does not require proof of identity.
Required:
(a) Identify and explain FIVE internal control STRENGTHS in Bronze Industries Co’s payroll system. (5 marks)
(b) Identify and explain SIX internal control DEFICIENCIES in Bronze Industries Co’s payroll system and provide
a RECOMMENDATION to address each of these deficiencies. (12 marks)
(c) Describe substantive ANALYTICAL PROCEDURES you should perform to confirm Bronze Industries Co’s
payroll expense.


 

PLACE THIS ORDER OR A SIMILAR ORDER WITH MY ONLINE PROFESSOR TODAY AND GET AN AMAZING DISCOUNT

get-your-custom-paper

The post Identify and explain FIVE internal control STRENGTHS in Bronze Industries Co’s payroll system appeared first on MY ONLINE PROFESSOR .

 
Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount!
Use Discount Code "Newclient" for a 15% Discount!

NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.