Which of the following audit procedures would be the most effective in testing for nonexistent employees?
A) Trace transactions recorded in the payroll journal to the human resources department to determine employment status.
B) Examine cancelled checks for proper endorsement.
C) Recalculate net pay.
D) Reconcile the disbursements in the payroll journal with the disbursements on the payroll bank statement.

Question

Quizplus · Accepted Answer

By tracing transactions from the payroll journal to the human resources department, the auditor can confirm and verify employment status. If the auditor cannot trace a transaction to a current employee, it may indicate that the employee does not exist. The other options (B, C, D) would not provide information specifically related to nonexistent employees.

Which of the Following Audit Procedures Would Be the Most