When developing the internal controls and record retention for a payroll system,a company should:
A)Involve all company employees to promote transparency.
B)Develop a closed system and alternate employee duties.
C)Designate a single employee with the responsibility for pay disbursements.
D)Train accounting personnel on a single payroll task.

Question

Quizplus · Accepted Answer

Developing a closed system and alternate employee duties is the best choice for internal controls in a payroll system. This ensures that there are checks and balances in place and that no single employee has complete control over the payroll process. Involving all company employees may not be necessary, as not all employees need to be involved in the payroll process. Designating a single employee with the responsibility for pay disbursements may increase the risk of fraud, as there would be no oversight or checks and balances. Training accounting personnel on a single payroll task may be helpful, but it is not enough to ensure proper internal controls in a payroll system.

When Developing the Internal Controls and Record Retention for a Payroll