Matthew Corp. has changed from a system of recording time worked on clock cards to a computerized payroll system in which employees record time in and out with magnetic cards. The computerized system automatically updates all payroll records. Because of this change,
A)a generalized computer audit plan must be used.
B)part of the audit trail is altered.
C)the potential for payroll-related fraud is diminished.
D)transactions must be processed in batches.

Question

Quizplus · Accepted Answer

Part of the audit trail is altered because the method of recording time worked has changed from clock cards to magnetic cards. The auditor will need to assess the reliability of the new system and ensure that the integrity of the data is maintained. The potential for payroll-related fraud may or may not be diminished depending on the effectiveness of the new system and the controls put in place. A generalized computer audit plan may be used, but it is not the best choice in this scenario. Transactions do not necessarily need to be processed in batches solely based on the change from a manual to a computerized system.