For clients that distribute checks or cash payments and have significant payroll control weakness,which of the following audit procedures is aimed at determining whether every name on the company payroll is a bona fide employee actually on the job?
A)A surprised observation of a paycheck distribution,while establishing the identity of each employee receiving payment.
B)A test of payroll extensions.
C)Analytical comparisons of budgeted to actual payroll expense.
D)Comparison of payee names on canceled payroll checks with the payroll register.

Question

Quizplus · Accepted Answer

A surprised observation of a paycheck distribution, while establishing the identity of each employee receiving payment, directly addresses the concern of verifying the existence of employees and ensuring that payroll disbursements are made to actual, bona fide employees. This method helps in identifying any fictitious employees that might have been added to the payroll as part of a fraudulent scheme.

For Clients That Distribute Checks or Cash Payments and Have