A surprise observation by an auditor of an entity's regular distribution of paychecks is primarily designed to satisfy the auditor that
A) All unclaimed payroll checks are properly returned to the cashier.
B) The paymaster is not involved in the distribution of payroll checks.
C) All employees have in their possession proper employee identification.
D) Names on the company payroll are those of bona fide employees presently on the job.

Question

Quizplus · Accepted Answer

A surprise observation of regular distribution of paychecks is primarily designed to satisfy the auditor that the names on the company payroll are those of bona fide employees presently on the job. By observing the distribution of paychecks, the auditor can ensure that only actual employees are receiving their paychecks and that there are no fictitious employees on the payroll. The other options, such as unclaimed checks and employee identification, may be important but are not the primary objective of this observation.

A Surprise Observation by an Auditor of an Entity's Regular