Which of the following is true of good internal controls over payroll?
A)Accounting for payroll should be separate from hiring and firing of employees.
B)Disbursement of paychecks should not be separate from the function of maintaining payroll records.
C)Hiring and firing employees should not be separated from accounting and from passing out paychecks.
D)Cash receipts from customers should be separated from the accounting for accounts receivable.

Question

Quizplus · Accepted Answer

Accounting for payroll should be separate from hiring and firing of employees to prevent any potential fraud, collusion or errors. This ensures that only authorized personnel have access to sensitive payroll information such as employee salaries, benefits, and tax deductions. Separating the two functions also allows for a review and approval process to ensure accuracy of employee pay and compliance with labor laws.

Which of the Following Is True of Good Internal Controls