Chapter 2 Flashcards
A computerized payroll system can help a payroll department accomplish
all the following tasks EXCEPT:
❑ a. compliance with laws and regulations
❑ b. producing timely, accurate paychecks
❑ c. record retention
❑ d. recognize changes in laws and regulations
d. recognize changes in laws and regulations
If you need very rapid response time with minimal lag between
input and output into your computer system, look for:
❑ a. batch processing.
❑ b. remote entry processing.
❑ c. real-time processing.
❑ d. network processing.
c. real-time processing.
True or False
Systems that typically interface with the payroll system includes:
- Human Resources/Personnel
- Benefits
- Data Collection
- Bank checking accounts
- Electronic Funds Transfer
- Time and Attendance
- General Ledger / Cost Accounting
True
Name two features found in systems providing employee self-service
- The ability to update personal data
- The ability to view and print pay statements
- The ability to view and print W-2 forms
Advantages of an integrated system are
- Help reduce data integrity issues
- Eliminate timing issues
- Eliminate the need for sending data from one system to another
Yes
or
No
Yes
The integrity of the data can be verified by:
❑ a. balancing and reconciliations.
❑ b. system edits.
❑ c. validity checks.
a. balancing and reconciliations.
Checking inputs or outputs against predetermined constraints
is called:
❑ a. internal control.
❑ b. validity edit.
❑ c. system safeguard.
❑ d. parallel test.
b. validity edit.
Every month, all of the following records are reconciled EXCEPT:
❑ a. payroll liability accounts.
❑ b. master record of payments.
❑ c. payroll bank checking account.
❑ d. validity edits.
d. validity edits.
Payroll documentation accomplishes all of the following EXCEPT:
❑ a. provide uniformity.
❑ b. simplify training.
❑ c. ensure procedures are followed.
❑ d. provide a reference tool.
c. ensure procedures are followed
When system-generated totals do not agree to batch control totals,
what must occur?
❑ a. continue processing.
❑ b. finding the cause and correcting the error.
❑ c. delay finding the error until more time is available.
❑ d. document the difference and continue processing.
b. finding the cause and correcting the error.
Payroll tax liability accounts should be reconciled at least weekly.
❑ True
❑ False
False
The should be reconciled monthly
Which of the following is the best method of guarding against
phantom employees?
❑ a. Monthly bank reconciliation
❑ b. Validity edits
❑ c. Physical payout
❑ d. Audit trails
c. Physical payout
All of the following issues are concerns of external auditors
EXCEPT:
❑ a. Safeguarding of the firm’s financial assets
❑ b. Risks to the company’s financial well-being
❑ c. Efficiency of payroll procedures
❑ d. Material misstatements of financial statements
c. Efficiency of payroll procedures
What is the correct chronological sequence for the following events
associated with direct deposit?
1. Company creates ACH file
2. Employee receives deposit in his or her bank account
3. Company collects employee information
4. Originating financial institution transmits data
5. Settlement through ACH
❑ a. 1 3 4 2 5
❑ b. 3 1 5 4 2
❑ c. 3 1 4 5 2
❑ d. 1 4 5 3 2
c. 3 1 4 5 2
All of the following regulate payments made by direct deposit
EXCEPT:
a. Consumer Financial Protection Bureau
b. Nacha
c. State laws
d. Local laws
d. Local laws
