Chapter 18 – Audit of the Payroll and Personnel Cycle

Thoun - Olga Quintana

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31 pages

English

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Audit of the Payroll and Personnel Cycle Chapter 18 ©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder 18 - 1 Learning Objective 1 Identify the accounts and transactions in the payroll and personnel cycle. ©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder 18 - 2 Accounts in the Payroll and Personnel Cycle The overall objective in the audit of the payroll and personnel cycle is to evaluate whether the account balances affected by the cycle are fairly stated in accordance with generally accepted accounting principles. ©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder 18 - 3 Accounts in the Payroll and Personnel Cycle Accrued Wages, Salaries, Direct Bonuses, and Commissions Labor Payment Beginning Cash in Bank balance Payment for Earned wages, salaries salaries, etc.

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Publié par	Thoun
Nombre de lectures	338
Langue	English

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Audit of the Payroll and Personnel Cycle

Chapter 18

18  1

Learning Objective 1

Identify the accounts and transactions in the payroll and personnel cycle.

18  2

Accounts in the Payroll and Personnel Cycle

The overall objective in the audit of the payroll and personnel cycle is to evaluate whether the account balances affected by the cycle are fairly stated in accordance with generally accepted accounting principles.

18  3

Accounts in the Payroll and Personnel Cycle Accrued Wages, Salaries, Direct Bonuses, and Commissions Labor Payment Beginning Cash in Bank balance Payment for Earned wages salaries salaries, etc. Payment for Ending balanc payroll taxes Withheld Income Taxes and Other Deductions Payment Beginning balance Payroll withholding Ending balance ©2008 Prentice Hall Business Publishing,Auditing 12/e, 4Arens/Beasley/Elder 18

Accounts in the Payroll and Personnel Cycle Withheld Income Taxes and Other Deductions Payment Beginning Cash in Bank balance Payment for Payroll salaries withholding Payment for Ending balance payroll taxes Accrued Payroll Payroll Tax Expense Tax Expense Beginning balance Payroll tax expense Ending balance ©2008 Prentice Hall Business Publishing,Auditing 12/e,Arens/Beasley/Elder

18  5

Accounts in the Payroll and Personnel Cycle

In most systems the accrued wages and salaries account is used only at the end of an accounting period.

18  6

Learning Objective 2

Describe the business functions and the related documents and records in the payroll and personnel cycle.

18  7

Business Functions in the Cycle and Related Documents and Records

The payroll and personnel cycle….

Begins

Ends

Hiring of personnel

Payments

18  8

Personnel and Employment

Personnel records

Deduction authorization form

Rate authorization form

18  9

Timekeeping and Payroll Preparation

Time Card Job Time Ticket

Payroll Transaction File

Payroll Journal

Timekeeping and Payroll Preparation

18  10

Payroll Master File

A payroll master file is used for recording each payroll transaction for each employee and maintaining total employee wages paid for the year to date.

18  11