1. What internal control procedure(s) would be most effective in preventing the

Question

1.     What internal control procedure(s) would be most effective in preventing the following errors or fraudulent acts?

a.     A programmer obtained the payroll master file and increased his salary.

Some time cards were lost during payroll preparation; consequently, when paychecks were distributed, several employees complained about not being paid.

c.      A large portion of the payroll master file was destroyed when the disk pack containing the file was used as a scratch file for another application.

Explanation / Answer

Solution:-

a.     A programmer obtained the payroll master file and increased his salary:-

b. Some time cards were lost during payroll preparation; consequently, when paychecks were distributed, several employees complained about not being paid:-

A record count of job time records should be prepared before the records are submitted for processing, and checked subsequent to data entry. In addition, reconciliation of job time records to employee clock cards should detect this.

c. A large portion of the payroll master file was destroyed when the disk pack containing the file was used as a scratch file for another application:-

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