OCPS OCPS Payroll Auditing & Internal Controls

Question 1

What is the primary purpose of a payroll internal audit?

Accepted Answer

To verify accuracy, compliance, and prevent fraud in payroll operations

Answer

Payroll internal audits verify that payroll processes are accurate, compliant with regulations, and protected against fraud or errors.

Question 2

Which control helps prevent a single employee from both adding new hires and processing payroll?

Accepted Answer

Segregation of duties

Answer

Segregation of duties divides key payroll functions among different employees to reduce the risk of errors and fraud.

Question 3

What is a 'ghost employee' in the context of payroll fraud?

Accepted Answer

A fictitious or terminated employee whose wages are fraudulently collected

Answer

A ghost employee is a fictitious or terminated individual left on the payroll so that someone can fraudulently collect their wages.

Question 4

Which document is most commonly reviewed during a payroll audit to verify headcount accuracy?

Accepted Answer

Active employee roster cross-referenced with HR records

Answer

Auditors cross-reference the active employee roster with HR records to confirm that only legitimate, active employees are being paid.

Question 5

What is a 'three-way match' in payroll auditing?

Accepted Answer

Verifying hours worked, approved timesheets, and pay stubs align

Answer

A three-way match in payroll auditing confirms that hours worked, approved time records, and issued pay stubs are all consistent with each other.

(OCPS) Online Certified Payroll Systems Certified Professional Practice Test