ACCA AA · Chapter 8 · Question 7 of 12
Which control would best prevent fictitious employees from being added to the payroll?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) New joiners are authorised by the human resources department, which is independent of the payroll processing function
Explanation
Requiring independent authorisation of new joiners separates the authority to add employees from the ability to process and pay them. Bank transfers do not stop payments to fictitious bank accounts, and month-on-month comparison would be unlikely to detect one extra salary among many.
More Internal control systems MCQs
- Q9Which of the following bank reconciliation procedures represents the strongest control?
- Q10Under ISA 265, how must the auditor communicate significant deficiencies in internal control identified during the audit?
- Q11Which of the following is a test of controls rather than a substantive procedure?
- Q12Which of the following is an application control rather than a general IT control?
- Q1Which of the following is NOT one of the components of an entity's system of internal control under ISA 315?