Raspberry Co-Solution - Key controls and tests of control - Deficiencies and recommendations

Sep 14, 2026

Document content focuses on internal control design for Raspberry Co’s payroll process, detailing key controls and corresponding tests. It covers segregation of HR and payroll setup duties, verification of pre-printed joiner forms and employee numbers, bonus data input checks, clock-card supervision, automated transfer of hours into payroll, and review of exception reports. It also addresses cash-handling for weekly pay packets and dual-preparer/checker signing, followed by control deficiencies and improvement recommendations.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages25

Reading Time1 h 3 min

AccessFree to download

Key controls and tests of control

Human resources setup controls

Bonus processing controls

Attendance and hours controls

Exception reporting controls

Cash payment controls

Pay packet preparation controls

Deficiencies and recommendations

Discretionary bonus governance

Raspberry Co-Solution (a) Key controls and tests of control | Key Control | Test of Control | | --- | --- | | Raspberry Co has a separate human | Review the job descriptions of payroll | | resources (HR) department which is | and HR to confirm the split of | | responsible for setting up all new | responsibilities with regards to setting up | | employees. | new joiners. | | Having a segregation of roles between | Discuss with members of the payroll | | human resources and payroll | department the process for setting up | | departments reduces the risk of fictitious | new joiners and for confirmation that the | | employees being set up and also being | process is initiated by HR. | | paid. | | | Pre-printed forms are completed by HR | Select a sample of new employees | | for all new employees, which include | added to the payroll during the year, | | assignment of a unique employee | review the joiner forms for evidence of | | number, and once verified a copy is sent | completion of all parts and that the | | to the payroll department. Payroll is | information was verified as accurate and | | unable to set up new joiners without | was received by payroll prior to being | | information from these forms. | added to the system. | | The use of pre-printed forms ensures | Select a sample of edit reports for | | that all relevant information, such as tax | changes to payroll during the year; | | IDs, is obtained about employees prior to | agree a sample of new employees | | set up. This minimises the risk of | added to payroll to the joiners forms. | | incorrect wage and tax payments. In | | | addition as payroll are unable to set up | | | new joiners without the forms and | | | employee number it reduces the risk of | | | fictitious employees being set up by payroll. | | | The quarterly production bonus is input by a clerk into the payroll system, each entry is checked by senior clerk for input errors prior to processing, and they evidence their review via signature.
This reduces the risk of input errors resulting in over/underpayment of the bonus to employees. | If attending Raspberry Co at the time of bonus processing, observe the clerk inputting and senior clerk checking the bonus payments into the payroll system.
In addition obtain listings of quarterly bonus payments and review for evidence of signature by the senior clerk who checks for input errors. | | Production employees are issued with clock cards and are required to swipe their cards at the beginning and end of their shift, this process is supervised by security staff 24 hours a day. | Observe the use of clock cards by employees when entering the power station.
Confirm the security team is supervising | | This ensures that genuine employees are only paid for the work actually done, and reduces the risk of employees being paid but not completing their eight hour shift. In addition due to the supervision it is unlikely that one employee could swipe in others. | the process and following up on discrepancies through discussions with the security staff. | | --- | --- | | The clock card information identifies the employee number and links into the hours worked report produced by the payroll system.
As the hours worked are automatically transferred into the payroll system, this reduces the risk of input errors in entering hours to be paid in calculating payroll, ensuring that employees are paid the correct amount. | Utilise test data procedures to input dummy clock card information, verify this has been updated into the payroll system. | | On a quarterly basis exception reports of changes to payroll standing data are produced and reviewed by the payroll director.
This ensures that any unauthorised amendments to standing data are identified and resolved on a timely basis. | Select a sample of quarterly exception reports and review for evidence of review and follow up of any unexpected changes by the payroll director. | | For production employees paid i

FAQs

What is the main purpose of separating HR and payroll responsibilities?

It reduces the risk of fictitious employees being set up and being paid, and helps ensure new joiners are set up using verified information.

How should the payroll bonus process be tested under these controls?

Observe the clerk’s input and the senior clerk’s checking, then review listings for evidence of the senior clerk’s signature and follow-up on input error checks.

What recommendations address discretionary bonus determination?

The bonus should be determined by a responsible official under a written policy and, if significant, formally agreed by the board, then communicated in writing to the payroll department.

Sep 14, 2026

Uploaded by Riley West