A team of internal auditors was assigned to review the Galena Plant's Payroll Department, including the system for payroll processing. Their findings are as follows:
(a) The payroll clerk receives the clock cards from the various department supervisors at the end of each pay period, compares the employee's hourly rate to information provided by the Personnel Department, and records the regular and overtime hours for each employee.
(b) The payroll clerk sends the clock cards to the plant's Data Processing Department for compilation and processing.
(c) The Data Processing Department returns the clock cards with the printed checks and payroll journal to the payroll clerk on completion of the processing.
(d) The payroll clerk verifies the hourly rate and hours worked for each employee by comparing the detail in the payroll journal to the clock cards.
(e) If errors are found, the payroll clerk voids the computer-generated check, prepares another check for the correct amount, and adjusts the payroll journal accordingly.
(f) The payroll clerk obtains the plant signature plate from the Accounting Department and signs the payroll checks.
(g) An employee of the Personnel Department picks up the checks and holds them until they are delivered to department supervisors for distribution to employees.
Required:
Discuss the shortcomings in the Payroll Department's systems and suggest corrective action.