ABC Company's payroll process begins each pay period when employee's submit their timecards to the payroll system.
Question:
ABC Company's payroll process begins each pay period when employee's submit their timecards to the payroll system. The payroll clerk enters all the time data including hours worked, overtime hours, sick time, and vacation time for each employee into the master payroll file. Once this initial time data is entered, the payroll system sends the data to the Human Resources department to review and confirm the details. HR then adds any additional pay information like salaries, rate changes, bonuses, or deductions that apply for the current period. This combined payroll data file is then returned to the payroll department for the next steps in the process.
Next, the payroll software updates the employee data file with pay rates, benefits, deductions, and tax info stored in the system. The software runs calculations for gross pay, taxes, deductions, and net pay for each employee. The payroll manager reviews the software reports for accuracy.
On payday, the software transmits the final direct deposit info and amounts to the bank to credit employee accounts. The payroll system generates electronic pay stubs for each employee. The system then compiles all tax paperwork which is sent to federal, state, and local tax agencies.
The total payroll amount is transferred from the company's payroll account to the payroll processor to fund the direct deposits. Any benefit deduction payments are remitted to the external entities such as the 401k management company and health insurance provider.
Finally, the payroll manager completes internal accounting documentation and reports for the Finance department's budget review. The payroll data file is updated with the current period's information. This data file contains employee personal information, pay rates, deductions, and direct deposit details. A separate tax data file is also updated with the current payroll tax information including federal, state, and local taxes that were withheld and need to be remitted to each agency. This tax data file ensures accuracy when submitting payments and tax paperwork. Both the payroll data file and tax data file are crucial for compiling information and records for the next payroll processing cycle. The data file updates conclude the current payroll period activities.
attached below is my E&A table and my mock Level-0 DFD, Got this mock draft checked by my TA and she said the E&A table was correct but the Level-0 DFD was wrong.
Auditing An International Approach
ISBN: 978-0071051415
6th edition
Authors: Wally J. Smieliauskas, Kathryn Bewley