Below is part of payroll controls at your client:

- The payroll system takes the hourly rate from each employee’s master file and multiplies this by the hours entered by employees to calculate gross pay.

- A supervisor reconciles the payroll to the amount to be paid to staff by electronic funds transfer and approves the payment.

i) For each of the above control procedures, briefly explain the procedure’s purpose, and identify whether it is a ‘preventive’ or ‘detective’ control.
ii) Identify ONE potential inherent risk of each control procedure.