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You are the audit senior reviewing the audit work for Online Ltd., a large Canadian company. Online uses a payroll service bureau to process all wages. Time sheets are authorized by the appropriate supervisor, batched, and sent to the service bureau for processing. Detailed payroll reports, as well as the time sheets, are returned to the accountant, who reviews the reports for reasonableness and initials them as evidence of her review. Required
Problem a. Identify two (2) input, and two (2) output controls that should be implemented when using the services of a payroll service bureau.
Problem b. Describe the additional audit procedures you believe should be performed to ensure that we can rely on the accuracy service bureau payroll calculations.
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