Control Strengths in Mvf Company’s Payroll Process

Control strengths in MVF Company’s payroll process are as under:

1. MVF personnel dept. maintains an action form for every personnel from hiring to the termination and in between all and any changes in the personnel’s payroll activity like pay rates, deductions, and any changes in address or Last names. These forms are inputted in a data system for personnel master file and get updated regularly.

2. MVF uses time cards to record the time worked by the employee. A supervisor collect the time card and verify the hours worked for each employee. This process ensures that workers are paid only for the hours actually worked by them.

3. A further check on each time card gets done by a payroll employee who sort the cards by the employee number and recalculate the hours worked. This minimizes the probability of a calculation error by the supervisor. Matching the employee number also minimizes the possibility of a ghost employee.

4. Once the payroll data is entered into the system, the system has the capability to detect any error like invalid employee numbers, unreasonable overtime worked. Once checks get printed with appropriate control number for each payroll check it gets registered in to the payroll register.

5. After the printing of the checks employee master file get updated with new earning record and a journal entry get prepared for financial record.

6. A backup file in DVD-ROM gets created. This backup process ensure that company will have the file in case the main computer has any problem.

7. Before signing the check the MVF treasurer cross checks the payments made with the time cards file sent by the production supervisor.

A.2 Control deficiencies in MVF Company payroll process are as under:

1. The data from the action forms should be entered into the system on the same day to ensure that it reflects an updated information on employees each day because even in 24 hours a lot can happen to an employee or the information can get lost during the time of receiving the info to the time of input.

2. The idea of time card is old and vulnerable to damage or misplaced. This days and time employee should input their hours in computer which is a safer option for keepsake. It can make it easy to check daily for a supervisor instead of checking it at the end of the week.

3. Computerized time card can also can illuminate the hours spend on calculating and recalculating the hours worked for the employee and supervisor can detect and unnecessary overtime worked or a shift differential.

4. Black payroll checks are left in the box next to a printer makes it easier for someone to take the check and print. Blank checks should be under lock and key with the double custody and payroll