Freesia:

Control deficiency Control recommendation Test of control

+ Receivables ledger + Credit limits should be + For a sample of new
clerks carry out credit set by a senior member customers accepted in
checks on new customers of the sales department the year, review the
prior to being accepted and not by receivables authorisation of the credit
and then set their credit ledger clerks. These limit, and ensure that this
limits. Receivables ledger limits should be regularly was performed by a
clerks are not sufficiently reviewed by a responsible responsible official
senior and so may set official + Enquire of receivables
limits too high, leading to ledger clerks as to who
irrecoverable debts, or can set credit limits.
too low, leading to a loss
of sales

A GRN copy should be + Review copy GRNs held

+ GRNs are only emailed auto-emailed to the by the purchase ordering
to the finance ordering department. A department and review
department. Failing to copy should be held at for evidence that these
send a copy to the the warehouse as well as are matched to orders
purchasing ordering being emailed to the and flagged as complete
department means that it finance department + Review the report of
is not possible to monitor A purchase ordering clerk unfulfilled purchase
the level of unfulfilled should agree their copy orders for any overdue
orders. This could result of the GRN to the items and discuss their
in a significant level of purchase order and status with an ordering
unfulfilled orders leading change the order status clerk
to stock-outs and a to complete in the
consequent loss of sales purchasing module. On a
In addition, if the GRN regular basis, a report of
record is lost, then it will unfulfilled orders should
not be possible for the be generated and
finance department to reviewed and each order
match the invoice to should be followed up
proof of goods being with the relevant supplier
received. This could
result in a delay to the
invoice being paid and a
loss of a supplier goodwill + Re-perform the control
by undertaking a
Sales orders should be sequence check of sales
+ Each sales order sequentially numbered. orders
number generated is On a regular basis, a + Discuss any gaps in the
based on the sales sequence check of orders sequence with sales
person’s own should be undertaken to ordering staff
identification number in identify any missing biểu diễn lại cái control
order to facilitate orders sequence đấy để check
monitoring of sales staff sales orders và discuss
performance. nếu có omission hay gaps
These numbers are not nào đấy giữa hai số tại
sequential. Without đánh liên tục
sequential numbers, it is
difficult for the company
to identify missing orders
and to monitor if all
orders are being
dispatched in a timely
manner. If they are not, + Review the file of
this could lead to a loss completed bank
of customer goodwill The key roles of posting reconciliations to identify
(thiện chí) bank receipts, updating who prepared them
the receivables ledger + Review the log of IDs of
and performing bank individuals who have
+ Lily Shah, a finance reconciliations should be posted bank receipts and
clerk, posts the bank split between different updated the receivables
transfer receipts from the individuals. ledger to assess whether
bank statement to the If this is not practical, these are different
bank ledger account and then as a minimum, the individuals
updates the receivables bank reconciliations + Discuss with the
ledger and on a monthly should be undertaken by financial controller which
basis, she performs the another member of the members of staff
bank reconciliation. finance team undertake the roles of
There is a lack of processing of bank
segregation of duties and receipts and updating of
errors will not be bank ledger account and
identified on a timely receivables ledger
basis. There is also an
increased risk of fraud
+ For a sample of new
The credit limit should be customer đc accepted in
set by a senior member the year, review the
of sales department and authorisation of credit
be reviewed regularly by limit ensure that this was
Receivables ledger clerks, a responsible official performed by a
who work at head office, responsible official
carry out credit checks on + hỏi các nhân viên
new customers prior to receivables xem ai là
being accepted and then người được quyền duyệt
set their credit limits cái credit limit
The receivables clerks  authorization
doesn’t have sufficient
senior to set a credit limit
for customers so they
may lack of knowledge
and experience that lead
to set higher or lower
limit. In the result, this Sales orders after + Re-perform the control
could cause loss of accepted should be by undertaking a
customer’s goodwill or sequentially numbered to sequence check of sales
irrecoverable easily detect if there are orders
some omission. On a + thử check sample xem
regular basis, a sequence vài cái PO có đc đánh số
Sales order number check of orders should be đàng hoàng k
generated is based on undertaken to identify + thử đánh số sai xem
the sales person’s own any missing orders máy phản ứng nnao, có
identification number in dễ phân biệt nếu bỏ sót k
order to facilitate + Discuss any gaps in the
monitoring of sales staff sequence with sales
performance ordering staff
These numbers are not
sequential. Without
sequential numbers, it is
difficult for the company
to identify missing orders
and to monitor if all
orders are being
dispatched in a timely + Review the file of
manner. If they are not, The key role of posting complêtd bank
this could lead to a loss bank receipts, updating reconciliations to identify
of customer goodwill the receivables ledger who prepared them
and performing bank + Review the log of IDs of
reconciliations should be individuals who have
split between different posted bank receipts and
individuals updated the receivables
A finance clerk posts the If this is not practical, ledger to assess whether
bank transfer receipts then as a minimum, the these are different
fromt the bank bank reconciliations individuals
statements to the bank should be undertaken by + Discuss with the
ledger account and another member of the financial controller which
updates the receivables finance team members of staff
ledger and she also undertake the roles of
performs the bank processing of bank ledger
reconciliation monthly account and receivables
There is a lack of ledger
segregation of duties and
error will not be identified
on a timely basis. There
is also an increased the
risk of fraud

deficiency recommendation TOC

+ Credit limits are The credit limit should be + For new customer
subsequently set by the set by a senior that have accepted, review the
receivables ledger clerks sufficient experience authorization of setting
who record the new such as manager and up the credit limit and
customer details and set should be reviewed ensure that it is set by a
credit limits in the master regularly by responsible senior
data file official + Enquiry receivables
The receivables ledger Any such ledger clerks who can set
clerks are not sufficient additions/amendments to the credit limit
senior to set the credit master file data should
limit and may set the be restricted so that only
limit too high that can supervisors and above
lead some receivables be can make changes
irrecoverable or too low An exception – unusual-
that can be loss of sales report of changes made
should be generated and
reviewed by a responsible
official

+ The company’s credit + During the period of + Enquiry the

controller is currently on the secondment, an management who
secondment to the alternative member of monitor, manage credit
internal audit department the finance department and debts and ensure
for 6 months and no should be trained in the that the employee has
replacement has been credit control role and technical competency
appointed assigned responsibility about this field and
- Đang thuyên for reviewing the aged enough experience,
chuyển receivables listing and reliable
There is an risk of error following up on any + Review the work of that
that the credit is not overdue customers employee by recording a
monitored and updated overdue receivables to
regularly within 6 months observe his work
and increased risk of
irrecoverable debts and
lead to customers not
paying their outstanding
balances on time, or at
all, leading to reduced
cash flows.
The GDN should be
amended so that one
copy is sent to the sales
+ GDNs copies are sent order department
with the goods, Once the copy of the
warehouse and to the GDN has been received
finance department by the order department,
There is lack of an copy it should be matched to
to sales order the order. A regular
department. review of unmatched
If the sales order orders should be
department does not undertaken by the sales
receive a copy of the order department to
completed GDNs, they identify any fulfilled
are not able to monitor if orders
orders are being fulfilled
on a timely basis. This
could result in a loss of
revenue and customer
goodwill Only the sales clerks
should be able to raise
sales invoices. As
+ Additional temporary Amberjack Co is
staff members have been expanding, consideration
appointed to help the should be given to
sales clerks to raise the recruiting and training
sales invoices (LẬP more permanent sales
invoice). clerks who can produce
As the extra staff will not sales invoices
be as experienced as the If this is not currently
sales clerks, there is an possible, temporary staff
increased risk of mistakes should be adequately
being made in the sales trained and additional
invoices. This could result input checks on invoices
in customers being under should be introduced + Re-perform the controls
or overcharged leading to of numbering sales
misstated revenue or invoices by recording
dissatisfied customers. some fake GDNs and
discuss with the
management if there is
GDNs should all be any gaps or errors
+ The sales invoices are sequentially numbered +
raised using quantities using a sequence which
from the GDNs / are is different to the order
allocated the same number. On a regular
number as the order basis, a sequence check
number to which they of GDNs (kiểm tra trình
relate. tự) should be undertaken
The sales invoices are to identify any missing
only raised on receipt of a dispatch notes
GDN, and without
separate sequential
numbers based on
information and number
matched to GDNs, it is
difficult for the company
to identify if any GDNs
are missing as they are
not likely to be raised in + Discuss xem có ai ktra
the same sequence as thường xuyên cái
the sales orders authorised sales prices
If GDNs are missing and file trong thời điểm hay
the company fails to raise có sale nnay không
invoices in a timely + Review các file xem có
manner, this could lead During the period of any sign của responsible
to a loss of revenue special offers, such as the official là đã check k
10% off weekend, the + Re-perform thử 1 order
authorised sales prices giả vào ngày giảm giá
+ Discount given to file should be updated by xem nó hđ nnao
customers who a responsible official. + Obtain xem có
purchased goods during These changes should be exception note không và
the 10% off weekend are reviewed for any input nếu có thì verify cách nó
manually entered by the errors, this review should xử lí lỗi
sales clerks when be evidenced. The
generating the invoices invoicing system should
(chiết khấu bán hàng confirm that orders were
được nhân viên nhập thủ placed during the
công) discount weekend. Hence
This could result in the sales invoices for
unauthorised sales these periods should
discounts being given as automatically contain the
there does not seem to reduced prices
be any authorisation những changes cần
required. (có thể giảm giá review để phát hiện lỗi
trái phép do không thấy sai đầu vào và phải có
cần có sự cho phép bằng chứng cho sự
authorisation nào được review. Invoicing system
yêu cầu) cx phải xác nhận các
In addition, a clerk could orders vào cuối tuần có
forget to manually enter discount để tự động áp
the discount or enter an giá đã giảm vào
incorrect level of discount
for a customer, leading to The invoicing system + review the customer
the sales invoice being should be amended to statement reconciliation
overstated and a loss of prevent sales clerks from
customer goodwill being able to manually
Unauthorised discounts in enter sales discounts
excess of 10% would when raising invoices
result in a loss of
revenue, either due to
error or fraud The company should
generate monthly
customer statements for
all customers and send or
email them out promptly.
Ideally this would be an
+ Customer statements automated monthly email
are no longer being routine attaching
generated and sent out. statements based
This can lead to when outstanding invoices per
some invoices are posted the receivables ledger
to wrong customer
account, it is difficult to
correct and check which
customer we need to post
instead. In addition, this
could increase the
likelihood of errors and
any disputed invoices not
being quickly identified The receivables ledger
and resolved by the control account should be
company. This could lead reconciled on a monthly
to cash flow issues basis to identify any
errors which should
investigated and
The receivables ledger corrected. The
control account is only reconciliations should be
reconciled at the end of reviewed by a responsible + hỏi xem ai là người
April in order to verify the official and they should review và xem việc
year-end balance. If the evidence their review by review có thường xuyên
receivables ledger is only way of physical or không
reconciled annually, there electronic signature + ktra các bằng chứng
is a risk that errors will như có sign hay gì đó trên
not be spotted promptly các document review
and receivables may be
misstated

Sai sót không được phát

hiện kịp thời – errors will
not be spotted promptly Credit limits should
continue to be set by the
sales director. However, + hỏi xem ai đc appoint
these limits should be vào vi trí này để ensure là
reviewed and amended phù hợp
These credit limits are as appropriate on a + review sign trên giấy
not reviewed unless a regular basis by a để xem chức vụ ng thực
review is requested by responsible official hiện đúng k
the customer + test control các old
If the credit limits are not receivables xem có hiệu
reviewed regularly, they quả k, thử làm 1 cái hoá
could be out of date, đơn trên 30 days và dưới
resulting in limits being 90 days xem có bị chase
too high and sales being k và ng chase có đúng
made to poor credit risks chức vụ k
or too low and the A credit controller should
company losing potential be appointed, and it
revenue should be their role,
rather than client
 services managers, to
Client services managers chase any outstanding
are given responsibility to sales invoices which are
chase customers directly more than 30 days old
for payment once an
invoice is outstanding for
90 days. This is
considerably in excess of
the company’s credit
terms of 30 days which
will lead to poor cash flow
Futher, client services
managers are more likely
to focus on customer
relationships and
generating further
revenues rather than
chasing payments. This Credit limit should be
could result in an continued set by sales
increase in irrecoverable director and are reviewed
balances and reduced regularly by a responsible
profit and cash flows official.

Credit limits are set by

the sales director but it
only changes when a
customer requests an
increase
If the company doesn’t
review credit limit The links to the GDNs
regularly, they could be should be sent to the
out of date, leading to finance department on a
limit be set too high that more frequent basis, such
some may become as daily
irrecoverable and too low The finance department
which result in loss of should undertake a + enquiry xem appoint ai
potential revenue sequence check of the va sufficient technical
GDNs to ensure none are competency khong
missing for processing + ktra 1 overdue
Electronic copy of GDN is customer xem co dc
added to a pending review va chase k
accounts email and then + obtain aged
is sent on weekly basis to receivables listing xem
the sales ordering dung khong
department and finance
department
If finance department During the period of the
doesn’t promptly (nhanh maternity an alternative
chong) receive links to member of finance
the GDNs, this could department should be
result in good being trained in the credit
dispatched but being control role (or a
invoiced late. This could temporary credit
result in revenue cut-off controller recruited) and
issues and understated assigned responsibility
receivables for reviewing the aged
receivables listing and
following up on any
No one has taken over overdue customers
the credit controller’s
duties while she is on
maternity and have to
leave for 6 months.
This can arise risk of error
because no one has been
responsible monitoring The RLCA reconciliations
and chasing ageing should be reviewed by
receivables. This could the financial controller on
result in an increased risk a monthly basis, evenif
of irrecoverable there are no exceptions,
receivables and lead to and the review should be
customers not paying evidenced by way of
their outstading balances signature on the
on time, or at all, leading reconciliation
to reduced cash flows

The monthly receivables

ledger control account
(RLCA) reconciliation is
only reviewed by the
financial controller if
there are any
unreconciled differences
The RLCA reconciliation
could reconcile but still
contain significant errors The sales order copy
as there could be should be emailed to the
compensating errors sales department
which cancel each other Upon dispatch, the GDNs
out or it may have been should be match to the
incorrectly prepared or order, a regular review of
manipulated and this unmatched orders should
would not be identified. If be undertaken by the
the reconciliation is not sales department to
reviewed, then this identify any fulfilled
significantly reduces its orders
effectiveness

Copies of electronic order

form are emailed to
customer, warehouse and
finance department but All discounts to be
arent sent to sales granted to customers
department should be authorised in
If sales department advance by a responsible
doesn’t receive one copy official, such as the sales
of order form, no one will director. If this is not
monitor if orders are practical, then the
being fulfilled on a timely supervisor of sales staff
basis. If orders are not should undertake this
fulfilled on a timely basis, role. A copy of the
this would reduce authorisation should be
customer goodwill sent to the sales
department and the
customer’s master file
Sales staff can use their data amended for
discretion in granting discounts allowed by a
discounts up to a responsible official
maximum of 8% and no The master file data
review is undertaken of system should be
discounts granted but amended to prohibit
discounts granted are not discounts in excess of 8%
reviewed being entered
This could result in On a regular basis, the
unauthorised discounts in sales director should
excess of 8% being undertake a review of
allowed and a loss of discount levels granted
revenue as they may on sales orders and
award unrealistic ensure they are in line
discounts simply to meet with authorised level
sales targets (similar to, consistent
with)

Purchase

Deficiency recommendation TOC

GRNs are only emailed to A GRN copy should also + Review copy GRNs held
the finance department. be auto-emailed to the by the purchase ordering
Failing to send a copy to ordering department. A department and review
the purchase ordering copy should be held at for evidence that these
department means that it the warehouse as well as are matched to orders
is not possible to monitor being emailed to the and flagged as complete
the level of unfulfilled finance department (xem purchase clerk làm
orders. This could result A purchase ordering clerk việc có hiệu quả hay
in a significant level of should agree their copy không)
unfulfilled orders leading of the GRN to the + Review the report of
to stock – outs and a purchase order and unfulfilled purchase
consequent loss of sales change the order status orders for any overdue
dẫn đến sẽ có số lượng to complete in purchasing items and discuss their
đơn chưa thực hiện ở mức module. (đang nói work status with an ordering
đáng kể (sẽ có vài đơn của nvien là đối chiếu clerk
mua nhg mãi không đc copy of GRN với purchase (xem mấy cái unfulfilled
thực hiện mà mình không order và đổi status of này có đc giải quyết hay
bt tại k có ai monitor), order to complêt in chưa, tránh bị loss of
dẫn tới tình trạng hết purchasing) revenue)
hàng tại và hậu quả là On a regular basis, a
mất doanh thu report of unfulfilled
In addition, if the GRN orders should be
record is lost, then it will generated and reviewed
not be possible for the and each order should be
finance department to followed up with the
match the invoice to relevant supplier
proof of goods being
received. This could
result in a delay to the
invoice being paid and a
loss of supplier goodwill
The audit team should
utilise test data
The payables ledger The payables ledger clerk procedures to assess
clerk, only uitilises should instead input the whether data can be
document count controls invoices in batches and entered without the use
when inputting invoices apply application of batch control totals
into the payables ledger controls, such as control and also whether
Document count controls totals, rather than just sequence checks are built
can confirm the completeness checks to into the system
completeness of input. ensure both (xem data có đc nhập
However, they do not completeness and nếu dùng batch control
verify the accuracy or accuracy over the input totals và xem sequence
validity of input of purchase invoices. In check có dc áp dụng vào
If the invoices are not addition, sequence system không)
input correctly, suppliers checks should be built Observe/Monitor the
may not be paid on time, into the system to ensure inputting of purchase
or paid incorrect amounts completeness of input invoices and identify
leading to an what application controls
overpayment or loss of are utilised by the clerk
supplier goodwill who
may withdraw credit
facilities
Obtain a copy of the
A review of all standard standard costs used for
The basis of the standard costs currently in use inventory valuation,
costs was reviewed should be undertaken by assess when the review
approximately 18 months a senior manager in the was last undertaken and
ago production department. inspect for evidence of
If the standard costs were Actual costs for materials, review by the production
reviewed 18 months ago, labour and overheads director/senior manager
there is the risk that the should be ascertained Obtain actual costs
costs are misstated as and compared to the calculation and agree to
changes in raw materials proposed standard costs the copy of standard
and wages inflation may ensure they are close costs and discuss the
not have been adjusted approximation manager if there are
for. This could result in some material difference
inventory being under or to ensure the standard
overvalued and profits costs have to be closely
being misstated approximated to actual
In addition for year-end cost
reporting, IAS 2
Inventories only allows
standard costs to be used
for valuation purposes if
they are a close
approximation to actual
costs, which is unlikely if
the standard costs
remain unchaged for a
long period of time.
Therefore the valuation
may not be in line with
IAS 2

(standard cost là chi phí

ước tính từ đầu cho việc
sản xuất sản phẩm nên
cần đc review thường
xuyên, nếu không có thể
raw materials hay wages
inflation lại không đc
adjusted vào)
Close approximation to It is important that goods
actual cost are despatched promptly, For a sample of orders,
but this is just one of vouch that the suppliers
many criterias that used are on the preferred
should be used in supplier listing
The clerk contacts a deciding which supplier Obtain the supplier list
number of suppliers to to use and check the review to
see which can dispatch An approved supplier list verify if it is reviewed and
the goods first should be complied; This updated regularly by a
There is a risk that should take into account responsible official
suppliers whom clerk the price of goods, their
contacted doesn’t give quality and also the
most competitive price, speed of delivery
higher than other (generate supplier listing
supplier which lead to and containt the
increase the expenses on quotation, speed, quality
buying products and of goods)
profit can be affected to Order should only be
be reduced. placed with supplier
In addition, the supplier which is on the entity’s
that can delivery faster list of preferred suppliers
than others may ask for which have been
higher price of goods approved for the
because the rush of time effectiveness of goods
ordered not for the timely
basis
The supplier list should
be updated and reviewed
regularly with details of For a sample of recent
quotation purchase orders, review if
it is sequentially
numbered and discuss
The system should be with finance director if
configured so that there is any gap
Purchase orders are not purchase order numbers difference between
sequentially numbered. allocated are sequential. Obtain some unfulfilled
Failing to sequentially On a regular basis a orders to verify if it is
number the orders means sequence check of regularly check by a
that Fox Industries Co unfulfilled orders should responsible official
ordering team are unable be performed
to monitor if all orders (hệ thống phải đc cấu
are being fulfilled in a hình configued sao cho
timely manner; this could PO numbers đc tuần tự)
result in stock outs
If the purchase orders are
sequentially numbered,
then a sequence check
can be performed for any
unfulfilled orders
All purchase orders
should be authorised by a
Only orders above 5,000 responsible official
require authorisation and Authorised signatories
under 5000 are not should be established
authorised and are with varying levels of
procesed solely by an purchase order
order clerk authorisation. Governs
This can result in goods which usernames can
being purchased which authorise the varying
are not required by levels of purchase order
company. In addition,
there is an increased
fraud risk as an order
clerk could place orders
for personnal goods up to
the value of 5000, which
is significant
tại có mình nvien kia làm
nên có thể tự ý đặt mua
đồ for personnal use
instead of for business tới
5000, nếu có người nx thì
vẫn có thể thông đồng The purchase ledger clerk
COLLUDE với nhau should input the invoices
in batches and apply
information processing
Purchase invoices are controls, such as control
input daily by the totals, to ensure
payables ledger clerk completeness and
who has been in role for accuracy over the input
many years and does not of purchase invoices
apply/utilise any
information processing
controls over the input
process
Without these controls
there is an risk that
invoices could be input
into the system with
inaccuracies or they may
be missed out entirely. The monthly exception
This could result in report of changes to
suppliers being paid master file data should
incorrectly or not at all, be reviewed by a
leading to a loss of responsible official, who
supplier goodwill should evidence this
review.
(example: signed, any
Access to the master file signature)
data for suppliers is Any authorised or
available to all those in unexpected changes
the purchasing should be investigated
department and the and appropriate action
monthly exception report taken.
of changes to master file The ability to make
data is not reviewed (just amendments to master
automatically generated) file data should be
All members of the restricted to those
purchasing department required and authorised
could amend data and, to make changes to this
potentially, add new data
suppliers to the payables
ledger system, and as the For a sample of GRNs
exception report is not trace through to
reviewed it is unlikely corresponding invoice
that this would be and verify that the
identified. This leads to invoice has been
an increased risk of fraud recorded in the
as clerks could add accounting records.
fictitious suppliers and (trace xem các GRNs với
then place fraudulent invoice xem đc ghi nhận
orders without detection All purchase invoices đầy đủ completeness
(because no one reviews should be matched to chưa)
it) both the purchase order Where no invoice has
and the related GRN. The been received but
details should be agreed already received goods,
prior to the invoice being verify that the relevant
Purchase invoices are not authorised and logged in accrual liability has been
agreed to the relevant the payables ledger recorded
GRNs prior to Unmatched GRNs should
authorisation and input reviewed periodically and
(chỉ có invoices match vs an accrual posted for the
purchase order chứ kphai associated liability
với cả GRN nữa) (chưa đc gửi invoice mà
This could result in đã nhận goods vẫn nhớ
invoices being paid for phải record liability dù đã
goods which were not tới date payment)
received, resulting in
increased costs
(vì không check kèm với On a monthly basis,
cả GRN nghĩa là hàng có payables ledger comtrol
thể chưa đc chuyển tới account reconciliations
mà vx ghi nhận) should be undertaken
with all reconciling items
fully investigated. The
The total on the payables account reconciliation
ledger (sub-ledger) is not should be reviewed by a
compared to the general responsible official who
ledger on a monthly would evidence this
basis, hence payables review by way of
ledger control account signature.
reconciliations are not Unfulfilled check
being undertaken.
Failing to undertake these
reconciliations means
that errors in the
payables ledger may not
be identified promptly,
resulting in suppliers
being under or overpaid.
In addition, errors may be
present in the general
ledger resulting in the
payables balance in the
FSs being under or
overstated

PAYROLL SYSTEM

deficiency recommendation TOC

Details of overtime All overtime should be For a sample of
worked per employee is authorised by a responsible overtime payments,
collated and submitted official/senior/manager/super trace back to the
to the payroll visor and an overtime overtime authorisation
departmebt by a authorisation form form.
production clerk but not completed prior to the Review the overtime
be authorised. The payment being processed by report for evidence of
production director is the payroll department. This authorisation and note
only informed about authorisation should be the date this occurred
overtime levels via evidenced in writing. to ensure that this was
quaterly reports undertaken prior to the
(director chỉ đc thông payment of the
báo về level of overtime
overtimes thông qua via
báo cáo quý)
These reports are
reviewed sometime
after the payments
have been made which
could result in
unauthorised overtime
or amounts being paid
incorrectly and Freesia
Co’s payroll cost
increasing.
(những báo cáo này đc
review vài lần sau khi
trả thì. Có thể sẽ có
unauthorised overtime
hay amounts being paid The finance director, when
bị sai do review có ít lần authorising the payments, Obtain a sample of
thoi) should on check a sample of payments lists and
staff records from human review for signature by
 resource department to the finance director as
The finance director payment list and vice versa evidence that the
compares the total of to confirm the payments are control is operating
the list of bank complete and only made to effectively
transfers with the total bona fide employees + vouch a sample of
to be paid per the The finance director should payments to staff
payroll records. sign the payments list as records to ensure the
There could be evidence that these checks payments are only
employees omitted or have been undertaken made for bona fide
fictitious employees employees
added to the payment
listing so that, although
the total payments list
agrees to payroll totals,
there could be
fraudulent or erroneous
payments being made.
(ý là có thể có fake
employee nên ngay khi
agree vs nhau thì vx có Employees should receive
thể có fraud hay error written confirmation when
payments) their holiday has been Obtain a sample of
approved and should be employees’ holiday
informed that they will not be forms and check if the
able to take holiday without managers reviewed it
Department managers notification by verify the signature
are required to approve Any payments for unused such as sign to ensure
all employees’ holiday holiday should be authorised the controls
forms, however, this by department managers surrounding approving
does not always occur. prior to payment the holidays form is
This could result in operated effectively
employees taking + obtain the unused
unauthorised leave holiday record be
which could lead to
operational difficulties if
there are shortages of
staff at critical periods.
In addition, payments
for untaken holiday may
be made in error as
holiday records may be
incorrect
(nhân viên có thể tự ý
nghỉ không phép, dẫn
đến hđ kinh doanh có
thể khó khăn nếu ít
nhân viên đi làm và việc Once the bank transfer has
chi trả lương cho ngày been prepared by the
nghỉ cũng bị sai vì financial controller, it should
holiday records sai) be passed to the finance
director to be reviewed and
authorised for payment. The
The financial controller review and authorisation
prepared the bank should be evidenced by the
transfers for the payroll finance director
and also authorises (nếu financiak controller là
these to be paid ng cbi banktransfer thì phải
This lack of segregation chuyển sang trc cho FD để
of duties increases the review và authorise cái
risk of fraud/error as the payment)
financial controller
could pay themselves
or certain employees The payroll supervisor or a
more than they are due member of the finance team
without this being should review all edit reports
detected and agree changes made to
the details on the
joiner/leavers forms. Any
The payroll clerk discrepancies should be
amends the payroll and investigated promptly and
an edit report of the payroll system updated
changes is produced for any errors or omissions
but this report is not The payroll supervisor should
reviewed evidence their review on the
As the edit report is not edit report with their
checked, errors made signature
by the payroll clerk
when updating the
system will not be
identified promptly. This
may result in new
employees not being
paid at all, errors being
made in payments to
new employees or
leavers being paid after
they have left the
company. This would
lead to loss of employee
goodwill and errors in
accounting records for
wages and salaries
(error có thể không đc
phát hiện kịp thời, new
vs leavers paid after
left) All staff appoinments,
It could also result in an including temporary staff,
increased risk of fraud á should only be processed by
fictitious employees the HR department to ensure
could be added by the that correct procedures are
payroll clerk followed
If it is not possible for HR
department to carry put all of
The HR department is the detailed processing due
responsible for to staff shortages, a member
processing joiners and of HR team should review the
leavers, but due to staff leaver/joiner form and
illness, the operations authorise it before it is sent
manager has processed to the payroll department
temporary new drivers The payroll department
and notified payroll should be notified not to
The operations accept any new joiner
manager may not carry information unless approved
out all the required by a member of HR
procedures for
processing temporary
new drivers as the
manager may not be
using appropriate
documentation
This could result in
temporary employees
not being set up in the All overtime, including that
payroll records below 5 hours, should be
correctly, resulting in authorised by a responsible
the late payment of official before being
wages, incorrect processed in the payroll. This
statutory deductions authorisation should be
being calculated and evidenced by the way of
incomplete payroll signature
records

Only overtime in excess

of 5 hours per week
needs authorisation by
the operations manager
This means that
employees could claim All drivers collecting cash
to have worked up to 5 pay packets should provide a
hours overtime without form of identification to the
authorisation resulting finance staff member before
in payments being the pay packet is handed to
made to employees for them. The driver should also
hours not worked and be required to sign their pay
additional payroll costs packet
Where cash wages are
paid, the driver is only
required to provide their
name to collect their Approved bonus parameters
pay packet should be established by the
Payment of wages board. All bonuses should be
without proof of identity determined by a senior
or signature increases official, such as the sales
the risk that wages director or production
could be paid to director, in line with these
incorrect employees parameters, who should
either in error or due to communicate the bonus in
fraud resulting in a loss writing to the payroll
of cash department
(cái bonus parameters nên
The operations đc approved bởi BOD,
manager decides on the determined by sales director
bonus to be paid to và communicate the bonus in
delivery drivers each writing tới ban payroll)
quarter and there are
no approved
parameters for the
bonus levels (không có
thông số, hạn mức đc
duyệt cho mức thưởng)
Without approved
parameters, the The company should monitor
operations manager the activity of the delivery
may award excessive drivers through electronic
bonuses or pay means, for ex, by using
additional sums to tracking devices (thiết bị
friends and family theo dõi) attched to their
members resulting in vehicles to ensure that the
additional payroll costs prescribed breaks (giờ nghỉ
quy định) are taken by the
employees
Data should be downloaded
Delivery driver must abd reviewed by a
take breaks throughout responsible official on a
the day which are not regular basis
monitored.
Drivers could take
longer breaks than
those authorised
resulting in payments
being mafe to
employees for time not
worked. Conversely, if The password to amend
drivers do not take the standing data should be
required breaks, they changed and only
may be in breach of law communicated to senior
and regulations which members of the payroll
require drivers to take department
regular break, hence If all members of payroll
the company is at risk need the ability to amend
of fines standing data, the system
should be changed to require
authorisation of all changes
All members of the by a senior member of
payroll department can payroll.
amend employees’ Edit reports should be
standing data in the generated for all standing
payroll system as they data changes with clear
have access to the reference to who made the
password change and who authorised
As all members of it. These edit reports should
payroll can amend be regularly reviewed by a
standing data this may responsible official and they
result in errors of should evidence this review
unauthorised changes with signature
being made, leading to
incorrect payment of
wages and increased The senior payroll manager
risk of fraud should not be able to process
changes to the payroll
system as well as authorise
payments. Discrepancies
should be thoroughly
investigated, and
adjustments made in the
relevant record as required
The authorisation of the bank
transfer listing should be
undertaken by an individual
The senior payroll outside the payroll
manager reviews the department such as the FD
bank transfer listing
prior to authorising the
payments and If any
discrepancies are
noted, always makes
the adjustment in the
payroll records for any
changes required
Discrepancies may arise
due to the payroll
records or the bank
transfer listing being
incorrect. Assuming the
discrepancies are
always in the payroll
records may result in
incorrect records may
result in incorrect
amendments being
made to payroll or
incorrect amounts paid
to employees
In addition, there is a
lack of segregation of A senior member of the
duties as it is the payroll team should
payroll team which recalculate the gross to net
processes the amounts pay workings for a sample of
and the senior payroll employees and compare
manager who their results to the output
authorises payments. from the payroll system.
The senior manager These calculations should be
could fraudulently signed as approved before
increase or incorrectly payments are made.
amend the amounts to Discrepancies -> discuss and
be paid to certain request adjustment
employees, process this
payment as well as
amend the records

The payroll department

The wages calculations should maintain a schedule,
are generated by the by employee, of payments
payroll system and made to third parties, such
there are no checks as the central government as
performed well as cumulative balance
Therefore, if system owing. On a regular basis, at
errors occur during the least annually this statement
payroll processing, this should be reconciled to the
would not be identified. loan statement received from
This could result in the government and sent to
wages being over or the employee for agreement
under calculated, In accordance with the
leading to an additional schedule, payments which
payroll cost or loss of are due to cease shortly
employee goodwill should be confirmed in
writing with the third party,
prior to stopping
Student loan deduction
forms are completed by
relevant employees and
payments are made
directly to the third
party until the
employee notifies HR
that the loan has been
repaid in full
As the payments
continue until the
employee notifies HR,
and emloyees are
unlikely to be closely
monitoring payments,
there is a risk that
overpayments may be The authorisation of the bank
made, which then need transfer listing should be
to be reclaimed, leading undertaken by an individual
to employee outside the payroll
dissatisfaction. department, such as the FD
In the case of
underpayments, the
company has an
obligation to remit
funds on time and to
reconcile to annual loan
statements. If the
company does not
make payments in full
and on time, this could Payroll department should
result in non- distribute the paypackets
compliance by both th directly to employees while
company and check the employee’s clock
employee, which could card and photographic
result in fines or identification as this confirms
penalties proof of identity
Payroll should undertake a
reconciliation of pay packets
There is a lack of issued to production
segregation of duties as supervisors, wages
it is the payroll team distributed need to
which processes the accomplished with
amounts and the senior employee’s signature to
payroll manager who confirm the receipt and pay
authorises payments. packets returned to payroll
The senior manager due to staff absences. Any
could fraudulently diff should be investigated
increase the amounts to imme
be paid to certain
employees, process this
payment as well as
amend the records

The pay packets are As employees work 8-hour

delivered to the shifts over 24 hours,
production supervisors, consideration should be
who distribute them to given to operating a shift
employees at the end of system for the payroll
their shift department on wages pay
The supervisor is not out day. This will ensure that
sufficiently independent there are sufficient payroll
to pay wages out. They employees to perform the
could adjust pay wages pay out for each shift
packets to increase of employees, with the same
those of close friends level of controls in place
whilst reducing others The monthly management
In addition, although accounts should be amended
the production to include an analysis of
supervisors knoe their wages and salaries
team members, compared to the budgeted
payment of wages costs. These should be
without proof of identity broken down to each
increases the risk that relevant department and
wages could be paid to could als include an analysis
incorrect employees. of headcount numbers
compared to budget
(phân tích tiền lương so với
Monthly management budgeted costs và nên chia
accounts do not analyse ra department liên quan, so
the variances between sánh cả headcount numbers
actual and budgeted số lượng nhân viên so vs
wages and salaries; this budget
is because there are no
overtime costs
However, wages and
salaries are a significant
expense and
management needs to A joiner form should be
understand why completed for all new
variances may have employees, whether
arisen. These could temporary or permanent.
occur due to extra The authorised joiner form
employees being should then be sent to
recruited which were payroll on the day the
not budgeted for, or an employee commences
increase in wage pay employment. Payroll should
out rates. The Board then sign the form as being
would need to monitor actioned.
the wages and salaries Payroll should not set up new
costs as if they are too employees without an
high, then this would authorised joiner form.
impact the profitability
of the company
(variances có thể xảy ra
nếu thuê thêm nhân
viên mới mà không đc
cấp ngân sách cho are
not budgeted for)
Employee work theo ca
8 hours a day

Additional staff are The production supervisor

required at short notice, should review and authorise
joiners forms are not overtime worked reports
completed and instead, before they are passed to the
the production payroll department for
supevisor notifies processing. This will ensure
payroll department by the correct levels of overtime
email are paid to the correct
The production employees.
supervisor may not The payroll department
include alk the relevant should be instructed not to
details on the email to process any overtime worked
payroll. This could result reports which have not been
in the temporary reviewed and authorised
employees not
receiving or not being
paid on time, resulting
in a loss of employee
goodwill. The addition
of employees to the For a sample of employees, a
payroll without senior member of the payroll
authorisation from HR team should recalculate the
also increases the risk gross to net pay workings
of fictitious individuals and compare their results to
being added. the output from the payroll
system. Any discrepancies
should be investigated
Staff are paid overtime These calculations should be
on a monthly basis but signed as approved before
the overtime worked payments are made
reports are only
reviewed every quarter
after the overtime has
been paid
Reviewing overtime
worked reports
quarterly after
employees have been
paid is too infrequent.
This could result in
employees being paid
for hours not worked, The bonus payments should
hence increasing costs be determined in line with
or not being paid specified and documented
enough overtime which criteria and approved by the
could result in loss of board. The HR director or
employee goodwill other responsible official
should provide payroll with a
list detailing approved
The wages and bonuses per employee.
deductions calculations Payroll should be informed
are automatically only to action payment of a
performed by the bonus or any other change
payroll system but no on receipt of written
checks are carried out authorisation approved by
to confirm the the board
calculations are
accurate
There is a risk that any
system errors which
occur during the payroll
processing would not be
identified. This could
result in wages being
over or under
calculated, leading to
an additional payroll
cost or loss of employee
goodwill. In addition,
statutory deductions
may be over- or
underpaid, giving rise to
compliance issues.

The HR manager
decides on bonuses
based on employee
performance and has
confirmed the bonuses
to the payroll
department
There are no approveed
parameters for the
bonus level so it is
purely based on the
discretion of one
individual who could
pay bonuses
inappropriately, leading
to extra costs or loss of
employee goodwill.
The bonuses were input
into the system and a
number of employees
subsequently notified
the payroll department
of errors in their pay