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Automated Payroll or Regular Auditing of Payroll

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Employee Integrity and motivation should be considered when a process has to be changed. Although implementing additional controls comes at a cost to the organization, the benefit almost always outweighs the cost. In this case, the obvious remedies are either someone needs to be responsible for auditing payroll records on a regular basis, or it needs to be automated.

Which of these two controls would cost less and prove more effective? Is there a different, more cost effective strategy we should consider?

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Solution Summary

This solution explains which of the two controls listed would cost less and be more effective. I also discuss if there is a different, more cost effective strategy that should be considered. The two controls that would cost less and prove more effective are determined.

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Automating payroll records would definitely be the more effective strategy even though it would cost more. If we were to use a strategy where a person is responsible for auditing payroll records, the error rates are automatically higher simply due to the fact that humans ...

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