Fraud Data Analytics Methodology by Vona Leonard W.;

Author:Vona, Leonard W.;
Language: eng
Format: epub
Publisher: John Wiley & Sons, Incorporated
Published: 2017-01-04T00:00:00+00:00

Starting with the human resources database, identify what information can be used for fraud data analytics. In human resources, there is the obvious information, name, address, and so on; the other relevant items of information are:

Employee hire date

Last update

Employee classification systems as to job titles

Salary grade as to the maximum salary within the grade

Employment status: regular full time, contract employee, temporary status

Country of residence

The time and attendance system starts the payroll calculation. For hourly employees, time and attendance system is the basis of their gross payroll; for full‐time employees, it indicates whether the employee is using personal time. The fraud auditor should understand how the information is created, changed, and reported. Other necessary information is the creator ID, the approver ID, the computer ID, job duties if employee performs different jobs and different rates, date, and time records for creating and changing the time record.

The table structure for payroll has two primary tables for fraud data analytics, the payroll register table, which has the results of the payroll calculation, and the payroll summary table that is used for tax reporting and various fringe benefit requirements. The fraud data analytics should be based on the payroll register table; however, the payroll summary table is useful because the table size is small in comparison to the size of all the payroll registers for the year.

The net payroll calculation is gross payroll minus deductions equals net payroll. The gross payroll is based on a salary grade, divided by the number of pay periods. Hourly employees are paid based on the number of hours multiplied by an hourly rate. Gross wages are classified based on an internal earnings code; the fraud auditor should obtain a copy of the earnings code as part of the planning.

Within the payroll system, there can be many earnings codes that mirror how the business operates. Some of these earnings codes are for classification of wages, such as vacation time. Other earnings codes are designed to increase gross payroll, such as a one‐time bonus payment. Within fraud data analytics the earnings codes are an integral part of searching for fraud in payroll.

There are two types of deductions from gross wages. Those deductions required by the government and voluntary. The fraud auditor should obtain a copy of the deduction codes as part of the planning.

Now that regular gross payroll is calculated, the next step is to understand how adjustments to gross payroll, deductions, and net payroll are reported and where the adjustment transaction is recorded in the database.

Lastly, how is net payroll calculated? Within some companies, employees are reimbursed for expenses through payroll. The company includes the reimbursement as an adjustment to net payroll.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.