Finally, a “go-to” resource for Payroll Auditing.

bookPayroll Auditing: A Guide for Multi-Employer Plans
By Lawrence R. Beebe and Philip Vivirito

Payroll auditing guidance is lacking for professionals working with employee benefit plans who are responsible for and who perform payroll audits. Best practices in payroll auditing, procedures and methodologies of performing an audit have not been given enough focus. This book helps trustees fulfill their fiduciary duties by understanding payroll audits.

This book is published by the International Foundation of Employee Benefit Plans and is available at its [online bookstore].

Should a Payroll Audit Program Be Rigid or Flexible?
Tuesday, 29 March 2011 07:57

Written By Larry Beebe
Bond Beebe
P: 301.272.6025 E: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Payroll auditors continue to debate whether payroll audit programs should be rigid or flexible.  Here is what our book, Payroll Auditing: A Guide for Multi-Employer Plans, says on the subject:

There are two types of audit programs.  One is very rigid.  The auditor must perform every step in the audit program and should not deviate from the steps shown.  The other audit program allows flexibility and audit judgment on the part of the auditor.  Certain steps in the program will always be performed, and others will be performed based on the circumstances the auditor finds in auditing each employer.

Should payroll audits be performed using a rigid payroll audit program or a flexible audit program?  If the auditor is inexperienced, a rigid program may be appropriate for the first few audits performed.  Under normal circumstances, however, a flexible audit program is best suited to the performance of an efficient payroll audit.  Every payroll audit is different.  Some employers are large and some are small.  Some employ only workers covered by the collective bargaining agreement (CBA) and some employ many trades.  Some employers’ payroll records are simple and others have complicated records.  The rigid payroll audit program attempts to fit all circumstances.  Performance of every step in an audit program designed to fit all circumstances can result in inefficient payroll audits.  If trustees adequately train their auditors, the trustees can be given flexibility in performing the audit.

This is our humble, but experienced opinion.  We suspect, however, that the debate will continue among some auditors.