A company employs about 50 production workers and has the following payroll procedures. The factory foreman interviews applicants and, on the basis of the interview, either hires or rejects the applicants. When the applicant is hired, he or she prepares a W- 4 Form (Employee’s Withholding Exemption Certificate) and gives it to the foreman. The foreman writes the hourly rate of pay for the new employee in the corner of the W- 4 Form and then gives the form to a payroll clerk as notice that the worker has been employed. The foreman verbally advises the payroll department of rate adjustments. A supply of blank time cards is kept in a box near the entrance to the factory. Each worker takes a time card on Monday morning, fills in his or her name, and notes in pencil on the time card his or her daily arrival and departure times. At the end of the week, the workers drop the time cards in a box near the door to the factory. The completed time cards are taken from the box on Monday morning by a payroll clerk. Two payroll clerks divide the cards alphabetically between them, one taking the A to L section of the payroll and the other taking the M to Z section. Each clerk is fully responsible for his or her section of the payroll. He or she computes the gross pay, deductions, and net pay; posts the details to the employee’s earnings records; and prepares and numbers the payroll checks. Employees are removed automatically from the payroll when they fail to turn in a time card. Payroll checks are signed manually by the chief accountant and given to the foreman. The foreman distributes the checks to the workers in the factory and arranges for delivery of the checks to the workers who are absent. The payroll bank account is reconciled by the chief accountant, who also prepares the various quarterly and annual payroll tax reports.

Required

a. Draw a flowchart of these procedures.

b. List your suggestions for improving the company’s system of internal control for the factory hiring practices and payroll procedures.