On June 1, 2021, Colour Scheme Inc. hired Grant Weaver in the position of Payroll Manager. The Chief Executive Officer (CEO) of the company had been receiving numerous complaints form employees that their wages were always incorrect. The CEO had stressed to Grant during that interview process that his major responsibilities were to ensure that the employees were paid on time and accurately as well as ensure that the company meet their statutory obligations.

Colour Scheme Inc. has four employees who work on an hourly basis and are paid semi- monthly. The current CPP rate is 5.25%, the current EI rate is 1.58%, and the appropriate income tax rate is 15%. Each employee pays union dues. The employer pays half of the amount of the health care premium for the employees. Assume that the employer contributes 100% toward CPP and 140% toward EI. Regular hours for each pay period are 80 hours. Employees who work more than 80 hours in a pay period are paid 1.5 times for the excess hours.

George Grover, the Payroll Supervisor, has the following responsibilities.

• Hiring and paying employees

• Determining, approving, and paying increases to employees

• Termination of employees

• The single bank account used for all transactions in the company.

  The following is the information provided by George, for the pay period ending June 15, 2021.

Total Hourly Hours Rate

86 $22.00 75 $25.00 $18.00 $18.00 82 $30.00 $26.00 $24.00 79 $35.00 $30.00 $26.00

Employee

Dave Green Jean Grey Doris White Earl Blue

Union Dues

Health Care

$20.00

$16.00

George has also completed the payroll register and Grant had requested that it should be forwarded to him for his review.

Payroll Register
		Deductions
Employee	Gross	Income Tax	CPP*	EI	Union Dues	Health Care	Total Deductions	Net Pay
Dave Green	$1,892.00	$283.80	$99.33	$29.89	$20.00	$16.00	$449.02	$1,442.98
Jean Grey	$1,875.00	$281.25	$98.44	$29.63	$18.00	$18.00	$445.31	$1,429.69
Doris White	$2,460.00	$369.00	$129.15	$38.87	$26.00	$24.00	$587.02	$1,872.98
Earl Blue	$2,765.00	$414.75	$145.16	$43.69	$30.00	$26.00	$659.60	$2,105.40
Total	$8,992.00	$1,348.80	$472.08	$142.07	$94.00	$84.00	$2,140.95	$6,851.05

*Remember the $3,500 exemption

Required:

Assume that you are Grant, the Payroll Manager. Prepare a report to the CEO, identifying any errors that may have been made while preparing the payroll register. Included in this report should be the corrected payroll register as well as any payroll controls that could be implemented to enhance internal control.

Case Layout

Title Section (name of report, team members, and date) - Executive Summary - Findings (Problem identification) - Discussion (Summarize the major problems) - Conclusion - Recommendations - Implementation - References -

3 marks 5 marks 5 marks 10 marks 5 marks 5 marks 5 marks 2 marks