You are testing the controls over the payroll system at Supreme Chemicals Limited. After completion of some analytical procedures, you confirmed that the following controls have been operated throughout the year, 2021 January to December: 1. Sample check of payroll calculations by payroll manager. 2. Review of payroll listing once prepared before details are entered into the banking system. 3. Segregation of duties between calculation of monthly payroll and responsibility for changes to standing data. 4. Each department manager receives a list of employees in his/her department to confirm that they should be paid.

B. Explain whether or not inspection of employee contracts to confirm salaries to be paid is a test of control.

C. What is the rationale for review of the list of employees by department managers? (3 marks)

D. Describe ONE (1) substantive procedure that could be applied to testing for each of the following financial statement assertions during an audit of a payroll system: i. Accuracy ii. Completeness iii. Occurrence