Which method is the BEST way to control miscellaneous payments when using online input?

• A. Visual audit of the online activity report
• B. A comparison of the online report totals to predetermined totals taken from the source documents
• C. Verification of a sample of entered data
• D. An auditor's comparison of each input source document to the database record

Answer: (B)

The key control idea is reconciling online totals with independent, source-based totals. By comparing what the online system shows as the total for miscellaneous payments to the totals from the source documents (such as approved vouchers or payroll journals), you quickly detect discrepancies caused by data entry mistakes, mispostings, or unauthorized changes. This reconciliation provides a clear, verifiable link between the online input and the authorized payments, making it easier to spot and correct errors before they affect the payroll.

Other approaches are useful in their own ways but less effective as the primary control. A visual audit of the online activity report can catch obvious issues but may miss subtle errors or misallocations. Verifying only a sample of entered data reduces work but risks missing systematic problems if the sample isn’t representative. An auditor reviewing every input source document against the database is thorough, but impractical for large volumes of miscellaneous payments, making day-to-day reconciliation of totals the best overall control.