Accounting Multiple Choice Question – 2 March 2026

Which ONE of the following features in the payroll system of Alex Manufacturing Ltd could result in the employee costs figure in the financial statements being MISSTATED?

Select ONE answer:

1. Rates of pay are negotiated at a local level; there is no central control
2. Personnel records are kept up to date
3. The payroll department receives confirmation of new employees in writing
4. The payroll clerk CAN amend standing data on the payroll system without the written authorisation of a senior member of staff

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – Unauthorised amendments could result in the creation of bogus employees or overpayment of existing employees. Options 1,2 and 3 would not lead to misstatement in the financial statements

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