Internal Check as Regards Wages.
In case of Labour oriented industries where the industries employees’ large number of labourers, payment of wages constitutes a major expenditure. The preparation of wage sheet and payment of wages to workers provides lot of scope for errors and frauds. The possible errors may be such as recording excess time in case of time wages, recording excess productivity in case of piece rate system, calculating wages at inflated rates, over casting, inclusion of dummy workers, etc. All the persons involved in preparation of wage sheet and payment of wages may use different tricks in misappropriation of cash. Thus an effective system of internal check is quite essential for preventing error and frauds in payment of wages.
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| INTERNAL CHECK |
The internal check as
regards wages should aim at the following.
- Scientific and systematic methods for time keeping and time recording.
- Scientific methods for recording workers productivity.
- Scientific methods in preparation and payment of wages.
- Prevention of errors and frauds in payment of wages.
- Payment of correct wages to right person.
Internal Check on the following lines may serve the purpose
of achieving above objectives. The lines of internal check are grouped under
the following four heads.
1. General Guidelines:
a. Written Orders: Al appointments, placements, promotion,
transfer orders should be in writing and should be authenticated by competent
authority.
b. Personal Files: Personal files for each worker should be
maintained. It should contain every details right from appointment date, date
of birth, date of retirement, date of promotion, date of increment, details of
work experience, additional qualification, the department, section, employee
name, code number etc.
c. Wages Office: A separate section for time keeping,
recording of productivity an experienced officer attached to cash department.
Wage office should work charge of in close association with production
department, Labour department for effective system of wage distribution.
d. Communication to Wage Office: All the orders passed by
personnel department for fresh recruitment, promotion and placement of worker are
communicated to wage office for correct incorporation In preparation of wage
sheet.
e. Employees Cards: As it is common in every large-scale
organization, each employee should be given with identification card with code number;
Data bank consisting of every information relating to workers is developed.
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