Digjam Limited

Entry: Sequel Logistics Private Limited

Location: Corporate Office
Business Process: Human Resources & Payroll

Process and risk Assertions Control

Existence / Occurrence

Presentation and Disclosure

Completeness

Valuation & allocation

Rights and obligations
Control Account Business Cycle/ Sub-process Risk Control Objective Standard Control Description Process activity and walkthrough details
number balance/ Process
disclosure

1 Employee HR DoA Delegation of Authority Absence of proper approvals due to missing P To ensure that all HR related A Delegation of Authority (DoA) is The decisions related to appointment of contractor, passing of
Benefit Expense Delegation of Authority decisions are approved by in place and approved by Board of contractor's invoice, manpower requisition form ("MRF"), etc.
competent authority Directors to map the approving are taken with the approval of CEO. For other activates, the
authorities for various HR related delegation of authority is prepared and approved by Head HR,
decisions defining roles & responsibilities of each person of Personnel
Department/Labour office.

2 Employee Recruitment Recruitment request Recruitment not aligned with the business P P To ensure alignment between Manpower request form is In case of workers, a Manpower Requisition Form ("MRF") is
Benefit Expense plan or in excess of the budget business plans & recruitments authorized by the concerned HOD. prepared by concerned department head. The MRF is
Any deviation from the budget is approved by CEO, then appointment is done by Labour Office.
reviewed by HR department and In case of staff, the manpower request is raised by user
approved by competent authority department verbally.
as defined in DoA

3 Employee Recruitment Candidate screening and interview Improper evaluation of the candidate being P Proper evaluation of the candidate Appropriate panel conducts the
Benefit Expense interviewed being interviewed interview depending on the
vacancy. Technical experts in
relation to the job description are
involved in the panel.
All the persons involved in the
interview process are made to fill
and sign an Interview Assessment
Form at the time of conducting an
interview.
In case of recruitment of worker & Sub staff, a candidate is
interviewed by the Labour Office. If the candidate meets the
criteria set (qualification, age, height, etc.), the selection is
done.
In case of recruitment of staff, the concerned department HoD
conducts the interview and final selection is done by Head HR
and in case of key and critical positions by CEO. The
interviewers mention the remarks (if any) on the available
documents and signs the same. The assessment sheet of
employee is prepared by department head on completion of
probation period, based on which decision to make
permanent is taken.

4 Employee Recruitment Candidate screening and interview Individuals may be employed who do not
Benefit Expense meet the company's hiring criteria,
resulting in an inadequate workforce in
terms of manpower cost, numbers and/or
quality.
P Proper assessment of candidates HR executive reviews all original
documents submitted by candidate
and maintains photocopies of the
same.
In case of recruitment of workers & sub staff, the original
documents are checked with the candidates information form.
The interviewer (Labour Office) verifies whether the candidate
meets the criteria set (minimum 10th pass, Height - 5'2 inch,
age 22-40 years, etc.).
In case of recruitment of staff, the application & bio data form
is filled by the interviewee and resume & supporting
documents are attached with it. The labour office department
verifies the application with all documents attached.

5 Employee Recruitment Selection and hiring of candidates Letter of Intent to the candidate without P P To ensure offers are made to the Appointment letter signed by the On selection of staff, the offer letter signed by Head HR is
Benefit Expense completion of employee verification eligible candidate Head HR and issued to candidate issued to staff. On completion of probation period, the
process post performance of above appointment letter is issued which is signed by Head HR.
activities

Private Confidential
 Digjam Limited

6 Employee Maintain Create new employee code Unauthorized creation of employee codes P P P Valid additions made to the Employee master is updated based The employee code is created by HR Tools team based on
Benefit Expense Employee Master employee masters on proper base documents and details received from labour office.
check is made on the updation The appointment letter is generated and a signed
made acknowledgement is taken from every staff along with the
signature of Head HR
In case of Manager & above, appointment letter is generated
and a signed acknowledgement is taken from every staff along
with the signature of Head HR and CEO

7 Employee Maintain Create new employee code Similar codes may be allocated to different P Unique codes are allocated for each System is configured to It is a system generated code by SAP which is then further fed
Benefit Expense Employee Master employees employee automatically give unique serially in to the inhouse ERP system called 247 for Operational use.
numbered codes

8 Employee Maintain Amendment/Updation of master data Unauthorized changes to the pay details P P Only authorized changes are made Access to change employee master The access to employee master for employees is granted to
Benefit Expense Employee Master to the payroll master files. is restricted to competent authority Payroll Manager.

9 Employee Payroll processing Capturing attendance details Attendance details may not be captured P P Attendance data recorded reflect Employee should record their All employees sign in the respective register while making a QR
Benefit Expense accurately actual time worked and is attendance daily in the QR code code scan for attendance.
authorized. scanning system in 247 At the end of each month, HR Tools Incharge updates the no.
of present days in system for salary processing.

10 Employee Payroll processing Capturing number of hours worked Salary is not paid for actual hours worked. P The number of hours worked and Overtime hours generated from the The worker is allowed to do overtime only if in case of
Benefit Expense overtime hours concerning the time office software is sent to requirement (i.e. workers of boiler, panel board, maintenance
employee are approved competent authority for approval. workers whose repairing work in process). In case of overtime,
On approval from competent the overtime sheet is prepared and signed by concerned
authority the overtime payment is department head, verified by labour office and approved by
made Executive Head HR. The overtime sheet is then circulated to
Time Office for adjustment in the salary at month end. In case
of overtime hours, the worker is paid twice of normal pay per
hour.
In case of staff, no overtime payment is done.

11 Employee Payroll processing Updating the leave records Payment may be made for unpaid leaves P Accurate payment to the employees HR does not allow an employee to
Benefit Expense apply for leave more than credit
available. If employee wants to
avail a leave over and above the
leave balance, it needs to be
marked as LWP. LWP is adjusted
from the employee’s salary in the
subsequent month.
Leave application is approved by concerned HOD and then
shared with HR to inform for authorised absence. The soft
format of leaves is maintained in 247.
At the end of month, the leaves taken by the employee is in
excess of balance of paid leaves, the excess is deducted from
that month's salary.

12 Employee Payroll processing Updating the leave records Inaccurate credit of leaves P Accurate credit of the leaves to an Leave are credited based on the Leaves are credited to leave register for each employee at the
Benefit Expense employee policy developed by the company. beginning of year, based on the policy of company. The paid
Check is made to ensure that the leaves can be availed proportionately based on no. of present
leaves have been properly credited days. The record of leave balance is maintained in manual
register by time office.

Private Confidential
 Digjam Limited

13 Employee Payroll processing Updating the leave records Excessive cost to company due to excess P Leave encashment should be as per Leave encashment is made based Employees leave encashment is done on separation of
Benefit Expense leave encashment company policy on company policy and after proper employee based on the available credit of priviledge leaves.
approvals The balance of leaves will not exceed 45 days.
In case of Warehouse staff, it is built in to the salary breakup
as Leave With Wages based on the consent from the
Client/Project.

14 Employee Payroll processing Accuracy of payment Inaccurate calculation made for payroll P Correct calculation of payroll is Salary pay-outs are calculated by Warehouse Staff :
Benefit Expense processing done based upon the entitlements the system after all data has been The attendance details, advances, deductions, etc. are entered
and inputs received fed. Proper maker checker controls in employee master by payroll team. It is a manual process of
are established for the payroll payroll calculation on excel. The working is verified by the
generated Client before the payment is processed.

Other staff:
The attendance details, deductions, etc. are entered in
employee master by Payroll team in SAP system at the time of
employee creation along with necessary credentials.
Incase of any additional payment, advances, loans etc are duly
approved by CEO and then the inputs are shared with Payroll
team by HR Head. The salary report and pay slip is completely
done in SAP.
Input vs Output is further checked by HR Head and then
shared with CEO for approval based on which the final
disbursement sheet is shared with Finance team for payment.

15 Employee Payroll processing Computation of salary Payments may be made to the wrong, P P Payroll processing is accurately Salary reconciliation is made with No salary reconciliation is made with the previous month.
Benefit Expense fraudulent, or non-existent employee completed for all active employees. the previous month

16 Employee Organizational People Management Hindrance in employee’s growth leading to P P Reduction in attrition • Performance Management The performance review is done for at the end of the financial
Benefit Expense Development Setting Goals for All Employees attrition System forms contains adequate year. The grades are given to each employee based on their
parameters for goal setting and performance (A for excellent, B for good, C for average & D for
evaluation. poor).
• Goal setting for quantitative The performance review report is prepared & shared by
targets and qualitative targets is Department HOD along with their recommendation to
conducted. Management and HR for the finalisation of increments and
• Evaluation and Goal setting promotions.
calendar is formulated and
circulated to all HODs
Evaluation is finalized post
discussion with the appraiser and
appraisee
• Sign-offs of the HOD is taken on
the PMS form.

17 Employee Organizational Promotion & Increment Increment not as per company standards P P To adhere to company standards Approval of competent authority is The Warehouse staff increments are decided in liaision with
Benefit Expense Development for increments obtained at the time of providing the respective Client or Project Head.
increment In the event of promotion/transfer of employees, the wages
are decided based on the cost of living index of that location.
Prior approval of Head HR/Personnel Head is obtained in case
of transfer/promotion.
In case of Other staff, the promotion is given with the approval
of Head HR and CEO. Whereas, yearly increment is provided to
competent staff with the approval of CEO.

18 Employee Employee Intimation of resignation Non submission of resignation date on time Timely intimation and subsequent Resignation is approved by The resignation letter of employee is approved by respective
Benefit Expense Separations approval of the resignations respective HoD and HR department department head and Head HR.
updates the same in employee The same is shared with payroll team for necessary processing
master like holding payroll and F&F preparation

Private Confidential
 Digjam Limited

19 Employee Employee Full and final settlement Non recovery of dues from employee P Accurate computation/ compilation No dues certificate is taken from all Before making the full and final payment, the Labour office
Benefit Expense Separations of full and final settlement details departments to come at the obtains sign of all concerned department (i.e. co-operative
deduction amount store, time office, canteen, mess, etc.) on no dues certificate.
The no dues certificate is signed off by all concerned
departments and forwarded to HR with ID card and other
Company assets to be collected at the time of releiving.

20 Employee Employee Full and final settlement Full and Final ("F&F") settlement amount P Computation / compilation of full F&F statement is prepared by the In case of Warehosue staff and Other staff , F&F settlement
Benefit Expense Separations may not be approved and final settlement details are HR department and approved by amount is computed by the payroll team, which is verified by
approved and authorized by competent authority before making Head HR.
competent authority the payment The acknowledgement of receiver is obtained on F&F
settlement.

21 Employee Payroll Period end accruals Accruals are inaccurate or incomplete P P Management reviews and approves Proper assessment of accruals are Period end accruals for gratuity and leave encashment are
Benefit Expense Accounting period-end accruals for payroll- made at the period ends and by calculated by external consultant (Kapadia Actuaries) based on
related obligations incurred but not taking proper estimates the assumptions and adjustments. Based on this, provisions are
yet paid. accruals are provided for through created in books by accounts department.
external actuarial valuers

22 Employee Payroll Employee Taxes Employees taxes are inaccurate or untimely P P The payroll withholding table data TDS is deducted after all investment For TDS, the income tax declaration is taken from the staff for
Benefit Expense Accounting withheld / remitted. is periodically reviewed by details have been set in the system tentative investments & savings for the year at the beginning
management for accuracy and and regular updation of the of year. The same is entered in employee master and based on
ongoing pertinence. Updates to the sections are made this, monthly TDS is deducted. The investment proofs are
withholding table data are submitted by the employee during the year upto the end of
communicated on as needed basis. financial year. In case the actual investment is less than the
amount as per declaration form, the differential amount of
TDS is deducted from last month's salary.

23 Employee Statutory Compliance of PF and ESI Delay in payment of PF and ESI which P P Compliance to PF and ESI is ensured The authorized person ensures Every month, the payroll team extracts details of PF and ESI
Benefit Expense Compliance results in statutory non-compliance timely payment and return filing of deducted for 'each employee location wise from SAP/Excel. It
ESI and PF is further uploaded in to the website and challan is generated.
The payment is made by the Finance department based on the
email from the Payroll team and the reconciliation done with
the payroll. The half yearly return for ESI and yearly return for
PF is automatically generated over the website, which is
downloaded and kept on record.

24 Employee Recruitment Identification of source Inadequate performance evaluation of P Ensure the periodic monitoring of HR Head reviews the contractors There is no periodic monitoring of performance of contractor
Benefit Expense contractors resulting in hiring of inefficient the performance of contractors rating sheet and the agency is done. If the worker/sub-staff of contractor is found
manpower performance. incapable, he is removed.
25 Employee Recruitment Contractor's Invoice Unauthorized/Excess payment made to P P To ensure accurate payment is Invoice and supporting received is The attendance record of contractor's worker is maintained by
Benefit Expense contractor's made to contractor which is verified with the attendance record concerned department and verified by HR for evidence.
approved by concerned department. The The billing is done by contractor on monthly basis.
approval of higher authority is The contractor's invoice is first verified and signed by
taken before processing invoice. concerned user department's head. The invoice is then
verified by Deaprtment HOD in Corporate office. On approval
of CEO, the invoice is passed by the accounts department.

Private Confidential
 Digjam Limited

Control
Does the control IPE Reference Will we obtain audit Nature of Type of Impact of Key Control Application Frequency of Control Performer Control Owner Whether
rely on information evidence of the accuracy Control Control Control (Yes / No) Name Control fraud risk
produced by the and completeness of (Preventive or (Manual/ (Operational/ (Annually/
entity? information produced by Detective) Automated) Financial) Semi annually/
the entity by testing quarterly/
controls or by performing monthly/
procedures directly on the fortnightly/
information? weekly/ daily/
multiple)

No - - Preventive Manual Operational Yes NA Multiple Head HR CEO Yes

Yes Manpower Direct testing Preventive Manual Operational Yes NA Multiple Respective HOD Head HR Yes
Request Form

Yes List of Direct testing Preventive Manual Operational Yes NA Multiple Respective HOD Head HR and CEO Yes
recruitments
made in the year

Yes List recruitments Direct testing Preventive Manual Operational No NA Multiple Recruitement team Head HR No
made in the year

Yes List recruitments Direct testing Preventive Manual Operational Yes NA Multiple Recruitement team Head HR Yes
made in the year

Private Confidential
 Digjam Limited

Yes Employee master Testing of controls Preventive Manual Operational Yes NA Multiple Recruitement team Head HR and CEO Yes

Yes Register for list of Testing of controls Detective Manual Operational Yes SAP Multiple Payroll team Head HR Yes
employees

No - - Preventive Automated Financial Yes SAP Multiple Payroll team Head HR Yes

Yes Attendance Testing of controls Detective Manual Financial Yes 247 Daily HR Tools Manager Payroll Manager and No
register Head HR

Yes Overtime Sheet Testing of controls Detective Manual Financial Yes Excel Multiple Yes

Yes List of Leave Direct testing Detective Manual Financial Yes NA Multiple Payroll team Head HR Yes
Applications
received

Yes Leave Balance Testing of controls Detective Manual Operational No NA Multiple No

Register

Private Confidential
 Digjam Limited

Yes List of leaves Direct testing Detective Manual Financial No NA Quarterly Payroll team HR Head No
encashed

Yes Salary register Testing of controls Detective Both Financial Yes SAP Monthly Payroll team HR Head/ CEO Yes

Yes Salary register Testing of controls Preventive Manual Financial Yes SAP Monthly Payroll team HR Head/ CEO Yes

No - - Detective Manual Operational Yes NA Yearly Department HOD HR Head/ CEO Yes

Yes List of Direct testing Detective Manual Financial Yes NA Multiple Head HR CEO No
Increments made

Yes List of employees Direct testing Preventive Manual Operational No SAP Multiple Department HOD HR Head/Payroll Team No
resigned

Private Confidential
 Digjam Limited

Yes List of employees Direct testing Detective Manual Financial Yes NA Multiple Employee Payroll Manager and Yes
resigned Head HR

Yes List of employees Direct testing Detective Manual Financial Yes NA Multiple Payroll team Head HR Yes
resigned

No - - Detective Manual Financial Yes NA Yearly Payroll team Finance Manager No

No - - Detective Manual Financial Yes Excel Monthly Assistant Manager Finance Head No
Finance & Payroll team

- - - Preventive Manual Financial Yes Excel & SAP Monthly Payroll team Finance team No

No - - Detective Manual Operational Yes NA - Respective Department Respective Department Yes

HOD HOD

Yes Attendance Testing of controls Detective Manual Financial Yes NA Monthly Respective Department CEO Yes
record of HOD
contractor's
worker

Private Confidential