814 - Federal Employees Health Benefits Act
Note 1: For part-time career employees, the biweekly entity contribution shall be
calculated on a prorata basis based on the ratio of number of scheduled
part-time hours to the number of scheduled regular hours for an
employee serving in a comparable position on a full-time basis. (5 U.S.C.
Note 2: If multipurpose testing is used for the compliance test and/or
compliance control test and a substantive test of payroll expense details,
the sample items for the compliance test and/or compliance control test
should be selected using the sampling method used for the substantive
test. Otherwise, the items should be selected using attribute sampling,
as discussed in FAM 460.02.
As with all sampling applications, the auditor should consider the
completeness of the test population. For efficiency, the auditor should
consider using records that were tested for validity and completeness
(as well as the other financial statement assertions) in conjunction with
substantive tests of payroll or other payroll related compliance tests.
Note 3: If the entity outsources payroll processing, the entity remains
responsible for compliance. Dividing responsibility for payroll
processing activities between the entity and the service organization
could make payroll testing more complicated, although the same testing
should be performed. The auditor may accomplish that testing with the
assistance of the service organization's auditor, who may issue an
internal control report on the service organization under AU 324 (SAS
70). Or the service organization's auditor may assist the entity auditor by
performing agreed-upon procedures at the service organization (e.g.,
substantive testing) under SSAE No. 10, section 201 (see FAM 660).
GAO/PCIE Financial Audit Manual - Part II
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