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Audit of compensation processes and controls: Key findings

16. Gaps exist in the HR-to-Pay internal control framework. More than half of the controls are not designed, documented, or operating effectively. These gaps increase the risk of processing invalid or inaccurate pay transactions. Concerns first raised by the OAG in 2017–2018 have not yet been addressed.

17. The systems used in the HR-to-Pay process do not always facilitate the end-to-end process without errors. However, these errors can be mitigated by increased training and reducing the retroactive processing of late pay actions. Compensation has launched the "Timeliness Pays!" initiative to ensure key documentation is received in a timely manner, which will help reduce errors created by late processing of pay actions.

18. The audit identified cases where users were provided incompatible roles in the HR Systems. While in some instances these users require elevated access, additional oversight and monitoring was not implemented to ensure the access is used appropriately.

19. In the absence of formal training specifically designed for Compensation Advisors of web-service organizations, an in-house reference tool was in the process of being developed. Compensation Advisors rely on guidance such as standard operating procedures, reference manuals and policies.

20. Formal internal governance channels are used to communicate on HR-to-Pay issues with senior management. However, formal mechanisms to facilitate collaboration and decision making at the working level have not been developed. This is an issue as stakeholders have difficulty working collaboratively, despite the interdependencies that exist in the HR-to-Pay process. There is a lack of understanding or appreciation of the priorities and concerns faced by other groups that can negatively impact the timely processing, payment and reporting of pay.

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