What is usually included in the financial documentation provided during an employee audit?

The inclusion of payroll transaction records in the financial documentation provided during an employee audit is critical because these records serve as the official financial proof of all compensation-related activities for each employee. They detail hourly wages, salaries, bonuses, deductions, and taxes withheld, providing a comprehensive view of payroll processes and compliance with labor laws.

Additionally, these records help auditors verify that all payroll practices are consistent with company policies and external regulations. By analyzing payroll transaction records, auditors can ensure that employees are being paid accurately and that the company's payroll practices align with applicable tax and labor laws, thereby reducing the risk of errors or compliance issues.

In contrast, personal employee evaluations, contracts with vendors, and interdepartmental communications do not directly relate to payroll processing and may not provide the necessary information to assess compliance or financial accuracy during an audit focused on employee compensation and benefits. These records serve different purposes and do not contribute to the specific financial examination needed for payroll auditing.