Better Payroll Walkthroughs using Claude

Preparing effective walkthroughs is often the most time-consuming phase of an audit engagement. Traditional checklists can feel robotic and may miss nuance. By leveraging Claude, Internal Auditors can generate dynamic, risk-focused interview scripts that adapt to specific payroll environments, ensuring a more effective Test of Design (ToD).

Why This Workflow Matters

Payroll cycles are high-frequency and high-risk, making them prime targets for fraud and error. Relying on static verified-by lists often fails to uncover the root cause of control deficiencies. This workflow enables you to generate scenario-based walkthrough questions that probe for specific risks—like ghost employees or unauthorized pay rate changes—saving hours of prep time while increasing audit coverage.

Prerequisites

• Active Claude account (Pro recommended for larger context windows, but Free works).
• Basic narrative or understanding of the client's payroll system (e.g., ADP, Workday, SAP).
• List of key risks or assertions you need to validate (Completeness, Accuracy, Validity).

Step-by-Step Guide

Step 1: Define the Auditor Persona and Scope

To get the best results, you must prime Claude with the specific context of the audit. You aren't just asking for questions; you are simulating a senior auditor's logic.

Step 2: Generate the Walkthrough Script

Once Claude acknowledges the risks, ask it to create the specific interview guide. This prompt forces the AI to structure the output logically: Question, Rationale (Why we ask), and Evidence (What to check).

Step 3: Drill Down into Exceptions

Payroll Managers often describe the "Happy Path" (when everything goes right). Auditors need to know about the exceptions. Use this prompt to dig deeper into "What Could Go Wrong" (WCGW) scenarios.

Step 4: Create a Document Request List (PBC)

Finally, convert the interview needs into a formal Provided by Client (PBC) list to send ahead of the meeting.

Pro Tips

• Upload Policy Documents: If you use Claude Pro/Enterprise, you can upload the company's Payroll Policy.pdf and ask Claude to flag questions where the process might deviate from written policy.
• Focus on Artifacts: Always insist Claude includes the "Corroborating Evidence" column. A walkthrough without seeing the screen is just an inquiry, not an observation.
• System Specifics: Start by mentioning the specific software (Workday, ADP, Oracle). Claude knows the specific limitations and common control gaps of major ERPs.

Common Mistakes to Avoid

• Inputting PII: 🚩 NEVER paste real employee names, SSNs, or salary data into Claude. Use placeholders like "Employee A" or "$50,000" if specific examples are needed.
• Accepting Generic Lists: If the questions look too standard, prompt Claude with: "Make these questions more aggressive regarding Segregation of Duties conflicts."
• Ignoring the "Show Me": Don't just read the questions needed. Use the script to prompt the "Show me how you do that" moment.

Frequently Asked Questions