Proof in total/ returned dividend warrants

Hi tutor,

Hope you are fine.

Question 1:
I came across this substantive procedure relating to confirmation of dividends in the BPP study text:

“Verify dividend payments by inspecting supporting documentation (e.g returned dividend warrants)”

I most probably will write “..by inspecting cash book and bank statement” instead for this particular procedure but what are returned dividend warrants? I am assuming dividend warrants are dividend payments in the form of cheque rather than cash, but why would there be returned dividend warrants, or rather, why would shareholders not want to accept the dividend payment?

Question 2:
Also, is it necessary to elaborate on the substantive analytical procedure – Proof In Total?

Say, to test wages expense for example:

a. Perform a proof in total of total factory workforce wages by taking last year’s expense, dividing by last year’s average employees numbers to arrive at an average wages and multiplying by current year average employee numbers. Joiners and leavers and the annual pay increase should be taken into consideration as well. Compare this estimate of the current year charge with the actual wages cost in the financial statement and investigate any significant differences.

OR

b. Perform a proof in total of the wages expense for the year using the prior year charge and increasing it for the annual pay increase and taking account of any starters or leavers in the period. Investigate any significant differences.

Would option B be sufficient?

Hoping you could help me on this, thank you 🙂