A Dissertation Submitted in the Partial / Fulfillment of the Requirements of the Award of the Degree of Masters of Business Administration (MBA) – Corporate Management of Mzumbe UniversityThe objective of the study was to learn to what extend are the required procedures or activities for effective internal control over payroll performed, find out the weaknesses in the payroll system, and to suggest measures which would be taken by the management in order to improve the payroll system at IAE. Both, primary and secondary data methods were used in collecting relevant data for this research paper. Primary data were collected using questionnaires while secondary data were collected through documentary reviews. This is a cross-sectional study design, conducted at IAE headquarters Dar es Salaam. A simple random sampling was employed to obtain a desired sample i.e Twenty seven (27) respondents. Data analysis was carried through Statistical Package for Social Sciences (SPSS) program where descriptive and quantitative data analyses were both employed. In conducting the research at IAE headquarters Dar es Salaam, the research revealed the following: strength, Timely processing of payroll and accurately, Employees attendance records are established and properly maintained, Changes in employments status are promptly reported to the payroll processing unit , Termination settlements properly approved and communicated to payroll staff in a timely fashion, Access to payroll secure & limited to authorized persons only, Payrolls are documented and in compliance with state laws and regulations, Payrolls are documented and in compliance with state laws and regulations, Transactions are properly recorded, Staff understands their duties, responsibilities and accountabilities, Segregation of duties exists between those responsible for the preparation and processing of payroll, and those responsible for the recruiting, disciplining and removal of personnel It also revealed the following weakness: There is no proper computer data security in case the computer system is damaged by either fire or floats, as the backup’s disks are kept in the same building. I can say that the internal control system over payroll is good, despite a single weakness observed. However, we would like to advise the management of IAE that they should preserve the proper functioning of internal control system by remaining alerted to problems and making regular test and investigation on those phases of the system which indicate some weakness. It was therefore recommended that, the management of IAE is hereby to improve the areas of weakness observed by proper supervision, the backups disks should be kept in different building so that in case the computer system is destroyed, the backup disk will be safe and thus will be used in new system to retrieve the lost data.