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Source: Journal of Accountancy
Your success in discovering fraud will be enhanced if you know what kind of fraud is likely to occur in the circumstances of your engagement and you utilize techniques specifically designed to uncover fraud. It will also be enhanced by using good interviewing techniques.
Conducting an interview to detect fraud usually occurs after the auditor has discovered a problem. The person being interviewed may be a suspect, or a person who may know something about the fraud but was not a party to it.
People who perpetrate fraud generally blend the truth with lies. They falsify documents and make deceptive statements, so deep probing is required.
Here are some suggestions:
- Prepare by obtaining as much detailed information as possible including background on the person you are interviewing.
- Plan the entire interview, including expected points of resistance. Try to anticipate what might go wrong in the interview, and prepare your response to it.
- Start with general, open ended questions such as “tell me about . . .”
- Then proceed to specific questions starting with those to which you already know the answer. Use this in evaluating the veracity of other responses. Ask for the rationale behind any statements made. Restrain yourself from disagreeing, making judgmental statements, or expressing suspicions.
- Close by confirming your understanding of what was said. Ask for suggestions of other people to interview.
- Scripts can be helpful to the interviewer and can also impress the subject.
- If there is silence after a question, use the silence to your advantage. It creates tension that might cause the subject to offer clues to whether he or she is being open and honest.
- Try to draw out the subject by asking for:
- An example
- A description of what ensued
- The subject’s feelings about what happened
- Your questions may strike a nerve. Be prepared for angry and intimidating responses. Don’t allow them to alter your plan.
- Subjects may have legitimate concerns about revealing too much for fear of recrimination, among other reasons. Be compassionate.
- Take notes to assure correctness, but don’t let note-taking detract from connecting with the subject or distract you from observing nonverbal clues.
- It is alright, at times, to ask disconcerting questions. Listen to the answers with your ears and your eyes.
From Journal of Accountancy, September 2005. For the complete article, click on the following link: http://www.aicpa.org/pubs/jofa/aug2005/hall.htm. |
