There Is Art to Conducting Admission-Seeking Interviews
Joseph T. Wells · Journal of accountancy online/Journal of accountancy · 2003
The scenario: During a routine audit of a client, you discovered the company was paying twice the market price for widgets. By looking further, you believe--but are not sure--the purchasing agent is engaging in a pass-through billing scheme, in which he buys the widgets from the supplier, marks up the merchandise and resells it to his employer at inflated prices through a shell company he set up. You have gathered all of the documentary evidence from the client's files and retained the services of an antifraud expert, Sherlock Holmes, CPA, who has interviewed a number of possible witnesses. It now is time to talk to the purchasing agent. Tag along with Holmes, just as Dr. Watson would, and learn more about the art of admission-seeking interviews. Who knows? With experience you might find the fraud examination field is just your cup of tea. As discussed in part one, to conduct a proper interview, Holmes will he intimately familiar with the five types of questions that legally can be asked (see exhibit, page 71). To close the circle of suspicion, Holmes will interview those involved in the suspected fraud. For purposes of illustration, assume the purchasing agent conspired with a widget manufacturer in a rebilling scheme where the purchasing agent got 90% of the illegal proceeds, the vendor the remainder. Legally, all participants in a conspiracy a re equally culpable--regardless of the split. But in the order of conducting interviews, it would be better to have the statement of the coconspirator (in this case, the vendor) before confronting the perpetrator. Holmes will use the same techniques, described below, to interview the coconspirator. The more evidence amassed that implicates the suspect, the more likely the investigator can convince him or her to voluntarily confess. INITIAL QUESTIONING Commencing an interview is often one of the most difficult phases because it requires the interviewer to accomplish several things simultaneously (see Ten Steps to a Top-Notch Interview,. JofA, Nov.02, page 99) or online at www.aicpa.org). The interview of the purchasing agent normally is conducted by surprise to avoid providing advance notice that will allow the employee ample time to think of an alibi. Here are the four steps in the introductory phase of questioning: Provide the introduction. Assuming the purchasing agent doesn't know Holmes, the introduction is straightforward: The investigator will smile, make eye contact, state his name and title and shake hands. Smiles are comforting, and eye contact conveys sincerity; shaking hands is disarming. Explain the purpose. Holmes first will need to explain why he's there, but he won't jump right in and start asking important questions. The explanation will be the essence of simplicity; he has some questions about the company's accounting procedures. He is purposely vague so as not to be off-putting. Holmes won't be cagey because the suspect will sense it and become suspicious. Establish rapport. At the beginning of any interview, Holmes wants the person to be comfortable. That's because his primary goal is to gather information. If the person feels threatened or ill at ease, the examiner will have much more difficulty gathering facts. Holmes will begin with easy questions about the employee's favorite topic, himself, and about his duties and ideas for improvements. As the speaker talks, Holmes will lean toward him slightly, as if what he says is important. Observe reactions. At the same time, Holmes carefully will watch how the person reacts. His goal is to put people at ease so he later can see how they handle stress. This procedure (called calibration or norming) is vital when an antifraud expert is interviewing someone whose truthfulness is in question. (For more information on detecting deception, see A Fish Story--Or Not? JofA, Nov.01, page 114 or online at www.aicpa.org.) INFORMATIONAL QUESTIONS Once Holmes has gotten the preliminaries out of the way, he will get down to business. …