Testimonial evidence—the fancy auditor term for verbal evidence—is the weakest type of evidence.
The GAO lists three types of audit evidence in the government audit standards.
- Physical evidence
- Documentary evidence
- Testimonial evidence
An example of testimonial evidence
Let’s say you are doing an inventory audit at a motor pool for a police department.
If you want physical evidence, you could go out on the lot and make sure the vehicles are there.
Documentary evidence could be gathered by comparing purchase vouchers to inventory records to make sure the vehicles are there.
To gather some weak testimonial evidence, you could ask the manager of the motor pool if the vehicles exist. And she is going to say, “Of course the vehicles exist!”
Obviously, the testimonial evidence cannot be relied upon as the basis for your audit conclusion! Verbal statements from the auditee can contribute to your audit conclusion, but should be bolstered by some other sort of evidence.
Rock, paper, scissors
The GAO hints at this necessity in this clause:
GAGAS 2018 8.105 Testimonial evidence may be useful in interpreting or corroborating documentary or physical information. Documentary evidence may be used to help verify, support, or challenge testimonial evidence.
Do you feel like you just read the GAO’s academic version of rock, paper, scissors? The second sentence indicates that documentary evidence trumps testimonial evidence. And the first sentence indicates that testimonial evidence can (only) support documentary and physical evidence. Nowhere does the GAO say in the standards that testimonial evidence stands alone.
It isn’t exactly lying…
Why is testimonial evidence not reliable? Well, sometimes the auditee doesn’t tell the truth.
I haven’t met very many bold-faced liars in my work as an auditor, but I have met quite a few auditees who will tell you what you want to hear.
You may ask, “Do you sign purchase vouchers?”
The auditee may answer, “Yes.” But what he is really thinking, in that invisible speech bubble above his head is, “I usually sign purchase vouchers, but if I am busy, I don’t get around to it and just move them to Beatrice’s in-box for processing without my signature. But hopefully the auditor won’t find that out. I’ll just keep that to myself for now.”
Or you could miss getting to the truth because you inquire of the wrong person, or a person who is a little out of touch. For instance, you might ask a manager at a housing project if they got three bids on a repair, but the person who really knows is the maintenance supervisor.
This is why the GAO asks that auditors take extra steps when they use testimonial evidence. GAGAS 2018 8.94 says: Auditors should evaluate the objectivity, credibility, and reliability of testimonial evidence.
The inherently weak nature of testimonial evidence then should encourage you to get in the habit of asking the interviewee for some documentation or physical evidence to bolster their statements before you leave the audit interview.
If the interviewee brings up something significant during an interview, say something like, “What do you have that I can put in my working papers to show my supervisor that you sign the purchase vouchers?”
Notice how I softened the request? I did not say, “I don’t believe you; show me!” I blamed this need for documentation on the supervisor—so I made the request less offensive—but still gets you what you need. (Yes, that is a little disengenous! See how I stretched the truth just a little to get what I needed? You can be pretty sure the auditees are doing that, too!)
If you forget to ask for better evidence during the interview, no worries—you can just call the client back later.
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