In searching for the evidence of fraud and corruption the auditor must:

• Always search for the strongest possible evidence;
   

• Investigate without delay, as evidence can be destroyed, lost or forgotten;
   

• Not ignore small clues or leads;
   

• Look for facts that confirm or refute suspicions;
   

• Concentrate on the weakest point in the fraud and corruption.
   

• Identify and summarize the evidence indicating that fraud and corruption may have been committed;
   

• Identify the possible scenario of fraud and/or corruption;
   

• Summarize and explain the accounting and control systems involved, the paper trail
   involved in the transaction, and the deviations from the systems;
   

• Explain patterns used in covering up the fraud and corruption;
   

• Identify the possible extent of the fraud and corruption; and
   

• Consider the possibility of collusion.
   

• Sources of Evidence
   

• Documents from the auditee: During the course of examination of books of accounts, auditors investigate various documents that serve as evidence for the audit. These documents may be originals or photocopies depending upon their importance.
   

• Report of Internal Auditor: The internal auditor may have identified instances of deviation from normal procedure.
   

• Interviews: Auditors can obtain important information from various government employees. Since they may have noticed internal control failure made by managers and fraudulent activities perpetrated by other employees, interviews may be useful in detecting material misstatements caused by fraud and corruption.
   

• Inspection/ Observation: Auditors can notice possibility of fraud and corruption through the examination of inspection /observation/physical verification reports (e.g. forged document, inventory not in existence or inferior quality). Where any auditor relies on physical observation for an audit conclusion this would needs to be supported with properly documented evidence.
   

• Questionnaires: Auditors may gather important and helpful information by using questionnaires.
   

• Confirmation with other related parties: Auditors sometimes obtain information directly from other related parties (e.g. bank balance confirmation from the bank, Debtor's balance confirmation from individual debtors etc). If the figures provided by these agencies do not tally with the books of account, they should check in detail to find out the reason for discrepancy.
   

• Results of Analytical Review: Auditors analyze both financial and non-financial information, which can indicate abnormal trends. In that case, auditors need to concentrate on particular areas.
   

• Expert Opinion: Auditors may seek expert opinion about a suspicious case. The expert’s opinion becomes evidence if auditors can rely on that opinion in assessing fraud and corruption.