Observation is a key skill in business
Observation is one of the key skills that can be applied in any professional, occupation or relationship. Proper observation has been known to save marriages. There is such a thing called “obnosis”. This simply means to observe the obvious. So much of what we see is see through the filters of our upbringing, education, religion and culture that we do not simply see what is there. If you were asked to observe someone then you may say they are from a particular religion, race etc. but in fact this would be your viewpoint or frame of reference and is not observing their clothes, how they actually appear.
See what isn't there
In Forensic Accounting Reviews, audits and investigations it is important to be able to observe and see what is there. A colleague of mine, while at the services on the M25, observed a man entering the petrol station with a plastic bag and leaving without it. Now this seems odd as normally it would be the reverse where you leave with the packet. There are several conclusions you can reach about what transpired – he was returning an article – he worked in the shop – it could have been a bomb. You can tell a lot by the way the person is carrying themselves (their posture, their eyes) but a true trickster can hide this with confidence and mislead most people. Forensic Investigators observe what is there and then obtain evidence or facts through discussion, enquiry and scrutiny of documentation.
Walkabout and look
When visiting a site, the first thing that I do is a “walkabout”, where I take a walk through the site. The simple things to look for are housekeeping (is everything orderly or disorganised), security (is the site safeguarded, access control, CCTV etc.) and then the attitude of the employees (do they smile and greet you, are they surly, how are they dressed). It is important to also observe the state of repair of the buildings and equipment. It does not take any learned skill or qualification to observe. We all live in houses and most of us drive cars so we know when something looks in good condition or not. By observing the condition of the area, you can get some idea of how the business is run. If the flowers or plants in the reception are dying then this does not bode well for the success of the business. Appearance is important and can tell you a lot. Then you start digging.
The skill of observation.
One of the forensic accountant’s and auditor’s most successful skills and one you do not learn at university is the skill of observation.
Using Observation in Investigations: Useful Resources
Observation can be an important part of an investigation. It may help an investigator understand behaviour, working practices, control weaknesses, site conditions, inconsistencies, process failures, or potential fraud indicators. However, observation evidence should be recorded carefully, used proportionately, and considered alongside documents, interviews, financial records and other evidence.
Investigation Standards and Evidence Gathering
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Government Counter Fraud Professional Standards and Guidance
Useful guidance on evidence collection, investigation planning, evidence handling, decision-making and presenting investigation findings. -
College of Policing: Conducting Effective Investigations
Evidence-based guidance on conducting effective investigations, including following reasonable lines of enquiry and maintaining an investigative mindset. -
Acas: Investigations at Work
Practical guidance for workplace investigations, including gathering evidence from all sides and ensuring a fair process.
Observation, Monitoring and Privacy Considerations
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ICO: Employee Monitoring – Is It Right for Your Business?
A useful resource on staff monitoring, proportionality, privacy and compliance with data protection requirements. -
ICO: CCTV and Video Surveillance Guidance
Guidance on the use of CCTV, video surveillance, body-worn video, drones, dashcams and other visual monitoring technologies. -
NPSA: Investigating Employees of Concern
Guidance on conducting legal, ethical and fair investigations involving employees of concern.
Fraud, Financial and Workplace Investigation Resources
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ACFE: Fraud Investigation and Examination
Resources from the Association of Certified Fraud Examiners on fraud investigation, examination techniques and investigative best practice. -
Solicitors Regulation Authority: How Evidence Is Gathered in Investigations
Guidance explaining how evidence may be gathered and used in regulatory and disciplinary investigations. -
HSE: Investigating Accidents and Incidents
A practical resource on investigating workplace accidents and incidents, including observing the scene, identifying risks and learning lessons from evidence.
Practical Points When Using Observation Evidence
When using observation in an investigation, it is important to record what was actually seen, heard or identified, rather than jumping immediately to conclusions. Good observation notes should usually include the date, time, location, people present, what was observed, what records or documents support the observation, and whether any follow-up evidence is required.
Observation should not normally be treated as a substitute for proper evidence gathering. It is most useful when combined with financial records, system logs, emails, interviews, witness evidence, policies, contracts, bank records, CCTV footage, photographs or site inspection evidence.
