Physical evidence in internal auditing refers to tangible, observable, and verifiable information obtained directly through auditors' activities. Making purchases from retail outlets to evaluate customer service involves direct interaction and observation, which constitutes obtaining physical evidence. This differs from documents, interviews, or confirmations, which are considered documentary or testimonial evidence. References:
* "Internal Auditing: Assurance & Advisory Services" (The Institute of Internal Auditors)
* "Audit Evidence" (International Standards on Auditing)