Understanding reverberation lags in 1H0707-495

The first reverberation lag from the vicinity of a supermassive black hole was recently detected in the NLS1 galaxy 1H0707-495. We interpreted the lag as being due to reflection from matter close to the black hole, within a few gravitational radii of the event horizon (an inner reflector). It has since been claimed by Miller et al that the lag can be produced by more distant matter, at hundreds of gravitational radii (an outer reflector). Here, we critically explore their interpretation of the lag. The detailed energy dependence of the time lags between soft and hard energy bands is well modelled by an inner reflector using our previously published spectral model. A contrary claim by Miller et al was obtained by neglecting the blackbody component in the soft band. Soft lags can be produced by a large-scale outer reflector if several, implausible, conditions are met. An additional transfer function is required in the soft band corresponding to a region that is physically close to the continuum source, or lies close to our line of sight and subtends a small solid angle at the source, challenging the production of the observed spectrum. We show that the original inner reflector interpretation of reverberation very close to the black hole provides a self-consistent and robust model which explains the energy spectrum and timing properties, including the time delays, power spectra and the shape of the coherence function. Several of these properties are opposite to the predictions from a simple large-scale outer reflection model.