An employee devises a payroll scheme that costs the employer $150.The employer discovers the fraud but decides not to confront the employee since the amount of the fraud is small.Discuss why this course of action is not advisable.

While this particular incident resulted in a minor loss to this company,by ignoring the fraud,the company may be encouraging future incidents of fraud.The company should not overlook the fact that a number of small losses can add up to a significant loss to annual revenues.