The damage done to any organization by fraud can be enormous if it is not prevented. The main role of internal auditors in an organization is to detect and then prevent fraudulent activities, which is why organizations pay them. Some fraudulent activities have occurred in Ajax Export Corporation. The fraud is committed by the accounts payable employee with an amount of $18,000 by writing checks to herself and debiting the expense to miscellaneous accounts/expenses. This process according to the examination took place over three years. The issues addressed may contain the following recommendations. Fraud Prevention Recommendations: Issue 1: Ineffective internal controls due to recent downsizing Recommendation: As the company is engaged in downsizing, it appears that effective internal controls are not in place and therefore It is recommended that there is a written policy regarding the implementation of internal controls by employees. This trend should be established by the management from top to bottom so that every employee is aware of their role. Problem 2: Morale is down substantially due to downsizing Recommendation: Since every employee is afraid of job related security issue, their morale is also down as they are experiencing downsizing in their organization, so they might think that they would be next . In this situation it is recommended that the internal audit department performs its function regarding building employee trust and ensure that adequate awareness has been spread among employees that this downsizing is a cost-cutting strategy and is not necessary worry about employees working with honesty and integrity. It's...... half of the paper...... duties. Additionally, you need to recover $18,000 from the employee and fire the accounts payable clerk ASAP. Conclusion: Overall, the company has ineffective controls across different departments and across the entire organization. An effective internal audit department should be established within the organization which should regularly test the effectiveness of these controls and ensure that all controls work effectively and efficiently with the different departments of the organization. The internal auditor should also implement the most effective processes and measures to prevent and detect fraud, corruption and non-compliance with laws and regulations in the organization. In this regard, the establishment of an internal control committee composed of executive and non-executive directors would be useful.