Fraud is a risk for virtually every business. But some companies are better at deterring and preventing fraud than others. On average, businesses lose 5% of their annual revenues to fraud, according to the biennial Report to the Nations on Occupational Fraud and Abuse issued in 2014 by the Association of Certified Fraud Examiners (ACFE). The median loss was $145,000 — but 22% of victim organizations in the study incurred losses of $1 million or more. Clearly, fraud can devastate a closely-held business. Although testing for and investigating fraud isn’t normally part of the valuation process, valuators do take fraud risks into account when appraising a private business interest.