You are the controller of Garton Inc. H. K. Logan, the president, recently mentioned to you that she found an error in the 2021 financial statements which she believes has corrected itself. She determined, in discussions with the purchasing department, that 2021 ending inventory was overstated by $1 million. H. K. says that 2022 ending inventory is correct, and she assumes that 2022 income is correct. H. K. says to you, “What happened has happened—there’s no point in worrying about it anymore.” 

Instructions 

You conclude that H. K. is incorrect. Write a brief, tactful memo to her, clarifying the situation.