Miriam Sata, the controller of the My Patriot Company, has gone over its inventory

records many times and is concerned that one or more company employees has

stolen large amounts of the

company's

inventory. However, she is not absolutely

sure that any theft has actually taken place because large portions of the written and

computer records are missing for unknown reasons. Still, rough calculations, based

on total purchases and sales, show that perhaps 20% of the inventory is missing.

Miriam spoke to her internal auditors and demanded that they give her an

explanation, but they said no explanation was possible without the missing records.

Required:

What should Miriam Sata do? Should she contact the police? Should she hire an

external forensic accountant? How might a forensic accountant help in this case?

Specifically, what could the forensic accountant do that the Miriam's

internal

auditors could not do?