You are a manager in the forensic department of your firm, Kaffe & Co. You have received a request from Beyer Ltd about an inventory fraud which was brought to the attention of the company’s audit committee by a whistle-blower. Beyer Ltd is not currently a client of your firm.

Beyer Ltd manufactures and sells parts used in the automotive industry to both car manufacturers and to garages specialising in the repair and servicing of cars. The audit committee would like Kaffe & Co to perform a forensic investigation to quantify the loss suffered as a result of the inventory fraud, and to recommend improvements in the company’s internal controls to avoid similar issues in the future. In addition, the audit committee has mentioned that although the quantification of the loss is to form the basis of an insurance claim, the matter has been reported to the police who will be investigating the matter further.

Required:
Evaluate the matters which should be considered before your firm accepts the invitation to perform a forensic investigation for Beyer Ltd. (8 marks)