Please note carefully the task you are being assigned, and also the circumstances. You should not repeat or summarize the information given in the case description, since the person you're writing to obviously knows all about it already -- in fact she's the one who told it to you. Just focus on giving her advice about what to do now.
Note also that this is an external report -- that is, you are not part of the firm but are an outside consultant who has been called in to help. Use the "to/from/subject/date" format.
To help with this assignment:
Also, you must not say “we should” or “our company should” or anything like that. You are an outsider, not part of the Mountainside Industries Co.