Stock Taking Program
Stock Taking Program
Stock Taking Program
13. Do proper accounting controls and procedures exist for the exclusion from
inventory of merchandise on hand, which is not property of the client (e.g.,
customers’ merchandise, consignments in)? Describe.
14. Do proper accounting controls and procedures exist for the inclusion in
inventory of merchandise not on hand, but the property of the client (e.g.,
merchandise in warehouses, out on repair, consignments out)? Describe.
17. Are significant differences between physical counts and detailed inventory
records investigated before the accounting and inventory records are adjusted
to match the physical counts? Describe.
18. Will the client be using the services of a specialist? If yes, describe the
arrangements that have been made.
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Stock Taking:
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Summary of Records:
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Particulars
Client:
Year End:
Title:
Date of Preparation:
Initials of Preparer:
Initials of Reviewer:
Planning:
Obtain Summary of different types of finished inventory lines with approx. value indicated
Obtain Summary of different types of raw inventory lines with approx. value indicated
Obtain Summary of different stages of WIP with approx. value indicated
Obtain planning and method for counting small components from client
Obtain list of personnel involved on behalf of client for stock taking
Obtain copy of client's inventory count instructions and assess if any changes are needed.
Obtain plan/ list of warehouse and inventory holding location.
Obtain list of inventory held by third party and their location.
Obtain list of inventory held on behalf of third party/customers.
Obtain list of inventory already sold but not moved and consignment goods.
Obtain detailed list of slow moving and old items.
Plan on how many test counts you will perform and how you will select the items.
Stock Taking:
Note whether personnel responsible for counting and personnel responsible inventory management
are different
Note how many counter teams are there- for double check on test basis there could be two teams
Note whole area is restricted for movement during count
Note how the counted goods are marked
Note how the client records the goods that (if) are moving on the day of count.
Check how the raw materials or finished goods are counted and recorded with codes, descriptions and
numbers:
a) from physical inventory to clients count sheet- confirms accuracy and correctness
b) from count sheet to physical inventory- confirms existence
Check whether any materials are in transit or not and if it is possible to count:
a) check last lc opened
b) checked last purchase order arisen
c) match last grn with lc, bill of entry, purchase order to confirm if there is material in transit
Check if the inventories are actually moved in FIFO basis (check warehouse management whether
goods came first are actually issues first)
Check whether old, obsolete, damaged goods are counted, and recorded with codes, description and
numbers.
Check how WIP count is assessed:
a) Volume of part complete parts at each stage
b) Assess how many finished goods will be produced from last stage of WIP and check the actual
production to assess accuracy
c) Obtain the last ticket (cutting, sewing etc.) sent from one department to each till the finished goods
are ready.
d) Obtain how many pieces were cut, sewed, finished and packed during the last month.
e) Obtain the length of production cycle from production manager or so.
f) Obtain % of completion for the last orders which are less than 100%.
Obtain Approx unit cost of items, both raw and finished goods.
Obtain last 5 (five) copies of from site:
a) dispatch notes
b) goods received notes
c) material requisitions
d) receipts to finished goods
e) credit notes raised by the client to customers
Summary of Records:
Present on
Present on behalf of
Date: behalf of
Client:
Firm:
SL No.
Qty as
Qty as per Physical
Code/Bin per Explanation for
Category Item Inventory Qty Discrepancy
card No. Stock discrepancy
Report Counted
Card
Explanation for
discrepancy