A gap between the system balance and what is actually on the shelf means either lost money or profits in the financial statements that are not real. Accuracy starts with recording every movement when it happens.
Link every movement to a document
- Receiving through a goods receipt linked to the purchase order.
- Sales through an invoice that deducts from the right warehouse.
- Branch transfers through a transfer document received at the other end.
- Damage and shrinkage through an approved adjustment.
Cycle counts, not just year-end
Counting groups of items weekly — especially the highest-value and fastest-moving — exposes differences early and eases the year-end count.
Correct accounting valuation
IAS 2 Inventories requires inventories to be measured at the lower of cost and net realizable value, with cost determined using weighted average cost or first-in, first-out (FIFO). A system that applies one method consistently gives reliable cost of sales and profit margins.
Barcodes and units of measure
Using barcodes and setting units of measure (piece, carton, kilo) with their conversion factors prevents the most common entry errors.
Reorder levels
Set a minimum for each item in each warehouse and let the system alert you before it runs out, so you buy on time without overstocking.
Ready to apply this to your business?
Try Shumoul for free or talk to our team to choose the right systems.