Guidelines for efficient stocktaking


Dear business partners,

Most of you have already planned your annual stocktaking, which, in addition to providing you with a great opportunity to count your company's assets and make sure the asset register is in line with the accounting system, also allows:

  • to assess the condition of key production equipment and stock in the warehouse
  • to plan preventive maintenance
  • to evaluate the processes of interaction between the company's divisions, efficiency and safety of warehouse operations.

Stocktaking can be full or sampling. Its process depends on the inventoried object: finished goods, semi-finished goods, raw materials, fixed assets or monetary funds.

A compulsory stocktaking is carried out in case of a change of financially responsible employees, before preparation of annual reports or company liquidation. An initiative stocktaking is appointed by company director and serves to increase the level of control over the company's assets.

Below are our recommendations to help make your stocktaking more efficient.

Key points

1. Independence of participants.

It is important to involve in the process of counting, reconciliation, investigation of errors and data correction not only company employees, but also external specialists who are not directly related to the inventoried assets.

2. Agreed stocktaking dates.

All concerned departments should be notified of stock stop dates, receipt or shipment deadlines. It is important to explain to employees that even minor stock movements can seriously affect the accuracy of stocktaking results or slow down the stocktaking process.

3. Appointing responsible persons.

It is important not only to identify the employees responsible for the valuable assets, but also to appoint those who will be responsible for organising the stocktaking process.

4. Checking of physical condition

of stock and fixed assets. Stocktaking is a unique opportunity for employees from different departments to assess the physical condition and storage of stock and equipment. A physical check not only reveals worn-out equipment and missing inventory numbers, but also non-compliance of the goods receipt process with approved procedures and accounting requirements. As a result of such a check, the interaction between departments can be optimised, and the work of the procurement department, warehouse and engineering service can be brought into compliance with corporate rules. Preventive maintenance based on stocktaking results can extend the life of equipment and save the company's budget.

5. Approval of assets for write-off.

Inventory discrepancies and shortages must be confirmed by the accounting and finance departments prior to final approval.

6. Addressing storage system, barcodes and scanners can speed up stocktaking counts.
7. Operational accounting and control.

Equipment that is not in use or is out of service should be written off in accordance with the company's approved process of confirmation without waiting for an annual stocktaking.

8. Photographing

at the registration of fixed assets helps to save time in searching and identifying equipment later on.

Stages of efficient stocktaking

Before stockaking
  • Check for approved policies, procedures and job descriptions for receipt and release of materials, write-offs, stocktaking management
  • Prepare an order and notify all involved parties about the stocktaking process
  • Agree on stocktaking dates and details (locations, methods, participants; types of assets to be counted: finished goods, stock, monetary funds, fixed assets)
  • Assign the date for stopping the movement of inventory items (acceptance, shipment, internal transfer)
  • Organise trainings for stocktaking participants
  • Familiarise participants with safety rules (especially in production areas and warehouses)
  • Allocate roles and responsibilities among stocktaking participants (e.g., assign responsibility for a group of counters, coordinators responsible for consolidation and stocktaking corrections).
During the counting process
  • Ensure that at least one independent counter is present and involved in counting each inventory item
  • Ensure that counters do not have access to information on the number of counted assets
  • If necessary, perform additional recalculation when there are discrepancies between the different counts and the accounting system (during reconciliation).
After the counting process
  • Draw up inventory sheets with the results of stocktaking
  • Analyse the reasons for any discrepancies found
  • Approve accounting adjustments in accordance with the company's established approval process
  • Make adjustments to the accounting system.

Based on 20 years of experience in working with companies from various industries, SCHNEIDER GROUP can:

  • Provide employees to act as counters, coordinate stocktaking, organise video broadcasts from storage areas
  • Provide independent judgement and recommendations based on observation of the stocktaking process
  • Analyse business processes, develop procedures and instructions for conducting the stocktaking process
  • Develop, implement and provide training on procedures and instructions for the entire life cycle of assets (acceptance for accounting, control during operation, write-off of company assets, investigation of causes of shortages or discrepancies)
  • Check the correctness of the calculation of the amount of provisions for replacement, repair of equipment and impairment of assets in accounting and reporting.

We look forward to supporting you as you track and manage your company assets more efficiently.