Stock Audit (Receivable Audits)
Stock Audit
Stock Audit means physical verification of the stock maintained in the company’s storehouse. The result of this audit should match the company’s stock registers. It is needed in retail and production companies where raw materials need to be converted into finished goods. Sapient Services offers personalized and dependable stock audit services in Delhi NCR for businesses. We have a deep understanding of your strategy, business, industry, and the associated risks, which allows us to add significant value to your business by conducting a cost-effective, hassle-free audit.
Our qualified audit team has experience in a wide range of industries and sectors. We try our best to reduce gaps in your business’s inventory management process and improve your company’s financial performance.
What is a Stock Audit (Inventory Audit)?
Core Elements of a Stock Audit
Stock Audit is the process of verification of physical goods stored in the owner’s store or a warehouse. When the goods are sold out, quantities need to be rechecked because such goods verification becomes extremely important for recording the inventory sales and for meeting the supply chain’s future requirements.
After re-evaluation of inventories or verification of stock, if any deviations are seen in quantities, then it becomes important to conduct a stock audit. Stock audit services are done to supervise, observe, and protect your stock.
- Identification of Dead, Slow-Moving, Obsolete Stock: Helps companies in clearing out inventory that is outdated or not moving.
- Physical Stock Reconciliation: This is done with ERP data or stock ledgers.
- Inventory’s Valuation: The valuation is done based on the requirements of the assignment and accounting standards.
- Identification of losses, disparities, and obsolescence.
- Recommendations for corrective actions to ensure such issues do not occur in the future.
Why is Stock Audit Important for Businesses? A stock audit can help you achieve the following advantages:
- Identify the shortage/surplus of goods in the inventory
- Reduce losses and wastage resulting from damage or fraud
- Identify damaged or obsolete goods in the inventory
- Achieve over the stock-taking process better internal control
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Consequences of Not Conducting Stock Audits
If businesses do not conduct stock audits, they may have to deal with several challenges:
- Inaccurate financial statements that may impact creditworthiness and compliance.
- Financial losses
- Poor cash flow.
- Increased chances of inventory theft or fraud.
- Operational inefficiencies.
Our Comprehensive Stock Audit Process
At Sapient Services, we follow an in-depth and customized stock audit process.
Step 1: Planning of Audit
We help you know the auditing scope, specific items to be audited, types of inventories, and locations.
Step 2: Conducting Physical Verification
To perform the inventory stock’s physical count, we use a systematic approach to ensure comprehensive coverage.
Step 3: Book Inventory vs. Physical Inventory
We compare the inventory with physical counts.
Step 4: Report Preparation and Submission
We submit an extensive audit report wherein we recommend the best practices.
Benefits of Stock Audit Services
At Sapient Services, we provide best-in-class stock audit services.
Financial Report Development
Stock audit services help in improving the existing inventory management, leading to accurate financial reporting. By maintaining a well-stocked ledger, you can present a correct financial condition and make better decisions.
Identifying and Preventing Fraudulent Activities
Stock audit services help to identify fraudulent activities such as theft of stock or misappropriation, and any discrepancies, which may adversely affect business.
Streamlining Stock Processes
It is important for stock management to be very efficient. This can help streamline business operations. It shows any kind of inefficiencies in the stock handling procedure, allowing businesses to optimize their process.
Recognizing Understock and Overstock Situations
Stock audits help recognize optimal stock levels, improve cash flow, and minimize financial losses.
Industry Coverage
- Manufacturing (Packaging, Industrial Goods, Chemicals)
- Retail (Electronics, Supermarkets, Fashion)
- Pharmaceuticals and Healthcare
- Distribution and Logistics
- F&B and Hospitality
- Construction and Building Materials
Why Choose Sapient Services for Stock Audit?
- Integrity and Confidentiality: We understand the reliance and trust you place in us as your stock auditors. We ensure there are no breaches and deliver our audit services with full integrity and zeal.
- Timeliness: We deliver our work as per agreed timelines, as we understand financial deadlines importance. We never miss our targets and strictly abide by punctuality.
- Skilled Audit Professionals: Our audit professionals have years of experience in the industry.
Conclusion
Running a stock audit is important for businesses as it ensures that your operation runs smoothly. It also provides the correct view of your financial position. Sapient Services offers comprehensive Stock Audit Services. We carry out inventory checks and help businesses optimize inventory.
FREQUENTLY ASKED QUESTIONS (FAQ)
When is a stock audit needed?
The stock audit is needed because of regulatory requirements or by banks due to a working capital loan. Sometimes, a stock audit is conducted by management to identify the variance between recorded stock and physical stock.
How is a stock audit conducted?
The stock audit is conducted by an expert team that has decades of experience in different sectors. Stock audit reconciles the recorded stock with the physical stock.
What is the main reason for a stock audit?
The main reason for a stock audit is to reconcile the physical stock with the one that is recorded in books. It highlights any kind of variance to the management.
Who needs to get a stock audit?
Businesses such as quick service restaurants, manufacturers, grocery stores, retail chains, franchisees, bank borrowers on working capital, and supply chain companies are recommended to have stock audits.
What is included in the stock audit checklist?
The stock audit checklist includes evaluation of high-risk inventory items, required paperwork, identification of the weaknesses, and presentation of the findings.
What are the stock audit fees?
The stock audit fees can vary depending on the number of SKUs, inventory complexity, and days required.
What is the difference between an inventory count and a stock audit?
Stock audit means a detailed inspection of records that are related to products sold, store transactions, and information provided by customers for detecting any discrepancies. Inventory count refers to a check of physical stock provided by employees of the company.
Which industries can benefit from stock audit services?
Industries that can benefit from stock audit services include Retail, Distribution & Logistics, F&B, Hospitality, Pharmaceuticals, and Healthcare.