The Benefits of Conducting an Inventory Audit

Inventory audit is vital to tally the existing volume of products in stock against its financial/accounting records and for balancing the variation. It keeps an inspection on the stock flow by disclosing the actual number of the physical product.

VBV & Associates provides effective Inventory Audit Services in Kochi, Kerala through well professional hands with years of experience. Our team could ensure appropriate inventory levels, identify inefficiencies and budget more accurately. During an inventory audit, the auditor uses certain procedures and approaches to determine that the organization’s inventory policies are functional and compliant with regulatory standards.

In other words, whether the products are under-stock or overstock. Inventory audit could permit the company to decide on its forthcoming budget so that the business remains a float. It analyze the holding cost which is the sum of all expenses connected to inventory like storage, warehousing, labor, insurance, blended with the value of damaged, expired, and out-of-date stock. It ensures required investment in the stocks and obtains a balance in the process. It conveys the true picture of actual stock as compared to the recorded stocks which provides a better clarity of the financial status of the firm.

Inventory audit also disclose the losses which from wastage, damage, or even dormant stock. It analyzes the efficiency of the storage system, whether accurate measures are being taken to keep the stock away from any kind of harm. It determines the potency of the warehouse workings and discloses its issues, if any. This could lead in highlighting inefficiencies in the process. It results in lack of security which might result in fraud, theft, or misappropriation.

Generally overstocking leads in financial loss and poor cash flow. Inventory audit hosted in timely intervals would support in hacking this problem. It target to hold the employees in place by having a check on the dealings done by them. It finds out any inventory in stock incorrectly supplied to customers which could result to financial loss. It guides in calculating the actual profits or losses, which further decides the course of business for the company.

According to the inventory audit report, the company designs its course of business and decides whether the current process requires any changes or not. It keeps the management and the Board updated about the finances and accounts so that they can take corrective measures for maximizing profits and preventing the reputation of the company from irreparable damage.

For more information, please contact us at vbvassoc@gmail.com or call +91 980 901 2123.