Stock or inventory counting

All warehouses are obligated to undertake some form of stock count. It depends on the law of the country and accounting requirements as to how frequent and comprehensive the count is.
We have seen over recent years a move towards cycle counting or perpetual inventory counts as a replacement for an all-encompassing annual count of stock in the warehouse. A full stock count usually necessitates the closure of the warehouse for a period of time when all inbound and outbound movements are suspended.
A significant drawback of a single annual count is the difficulty in reconciling the discrepancy as it could have occurred over 11 months ago.
The count is normally carried out at the company’s year-end. Some companies will carry out quarterly or possibly half-yearly checks depending on the stipulations laid down by the auditors.
More recently, providing the company can prove that its cycle counting is accurate, auditors have agreed in some cases that if each stock line is counted and audited at least once per annum that will be sufficient for their needs.
Providing the cycle counts are considered to be accurate, the year-end stock figures will be taken from the WMS.