# Inventory Count and Reconciliation: [Site], [Count date]

> A record of a physical inventory count or cycle count: the count
> plan, count results against book quantities, variance analysis, the
> approved stock adjustments and the hand-off to the accounting close.
> It follows common warehouse and accounting practice. Under IFRS,
> IAS 2 Inventories measures inventory at the lower of cost and net
> realisable value; check the framework your organization reports
> under. Replace every `[bracketed]` value and every row marked
> *Example*. This is a working format, not accounting advice.

<!--
Guidance: How to use this template
- Use one copy per count event (a full count or a day's cycle count
  batch). Daily cycle counting rules are in `logistics/warehouse-sop`
  section 9.
- Freeze or control stock movements in the counted locations during
  the count, or record cut-off precisely; most false variances are
  cut-off errors.
- Investigate before adjusting. An adjustment fixes the record, not
  the cause.
- Common pitfall: netting gains and losses. A small net variance can
  hide large errors in both directions; always report the absolute
  value too.
-->

## 1. Count plan

<!-- Guidance: Agree the plan with finance before the count. Questions: which locations, which method, who counts, who checks, what is the cut-off? -->

| Field | Value |
|---|---|
| Count type | [Full physical count / Cycle count batch / Spot check] |
| Scope | [Zones, locations, item classes] |
| Cut-off | [Last receipt GRN-..., last dispatch DSP-..., time YYYY-MM-DD hh:mm] |
| Method | [Blind count by scanner, second count where variance exceeds tolerance] |
| Count teams | [Team 1: counter and checker names] |
| Observers | [Finance, external auditor if year-end] |
| Approval limit for adjustments | [Warehouse manager up to X, finance controller above X] |

Tolerances *(Example)*: class A 1% or 1 unit, whichever is larger;
class B 2%; class C 5%. A variance outside tolerance needs a recount
and an investigation.

## 2. Results and variance analysis

<!-- Guidance: Show book quantity at cut-off, counted quantity, difference and value. Value at standard or average cost, as your accounting policy uses. -->

| Item | Class | Book qty | Count qty | Difference | Unit cost | Value difference | Difference % | Within tolerance |
|---|---|---|---|---|---|---|---|---|
| SKU-1001 *(Example)* | A | 240 | 236 | -4 | 42.50 | -170.00 | 1.67% | No |
| SKU-1002 *(Example)* | A | 180 | 180 | 0 | 38.00 | 0.00 | 0.00% | Yes |
| SKU-2040 *(Example)* | B | 520 | 530 | +10 | 6.20 | +62.00 | 1.92% | Yes |
| SKU-3107 *(Example)* | C | 1,200 | 1,150 | -50 | 0.85 | -42.50 | 4.17% | Yes |
| SKU-3215 *(Example)* | C | 75 | 75 | 0 | 3.10 | 0.00 | 0.00% | Yes |

Summary *(Example)*:

- Book value of counted items: 21,516.50.
- Net value difference: -150.50 (-0.70% of book value).
- Absolute value difference: 274.50 (1.28% of book value).
- Items within tolerance at first count: 4 of 5 (80%).

## 3. Investigation

<!-- Guidance: For each variance outside tolerance, check recent movements, open transactions, mislocated stock nearby and unit-of-measure errors before concluding loss. -->

| Item | Recount result | Checks made | Cause found | Corrective action |
|---|---|---|---|---|
| SKU-1001 *(Example)* | 236 confirmed | Last 30 days of movements, adjacent locations, open picks | Two cartons of 2 units shipped on an order not confirmed in the system | Confirm the order; retrain packing on scan confirmation |

Possible causes to check: receiving errors, unconfirmed picks or
put-aways, wrong unit of measure, mislocated stock, damage not
recorded, theft. Repeated causes go to `business/root-cause-analysis`.

## 4. Adjustments and approval

<!-- Guidance: Post adjustments only after investigation and approval. Keep the evidence; auditors will ask for it. -->

| Adjustment ID | Item | Quantity | Value | Reason code | Approved by | Posted |
|---|---|---|---|---|---|---|
| ADJ-001 *(Example)* | SKU-2040 | +10 | +62.00 | Count gain, receipt under-recorded | [@warehouse-manager] | YYYY-MM-DD |
| ADJ-002 *(Example)* | SKU-3107 | -50 | -42.50 | Count loss, within tolerance | [@warehouse-manager] | YYYY-MM-DD |

SKU-1001 is not adjusted: the investigation found an unconfirmed
shipment, so confirming that order corrects the record.

## 5. Hand-off to finance

<!-- Guidance: Finance books the value of approved adjustments in the period and reviews provisions for obsolete or damaged stock. Link to the month-end close. -->

| Item | Value |
|---|---|
| Total approved adjustments | +19.50 *(Example: +62.00 and -42.50)* |
| Damaged or obsolete stock found | [Items and value for provision review] |
| Sent to finance | YYYY-MM-DD, [@finance-controller] |
| Close checklist step | `finance/month-end-close-checklist` |

## Standard and licence note

Based on common inventory control and accounting practice. IAS 2
Inventories is named as a dated reference from the IFRS Foundation page
(https://www.ifrs.org/issued-standards/list-of-standards/ias-2-inventories/,
checked October 2026); US GAAP and other frameworks have their own
rules. All wording and figures are original and invented for
illustration. Check your accounting framework, policies and a qualified
accountant. This is a working format, not accounting advice.

Template licence: MIT.