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Guest

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27 March 2009 what is stock audit

Jitender

Jitender (Expert)
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27 March 2009 it basically involves checking of records related to Inventory such as stock transfer etc and physical veirfication.

CA Pattanayak

CA Pattanayak (Expert)
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27 March 2009 Banks ask CA to do Stock audit of its client which gets loan based on average stock as a security . Basically its physical verification of Stock and valuation of the same.
Based on report the banks provide loan to the customer where the stocks are the security for the loan amount.

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CMA KNVV Sri Vidya - Sri Kanth

CMA KNVV Sri Vidya - Sri Kanth (Expert)
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27 March 2009 Stock Audit means

verification of the stock physically with computer (figures shown in computer)

In case of any excess / short of the items

they have to make necessary adjustments

some times u see contra items

i mean one item is short by 2 n another item is excess by 2

you are required to pass adjustment issues / adjustment receipts for such items of contra

in case of short, the amount of short is recovered from the staff who are employed as it is the reponsibility of the staff to take care of the items

In case of excess, the entries are passed in the system

Short of an items arises due to the reasons
1. if any item sold and employee had forgetten to write it in the book
2. forget to prepare a bill
3. item given to employee ( because of some urgency - later forgetten to record it in the book )

etc

Excess of an items arises due to the reasons
1. At the time of stock received by them any counting mistake by the employee
2. forgetten to make a bill of the stock recieved
3. stock received by the employer at the time closing of the shop n thought of recording it the next day ater coming but unfortunately forgetten to make a record

etc

CMA KNVV Sri Vidya - Sri Kanth

CMA KNVV Sri Vidya - Sri Kanth (Expert)
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27 March 2009 In case of banks i agree with CA Pattanayak