What the “stocktaking completed” status means
The phrase “stocktaking completed” does not in itself confirm that its results have been fully documented and recorded in the accounts. For an accountant, it only means that the physical verification may have taken place. To accept its results, it is necessary to establish the grounds on which the verification was conducted, who participated in it, which assets and liabilities were covered, and whether the actual data were reconciled with the accounting records.
The accountant verifies the completeness of the procedure using the entity’s administrative, source, and accounting documents. The purpose of the verification, its date, the list of items being verified, the responsible persons, and the reconciliation results must be consistent throughout the document package. The mere existence of an inventory list does not show that all required items were verified and that the identified discrepancies were reviewed.
Therefore, a mark in the software, a verbal statement from the warehouse manager, or a completed inventory list does not provide a complete answer. The accountant must review the entire document package and make sure that the actual results can be clearly linked to the accounting records.
How to verify whether the stocktaking was completed
It is convenient to begin the review with the entity’s administrative documents. The accountant must establish:
which document authorised the stocktaking;
which persons conducted the verification;
which property and liabilities were verified;
the date as of which the actual data were recorded;
whether the actual composition of the participants corresponded to the administrative document.
The scope of the items must then be reviewed. The list in the stocktaking documents should be reconciled with the accounting records, storage locations, agreements, and documents confirming that property is held by the entity or that the entity’s property is held by other persons. Special attention should be paid to property located outside the main storage location, items held by subdivisions, and valuables entrusted to financially responsible persons.
In practical terms, this means that the verification cannot be limited to goods in the main warehouse if the administrative and accounting documents provide for a broader scope. The list of verified items should be reconciled with the accounting registers, storage locations, agreements, and the entity’s internal documents. If some property is located in a subdivision, is held by a financially responsible person, or is outside the entity’s premises, the accountant must check whether it is included in the stocktaking documents.
The procedure established by management should be reviewed separately: the dates, grounds, composition of participants, and list of items. These decisions may be documented in orders and other internal documents. If the actual verification differs from the established procedure, a completion mark alone is insufficient: the result must be assessed on the basis of the documents actually prepared and the accounting data.
What the commission should have done before the verification
Before beginning the counting and inspection of items, the commission should review the documents from the previous stocktaking and the decisions made regarding the discrepancies identified. This control helps establish whether previous findings were addressed and whether the same discrepancies are recurring.
Taking into account the nature of the property being verified, the commission also checks organisational readiness for the stocktaking:
whether access to storage locations was restricted while actual balances were being recorded;
whether the measuring equipment used was fit for purpose;
whether the latest receipt and issue documents or property movement reports as of the start of the verification were identified.
Using the documents of financially responsible persons, the accountant checks whether receipt and issue documents were submitted by the start of the stocktaking, whether received property was recorded, and whether disposals were documented. The wording and composition of such documents must comply with the document flow procedures adopted by the entity.
These actions are important for correctly distinguishing transactions occurring before and after the start of the verification. If the latest property movement documents have not been identified, it will be difficult for the accountant to reliably reconcile the actual balances with the accounting data as of the same date.
After receiving the documents, the accountant should check their mutual consistency in terms of dates, storage locations, lists of property, and responsible persons. Any discrepancies identified cannot automatically be treated as accounting errors—their causes must first be established and the information reconciled with the relevant source documents.
When stocktaking is mandatory regardless of the plan
A scheduled verification is not the only reason for conducting stocktaking. An unscheduled verification may be required when events occur that make it necessary to record the actual existence and condition of property as of a specific date. If such an event occurs, the accountant should reconcile the grounds for the stocktaking with the administrative document and the completed results package.
The circumstances that must be separately documented in the entity’s records include:
a change of financially responsible person and the transfer of property held by that person;
the discovery of theft, abuse, or damage to property;
the consequences of a fire, accident, natural disaster, or other emergency;
reorganisation of the entity, if it requires the actual composition of property and liabilities to be determined.
If one of these events has occurred, the accountant must check for separate grounds, the date as of which the actual data were recorded, and the link between the stocktaking documents and the relevant event. A previously conducted scheduled procedure does not confirm balances as of a later date on which the responsible person changed or the incident or reorganisation occurred.
The final working review can be structured as follows: locate the administrative document and check the composition of the participants, verify the date and grounds, reconcile the actual scope with the established list, make sure the preparatory documents are available, and then check the reconciliation of actual data with the accounting registers. After this, it is necessary to trace how the identified discrepancies were documented and what decisions were made regarding them. Only if these documents are consistent can it reasonably be stated that the stocktaking results have been documented and verified, rather than simply marked as completed.
Frequently asked questions
How can I verify whether the stocktaking was completed? — Check the entity management’s administrative document, the actual composition of the participants, the date and grounds for the verification, the list of property and liabilities covered, the documents of financially responsible persons, and the reconciliation of actual data with the accounting records.
Is it enough to check the warehouse balances? — No, if the established list includes other items. Property must be verified at all specified locations, along with other assets and liabilities included in the entity’s administrative and accounting documents.
How often should stocktaking be conducted? — The frequency and dates should be determined in accordance with the applicable accounting requirements and the entity’s internal documents. The documents must distinguish between a scheduled verification and stocktaking associated with a specific event.
Who approves the composition of the stocktaking participants? — The persons conducting the stocktaking are specified in an administrative document issued by the entity’s management. The accountant should compare the composition specified in that document with the persons who signed the documents setting out the verification results.
Is a new verification required when the financially responsible person changes? — When property is transferred, its actual existence must be recorded as of the acceptance and transfer date, and the results must be documented in a way that distinguishes the responsibilities of the transferring and receiving parties.