Making sure your financial records match your physical count
Why an inventory audit is important
An annual physical inventory count is normally required for federal tax reporting. It is also a vital step in maintaining your inventory accuracy and ensuring profitability. Without performing an audit, it can be difficult to spot inventory shrinkage where goods are lost due to theft, damage or operating errors.
How often should I do an inventory audit?
At a minimum, a complete physical audit should be done once per year, but more frequent checks such as cycle counting can really help in spotting problems.
Before you do a physical count
Throw out all broken and outdated inventory items beforehand so that the time spent on this process is reduced. Identify which items will be included in the audit. Make sure any new inventory received has been handled. Items should not be moving around during a physical inventory count.
Inventory Audit in PawnSnap
With PawnSnap, you can do a physical inventory audit of your inventory, pawn and buy items. Auditing sections of your inventory by one category at a timenecessary inventory adjustments.