Stock Audit

Stock Audit Services – Ensure Inventory Accuracy & Financial Integrity

What is Stock Audit?

Stock Audit, also known as inventory audit, is a process of physical verification of the stock or inventory assets of a business. It ensures that the stock maintained in the books matches with the actual stock available in warehouses, godowns, or stores. A Stock Audit is essential for identifying discrepancies, preventing fraud, enhancing inventory control, and fulfilling banking or statutory requirements.

At [Your Firm Name], we offer professional Stock Audit services tailored to manufacturers, wholesalers, retailers, e-commerce businesses, and companies with multiple warehouses. Our expert chartered accountants and auditors ensure 100% accuracy and compliance with accounting standards.

 

Importance of Stock Audit

  • Prevents inventory mismanagement and pilferage

  • Ensures accuracy in financial statements

  • Enhances stock visibility and planning

  • Complies with banking or statutory norms

  • Assists in better decision-making through reliable data

Our Stock Audit services are fully customized to your business size and type, with detailed reports and recommendations.

 

Scope of Work in Stock Audit

Our detailed Stock Audit scope of work includes:

  • Physical verification of inventory

  • Verification of stock movement (inward/outward)

  • Cross-checking stock records with actual inventory

  • Reconciliation of discrepancies

  • Valuation of stock as per accounting standards

  • Observations on slow-moving/obsolete items

  • Examination of stock expiry/damage/return policies

  • Review of internal inventory controls

  • Audit of stock storage and handling practices

  • Suggestions for improvement in inventory management

  • Identifying stock lying in transit or under process

  • Analyzing stock turnover ratio

  • Reporting of theft or misuse (if any)

  • Final comprehensive audit report submission

  • Coordination with internal staff and inventory managers

 

Documents Required for Stock Audit

To initiate a Stock Audit, the following documents and records are required:

  • Inventory Register / Stock Ledger

  • Purchase and Sales Registers

  • Goods Inward and Outward Register

  • Opening & Closing Stock Reports

  • Stock Valuation Sheets

  • Store Issue Slips / Requisition Slips

  • Delivery Challans / Gate Passes

  • Physical Stock Statement (if any)

  • Stock Location List (Godowns/Warehouses)

  • Vendor and Customer Invoices

  • Production and Consumption Reports

  • Inventory Management Policy (if applicable)

  • Expiry/Damage/Return stock reports

  • Details of items under warranty/guarantee

  • Bin Cards or Stock Cards

 

Process of Stock Audit

Our Stock Audit process is systematic and ensures full coverage of all inventory-related aspects:

Step 1: Initial Consultation & Planning

We understand your business type, stock category, and purpose of audit (statutory/bank/internal). Then, we define the scope, audit dates, and assign an audit team.

Step 2: Document Collection & Review

We collect and review all stock-related documents to understand the current stock management practices and control systems.

Step 3: Physical Stock Verification

Our team conducts a surprise or scheduled physical stock verification at all locations, reconciling the physical stock with the books.

Step 4: Identification of Discrepancies

We identify mismatches, excesses, shortages, damage, or expired stock and record the discrepancies in the audit report.

Step 5: Reporting & Recommendations

A detailed Stock Audit report is prepared with observations, variance analysis, control gaps, and actionable recommendations.

Step 6: Review Meeting & Final Sign-Off

We conduct a discussion meeting to resolve queries and present the final signed audit report for submission to management, banks, or other stakeholders.

 

Industries We Serve

Our Stock Audit services are suitable for:

  • Retail Chains & Supermarkets

  • Manufacturing Units

  • Warehousing Companies

  • FMCG & Pharma Distributors

  • Automobile Dealers

  • Electronics & Hardware Showrooms

  • Wholesalers & Traders

  • Textile & Garment Manufacturers

  • Import-Export Companies

  • E-Commerce Fulfillment Centers

 

Frequently Asked Questions (FAQs) About Stock Audit

1. What is the purpose of a Stock Audit?
Stock Audit ensures inventory accuracy, helps detect theft/loss, and provides data for better inventory management.

2. How often should a Stock Audit be done?
Most companies do a Stock Audit annually, semi-annually, or quarterly depending on the volume of stock and industry requirements.

3. Who requires a Stock Audit?
Businesses with high inventory volumes, bank-funded working capital, or regulatory compliance requirements need Stock Audit.

4. What is the difference between internal and external Stock Audit?
Internal stock audit is conducted by your staff, while external audit is performed by a third-party CA firm for independent verification.

5. Is Stock Audit mandatory?
It is not mandatory under law, but is often required by banks for loan renewal, by investors, or as an internal control measure.

6. How long does a Stock Audit take?
The time varies based on inventory volume and number of locations. Typically, it takes 3-7 days per warehouse.

7. What happens if discrepancies are found?
We report and reconcile them, suggest corrective actions, and help in revaluing or adjusting the inventory books accordingly.

8. Do you cover multi-location inventory audits?
Yes, our audit team is equipped to handle audits across multiple warehouses or retail outlets.

9. How is the stock valuation done?
Stock is valued as per cost or market price, whichever is lower, or using FIFO/LIFO/weighted average methods based on your policy.

10. Can you audit stock in transit or under manufacturing?
Yes, we consider WIP (Work In Progress) and goods in transit as part of the stock audit scope.

11. What if our stock is managed through ERP?
We verify ERP reports and compare them with physical inventory during the Stock Audit process.

12. What kind of report will I receive after the audit?
You’ll receive a comprehensive Stock Audit Report with observations, discrepancies, item-wise data, and expert recommendations.

13. Is it necessary to halt business operations during the audit?
Not necessarily. We ensure minimal disruption by conducting audits during off-hours or in coordination with your team.

14. Are damaged or obsolete items included in the audit?
Yes, we identify and report damaged, expired, or slow-moving stock separately in the audit findings.

15. Can a Stock Audit help reduce pilferage and misuse?
Absolutely! Regular Stock Audits deter internal fraud and enhance accountability.

 

Why Choose Us for Stock Audit Services?

  • Qualified CA Professionals & Experienced Auditors

  • Transparent, Neutral, and Objective Reporting

  • Physical & System-Based Inventory Audit

  • On-Site & Multi-Location Audit Capability

  • Compliance with Accounting & Bank Norms

  • Tailored Audit Process Based on Business Needs

 

Get in Touch for Stock Audit Services

Ensure your inventory is accurate and your records are compliant. Partner with [Your Firm Name] for reliable and professional Stock Audit services. Contact us today to schedule an appointment or consultation.