Plan for physical inventory
Begin planning for the days of counting well in advance.
To plan for physical inventory
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Select dates for the count. Typically, you select dates near the end of the accounting year.
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Determine the number of tags you need to complete the count. Consider the number of part numbers, lot numbers, bins, locations, jobs, operations, and so on. You should be able to use the tag to count any kind of inventory. The tag should be a two-or three-part non-carbon form with an adhesive strip that attaches to counted items or locations.
If you are using the bar code system, you do not need tags.
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Notify your customers and vendors of your inventory dates. Tell them you will suspend shipping and receiving on those dates. Also tell them to reply in writing with counts of any of your inventory that they currently hold.
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Identify items you do not count, such as consigned material and scrap. Either tag the items as “no count” or move them to an area designated for no-count items.
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Review inventory procedures with your staff. Appoint leaders responsible for the areas.