Inventory rules

A properly conducted physical inventory is a very important part of the annual accounting. It is worthwhile to outsource inventory services to professionals. Companies offering such services, thanks to their acquired knowledge and experience, know how to do an inventory. Entrepreneurs who produce, process and trade on the last day of the fiscal year must provide the tax authorities with detailed information about the assets. This information is of great importance to the Authority, as it affects the calculation of tax contributions. Maintaining inventory rules will allow the entrepreneur to look forward to the next fiscal year with peace of mind and give a complete picture of the company.

Rules for carrying out the inventory

Like any accounting activity, inventory requires the application of a number of rules. The point is not to make mistakes, which in the case of income and expense ledgers can cause unexpected and painful costs. Failure to comply with the obligation under the Accounting Law is punishable by a fine. In addition, an unreliably performed physical inventory can be the basis for an erroneous tax assessment. Below we present the basic principles of inventory, the observance of which will allow you to reliably carry out the inventory.

1. Timeliness

Fulfilling the statutory deadlines is among the most important inventory rules. By adhering to the procedures in this regard, we avoid fiscal problems resulting in the worst case even in a severe fine. Practice shows that sometimes it is even better to enter erroneous values and then correct them in the income and expense ledger, than not to enter the current state of assets for the fiscal year at all.

2. Control

When conducting an inventory, it is a good idea to have at least two people do the final count. They can check each other and correct any errors. The person in charge of the property for the count should also participate in the inventory. It is customary for the inventory to be supervised by inventory controllers, i.e. people who take care that the company is properly guided through the entire inventory process.

3. Census behind closed doors

A good rule of thumb is not to do any trading in the company's goods during the ongoing inventory. In short, for the duration of the count, the company should be closed. This reduces the possibility of mistakes and, by its very nature, often makes it unnecessary to count the goods again. Due to the special nature of the business, it is possible to determine the inventory for a specific day, which allows the business to continue operating.

4. Reliability

Allthe rules of inventory preparation can be kept to the decimal point, but when the inventory is conducted unreliably, then even this may not help. The inventory establishes the actual and objective condition of the assets being inventoried, hence it is extremely important to maintain the highest standards of conduct. One must be very accurate!

5. Directory complete

This rule implies the inclusion in the inventory of all tangible assets of the company, which the Accounting Law indicates as necessary to be accounted for. This special rule also applies during inventories of a discontinuous, random nature or organized during ownership changes.

6. The right order

This inventory principle is still applied at the planning stage of all activities. When the inventory is well planned, the whole count is carried out much more efficiently. It is good to base the work on a pre-agreed schedule, that way everyone knows what to do and what effect it will have.

7. Surprise

In the case of a particular type of inventory, which may be a check or check inventory, the element of surprise can be of great importance. It is worth applying this principle when, for example, we want to control the cash on hand or there is a reasonable suspicion that some employee is not honest with us. Although in the latter case, the principles of accounting for the inventory are also justified - we always appoint a person who is responsible for the entire process.

8. Participation of the materially responsible person

A good and at the same time basic principle of inventory is the participation of the person materially responsible for the counted assets. This is not always the entrepreneur himself, most often we are talking about managers, managers and directors. If such a person is unable to appear, a substitute is appointed.

9. Professionalism

Inventory is a special type of activity that requires a number of rules and diligence at almost every stage. Hence the professionalism and expertise of the entire team is extremely important. Although it is customary for entrepreneurs to carry out an inventory using their own personal resources, it often turns out that it is more efficient and reliable to use the services of a professional company providing inventory services.

Following the above rules will lead to a reliable inventory report. This is the document on the basis of which the income and expense ledgers are updated, so it is extremely important that it is written well. Any errors in the accounting will result in fiscal consequences, among which there is even criminal liability. And at best, we will miscalculate the tax we should pay.