Annual inventory is not merely a night spent scanning boxes. The CGNC requires assets and liabilities to be identified and valued at each year-end. Physical stock is visible; doubtful receivables, unbilled liabilities, missing assets and wrong cut-off are less so.
The complete pack
- Instructions, teams and zones.
- Movement freeze or control.
- Numbered count sheets.
- Third-party, return and in-transit stock.
- Fixed assets present and usable.
- Customer, supplier and other balances confirmed.
- Delivery, invoice and expense cut-off.
- Valuation, impairment, differences and approval.
1. Prepare before the last day
Map shops, storerooms, vehicles, external depots and stock held by third parties. Clean references with unclear units and separate goods belonging to others.
- Name a controller independent of custody where possible.
- Divide zones without overlap.
- Number sheets or devices.
- Define count unit and packaging.
- Identify obsolete, damaged and quarantined goods.
- Communicate freeze time and emergency handling.
- Test one count and consolidation.
Retain signed instructions and participant list: they explain how the final figure arose.
2. Count with a control trail
One team counts; another recounts material differences. A correction retains original quantity, new quantity, reason, author and approval.
| Situation | Count treatment |
|---|---|
| Receipt during freeze | isolate and mark before/after cut-off |
| Order picked, not delivered | verify ownership and transfer |
| Stock at third party | obtain confirmation and detail |
| Supplier-owned goods | exclude with evidence |
| Damaged item | count separately and value later |
| Case/unit | convert with validated factor |
Photographs, zone maps and sheet sequences supplement the report without replacing signed counts.
3. Value after quantities are reliable
Apply the validated category method: individual cost for identifiable goods, or weighted average/FIFO for interchangeable goods under the CGNC. Then compare cost with current value and support impairment.
- Quantity: physical result reconciled to system
- Cost: consistent method and receipt evidence
- Current value: market and utility by nature
- Obsolescence: age, condition and sale prospect
- Difference: loss, unit error, late movement or fraud to investigate
VAT-inclusive selling price is not default stock value. A selling-price-less-margin estimate belongs only to the documented exceptional case provided by the framework.
Never replace the count with theoretical stock
The purpose is to confront the record with existence. A zero variance entered without independent observation is not a control.
4. Inventory the rest of the balance sheet
Reconcile fixed assets to existence/use, customers to invoices/payments/disputes, suppliers to receipts/invoices, bank to statements, and income/expenses to the right period.
| Cycle | Closing question |
|---|---|
| Fixed assets | present, in use, life and loss indicator? |
| Customers | collectable, disputed, paid after close? |
| Suppliers | are all deliveries and expenses recorded? |
| Bank/cash | external balance, count and difference? |
| Tax/social | returns and liabilities reconciled? |
| Commitments | guarantees, contracts and risks to disclose? |
BelloPOS may freeze/export recorded quantities, guide counts and retain adjustments. Ownership, cost, impairment and non-stock balances remain closing decisions.
Mistakes to avoid
- Counting without a freeze.
- Missing external depots.
- Mixing third-party goods.
- Overwriting first count.
- Valuing at selling price.
- Limiting inventory to merchandise.
Frequently asked questions
Does inventory mean stock only?
No. Accounting law targets assets and liabilities; physical stock is one part of the closing pack.
Must sales stop?
A freeze eases evidence. If activity continues, document every movement during count and cut-off.
Which stock methods are accepted?
The CGNC provides individual cost for identifiable goods and weighted average or FIFO for interchangeable goods.
How is damaged stock handled?
Count it separately, document condition, and validate current value and any impairment.
Does BelloPOS perform statutory inventory?
It supports quantities and adjustment trail; management and the professional validate ownership, cut-off, value and accounts.
What to take away
A defensible inventory connects instruction, observation, recount, movement, cost and approval. Count stock, but also identify every asset, liability and risk shaping the statements.
Sources
The figures and rules quoted above come from these pages, read on the date given in the article.
- Ministry of Economy and Finance, General Code of Accounting Standardisation, read 1 September 2026
- Ministry of Justice, Company Law 5-96, read 30 August 2026
Prepare a traceable count
Clean references, freeze or control movements and preserve every difference before approval.
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