Internal controls should be designed to safeguard assets and help prevent or detect losses from employee dishonesty or error; the owner’s involvement in a small organization is important in maintaining good internal controls. One area of focus should be segregation of duties, which largely means having different people responsible for authorizing transactions or contracts, recording …
The year-end physical inventory count can be a daunting task for companies that have large amounts of inventory. Having a successful physical inventory count relies heavily on planning, emphasis and direction provided by management. There can be significant ramifications to an unsuccessful inventory count such as recounts of total inventory, material adjustments to accounting records, …
A lot of times the cost at which a unit of inventory is being carried at is made up of more than just the cost of materials used to produce the actual item. It often includes other costs which are incurred to get the items in place and ready for sale. Some of these other …
With the close of 2016, did you question why you do a full physical count every year? Did you wonder if there was a better way to achieve the same result instead of having your employees come in early, stay late, and possibly closing your doors during regular business hours? If your company maintains inventory, …
It’s that time of year when companies need to begin preparing for their year-end inventory counts. The difference between a clean inventory count and one with multiple mistakes is due to a few key steps, which include preparing for the count, determining the method of completing the count, evaluating the counts and correcting the inventory …
If you are a company that carries inventory, you should most likely have an inventory reserve accounting policy in place. Creating an inventory reserve is a proactive and conservative accounting approach that companies use to prepare for events such as spoilage, theft, obsolescence, and other adverse situations on their inventories. An inventory reserve is a …
When accounting for property and equipment additions, it can be confusing to know exactly what should be capitalized or expensed when the asset is initially purchased. Often, I see clients capitalize the equipment’s purchase price but then expense the sales tax and transportation costs associated with acquiring the asset. So, to set the record straight, …
It’s one of the most dreaded days of the year for many of you…physical inventory day. This can be a frustrating and time-consuming process with numerous obstacles, though with the proper planning you can make the physical inventory process run smooth and efficient. Inventory preparation – There is a lot you can do ahead of …