Physical inventory

Physical inventory ensures that the General Ledger value of your inventory is correct in your system. The value of your inventory is the physical inventory quantity according to Product Warehouse Product Setup prices and costs. During the count process, each product or item warehouse location and the corresponding count are recorded by a warehouse employee.

Discrepancies are discovered during a physical inventory. Any discrepancies that are outstanding when the results of the physical inventory are communicated are cleared. The TWL quantity is used to update the system to the correct quantity. Theoretically, then, the inventory in the warehouse after the physical inventory equals the value stated in the General Ledger at that point in time.

A physical inventory is generally performed annually to verify and audit inventory. A physical inventory typically involves a complete warehouse shutdown. During shutdown, your warehouse personnel physically count product in all locations and record their findings using the RF unit. Warehouse managers monitor and evaluate the count using inquiries and reports until the counting is complete.

A cutoff time must be established before a physical inventory. All orders for the day must be entered and picked by the warehouse at that time. All products received must be entered and put away. Any orders or receipts that occur after the cutoff time must be held until the next day or until the count is complete. We recommend that you move committed or sold inventory to a staging or accumulation area. The inventory remaining on the shelves should match the amounts available for sale.