Stock-taking or "inventory checking" or "wall-to-wall" is the physical verification of the quantities and condition of items held in an

inventory Inventory (American English) or stock (British English) refers to the goods and materials that a business holds for the ultimate goal of resale, production or utilisation. Inventory management is a discipline primarily about specifying the shap ...

warehouse A warehouse is a building for storing goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They are usually large plain buildings in industrial parks on the outskirts of cities ...

. This may be done to provide an

audit An audit is an "independent examination of financial information of any entity, whether profit oriented or not, irrespective of its size or legal form when such an examination is conducted with a view to express an opinion thereon.” Auditing ...

of existing stock. It is also the source of stock discrepancy information. Stock-taking may be performed as an intensive annual, end of fiscal year, procedure or may be done continuously by means of a

cycle count A cycle count is a perpetual inventory auditing procedure, where you follow a regularly repeated sequence of checks on a subset of inventory. Cycle counts contrast with traditional physical inventory in that a traditional physical inventory ceases ...

. An annual end of fiscal year stock-taking is typically undertaken for use in a company's

financial statements Financial statements (or financial reports) are formal records of the financial activities and position of a business, person, or other entity. Relevant financial information is presented in a structured manner and in a form which is easy to un ...

. It is often done in the presence of the

external audit An external auditor performs an audit, in accordance with specific laws or rules, of the financial statements of a company, government entity, other legal entity, or organization, and is independent of the entity being audited. Users of these enti ...

ors who are auditing the financial statements. Periodic counting is usually undertaken for regular, inexpensive items. The term "periodic" may refer to annual stock count. However, "periodic" may also refer to half yearly, seasonal, quarterly, monthly, bi-monthly or daily.Applegate, M.
How Often Should You Do Inventory?
accessed 2 February 2017 For expensive items a shorter period of stock-taking is preferred. A stock-take sale is a sale with reduced prices in a shop designed to sell off stock from previous seasons. This makes the task of stock-taking easier. Another purpose of stock take is determination of a cutoff point i.e. what was the stock position of the company/organization at a specific point of time. However, such stock-taking tasks are often laborious and often lead to significant warehouse operational downtime, ranging from days to weeks.

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See also