Assets and Inventory Management 

TDS has developed a broad controls assessment for inventory and asset management. This controls assessment is:

Objective to determine whether: Procedure:
Inventory/assets recorded are valid
  • Random samples are obtained and traced bi-directionally
  • Observation of movements of inventory/assets during counts
Inventory/assets are clearly tagged
  • Observation during site visit
  • Determine location of all locations where inventory/assets are maintained
  • Observation of procedures for the issue and return of count sheets
Inventory/assets are owned (in the case of items belonging to contractors/other suppliers)
  • Observation for any indications of non-ownership
Inventory/assets counts are accurate
  • Observation of processes
  • Reperformance of counts
  • Trace counts back into inventory/assets ledgers
Inventory/assets are not being carried in excess of the recorded valuation
  • Identification of obsolete/damaged/redundant items through observation and review of inventory/asset records
Classification of inventory/assets
  • Obtain samples and trace into inventory/asset ledgers
Correct allocations to reporting periods
  • Observation of inventory/asset movements during stocktake
  • Perform cut off tests including:
    • Last transfer/shipping document prior to count
    • First transfer/shipping document after count

The above controls assessment is based on a client site which adopts manual stocktake procedures.  Many of our clients are now moving to the use of computerised stocktake processes.  The above controls assessment is still broadly applicable where such computerised stocktake processes are adopted but needs to be refined for the individual package being used.

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