Inventory/ Stock Audits/ Asset Count

Verifies the accuracy and existence of physical inventory, stocks, and assets, ensuring alignment with financial records and minimizing discrepancies.
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Best Tax audit firm in Dubai, UAE

To verify the accuracy of a taxpayer’s VAT liability, a tax audit reviews various documents maintained by the taxpayer. This process assesses whether taxable entities are meeting their obligations in accordance with tax laws.

The Federal Tax Authority (FTA) conducts annual tax audits to ensure that all liabilities are correctly calculated, collected, and submitted to the government on time. Consequently, taxpayers will receive an audit notice ahead of time.

The Tax Audit's Preparation

A Stock Audit involves physically checking inventory levels and matching them with financial records to ensure accuracy and ownership. This process verifies the value and existence of inventory, confirming:

– Physical inventory matches accounting records
– Ownership rights are confirmed
– Inventory value is accurately reflected

Why an organisation needs Stock Audit?

There are several reasons why an organization needs stock audit including the following:

  • Reveals stock trends.
  • Informs product decisions.
  • Detects fraud/discrepancies.
  • Values inventory accurately.
  • Optimizes cash flow.
  • Ensures stock accuracy.
  • Optimizes cash flow.

Our Inventory Audit Methodologies:

01

Physical Counting

Comprehensive counting of all inventory and assets on-site.

02

ABC Analysis

Classifying inventory by value and importance, enabling prioritized management and informed decision-making.

01

Cut-off Analysis

Temporarily halting inventory transactions to ensure accuracy during the audit.

01

Physical Counting

Examining key financial metrics, including:

  • Gross margins
  • Inventory on-hand days
  • Inventory turnover ratio
  • Cost of inventory

To optimize operations and minimize discrepancies.

List of Documents Required for Stock Audit:

  • Stock statement as of the audit date
  • Provisional balance sheet and trial balance as of the verification date
  • Most recent audited financial statements
  • Stock insurance policy, if applicable
  • Sample invoices for purchases and sales.
 

Asset Count: This process involves tracking every fixed asset within the organization. It serves as a detective control to ensure that no assets are misplaced, stolen, or unaccounted for. An asset register is created, maintained, and updated to facilitate ongoing monitoring of the organization’s permanent assets.

Asset counts are conducted during liquidation, as part of an external audit, during transitions from manual to automated systems, when relocating offices, or during interdepartmental transfers. The general processes and documentation necessary for an effective inventory audit also apply to asset counts.

Advantages of Inventory / Stock Audits / Asset Count

Ensure accurate inventory records by identifying differences between physical stock and recorded quantities.
Detect stock shortages, excess inventory, damaged goods, and unexplained discrepancies promptly.
Strengthen inventory controls and reduce the risk of theft, loss, errors, and stock mismanagement.
Improve financial reporting by ensuring inventory and asset records accurately reflect actual holdings.
Support better stock management and purchasing decisions through reliable and verified inventory information.
Enhance accountability and transparency with systematic physical verification of inventory and business assets.

Inventory / Stock Audits / Asset Count Includes

Physical Inventory Counting

Conducting systematic physical counts to verify actual inventory quantities across warehouses, stores, and business locations.

Stock Reconciliation

Comparing physical stock with accounting and inventory records to identify shortages, surpluses, and discrepancies.

Asset Verification

Physically verifying business assets and equipment to ensure records accurately reflect assets held by the company.

Inventory Classification

Categorising inventory based on value, type, usage, and importance to support effective stock management and control.

Discrepancy Identification

Identifying damaged, missing, obsolete, excess, or incorrectly recorded inventory and assets requiring management attention.

Audit Reporting

Providing clear inventory and asset count reports with identified discrepancies, observations, and practical recommendations for improvement.

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To date we are providing Accounting Services for more than 250 clients
across the UAE in Trading, Construction, Real estate, Healthcare, Logistics and other services.