What is an inventory, its types, why is it needed and how is it carried out + differences from an audit

At each enterprise, sooner or later, they are faced with the need to verify the actual availability and condition of goods, or fixed assets, with the data that are reflected in the accounting records. The reasons for this can be very different, from mandatory scheduled inspections to discovered facts of theft of property. In any case, an inventory must be made. And what it is, what types of it exist, how it is carried out, and how it differs from the revision, you will learn from this article.

Basic concept

Inventory is a set of measures taken to record and control the actual availability and state of the organization’s property. Fixed assets, finished products, raw materials for production, tangible and intangible assets, and much more can be subject to verification.


Depending on the frequency of inspections, it is customary to divide them into mandatory, which must be carried out in accordance with the law, and unscheduled, occurring at the initiative of the enterprise’s management.

The reason for conducting an unscheduled inventory of property may be:

  • change of financially responsible person;
  • lease of an asset;
  • recorded abuse;
  • deterioration in the condition of goods, entailing a decrease in its value;

They are also classified according to the degree of coverage into complete, when all property is subjected to verification, and selective, when a certain type of property is compared. And, finally, according to the method of conducting, there are natural, when everything is recalculated and checked manually, and documentary, when the object of verification is the correctness of the display in accounting.

What is it for?

In addition to the main function of accounting and control, additional goals are simultaneously pursued, such as:

  1. Monitoring the correct display of property on the balance sheet.
  2. Monitoring compliance with the rules of storage and operation.
  3. Monitoring the preservation of the quality characteristics of the goods.
  4. Identification of property not used in economic activity.
  5. Identification of fixed assets with expired or expiring storage period.

Procedure and timing

The choice of the order and timing of the inventory is entirely the prerogative of the head of the organization, with the exception of cases regulated by law.

The main rule is that the inspection should not adversely affect the daily activities of the enterprise.

What is a technical inventory?

During a technical inventory, the object of verification is real estate, its characteristics, and condition, as well as features of operation. It is carried out without fail in cases of redevelopment, transition to another operating mode, change in the level of engineering improvement or other quality indicators.

This procedure must be performed at least once every five years in accordance with current legislation.

The difference between inventory and revision

The main difference lies in the purpose of the event. The task of the audit is to identify the legality of the operations carried out by the organization. The appointment of audits is the prerogative of external regulatory bodies, which do not agree on the start and timing of the audit with the management of the enterprise and do not notify the audit in advance.

Inventory, on the contrary, is an internal affair of the company, pursuing, first of all, the observance of the interests of the enterprise.


A timely inventory of property will help not only to optimize the activities of the enterprise, but also, in case of detection of errors and inconsistencies, promptly correct them, and avoid future penalties from external regulatory authorities.

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