audit of stock

444 views 6 replies
how can I audit loss of stock due to theft except the declaration made by proprietor.
Replies (6)

The difference in closing stock calculations can give you an indication. As you calculate closing stock using trial balance (using sale, purchase and opening stock) you can get an estimate of stock lost by difference in actual and estimated stock.

agree but is this enough

In case this gives to satisfactory assurance for your opinion, I think this can be enough

In case this gives to satisfactory assurance for your opinion, I think this can be enough

Following process can be adopted 

1 Check FIR Lodged in police department

2 check Insurance claim made by proprietor and verify the insurance company's enquiry document.

Both will give you prima facie evidence on which you can rely absolutely

If not available

3 enquiry with employee who work there to reverify the owner's claim

4 perform arthematical calculation with physical inventory if possible 

 

 

Losses are entered in the inventory asset account as a credit. A debit entry must be made in an expense account; it's called a write-down of inventory account or loss of inventory account.

The entire amount of stolen cash is deducted from owner's equity. Create a theft expense account on the income statement. Record the entire amount of stolen cash as a theft expense and/or the net amount of assets less accumulated depreciation.


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
Featured 14 March 2026
Associate CA

N N V Satish&co

Hyderabad

CA

View Details
Company
Featured 12 March 2026
Customer Relationship Executive

TAXLET

Calicut

B.Com

View Details
Company
Featured 28 March 2026
Accountant

Ashok Amol & Associates

New Delhi

B.Com

View Details
Company
Featured 13 April 2026
GST CONSULTANCY

Abhishek G Agrawal & Co.

Korba

CA Final

View Details
Company
Featured 14 April 2026
GST CONSULTANT

Abhishek G Agrawal & Co.

Korba

CA Final

View Details
Company
Featured 14 March 2026
Article Trainee

N N V Satish&co

Hyderabad

CA Inter

View Details
Company
Featured 28 March 2026
CA Final

Ashok Amol & Associates

New Delhi

CA Final

View Details
Company
Featured 19 March 2026
Article Assistant

Gupta Sachdeva & Co. Chartered Accountants

New Delhi

CA Final

View Details