How to Reduce Finish Stock Quantity with out sales

[Former Member]

Hi All

My client wants to reduce the finish stock with out sales, as they want it to maintain a particular Quantity for that finish from 1st of April 2010

So how to achieve this & with which movement type , i should use in MB1A

Or any other suggestion to map this scenario

Thanks In advance

Ashok

[Former Member]

Thanks All

If possible please answer the last doubt

[Former Member]

Hi,

You can run Physical Inventory.

Regards,

K Bharathi

[sidi_reghioui]

You should use Physical inventory to correct the stock levels. This is also an audit procedure, and auditors mostly come and ask you about the difference, especially if differences are big enough.

Scrapping is used to get rid of non-usable (expired, OR damaged goods)material, but can be used to decrease your stock due to other reasons which the business may find suitable.

Here too, the auditors may ask you for a reason.

[Former Member]

First of all thanks to Both Sidi and Bharathi for your reply

As suggested by Sidi the Auditor may question if We are scraping the finish stock as the difference is very high.

so it is better to go for the second option i.e. Run Physical Inventory .

so could you please elaborate how to run physical Inventory or any link

Thank

[sidi_reghioui]

Ashok

in both cases the result will absolutely the sames in value, the only difference is where the amount is posted either to Inventory difference account or to an Scrapping account.

I would suggest no to run the Physical inventory to correct your stock, you will not be able to get around the auditor to explain why you have a huge nventory difference - like say 100.000 euro or 10.000 pieces. - it cannot be due to theft, or to erros in order picking.

But if you scrap it, you can explain that the scrapped material was not good enough to market it and we decided to scrapp it.

You may discuss this thouroughly with the business owners as it has a financial impact.

Could you share why they need to decrease stock so suddenly?

regards

Sidi

[Former Member]

Thanks Again Sidi for your prompt reply

As you know 1st April is the financial year beginning in India ,they want to make these adjustment because of some Policy/ Business compulsion .

consider the cost of this operation on the balance sheets of customer.

Could you please elaborate on your above statement, it would be really helpful for us.

Thanks

Ashok

[sidi_reghioui]

is the objective decrease your stock of finished goods?

you can try scrapping if you want.

MB1A and movement type 551, 553, or 555 depending on which stock type (unrestricted, quality or blocked).

consider the cost of this operation on the balance sheets of customer.