What is stores accounting

Some of the systems of physical stock taking are as follows:. Annual or Periodic Physical Verification: In this system the entire inventory is physically verified at the end of a period, usually the accounting period. That is, normally at the end of fiscal year. Stocks are closed for a few days. This may necessitate the shutdown of production operations;. A special crew of store inspectors and stores verifying officers, usually from the material audit, physically check each item and compare the entries on bin card and stores ledger.

This leads to the formation of a list of surplus or short items. Damaged and obsolete items are traced and recorded. This needs to develop a detailed programme and schedule to complete the verifications, store wise and item wise. As all the items are checked at one time there can be no confusion about any item being left unchecked. Perpetual Inventory and Continuous Stock Taking System: In case of large firms dealing with a large number of items the final inventory system may take a lot of time and it may not be possible to shut down the whole plant.

The perpetual inventory system is a more appropriate method for large plants. In this method the stock verification is done continuously throughout the year. Protecting against the consequences of non-availability of materials. Recording and receiving of materials in store. Classification and codification of items which is received by store.

Prohibited unauthorized persons from entering inside the store. Store keeping procedure or store routine. After receiving materials by receiving or store keeping department, store keeping has to perform various activities relating to materials.

It is known as store keeping procedures or store routing under store routine, following procedure has to be done:. Classification and codification of materials. Recording of materials received.

Issuing of materials. Classification and codification of materials facilitates prompt identification of the materials in storage when they are being issued to production departments. All items in the stores should properly be classified and codified. Goods which are received by store must be scientifically classified and coded. As per the nature of materials, it must be classified in various groups of goods.

Materials are classified to make issuing, storing and identifying materials easily and quickly. So materials are first classified on the basis of their nature and types. It may be classified as construction materials, consumable store, spare parts, lubricating etc. Codification of materials. After classification of materials in various groups, they are codified again. Coding means to a numbers or distinctive symbols to a specific materials of stores with a arrangement for prompt identification.

It is procedure for assigning symbols for each item in properly with proper arrangements to facilitate storing. The symbol allotted to the materials is known as 'code'. Alphabetical: alphabets are used for codification of each group of material e. A, B, C…. Numerical: Numbers are used for codification of each group of materials e.

Alpha-numeric: both alphabets as well as numeric are used for codification of each group of material e. A, A…. Advantages of classification and codification of materials:. It helps to maintain secrecy of materials. It facilitators to locate and identified the materials.

It avoids duplication of multiple names of materials. A coding system helps in the maintenance of mechanized accounts. After classification and coding of materials, next step on store route is recording of materials received by store department. Following are the two system of material recording received by store:. Bin card. Bin card term used o symbolize the place or shelf or rack or pigeon-holed or even a big room where materials are stored and the card attached to the bin or tag hung up there is known as bin card.

Bin card shows quantitative details of receipts, issue and balance of materials in the bin. This card also shows the maximum level, minimum level and re-orders level of the materials. It helps the storekeeper to control materials.

Bin card is used by the storekeeper to keep only quantities record for all items of materials in store remember that, it does not record the value of materials. Store ledger is maintained by costing department. This ledger shows the information for the pricing of materials issued and the money value at any time of each items of store.

Store ledger contains and account for every item of stores and makes a record of the receipts, issue and the balance, both in quantity and value. It contains the name, part number of the items, and bin number. Email This BlogThis! Share to Twitter Share to Facebook. Share this article :. Unknown September 17, at PM.

Unknown September 22, at AM. Unknown October 7, at AM. Unknown January 29, at AM. Madisi Parimalambica , Student at Andhra University. Raksha Sharma , Sarubjeet Singh , Student at Jammu university at Jammu university. Josephat Magwa.

Show More. Views Total views. Actions Shares. No notes for slide. Store Accounting 1. Material Received Account. Based upon the office copy procurement Section will prepare list of all the SMBs recorded during the month and sent it to the Accounts Section and Store Section.

Issue of material from Store. Issue of consumable material. Issue of Spare Parts. Issue of Scrape for disposal. Physical verification of Store Stock. Best of luck! We put a lot of work into creating an accurate and understandable resource. Thanks for your kind words! Be sure and let others know of this resource. Take care! Thanks for letting us know this material was useful.

Stay tuned because we have new stuff going up all the time. Glad you found the material helpful. In an hospital organisation where there is no store keeper but there is a pharmacist who do you suggest should be in charge of the store where medications are kept?

Save my name, email, and website in this browser for the next time I comment. Store Keeping. Indeed they are good Reply. Thanks so much for your hel. It helps a lot. This is very helpful, and educative. Thank you so much! Thanks we get usefull information Reply. Thanks that is very good investigation God bless evryone.