Stock audit refers to the physical verification of a company’s inventory assets. These audits examine the discrepancies, if any, in the records and ensure the correctness between the book or system stock and physical stock.
There are various types of stock audits and every audit requires a different approach depending on the purpose.
It has become very imperative for institutions to conduct audits as these audits work in their favour by establishing security and safeguarding them from any potential pilferage. Auditing in India is done through a set of rules and regulations.
They follow the legislation mentioned under the companies act 2013 and ensure every institution, public or private adheres to the compliances.
The result of the audit process is a report declaring the position of the company in terms of its compliance with the legislation, company financial statements and the congruence between the system stock and the physically recorded stock.
This whole process is overbearing to a company or an institution so that it can be assisted legally in reducing the preventable investment in inventories.
There are majorly four types of auditors, viz,
- External auditor
- Internal auditor
- Forensic auditor
- Government auditor
The job of an internal auditor demands certain attributes that stand up to the minimal requirements of being an internal auditor in Bangalore.
Apart from these certain minimal requirements, there are innumerable qualifications and expertise one can add to their professional hat that will eventually take them places. The horizon of stock auditors is no less low, it is wide and everlasting.
Before we move ahead with the scope of the stock auditor job in India, there are a handful of things to be acquainted with. These are-
- What is stock auditing?
- Who are stock auditors?
- Qualifications and skills of a stock auditor
- Importance of stock auditing
We shall cover all these points below in the blog, stay tuned and scroll through the end!
What is stock auditing?
A stock audit is a process of physically verifying the company’s inventory that includes an evaluation of the stock items based on the assignment’s reference. It is a necessary procedure as it helps the companies in overcoming the investments that are nonessential and dispensable. High levels of stock result in overstocking which thus leads to a poor value of cash flows and financial forfeiture.
Who are stock auditors?
Stock auditors are the professionals who carry out the auditing process pertaining to the inventory or stock of the company. The stock auditors may look for the discrepancies in the system stock and the actual stock and correct the mistake in that case. These auditors can be internal or can be assigned by a third party, either a private firm or a government body.
Qualifications and skills of a stock auditor
stock auditors encompass all the financial, operational, compliance, control and governance functions of a company. It plays a role deeper than we imagine them to play.
They are significant to any institution’s base by securing and safeguarding it and thus, facilitating prosperity, and legality within the institution’s internal framework.
That is why these stock auditors must possess qualities that set them apart from any normal financial professional. They are employed in all sectors of the economy and companies from varied fields request their service.
The academic qualifications of an internal auditor in Bangalore should be a degree in accounting or finance, or any other degree in fields of business, economics or mathematics may also be considered.
Professional qualifications like ACCA, CPA, and ACA are also required for some specific auditing roles. They must have work experience or must have done an internship in the same field. The skills they need to have are mentioned below-
- Risk management skills
- Problem-solving skills
- Accounting experience
- Project management skills
- Product knowledge
- Regulatory knowledge
- Communication skills
- Data analytics
- Leadership skills
There are innumerable reasons why you should be performing a stock audit. Some of them are mentioned below.
- Assists in identifying the slow-moving stock, deadstock, obsolete stock, and scrap.
- Helps in locating the discrepancies between recorded stocks and physical stock.
- Updates the physical stock that matches the recorded stock.
- Properly preserves and handles stocks.
- Helps in reducing cost and bottom-line improvement.
- Prevents pilferage and fraud.
- Provides accurate information on inventory value.
- Helps in reducing gaps in the inventory management processes.
- Special arrangements for third-party opinion.
- Acts as a commendable control mechanism in running the business.
You are all set to go, just learn the market, grab the degree, ace the exams, and offer the expertise!
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