Summary of "What is Stock Audit | Process of Stock Audit and Documents Required for Stock Audit"
The video discusses the concept of Stock Audit, its importance, and the necessary documents and processes involved.
Main Financial Strategies and Market Analyses:
- Stock Audit Definition: A Stock Audit involves the verification of inventory and related financial details, primarily conducted by banks to ensure that businesses are not committing fraud regarding their stock levels.
- Purpose of Stock Audit: To prevent companies from misrepresenting their inventory and financial health to banks, especially when loans are involved.
Process of Stock Audit:
- Appointment of Auditor: The bank appoints an auditor to conduct the Stock Audit.
- Verification of Stock: The auditor verifies the physical stock against the records provided by the company.
- Documentation Review: The auditor reviews various financial documents to ensure accuracy and compliance.
Required Documents for Stock Audit:
- Current stock statement.
- Stock statements from the last three months.
- Provisional balance sheet.
- Trial balance.
- Financial statements.
- Stock insurance policy.
- Sale and purchase invoices.
- Stock register.
- Closing stock method documentation (FIFO, Average, Standard Price).
- List of dead stock.
- Business constitution documents (partnership deed, PAN card for proprietorship, operation certificate for private limited companies).
- Details of debtors and creditors, including sales and production details (if required by the bank).
The video emphasizes the importance of accurate documentation and compliance for a successful Stock Audit.
Presenters/Sources:
The video is presented by an unnamed individual who engages the audience directly and encourages subscriptions to the channel.
Category
Business and Finance
