Stock valuation reconciliation

Businesses of all sizes need to reconcile their stock valuation. Reconciliation helps improve internal control and validate the accuracy of the financial statements. The frequency at which you reconcile your stock valuation is an internal decision, but is not something that should be left to the end of the year. The more frequently your stock valuation is reconciled, the more likely the value of your stock will be accurate.

This page suggests the steps to take to perform an accurate valuation of your stock.

Step 1: In Sage Intacct, determine the balance of the stock account

Open: Sage Intacct > General Ledger > Reports > Trial balance

In this step, you obtain the balance of the Sage Intacct General Ledger stock account for a specific period.

1. Enter or select the Opening balance date and Closing balance date for the period to reconcile.

   The Opening balance date should be the Closing balance date from the last reconciliation, if you have reconciled your stock value previously.
2. Enter or select the Sage Distribution and Manufacturing Operations company / Intacct Location.
3. View the generated report and make a note of the closing balance for the inventory / stock account.
4. Process & store the trial balance report.

Step 2: In Sage Distribution and Manufacturing Operations, calculate the stock value total

Open: Sage Distribution and Manufacturing Operations > Stock > Valuation > Stock valuation

In this step, you obtain the total stock value at a specific date.

1. Enter or select the Company.
2. If your organisation posts to multiple stock accounts, enter or select the Posting class.
3. Enter or select the closing balance Date. This needs to be the same as the Closing balance date you selected in the Sage Intacct Trial balance.
4. Select Run.

Step 3: Compare the figures

In this step, you compare the Sage Distribution and Manufacturing Operations total stock value with the stock account balance from the Sage Intacct Trial balance.

1. After the Stock valuation finished message is displayed, make a note of the Total stock value figure.
2. Compare the Total stock value figure against the Sage Intacct Trial balance inventory / stock account Closing balance.

Step 4: If the figures do not match

In this step, you take extra steps to compare the Sage Distribution and Manufacturing Operations total stock value with the stock account balance from the Sage Intacct Trial balance.

1. In Sage Intacct, drill down on the net change of the Trial balance.

2. In Sage Distribution and Manufacturing Operations, on the Journal entry inquiry page:

   1. Enter or select the Company.
   2. Enter the same Start date and End date as the Sage Intacct Trial balance Opening balance date and Closing balance date.
   3. Select Search.
3. Export the Lines grid to an Excel file.
4. In the Excel file, filter the results by the stock account.
5. Add a column to calculate the debits and credits (Amount column * sign).
6. Sum the total.

If the total does not match the net change to the Sage Intacct inventory / stock account, in Sage Intacct, analyse the transactions to determine if any journal entries were entered directly in Sage Intacct.

Step 5: Analyse causes of out of balance figures

In this step, you analyse the causes of out of balance figures if the total in Step 4 matches the net change.

• For purchased and sold items, not absorbed costs are posted to the stock account: Verify the Posting class for Purchase variance has the correct account assigned.
• For manufactured items, production variances are posted to the stock account: Verify the Posting class for Production variance has the correct account assigned.
• Additional transactions were made after the previous reconciliation: Run the Stock valuation and the Sage Intacct Trial balance for the previous period and compare the figures with the reconciled amount. If the amount varies, you need to reconcile the previous period again.
• The standard cost of a released item was not recalculated after component costs changed.