• From: Pakistan, Karachi
  • Registered: 03/03/2015
  • Posts: 651

Topic: How to satisfy an auditor

I am facing a challenge.
In one FA installation with many inventory items, the opening inventory was recorded at a cost and that was averaged out with purchases, voiding of transactions, inventory adjustments etc and current inventory is at average cost.

Now If I see the inventory valuation report of the first day of the fiscal year it is not giving the actual value of the inventory rather the averaged out value. Now auditor want's to see the actual value of the opening inventory.

Is there any way out to give him report.

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  • From: USA
  • Registered: 07/16/2017
  • Posts: 276

Re: How to satisfy an auditor

Do you have any backups?  If so, restore the database for the desired date.

If not, and your db still has transactions (not closed out) you may have to change the report to back out the transactions.    As you point out, that is more accurate than simply using the current average cost.

  • From: India, TN, Karur
  • Registered: 05/16/2014
  • Posts: 1,182

Re: How to satisfy an auditor

Find the cost update entries  and cross check with them with the abnormal prices for items. This is actually time consuming task. But this way you can identify which transaction makes the problem mainly. Like that you can identify other transactions a bit easily and update those entries manually in the database to make it workable.

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4 Reply by boxygen (edited by boxygen 08/19/2021 06:03:18 am)

  • From: Pakistan, Karachi
  • Registered: 03/03/2015
  • Posts: 651

Re: How to satisfy an auditor

Thanks @Braath and @Varadha for your suggestions.

Inventory Valuation Report Served the subject for me. Now my Trial Balance is giving exactly the same value of Inventory as that of Inventory Valuation Report. I had to set $use_costed_values = 1 in config.php. This I tested for any Date.

But now I am facing a very strange issue that I had to dig out after hours.

Here is the Screen shot of the Database.

https://prnt.sc/1qbickh

This is one item's records in stock_moves table which is fetch by Inventory Valuation Report to calculate average cost in the function getAverageCost

Now the below condition is calculating wrong average cost because in one record the standard_cost is ZERO as highlighted in above image.

https://prnt.sc/1qbiflo

What is the purpose of this condition? And I don't know why the standard_cost is set to ZERO for that line in first image?

If I remove this condition my Inventory Valuation is perfect. But I am unable to understand why this condition was applied earlier.

Here is the Screen Shot of Inventory Valuation Report
Any idea?

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