If your company uses ABC codes to identify items critical to your business, select
the By ABC code generation method to have counts performed based on the
frequencies required for items with different codes assigned. ABC codes, created
using theABC codes (IN208500) window, group
items by their stock value in a specific warehouse in a specific period, based on
period-to-date balances of appropriate inventory accounts. ABC codes divide items
into groups that require different management and controls; for example, A
code items, because of their high impact on the business, should be counted more
often than items with other codes assigned.
Variations
The generation method for counting based on ABC codes has two variations, based on
your specifications on the ABC code selection tab, which appears when you
choose this generation method.
The following table describes this:
IF |
THEN |
you specify a code in the ABC code field and leave the By frequency check box clear,
|
only the items assigned to a particular ABC code will be included in the stocktaking.
|
you select the By frequency check box and don't specify an ABC code,
|
items with any code for which counting is due, based on the frequency associated with the ABC code, will be included in the stocktaking.
|
Once ABC codes are assigned to items, you can organise counting by ABC codes in the
following way:
- Perform an initial full stocktaking.
- Conduct counts in one of these ways:
- Create a type for each ABC code defined in the system (which has a
specific frequency specified in the ABC codes (IN208500) window).
Conduct counts for
items assigned to every code with the appropriate frequencies.
By frequency based on the maximum counts per year
Make sure that the counts-per-year values for different codes
are factors of the largest counts-per-year value.
Then, when you are
preparing the stocktaking document, only items that are due for
counting by their code frequency will be included.
A stocktaking
document in this case can include items with different codes assigned,
for which counts-per-year values are factors of the largest
stocktaking-per-year value.
Example
Lets say you have defined the following counts per year values for the ABC codes:
A - 4 counts per year
B - 2 counts per year
C - 1 count per year
During stocktaking, all code items are initially included. In the subsequent session, only A and B code items are included since code C items been accounted for to meet the required count (one count). This logical progression applies to all subsequent stocktakings.
Optimal stock counting for most companies
Counting by ABC codes usually works best for maintaining accurate stocktaking counts
because in most businesses, a small number of items generally accounts for the
largest value of stock, and this method lets you count the high-value items most
frequently.