Inventory Control, Reconciliation, and Shortage Reporting
What this domain tests
Inventory Control, Reconciliation, and Shortage Reporting tests how bonded stock is counted, compared with records, and reported when it does not match. The focus is on timely, evidence-based adjustment rather than informal write-offs.
Core rules
- Maintain a perpetual inventory by SKU, lot, quantity, location, and status (bonded, non-bonded, damaged, held).
- Conduct physical counts on a planned cycle and at customs request. Use controlled count sheets, two-person verification where practical, and cutoff controls.
- Reconcile book quantity to physical quantity. Investigate differences before adjusting.
- Report shortages, overages, damage, and destruction to customs within the required time and with supporting evidence.
- Duty liability may attach to unexplained shortages. Supervised destruction, export, or an accepted explanation may remove or reduce that liability.
Worked example
The book shows 10,000 units; the count shows 9,850. The keeper checks receipts, withdrawals, and transfers and finds no unposted movement. The 150-unit difference is a shortage. The keeper reports it, attaches count sheets and system records, and customs may assess duty on 150 units. If 50 units were damaged and destroyed under customs supervision, only the remaining 100 unexplained units would be treated as the shortage.
Traps
Writing off stock without reporting; counting only open areas and missing holds; using estimated counts; failing to freeze receipts during the count; and treating an overage as a free correction for a shortage in another lot.