Number IPP 209

Dated: 07/19/11
Replaces: 03/27/03

Internal Policy and Procedures

MDS INVENTORY ADJUSTMENTS

POLICY:

Inventory may be adjusted in Great Plains under the following circumstances:

  • Annual Physical Inventory Count
  • Cycle Counts or Periodical Physical counts of specific products
  • Product lost during delivery
  • Damaged or Broken Product
  • Obsolete Product
  • Adjustments for miss-filled orders or other unusual gains or losses

A warehouse supervisor, financial manager or senior accountant may authorize inventory adjustments. The MDS/SWAP general manager must give final approval before any items are written off.

Inventory adjustments will be documented and reviewed periodically.

PROCEDURE:

1. MDS/SWAP Manager

  • Approve write-offs, additions and any adjustments to inventory.

2. Warehouse Supervisor, Financial Manager or Senior Accountant

  • Research the problem.
  • Take a physical count of the product in question.
  • Verify that the product should be adjusted.
  • Document of why the inventory item should be adjusted.
  • Forward the adjustment to MDS accounting staff.

3. Accounting staff

  • Review information on the form including Great Plains book inventory.
  • Assure that all documentation is included.
  • Verify the quantity to be adjusted.
  • Determine the proper general ledger account to be adjusted.
  • Forward the form and documentation to the MDS General Manager for approval.
  • Adjust inventory in Great Plains.
  • Attach a note to the Great Plains transaction explaining the adjustment
  • Maintain a file to document inventory adjustments.