ESSAY: Cycle Counts

All warehouses are obligated to undertake some form of stock count. It depends on the law of the country and accounting requirements as to how frequent and comprehensive the count is. We have seen over recent years a move towards cycle counting or perpetual inventory counts as a replacement for an all-encompassing annual count of stock in the warehouse. In 250-300 words describe cycle counts What are some of the benefits of cycle counts?

ANSWER

Logistics

            By capturing, monitoring, and evaluating results frequently, a company can boost the accuracy of its logistics and inventory quantities and report on finances more accurately. When it is conducted routinely, and in a systematic manner, cycle counting generates reliable numbers and can get rid of the burden of full physical counts (Kull et al., 2013). Cycle counts are inventory auditing procedures that fall under inventory management; in a specific location, small subset inventories are counted on a specific time or day.

Errors found during the counting are expected to adjust in line with the inventory accounting records (Kang & Gershwin, 2005). Additionally, cycle counts are based on different criteria, and the organization determines acceptable management practices for their inventory based on their specific situation as part of their stock control policy.            Cycle counts have benefits. For instance, cycle counts minimize process disruptions since the count focuses on a selected range of stocks, thus it can be conducted with the normal operations of the company. Cycle counts also facilitate faster corrective actions. According to Wilson (1995), because of the counting frequency of…