6 advantages of continuous stock-taking in cost accounting


Advantages – The advantages of continuous stock-taking are :

1. Closure of normal functioning is not necessary.

2. Whole time specialized staff can be engaged for the purpose since the work is spread throughout the year. In smaller concerns, duties may be assigned to various officers of middle rank by rotation to the checking, say, of 20 items. This would be easy because the store ledger card and the bin card will bear the bin number. The officers concerned need only walk up to the particular bin number, count, weigh or measure the article lying there and enter the quantity on the form provided for the purpose. The rest of the work (comparison with book figures) can be done by the stores ledger clerk.


3. Stock discrepancies are likely to be brought to the notice and corrected much earlier than under the annual stock-taking system.

4. The system generally has a sobering influence on the stores staff because of the element of surprise present therein.

5. The movement of stores items can be watched more closely by the stores auditor so that chances of obsolescence buying are reduced.

6. Final Accounts can be ready quickly. Interim accounts are possible quite conveniently.


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