First compare the same item, unit, location and cut-off time. Then trace receipts, dispatches, transfers and returns. A difference needs investigation; it does not prove theft, loss or an incorrect physical count.
Your software shows 100 pieces. The godown team finds 92. Where did eight go?
First compare the same item, unit, location and cut-off time. Then trace receipts, dispatches, transfers and returns. A difference needs investigation; it does not prove theft, loss or an incorrect physical count.
Make the comparison fair
Agree a count time and record the stock report's time. Pause movements during counting where practical. Otherwise, record each movement so you can reconcile both sides to one cut-off.
- Exact item: Check size, colour, batch and alternative item codes.
- Same unit: Convert cartons or packs using the checked pack size.
- Same location: Separate your godown, another branch and goods in transit.
- Same ownership: Identify supplier-owned or customer-owned goods separately.
- Same status: Distinguish usable, damaged, reserved and inspection-held stock.
A physical count includes reserved pieces still on the shelf. An “available stock” report may exclude them. Those two totals answer different questions.
Microsoft's inventory-counting documentation separates counting from inventory adjustment. Follow your system's controls; do not post a balancing entry before checking the cause.
Trace the eight-piece difference
The following quantities are fictional. Assume one owned item, one godown and one cut-off.
| Check | Pieces | Meaning |
|---|---|---|
| Recorded stock at the cut-off | 100 | Starting report |
| Verified dispatch omitted from that report | −5 | Goods left before the count |
| Corrected expected physical stock | 95 | 100 − 5 |
| Physical count, checked again | 92 | Count evidence |
| Difference still unexplained | 3 | 95 − 92 |
Five pieces have a documented explanation. Three still need investigation.
Do not post an eight-piece loss and then enter the five-piece dispatch. That would reduce the records twice for those five pieces.
Give accounts the missing dispatch reference and count evidence. After an authorised correction, rerun the comparison. Preserve the earlier result so the change remains explainable.
Check the usual hiding places
| Possible cause | Evidence to inspect | Wrong shortcut |
|---|---|---|
| Missing or late receipt | Receipt reference and arrival time | Assume the invoice proves arrival |
| Unrecorded dispatch | Pick, dispatch and carrier records | Treat every difference as loss |
| Transfer between locations | Linked outgoing and incoming movements | Count transit at both locations |
| Return awaiting inspection | Return receipt and condition record | Treat every return as saleable |
| Pack-size mismatch | Item unit and actual pack contents | Assume every carton holds the same quantity |
| Duplicate entry | Original reference and correction history | Add another entry to hide the duplicate |
Inspect another location before deciding that stock has disappeared. Also check the item next to it: a wrong-code receipt can create one shortage and one surplus.
Do not mix quantity and value differences
A report value can change because of its costing method even when quantities match. Resolve the quantity question first. Ask accounts to review valuation differences separately.
Likewise, damage changes condition. If damaged goods remain on the premises, record their location and status. Do not silently remove their physical quantity because they cannot be sold.
Keep an exception sheet until each cause closes
| Field | Example |
|---|---|
| Item, unit and location | SHIRT-M-BLUE / pieces / Godown A |
| Count and report cut-off | Same agreed date and time |
| First difference | Eight pieces |
| Explained movement | Five-piece dispatch; reference attached |
| Open difference | Three pieces; cause not established |
| Owner and next step | Store lead checks returns and adjacent item codes |
| Approval and recheck | Record who approved any correction and its result |
Use the partial-dispatch guide when order status obscures physical movement. Use the Empire report-total guide when two reports use different scopes.
Ask about a stock question
Tell us which records disagree. Share the software name and question, not private stock files. Empire is our current connector. Ask whether those records and that question are supported. Dhandha GPT does not physically count or adjust stock through this guide.
Questions you might ask
Should I adjust software stock to match the count?
Investigate and verify the count first. Correct a supported cause through your approval process. Keep unexplained differences visible until someone resolves them.
Does negative stock prove goods are missing?
No. Missing receipts, entry timing or incorrect units can cause it. Check the movements and physical position.
What if goods move while we count?
Record their times and references. Bring the report and count to the same cut-off before calculating a difference.