Inventory Control Services
Inventory Control Services in the UAE
For trading, distribution, retail and manufacturing businesses, inventory is where profit is made or quietly lost. Stock that is miscounted, mis-valued or unrecorded distorts gross margin, understates or overstates taxable income, and leaves the business exposed in a VAT audit when the movement of goods cannot be reconciled to the invoices.
Reflechir’s inventory control service puts the counts, valuation and controls in place so the stock figure in the accounts is one you can defend to your auditor, the FTA and your own management.
Where inventory goes wrong
- Book stock does not match physical stock: goods received without a purchase entry, sales despatched without an invoice, samples, returns and damaged items never recorded. The difference lands in cost of sales at year end as an unexplained adjustment.
- Valuation is inconsistent: landed cost, freight, customs duty and excise are sometimes included in cost and sometimes not, so margins move for reasons unrelated to trading.
- Slow-moving and obsolete stock is carried at full cost: IAS 2 requires inventory at the lower of cost and net realisable value; carrying dead stock at cost overstates profit and corporate tax.
- VAT and customs exposure: the FTA reconciles declared sales to stock movements and import records. Designated zone transfers, consignment stock and free samples each have specific VAT treatment that a weak system cannot evidence.
- No reliable data for decisions: reorder points, dead-stock write-offs and pricing all depend on numbers nobody trusts.
What the service covers
- Physical stock counts: planned full counts and cycle counts, with count sheets, cut-off procedures and independent recount of variances, either run by Reflechir or supervised for your team.
- Valuation under IAS 2: a consistent costing method (FIFO or weighted average), landed-cost rules covering freight, duty and excise, and a documented net realisable value review for slow-moving and obsolete lines.
- Reconciliation of book to physical: variances investigated to their cause and posted with proper approval, so stock adjustments are explained rather than absorbed.
- Inventory controls and procedures: goods-in, despatch, returns, transfers between locations and write-off authorisations designed for your operation and documented as SOPs.
- System set-up: inventory modules in Zoho Books, Zoho Inventory or your ERP configured with item masters, units, locations and costing so stock movements post to the ledger automatically.
- Audit and tax reporting: stock movement schedules, valuation workings and the inventory note prepared for the auditor and the corporate tax computation, with VAT treatment of stock movements documented.
How the engagement works
Reflechir begins with a review of how stock currently flows through the business and the accounting system, followed by a first full count to establish a reliable opening position. Controls, costing rules and the NRV review are then agreed with management and built into the system. Ongoing support runs as monthly reconciliation and periodic cycle counts, with a year-end count observed and reconciled ahead of the audit.
Fees are fixed for the initial count and set-up, and agreed monthly or quarterly for ongoing control depending on the number of locations and stock lines.
Why Reflechir
- Margin and tax in one view: inventory accounting is done by the team that files the VAT and corporate tax returns, so stock adjustments are treated correctly on both.
- Practical controls, not paperwork: procedures are designed around how your warehouse or shop actually works, with staff trained to run them.
- Sector experience: trading, e-commerce, F&B and light manufacturing businesses across the UAE mainland and free zones.
If your year-end stock adjustment is a number nobody can explain, contact Reflechir Consultancy to put proper inventory control in place.