Sequential inventory in PROLAG®World draws from the fact that 5 percent of the warehouse inventory generally represents 70 to 80 percent of the total value of goods in the warehouse. We recommend that you continue to do a full inventory count of very valuable articles or luxury articles.For all other items, inventory sampling is used based on a random sample of articles in the warehouse. These samples are determined and evaluated in PROLAG®World in individual, independent runs using the mathematical sequential method. If too many inaccuracies occur after a defined number of stocktaking passes,all articles in the warehouse must be counted.
Procedures for simplifying stocktaking such as sequential stocktaking are pursuant to the requirements of German commercial law (HGB, paragraph 241) if the following conditions apply:
- The procedure complies with accepted accouting principles.
- The inventory of assets may be determined according to type, quantity and value or by using recognised mathematical and statistical of random sampling.
- The significance of the this type of inventory count must be equivalent to the significance of a physical inventory count. The significance of sequential stocktaking must therefore correspond to that of conventional stocktaking procedures.
All three conditions are met by the digital documentation in the PROLAG®World history and by using a recognised, mathematical sequential procedure in PROLAG®World’s sequential stocktaking. The result is a simplified and efficient stocktaking process which is recognised by auditors as proof of correct inventory management in your warehouse.
Real-life example:
A sequential test is created for articles in the warehouse with a value of 1 (one) to 10,000 euros. The value range defines the size of the sample, since all articles within the range (and currently in stock) are included in test. The sequential test comprises several runs or passes. The results of each pass trigger a specific response: In the first pass, 24 different items are selected at random and counted. Since everything is counted correctly, the stock levels are assumed to be correct.If too many errors had occurred during the count, PROLAG®World would have initiated a new stocktaking run using a larger sample quantity.
