What is stock verification in relation to spare parts management and their function, objectives and procedures?
Stock verification refers to the process of physically checking the quantities of different items of material available in stock in a store or warehouse and tallying these physically available quantities with the quantities shown in stores stock records.
Stock verification is done not only for spare parts, but for all types of matrial that may be stocked.
Depending on timing of physical check of the quantity in stock, different types of stock verification can be designed. The most common types of stock verification systems are described below.
Periodic stock verification : In this systems the verification is done at fixed periodical intervals. For example many companies do their stock verification just before the year end so that the annual accounts of the company will reflect the correct stocks. Ther is a variation of periodic stock verification in which all items in the stock is divided in 12 groups, and a specific month is fixed for stock verification of the items in the group. Thus every item in store gets verified once a year, ut in different month. This system allows the workload of stock verification to be devided evenly throughout the year. In this system , insteadin of monthwise grouping, some other perion such as week or quarter may also be used.
Perpetual stock Verification: In this system the stock of every item is verified every time there is an issue or receipt transaction for the item. This means a much stricter control over physical stock. But this also involves more work. In one variation of this system the stocks are verified only before new receipt in stocks. This reduces the frequency of verification. The workload of verification is further reduced because quantities in stock are likely to be lowest just before replenishment.