Cycle Counting (INV104)

Process Group/Policy Details

• Subject: Inventory

• Process Group: Inventory

• Title of Policy: Cycle Count

• Effective Date: 07/01/2014

• Approved/Revision Date: 07/01/2014

• Approved by: State Controller

Process Group Description

• The process group Cycle Count, includes all related tables necessary for the inventory counts and related adjustments in each warehouse operated by the State of Colorado.

Definition CYCLE COUNT: 

• Physically counting & documenting each stock item in a warehouse, then reconciling the differences between what CORE calculates the quantity level and the quantity actually counted. 

Rationale or background to policy: 

• A policy is required to standardize how inventories are reconciled, when inventory items are frozen or unfrozen, and when inventory cycle counts occur. 

Policy Statement:

INV.PO.03 Cycle Count 

• Departments that operate warehouses shall conduct inventory cycle counts at least once per fiscal year. Each department shall have discretion to conduct more frequent counts and to determine timing of when the counts will be processed. Departments shall “freeze” warehouses to process cycle counts against without items being entered or removed from the warehouse. The cycle count allows stock items to be counted so that discrepancies between the recorded and actual on hand quantities can be accounted for. 

• Departments may also freeze an individual item without conducting a count for the entire warehouse. Once a department freezes an individual item, the department will be able to count that item and identify discrepancies between the recorded and actual on hand quantities. The department shall have discretion when to initiate an individual item freeze. 

• When discrepancies are discovered in either the cycle count or on an individual commodity, Departments shall conduct an Inventory Reconciliation process. This process will create the documents to make the necessary adjustments. The Inventory Reconciliation document shall be approved by the Warehouse Manager Role in an individual department. 

Procedure(s):

INV.PO.03.PR.01 Inventory Reconciliation 

• Once a physical count has been completed and discrepancies have been identified, the reconciliation must take place. The following steps will occur: 

  • Navigate to the INVF table. 

  • Click the Search hyperlink for the warehouse. 

  • Once the user is in the warehouse, enter the actual quantity on the INVF table. 

  • ***Save 

INV.PO.03.PR.02 Freeze & unfreeze single items in Inventory 

• At the department level, warehouses may decide to reconcile inventory counts on a given commodity more frequently. In this case, warehouses have the ability to count and adjust a particular commodity or group of stock items. 

INV.PO.03.PR.03 Cycle Count 

• At least once per fiscal year, each warehouse in the CORE system, will complete a cycle count on a predetermined schedule set by the respective department. Cycle count is defined as the act of physically counting each unit in the warehouse, and then reconciling those counts against the counts represented in the CORE Advantage system. The following steps will be completed: 

  • Batch Manager Job: 

    • Navigate to the secondary navigation panel, and 

    • enter the page code BATRUN. 

    • Click on the Job Manager link. A new sub-window will populate 

  • Inventory Freeze Batch Job: 

    • Open the Financial drop down menu, Inventory drop down menu, Batch Jobs drop down menu, and 

    • finally click on the Inventory Freeze Batch Job. 

  • Job Summary for Inventory: 

    • Click Schedule New Job hyperlink: 

    • Job Name, 

    • App Server, 

    • Scheduled Date/Time 

    • ***Save 

  • Setup Parameters Hyperlink 

    • Adjustment Code, 

    • From Warehouse Code, 

    • To Warehouse Code 

    • ***Save 

  • Click the View Pending Jobs hyperlink 

  • INVF Table: 

    • Navigate to it using Jump To 

    • Search a commodity in the Warehouse that was just frozen by checking the “Frozen for Accounting” check box and verifying it is grayed out with a check box.