Capability template for supply chain and inventory

Stock count reconciliation

After a physical count, the bookkeeper and the warehouse or store lead get every item counted beside the quantity and value in the books, each difference in units and money, what to check for it, and the items to recount. Nothing is adjusted until a person approves.

The outcome

The count and the books meet one item at a time rather than as a single total at the foot of a spreadsheet. Every stock item gets a line: what was on the shelf, what the books say, the difference in units, and its value at the books' own average cost. Short, over, agreed or needing a bookkeeping answer, each item is in exactly one place.

Each difference comes with a short list of what to look at, in the order a good bookkeeper would look. A delivery on the shelf that was never entered, a customer return back in stock, damaged goods pulled aside and never written off, a grey item counted as the blue one. Where the receiving, returns or damage notes already account for a difference, the reconciliation says so and shows which note. Unexplained loss is the last thing on the list, never the first, and no person is ever named.

Then it says what to count again before anyone touches the books, largest money first, and sets out each possible booking or adjustment with a blank approval line. The books change only when a person approves and enters it.

If the books keep no stock items at all, it says that plainly and stops. If the books' report will not open or stops part-way, it stops there too, rather than reporting that there is no stock.

Who starts the work, and when

The bookkeeper starts it after a physical count: at month end, quarter end or year end, after a spot count of a few shelves, or whenever the shelves and the books seem to disagree. The warehouse or store lead supplies the count sheet and the movement notes and does the recounts it lists. It runs again on the recounted figures before anything is approved.

The owner, or whoever signs off stock adjustments, reads the actions and approves or holds each one.

What they supply

  • The count sheet: each item counted, with its location, quantity and the unit it was counted in.
  • The book stock report for the count date, from the accounting or stock system: quantity and value for each item.
  • The stock item list: every item the books track as stock, inactive ones included, so an item a report quietly leaves out still gets compared.
  • The settings: when the count was made, whether it was a full count or a partial one, which locations were counted, unit conversions such as cartons to single units, the currency, who approves, and the business's recount levels.
  • Movement notes, if kept: receipts, customer returns, damage, transfers and samples around the count date, each marked as entered in the books or not.

Each file's column headers are checked before anything else. If one does not match, the work stops and asks which column is which.

What comes out

One reconciliation in a fixed order: a header that states the basis of the comparison, a summary with the net difference, any problems found in the files, every item line by line, what to check for each difference, bookkeeping queries, items counted but not in the books, items in the books but not counted, the recount list, the actions for the approver, and numbered questions for the bookkeeper. An empty section says "None."

Every figure can be traced to the count sheet, the book stock report or a movement note, and the bookkeeper can recheck any line with a calculator.

An invented example

Illustrative example with invented data. The business, the suppliers, the items, the quantities, the values and every date below are invented. The business is an invented online homewares shop with one warehouse, called the Store here, buying from suppliers named Supplier A and Supplier B. Its warehouse lead counted every stock item after closing on the last Saturday of October, and its bookkeeper exported the books' figures for the same date. People are referred to by role.

The inputs come first, in full, so the template can be run on them. The reconciliation follows.

The inputs

1. Settings (typed by the bookkeeper)

Business: the Store
Count date: Saturday 31 October 2026
When counted: after the warehouse closed; nothing moved after the count
Count basis: full count. Every stock item in the warehouse was looked for.
Locations counted: Warehouse
Book stock report covers: Warehouse (the only stock location)
Books' unit: each
Conversions: CND-02 counted in cartons; 1 carton = 12 each
Currency: US dollars
Bookkeeper: the bookkeeper
Warehouse or store lead: the warehouse lead
Approver: the owner
Today: Monday 2 November 2026

2. Count sheet

item_code,description,location,counted_qty,count_unit
MUG-01,Stoneware mug,Warehouse,118,each
MUG-02,Enamel mug,Warehouse,64,each
CND-01,Soy candle large,Warehouse,30,each
CND-02,Tealight box,Warehouse,9,carton
THR-01,Wool throw grey,Warehouse,14,each
THR-02,Wool throw blue,Warehouse,6,each
VAS-01,Glass vase,Warehouse,0,each
TRY-01,Oak serving tray,Warehouse,3,each
LMP-01,Table lamp,Warehouse,4,each

3. Book stock report as of 31 October 2026

item_code,description,book_qty,book_value
MUG-01,Stoneware mug,120,540.00
MUG-02,Enamel mug,64,352.00
CND-01,Soy candle large,42,378.00
CND-02,Tealight box,96,192.00
THR-01,Wool throw grey,10,320.00
THR-02,Wool throw blue,10,320.00
VAS-01,Glass vase,0,45.00
BSK-01,Seagrass basket,15,180.00

4. Stock item list

item_code,description,active
BSK-01,Seagrass basket,yes
CND-01,Soy candle large,yes
CND-02,Tealight box,yes
MUG-01,Stoneware mug,yes
MUG-02,Enamel mug,yes
THR-01,Wool throw grey,yes
THR-02,Wool throw blue,yes
TRY-01,Oak serving tray,yes
VAS-01,Glass vase,yes

5. Movement notes (typed by the warehouse lead)

Receiving log, 26 to 31 October:
- 28 Oct, Supplier A, MUG-01, 24 each. Entered in the books.
- 30 Oct, Supplier B, CND-02, 1 carton (12 each). Supplier B's
  bill has not arrived; not entered.
Returns log:
- 29 Oct, TRY-01, 3 each, customer returns, checked and back on the
  shelf. Refunds issued; the return to stock is not entered.
Damage log:
- 27 Oct, CND-01, 5 each, cracked jars, put in the disposal bin and not
  counted. Not written off.

The output

STOCK COUNT RECONCILIATION: the Store, counted Saturday 31 October 2026

  • For: the bookkeeper and the warehouse lead. Prepared Monday 2 November 2026 from: count sheet (9 rows, Warehouse), book stock report as of 31 October 2026 (8 items), stock item list (9 items), settings, movement notes.
  • Column check: all headers matched.
  • Basis: full count: an item not on the sheet counts as 0. Scope: Warehouse against books covering Warehouse. Timing: counted after the day's last movement. Units: converted: CND-02 carton = 12 each. Currency: US dollars.
  • Settings: recount at $100.00 or 10% of the book quantity; size check more than 10 times the book quantity and at least 50 units above it; approver the owner. Defaults used: recount value, recount share, size check.
  • Summary: 9 items compared. Agrees 1. Short 4, −$425.00. Over 3, +$152.00. Query 1. Counted, not in the books 1. In the books, not counted 0. Inactive at zero, left out 0. Net difference −$273.00, an estimate at average cost; left out of it: 1 Query, 1 other compared item with no cost basis. Recounts 5. Actions for the approver 4.

Count and book checks

  • TRY-01 Oak serving tray is on the stock item list but not in the book stock report. Read as 0 units and $0.00; see question 3.
  • LMP-01 Table lamp is on the count sheet but not on the stock item list. Listed under Counted, not in the books; see question 2.

Item by item

  • BSK-01 Seagrass basket. Counted 0 (not on the sheet); books 15, $180.00. Difference −15 × $12.00 = −$180.00. Short.
  • CND-01 Soy candle large. Counted 30; books 42, $378.00. Difference −12 × $9.00 = −$108.00. Short.
  • CND-02 Tealight box. Counted 108 (9 cartons × 12); books 96, $192.00. Difference +12 × $2.00 = +$24.00. Over.
  • MUG-01 Stoneware mug. Counted 118; books 120, $540.00. Difference −2 × $4.50 = −$9.00. Short.
  • MUG-02 Enamel mug. Counted 64; books 64, $352.00. Difference 0 × $5.50 = $0.00. Agrees.
  • THR-01 Wool throw grey. Counted 14; books 10, $320.00. Difference +4 × $32.00 = +$128.00. Over.
  • THR-02 Wool throw blue. Counted 6; books 10, $320.00. Difference −4 × $32.00 = −$128.00. Short.
  • TRY-01 Oak serving tray. Counted 3; books 0, $0.00. Difference +3; value: no cost basis. Over.
  • VAS-01 Glass vase. Counted 0; books 0, $45.00. Difference 0; value: no cost basis. Query: $45.00 in the books with no units behind it.

What to check

  • BSK-01, Short 15, −$180.00. Not on the sheet: check the shelf was looked at before reading this as a loss. Check: a sale shipped but not entered by 31 October; stock damaged, used or given away and not written off; a delivery entered in full that arrived short; counted under another code or in another unit; and only then unexplained loss.
  • CND-01, Short 12, −$108.00. Seen in the notes: damage log, 27 October, cracked jars in the disposal bin, not written off, 5 units; unexplained −7, −$63.00. Check: a sale shipped but not entered by 31 October; stock damaged, used or given away and not written off; a delivery entered in full that arrived short; counted under another code or in another unit; and only then unexplained loss.
  • CND-02, Over 12, +$24.00. Seen in the notes: receiving log, 30 October, Supplier B, 1 carton of 12 not entered, 12 units; unexplained 0, $0.00.
  • MUG-01, Short 2, −$9.00. Check: a sale shipped but not entered by 31 October; stock damaged, used or given away and not written off; a delivery entered in full that arrived short; counted under another code or in another unit; and only then unexplained loss.
  • THR-01, Over 4, +$128.00. Possible mix-up with THR-02: equal and opposite. Check: a delivery received but not entered; a customer return back on the shelf but not entered; a sale entered but still on the shelf; counted under another code or in another unit.
  • THR-02, Short 4, −$128.00. Possible mix-up with THR-01: equal and opposite. Check: a sale shipped but not entered by 31 October; stock damaged, used or given away and not written off; a delivery entered in full that arrived short; counted under another code or in another unit; and only then unexplained loss.
  • TRY-01, Over 3, no cost basis. Seen in the notes: returns log, 29 October, customer returns back on the shelf, return to stock not entered, 3 units; unexplained 0, no value.

Query

  • VAS-01: the books show $45.00 for 0 units, and none were counted. See question 1.

Counted, not in the books

  • LMP-01 Table lamp, Warehouse: 4 counted. See question 2.

In the books, not counted

None.

Recount before anything is adjusted

  1. BSK-01 Seagrass basket, Warehouse: counted 0, books 15, unexplained −15, −$180.00. Why: not on the sheet of a full count, and above the recount levels. How: a different counter; count in each.
  2. THR-01 Wool throw grey, Warehouse: counted 14, books 10, unexplained +4, +$128.00. Why: possible mix-up with THR-02, and above the recount levels. How: a different counter; count in each; count both at the same time.
  3. THR-02 Wool throw blue, Warehouse: counted 6, books 10, unexplained −4, −$128.00. Why: possible mix-up with THR-01, and above the recount levels. How: a different counter; count in each; count both at the same time.
  4. CND-01 Soy candle large, Warehouse: counted 30, books 42, unexplained −7, −$63.00. Why: 7 of 42 is 16.7% of the book quantity, above 10%. How: a different counter; count in each; leave out the 5 set aside.
  5. LMP-01 Table lamp, Warehouse: counted 4, not in the books, unexplained +4, no value. Why: counted but not in the books. How: a different counter; count in each; check the code on the label against the item list.

Actions for the approver

  • CND-01: write off −5 units, −$45.00. Cause: damage log, 27 October, cracked jars. Approved: ______________ Date: ________
  • CND-02: enter the receipt +12 units, +$24.00. Cause: receiving log, 30 October, Supplier B, not entered. Bill not yet received; its value may differ. Approved: ______________ Date: ________
  • MUG-01: adjust −2 units, −$9.00. Cause: not found. Approved: ______________ Date: ________
  • TRY-01: enter the return +3 units, value set by the books when entered. Cause: returns log, 29 October. Approved: ______________ Date: ________

Questions for the bookkeeper

  1. VAS-01 Glass vase: the books show $45.00 against 0 units, and none were counted. What does the $45.00 represent?
  2. LMP-01 Table lamp: 4 were counted in the Warehouse, and no stock item has this code. Is it a new item still to be set up in the books, or stock counted under the wrong code?
  3. TRY-01 Oak serving tray: it is on the stock item list but not in the book stock report, so it was read as 0 units and $0.00. Was the report exported in full?

Draft for the owner's decision. Nothing has been adjusted, posted or changed in the books or the stock system. Values are estimates at the books' average cost as of 31 October 2026; the books' own cost method may differ.

Where it fits

  • Supply chain and inventory: the count is where the warehouse finds out whether its records hold up.
  • Finance and accounting: for a business that holds stock, it is often one of the largest figures on the balance sheet, and the books are only as good as the last count behind them.
  • E-commerce and retail: online and physical stores where returns, damaged parcels and deliveries booked late pull the books away from the shelves.
  • Consumer brands: brands holding their own finished goods, often across a warehouse and a fulfilment partner.
  • Manufacturing: raw materials and finished goods counted against the books before the period closes.
  • Logistics and trade: distributors and wholesalers whose margin depends on stock they can find.
  • Established businesses: when the year-end count has always meant a long weekend with a spreadsheet.
  • Growth and scaling: when more items, more locations and more people handling stock make the gaps harder to spot by eye.

It sits naturally beside the month-end close checklist, for a business that makes the stock count one of its close tasks, and the inventory reorder plan, which works best on stock figures that have just been reconciled. Bank reconciliation preparation does the same careful matching for the bank account.

What has to change for your company

  • Your export headers, set once so the column check passes without a question.
  • Your recount levels: the money value and the share of the book quantity that send an item back to be counted again.
  • Who approves adjustments, and whether large ones need a second person.
  • Your count units and conversions, for anything counted in cases, cartons or packs.
  • Your movement logs: which you keep, and how each marks whether it has been entered in the books.
  • Your AI product. It runs in ChatGPT, Claude, Copilot or Gemini from the files and notes you supply, with any accounting or stock system that can export them. It needs no connection to your books, changes nothing in them and never asks for a password.

What has been checked

Fully Powered AI wrote this capability template in its own words, drawing on one published stock reconciliation method that is credited with this entry. It was editorially reviewed on 10 November 2026. It was tried once on its invented example in Claude on 10 November 2026, and the record of that run is published with the template. Earlier runs that day and an independent review found a few unclear points; the template and the example were corrected for them before the run recorded there, which is the run on the corrected version and was made by the assistant that applied the corrections. It has not yet been tested in a client environment. It has not yet been tested as a packaged version in ChatGPT, Claude, Copilot or Gemini.

Testing in your environment means running it on one or two past counts your bookkeeper remembers well, with hard cases written in advance: a renamed column, an item missing from the count sheet, a delivery on the shelf that was never entered, two similar items counted under each other's codes, a value in the books with no units behind it, and an empty item list. The bookkeeper checks every line against the exports before anyone approves an adjustment. Pilot acceptance-test preparation sets those cases up, and what we test before we call an AI workflow ready describes the record we keep.

The full capability template

Everything above is the outline. The complete capability template is the working version: the roles, the inputs, the procedure, the exceptions and stop conditions, the output format, the reviewer checklist, the acceptance tests, the instructions for an AI assistant and what to customize for your company. It comes with a download and the link to its folder in Fully Powered’s public repository.

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Talk with us Discuss adapting this

  • Inventory reorder plan

    The store owner or buyer gets one plan from the latest sales and stock exports: each item's sales rate, the day it could run out, its reorder point and safety stock, what to order, what is not moving, and a draft purchase order per supplier. Nothing is ordered until a person approves.

  • Month-end close checklist

    Before the month ends, your controller holds the whole close on one page: every task with its owner, its date and what it waits on, the chain that sets the close date, and each gap already written as a question. Entries are prepared for approval, never posted.

  • Bank reconciliation preparation

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