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Assignment 1 Logistics Management 2.2 2021

The inventory records at a warehouse facility are not reconciling with the physical stock. The selection accuracy is declining and cycle count staff are having to perform more corrections. This is causing major problems. Joseph, the inventory foreman, has been tasked with finding the cause. To help contain the problem until the root cause can be identified, the assistant recommends: 1) Tracking all stock receipts and issues since the last reconciliation to identify any omissions, duplications, or other errors. 2) Maintaining separate records for new inventory movements using the last physical count as the opening balance. 3) Recording any differences in a stock suspense account until the discrepancy can be resolved.

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Mahlatsi Mashilo
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66 views

Assignment 1 Logistics Management 2.2 2021

The inventory records at a warehouse facility are not reconciling with the physical stock. The selection accuracy is declining and cycle count staff are having to perform more corrections. This is causing major problems. Joseph, the inventory foreman, has been tasked with finding the cause. To help contain the problem until the root cause can be identified, the assistant recommends: 1) Tracking all stock receipts and issues since the last reconciliation to identify any omissions, duplications, or other errors. 2) Maintaining separate records for new inventory movements using the last physical count as the opening balance. 3) Recording any differences in a stock suspense account until the discrepancy can be resolved.

Uploaded by

Mahlatsi Mashilo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Logistics Management 2 Module 2: Assignment 1

Submission date: 24 September 2021

TOPIC: THE OPERATION OF A WAREHOUSE

CASE STUDY
The stock in a certain facility have been giving problems. The stock as physical items and the
computer-based WMS are not reconciled. The selection precision is suffering and the
percentage of problem is continuously rising. These issues are also showing up in the amount
of work the cycle-count staff have to perform and correct. This is now causing major
problems. The task of finding the cause has been left to Joseph, the inventory foreman. He is
trying to figure out the cause and is starting to wonder just where to start. As a logistics
expert, you are asked to help Joseph.

QUESTIONS

1. Advise Joseph of the processes that can cause the problems. (10)
2. How would you contain the problem until you have found the cause? (10)
3. If you knew that the staff had not altered, how would you isolate the cause of the problem?
(15)
4. The financial staff are claiming that the only way to fix the problem is to count the stock in
the entire warehouse. What is your advice? Justify your advice. (15)
TOTAL: 50
*NB: This is a group assignment with minimum of 5 and maximum of 7 members in a
group.

INSTRUCTIONS: You should use between 5-10 sources and the detailed content of the
assignment should be approximately 8 pages.
Font: Arial or Times New Roman
Font size: 12
Line spacing: 1,5
Alignment: Justified

NB: INCLUDE
1. Cover page

1
2. Table of content

3. I will offer a range of advice to research the shortage of stock records in a


particular facility and solve them:
4.
5. Recount the inventory concerned.
6. If numbers don't suit, this will be your first move. During the initial counting
method, it can be so simple as an error
7.
8. Check if there is a stock elsewhere.
9. If there seem to be a significant number of things missing, double inspect they 're
out in another section of your storeroom or even an entirely different storeroom.
You also have a chance to buy the stock, but your supplier hasn't yet come.
10.
11. Ensure that the right measurement unit has been used.
12. Ideally, anyone involved in the count would be educated in the process.
Nevertheless, one might still measure in liters or pounds rather than boxes or
individual units.
13.
14. Test if the identity number of the SKU or product is right.
15. Although uncommon, it is not rare for items with the wrong SKU to be labeled,
which upsets your inventory records. Check that the inventory management
system concept correlates with your product. You have found the question if it
doesn't.
16.
17. Ensure that a related product is not misunderstood.
18. It is a common mistake in stocks where workers count may not know that a
change in size or color is a different product with a distinct identity.
19.
20. Check for errors in your inventory records.
21.
22. Confirm that no documentation is lacking.
23. Uncounted sales can also throw away your count. Sales Check for missing
documents that may not yet be inserted into the system
24. Investigate that workers or customers stole stock. This is one of the best
measures to take, however, if no other rational explanation can be found for stock
loss.
25.
26. Consider the use of more robust safety measures such as CCTV cameras
or product safety tags in the shop.
27.
28. Speak to the managers of your warehouse/storeroom.
29. ●    There might have been a slip up in the standard processing of stock. Speak
to the bosses to see if the chain is kinked. When that is the case, individual staff
may need to retrain, or you may need to revisit the whole process.
30. Introduction and conclusion

2
1.2

1.1 whenever there is a difference between physical stock and computerized record we
need to track all receipts and dispatch of stock quantity ledgers, from the last period
when physical quantity and computerized records reconciled.
So we need to start from that perticular day, when last physical stock verification report
is found correct and reconciled with computerized record. There after we need to track
each issue and recipient transaction in stock ledger. There could be omission,
duplication, pilferage or embezzlement as well. It will be better if we can confirm the
balances from suppliers and customers or departments to whom quantities are issued,
so any omission or duplication of any entry in computerised record or stock ledger could
be traced.

2. Until the reason for difference in stock is traced, we can maintain separate records for
new receipts and dispatches by taking opening balance as per physical stock
verification. If there is Requirement of preparation of financial accounts. The difference in
stock could be recorded in books of accounts by debiting or crediting the stock suspense
account, with stock account. And when such difference is located the suspense account
Could be written off.

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