Stock does not match
The godown has one balance and Tally has another. Use a controlled count to find where the difference started, before adjusting numbers to make them agree.
What it looks like
- Tally shows 75 pieces, but the storekeeper counts 61 on the shelf.
- A worker returns unused parts. They go straight into a bin without an entry.
- Two names are used for the same item in the stores register.
- Material sent to a job worker still appears in the main godown balance.
- Accounts changes a stock figure at month-end, but the same mismatch returns.
Why it happens
Receipts and issues are posted late. Physical movement happens during a shift. The stock voucher is entered only when someone has time.
Items lack one code and unit. 'Plate 5 mm', 'MS plate' and a supplier's name can refer to the same item. Kilograms and pieces are mixed without conversion rules.
Returns and scrap have no place in the system. Unused material and offcuts are kept, moved or sold without a proper entry.
Stock locations are not tracked. The ledger includes material on the shop floor, in quality hold, in transit or at a job worker. A shelf count sees only one location.
Counts are corrected without finding the cause. A balancing voucher hides the point where the record failed.
The missed cause is often timing. A physical count at 10 am cannot be compared fairly with a book balance posted at 6 pm.
What to check first
- Choose five high-use items. Count them at a fixed time. Print or note the Tally stock summary for that same cut-off. Stop physical movements briefly, or record each movement during counting.
- Check the last ten vouchers for one mismatched item. Compare goods received notes, issue slips, customer returns and adjustments with actual movements. Mark missing references.
- Check other locations and units. Read job work challans, quality-hold notes and the item master. Make sure the count and the book use the same unit and location.
Do not change balances during this check. Write the difference and its likely source first.
How to fix it
- Create a discrepancy list. Record item code, location, book quantity, counted quantity, difference, value and person checking it.
- Investigate the largest operational differences. Start with items needed for this week's production or items with high value. Check vouchers and movements around the last accurate count.
- Give every movement a reference. Material received, issued, returned, scrapped or moved to another location should have a dated slip or entry.
- Standardise item names and units. Agree one item code, unit and storage location. Maintain a clear rule for any conversion between pieces, weight and length.
- Approve stock adjustments separately. The stores team can propose a correction. A designated person should check the evidence and approve it before accounts posts a voucher.
- Count a few items each week. Rotate categories. Do not wait for an annual physical stock take to learn that records are weak.
Use this count record:
| Item | Location | Book qty | Counted qty | Difference | Possible cause | Approved by |
|---|---|---|---|---|---|---|
| Bearing B17, example | Rack C2 | 75 | 61 | -14 | Issues not posted | Pending |
The possible cause is a hypothesis until the slips and entries confirm it.
A worked example
For example, a trading godown counts 61 bearings against 75 shown in the book. Each bearing cost ₹620. The 14-piece difference has a book value of ₹8,680.
The team finds an issue slip for ten pieces that accounts never entered. Four pieces remain unexplained. The justified entry for ten and the unresolved four must be handled separately. Do not call all 14 pieces theft or write them off immediately.
How you know it is fixed
- Over four weekly counts, compare the percentage and rupee value of differences by item group.
- Measure the number of receipts or issues waiting to be entered after shift-end.
- Check how many discrepancies have a documented cause and approved correction.
When it is more serious
Repeated unexplained high-value shortages require a controlled investigation. Restrict stock adjustments and preserve records. If losses could involve fraud, insurance or tax, bring in management and the relevant professional. If mismatches mostly come from job work or returns, repair those movements before attempting a full system migration. A new system will still inherit poor source records.
This works if someone does it every day. In most businesses, that someone is you.
Questions people ask
Should we change Tally stock to the physical count immediately?
Not before checking pending entries, locations, units and returns. Record a reason and approval for any correction.
What is cycle counting?
It means counting a small set of items regularly. It can reveal record problems earlier than an annual count.
How do we check material at a job worker?
Compare challans sent, receipts returned, process scrap and the job worker's confirmation. Keep it separate from godown stock.
What if stock is correct by value but wrong by quantity?
Review item codes, units and conversions. A total valuation can hide a serious item-level error.