How to Audit Inventory Like a Pro? Key Risks & Test Steps Explained

Inventory management is a core operational process handled by the Stores or Warehouse department — but when it comes to auditing, it's often misunderstood.
Many assume inventory audit is just about counting stock at year-end. This video is here to change this perception & to help you perform inventory audits like a pro!

This video is your complete guide to auditing inventory management – covering the full process, key risks, suggested controls, and test procedures.

If you’re a CA, CIA, or internal auditor, or in CA Articleship, this is your one-stop guide to understanding how inventory management works — and how to audit it effectively.

Topics Covered:

00:00 – What is inventory, Inventory vs Fixed Assets
01:09 – Sub Processes + What to check in SOP
02:23 – Material Master Management
05:34 – Material Requisition
07:41 – Receipt of Inventory
10:17 – Material Movement (Issues/Repairs/Returns, including NRGP, RGP)
13:54 – Storage Controls & Physical Verification
15:56 – Inventory Reconciliation
18:15 – Inventory Levels
19:29 – Inventory Classification – Slow/Non Moving/Obsolete
22:14 – Valuation & Data Analytics

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Link for notes on Inventory Audit- https://docs.google.com/spreadsheets/...

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