A contractor's count report: what the owner and accountant get

The count is over and the contractor's team has gone. What is left on your desk? In many companies it is "a long Excel table and a certificate". Yet two different people read the report, and they need different things. The chief accountant must see every line, while the owner needs two or three pages that answer the questions: how big are the differences, where are they, and what should be done. A good report serves both.

Who reads the report

The chief accountant compares book balances with the actual ones, sees the differences in so'm and completes the paperwork. They need precision: code, name, unit of measure, storage location. The owner or director does not go into detail but makes the decisions: whether anyone is held to account, whether a process changes, whether a deeper audit is needed. So the report has two layers: a short summary on the first page, then the full appendices.

Page one: the summary

The owner reads this page, and even if nothing else is opened, the situation must be clear. It contains:

• the count date, the cut-off time and the sites covered;
• total items, matches, shortages and surpluses, in units and in so'm;
• the 3–5 groups or zones with the biggest differences;
• the main conclusion: are the differences random or do they repeat in one place.

Scope and method: what was counted and what was not

This section is often skipped, yet trust starts here. Places the team did not reach should be listed separately: locked rooms, goods in a third party's warehouse, cargo in transit. Otherwise you may assume they were counted. The method is described too: whether there was a two-stage check, which zones were recounted, who was on the team and what the cut-off time was. Anything that changed during the count is noted too, such as how a lorry arriving overnight or an order shipped mid-count was treated.

Analysis of differences

Analysis matters more than the table. A good report shows differences in three cuts: by product group, by location and by the person responsible for the goods. Shortages and surpluses are not netted into one figure but shown separately.

A hypothetical example: 4,800 items were counted and 4,590 matched. 130 items show a shortage (14.2 million so'm in total) and 80 show a surplus (4.6 million so'm). If the report says only "net shortage 9.6 million so'm", mixed-up similar goods hide the real picture. With both figures shown apart, you can see that the surplus lines pair up with shortage lines, and the cause is often found right there.

Next to each large difference goes a comment on the cause, but a confirmed cause is kept apart from a guess. The 10–15 most expensive differences get a separate table: the owner looks at those first, and the chief accountant takes the rest from the file.

The file: Excel or 1C

The report should be a working file for the chief accountant, not a table that has to be retyped. These columns are usually enough: code, name, unit of measure, book balance, actual balance, difference, price, amount, location, comment. If the codes match those in your accounting software, reconciliation takes minutes. The totals on page one must match the sum of the lines in the file exactly. It is a simple requirement, yet trust in a report disappears the moment the figures disagree. Agree the file format (Excel or 1C) before the count.

Recommendations and appendices

Give recommendations in order of importance: what can be fixed at once and what needs time and a decision. They are addressed to the process, not to people: do not let receipt documents run late, label similar goods differently, close open documents before the cut-off date. If each recommendation carries a responsible department and a rough deadline, it will not stay on paper. The appendices hold the count sheets, photographs where they are needed and the list of zones that were not counted. How the differences are reflected in the books depends on your own procedure and on the chief accountant's decision: the contractor hands over facts, not accounting entries.

A good external report answers four questions: what was counted, what came out, why it came out that way and what to do next. Inventory hands over count results together with an analysis of the differences and recommendations, in Excel or 1C format, so that both the chief accountant and the owner can find their part at once.