An inventory internal audit programme tests SKU master data, goods receipt, quality control, issues, transfers, physical verification, ageing, NRV, costing, scrap, write-offs and warehouse-system access.
Inventory controls affect working capital, margin, production continuity and financial reporting. The programme must connect physical custody with ERP movement and valuation evidence.
Objective: Inventory master data is approved and accurate.
SKU master, location master, change log, approval workflow.
New/changed SKUs and high-value items.
Objective: Inventory movements reflect authorised physical movement.
GRN, issue note, transfer note, inventory ledger, adjustment approval.
Movement sample plus all material manual adjustments.
Objective: Book stock is reconciled to physical stock and obsolete stock is identified.
Count sheets, variance report, approval, ageing, provision working.
High-value/high-risk locations and aged items.
Objective: Inventory valuation and write-offs are reviewed.
Costing report, NRV working, scrap register, write-off approval, access listing.
Material categories, scrap/write-offs and privileged users.
ICAI IASB lists the Compendium of Standards on Internal Audit as on February 2026 as applicable from 1 April 2026. Use this page as a practical workpaper starter, then verify the latest standard, law, regulation, ERP report and client fact pattern before concluding.
It should cover SKU master, receipts, issues, transfers, adjustments, physical counts, ageing, NRV, costing, scrap, write-offs and warehouse access.
No. It is a fieldwork starter. The internal auditor must tailor it to the approved scope, ERP, delegation matrix, locations, volumes, materiality, prior findings and current legal position.
Yes. Use the linked CORAA workbook for the cycle. It contains editable RCM, testing, evidence and monitoring sheets that can be used as a fieldwork base.
