Perpetual Inventory System

Perpetual Inventory System

This means a system by which information about stock of materials etc is always available.Bin cards material cards and store ledger constitute Perpetual inventory system.

It is defined as ” A system of record maintained by the controlling department, which reflects the physical movement of stocks and their current balance”.

So PIS implies maintenance of up to date stocks and in its broad sense it covers both continuous stocking as well as up to date recording of stores books.The balance of the same item of store in the   bin card should correspond with that shown in the store ledger.A frequent checking of these two records should be made and compared with the actual quantity of material in stock.

In order to ensure accuracy of perpetual inventory record it is necessary to check the physical stocks by program of continuous stock taking.Any deviation noted between the physical stocks and the stock records may be investigated and rectification made then and there.

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