Field Notes
What happens during an inventory count observation
How auditors observe physical inventory in Taiwan warehouses — tags, cut-off, and why the shipping dock matters on year-end day.
When inventory is material to the financial statements, Intelligentbackends observes the physical count. We are not counting for you — we are watching how your team counts, how tags are controlled, and whether goods move during the freeze.
Before count day
Agree floor plans, team assignments, and whether production stops. Provide us the prior perpetual listing and the instructions issued to counters. Last-minute instructions create gaps that show up in test counts.
On the floor
We select locations for test counts, compare tags to the floor, and note damaged or slow-moving stock. Shipping and receiving docks are watched carefully: goods leaving or arriving near year-end often drive cut-off adjustments.
After the count
Tags must roll into the final inventory listing without unexplained missing numbers. We trace a sample from floor to listing and from listing to floor. Differences become open items until management explains or adjusts them.
Planning a December count? Read our year-end statutory audit scope or write to us with your count date.