“Slow” is such a subjective term in nature so the question of what can be considered as slow moving goods is actually quite relevant.

Normally something you’d assess is whether the goods have moved out at all during the reporting period or other relevant period, i.e. quarter. If they have not, I would say they’re “non-movers” so more than likely they will need a provision to cover for future expenses when they’re finally either sold or scrapped or whatever depending on the industry. 

Those are the ones that don’t move. However, what about those that move, but slowly and we’ve got considerable overstock. Say that you’ve got something in stock that if you take how much they’ve moved out during a year, you’ve got enough stock for 10 years. Will you be using those items in next 10 years?

I guess what I am trying to say is that when assessing whether something is slow moving, compare your stock levels with a reasonable and optimum levels you’ll need the items and would actually use them. If the answer to the above situation is that you’d only use them for the next 5 years, you should write down the amount exceeding the need for 5 years.

Consider your actual needs and be honest, don’t be overly optimistic considering huge growths etc.