“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.  Continue reading →

So you sold something with below their cost and earned a loss because of it. Does it affect your prior year or prior period results?

Most probably you’re saying “no”, however, to be correct, if your prior period results are still open and had you known you’d make a loss, you would have recognized the loss as a provision on the balance sheet at the time (expense at the end as well), you should correct the prior periods.  Continue reading →