Stock Control
Senior 6 · Entrepreneurship
Stock Control
Lesson 2 of 4
30 min
On 8 March, Isange Hardware's records show 575 bags of cement, but a count in the store finds 567. Were eight bags never delivered? Damaged and thrown away? Sold without a receipt? Stolen? Without documents, nobody can say. With them, each bag can be traced from the moment someone asked for it to be ordered, to the day it left the store. Stock documents are the paper (or electronic) trail that makes stock control and honest accounting possible.
Definition
Purchase requisition: an internal request from the store or a department asking the buyer to order goods. Purchase order (local purchase order, LPO): the buyer's written order to a supplier, stating items, quantities, prices and delivery terms.
Example: "Please supply 400 bags of 50 kg cement at Frw 10,500 a bag, delivered to Rubavu."
Definition
Delivery note: the supplier's list of goods sent, signed by the receiver on arrival. Goods received note (GRN): the buyer's own record of what actually arrived and in what condition, written by the storekeeper after counting and checking.
Definition
Stores requisition (materials requisition): a request from a department to take goods out of the store. Goods returned note: a record of goods sent back to a supplier. Debit note: sent by the buyer to tell the supplier its account is being reduced; credit note: sent by the supplier to confirm that the buyer owes less.
Definition
Bin card: a card kept at the storage place showing receipts, issues and the balance in quantities only. Stores ledger card (stock card): the accounts office's record of the same movements in quantities and values. Stocktaking sheet: the list on which counters record the stock physically present on a given day.
The three-way match is the key control: the accounts office pays only for what was ordered, what actually arrived in good condition and what is correctly billed. Because the documents are made by different people, one dishonest person cannot easily invent a purchase. In Rwanda the supplier's invoice must come from RRA's electronic billing system (EBM) for the buyer to claim input VAT (Unit 5).
| Document | Prepared by | Main purpose |
|---|---|---|
| Purchase requisition | Storekeeper or department | Asks for stock to be ordered |
| Purchase order | Buyer | Commits the business to buy on stated terms |
| Delivery note | Supplier | Lists the goods sent |
| Goods received note | Storekeeper | Records what arrived and its condition |
| Invoice | Supplier | Asks for payment |
| Stores requisition | User department | Authorises goods to leave the store |
| Bin card | Storekeeper | Running balance of quantities at the store |
| Stores ledger card | Accounts | Quantities and values for the accounts |
Worked example 1: a bin card
Item: cement, 50 kg bags. Maximum 760, reorder level 480, buffer 210 (lesson 1).
| Date (March) | Reference | Received | Issued | Balance |
|---|---|---|---|---|
| 1 | Balance | 520 | ||
| 2 | Stores requisition 041 | 95 | 425 | |
| 4 | Stores requisition 042 | 110 | 315 | |
| 6 | GRN 118 | 400 | 715 | |
| 7 | Stores requisition 043 | 80 | 635 | |
| 8 | Stores requisition 044 | 60 | 575 |
Reading it: each balance is the previous balance plus receipts minus issues, for example . The balance fell below the reorder level of 480 on 2 March, so a purchase requisition should have been raised that day. On 8 March the card shows 575 bags; if a count finds 567, the 8-bag difference must be investigated.
Worked example 2: the three-way match finds two errors
The purchase order was for 400 bags at Frw 10,500. The delivery note says 400 bags. The GRN records 392 good bags and 8 burst bags. The invoice bills 400 bags at Frw 10,800 (prices before VAT).
Amount invoiced: francs.
Amount that matches the order and the GRN: francs.
Difference: francs: 8 damaged bags and Frw 300 a bag of overcharging on 392 bags .
Action: return the burst bags with a goods returned note, send a debit note for Frw 204,000, and pay only when the supplier's credit note or a corrected EBM invoice arrives.
Warning
Never let one person order, receive and record the same goods. Separating these duties is the basic protection against fraud. Sign the delivery note only after counting, write "received subject to checking" if there is no time, and record damage on the GRN at once.
Practice
Sources and credits
Written by Ganzaa: the missing-bags case, the document flowchart, the tables, the worked examples and the practice items. The documents and the three-way match are standard practice in purchasing and stores control. Isange Hardware and all its figures are illustrative (2026).
