Inventory valuation and cost audit for a food processing plant

The plant expanded capacity to serve institutional buyers but gross margin volatility raised questions from investors. Raw material price swings, spoilage, and inconsistent batch costing in the ERP undermined confidence in inventory figures.

We attended physical counts at raw materials, WIP, and finished goods stores, tested yield assumptions, and challenged obsolescence provisions against shelf-life data. Cost accounting policies were rewritten to align bill of materials with actual production reports.

Investor due diligence received an agreed-upon procedures report on inventory and gross margin bridges. Year-end audit procedures concluded with one prior-year adjustment to opening inventory that was fully disclosed.