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Key Responsibilities and Required Skills for Inventory Accountant

💰 $55,000 - $90,000

AccountingFinanceInventory Management

🎯 Role Definition

The Inventory Accountant is responsible for accurate inventory valuation, reconciliation and control across the supply chain and ERP systems, ensuring that inventory balances, cost of goods sold (COGS) and related financial reporting comply with GAAP/IFRS and internal control standards. This role partners with operations, purchasing, production and external auditors to lead cycle counts and physical inventories, investigate variances, record journal entries, maintain inventory policies (obsolescence, reserves), and continuously improve processes to reduce shrinkage and improve working capital efficiency.

📈 Career Progression

Typical Career Path

Entry Point From:

  • Inventory Analyst / Stock Analyst
  • Staff Accountant (with inventory responsibilities)
  • Accounts Payable / Receivable with inventory exposure

Advancement To:

  • Senior Inventory Accountant
  • Inventory Control Manager / Inventory Controller
  • Cost Accountant / Cost Accounting Manager
  • Accounting Manager or Finance Manager (with inventory & COGS oversight)

Lateral Moves:

  • Supply Chain Analyst (inventory/planning focus)
  • Financial Analyst (manufacturing or operations finance)
  • ERP Functional Analyst (inventory modules)

Core Responsibilities

Primary Functions

  • Prepare, record and review monthly inventory-related journal entries including adjustments for inventory reserves, obsolescence, shipment discrepancies, intercompany transfers and cost revaluations to ensure accurate reporting of inventory and COGS.
  • Conduct detailed month-end and quarter-end inventory reconciliations between the general ledger and sub-ledgers (WMS, MRP, purchasing), investigate discrepancies, and drive corrective actions to resolve root causes.
  • Lead and coordinate cycle count and physical inventory programs (scheduling, test counts, reconciliation, reporting) to ensure inventory accuracy meets company targets and audit standards.
  • Perform inventory valuation under applicable accounting frameworks (GAAP/IFRS), applying FIFO/LIFO/weighted-average methodologies, calculating cost of goods sold impacts and preparing valuation disclosures.
  • Analyze inventory variances, drivers of shrinkage and movement patterns by SKU/location, prepare variance reports for management, and recommend process or control changes to mitigate future variance.
  • Ownership of inventory reserve and obsolescence reviews: evaluate slow-moving and obsolete stock, calculate reserve requirements, obtain approvals and record appropriate provisions in the financial statements.
  • Reconcile and review intercompany inventory transactions and transfers, prepare elimination and intercompany adjustment entries, and coordinate with trading partners or subsidiaries to resolve timing or valuation differences.
  • Support ERP inventory master data governance: maintain accurate item master records, costing methods, units of measure, scrap codes and bill of materials settings to ensure consistent valuation and reporting.
  • Prepare and review supporting schedules and documentation for external and internal audits, respond to auditor inquiries, provide inventory test evidence and implement recommended remediation actions.
  • Collaborate with supply chain, procurement, production and warehouse teams to investigate inventory discrepancies, identify process failures (receiving/putaway/issue errors) and implement root cause corrective actions.
  • Execute and document inventory-related SOX controls, perform control testing, maintain control matrices and work with internal audit to ensure regulatory compliance and control effectiveness.
  • Develop and maintain KPI dashboards and management reports for inventory turns, days on hand, shrinkage, carrying costs and aging to support executive decision making and working capital optimization.
  • Drive continuous improvement initiatives focused on inventory accuracy, cycle count efficiency, warehouse procedures, and automation opportunities (barcode scanning, RF systems).
  • Support month-end close activities for inventory and COGS, coordinate cut-off procedures (shipment and receiving), and validate accruals and deferred cost accounts to ensure timely and accurate financial close.
  • Prepare detailed cost reconciliations and cost variance analyses for production runs, raw material, WIP and finished goods, partnering with production planners and manufacturing accounting.
  • Implement and review controls and procedures for returns, scrap, consignment, and vendor-managed inventory to ensure correct accounting treatment and accurate inventory balances.
  • Assist in ERP implementations, upgrades or inventory module rollouts by testing inventory accounting flows, mapping chart of accounts, validating costing logic and training accounting/operations teams.
  • Manage and reconcile inventory-related accruals, prepaid purchases, and freight-in allocations, ensuring costs are capitalized and expensed in accordance with policy and matching principles.
  • Provide month-end support for revenue recognition as it relates to inventory shipments, ensuring proper cut-off and linkage between shipping documentation and accounting entries.
  • Maintain and update inventory accounting policies, process documentation, standard operating procedures and training materials to ensure consistency and knowledge retention across the team.
  • Serve as an inventory accounting subject matter expert for cross-functional projects such as product launches, SKU rationalization, warehouse consolidations and supply chain optimization initiatives.
  • Monitor and validate inventory-related tax calculations (sales tax, VAT implications) and assist tax teams with inventory data and supporting schedules when required.

Secondary Functions

  • Support ad-hoc inventory analytics and model building to forecast inventory requirements, working capital impact and purchase planning scenarios.
  • Participate in continuous improvement projects to streamline inventory accounting workflows, reduce manual journal entries and increase automation through ERP/reporting enhancements.
  • Provide training and daily support to warehouse and operations staff on inventory control best practices, cycle count preparation and documentation requirements.
  • Assist procurement and vendor management with reconciliation of delivered goods vs. purchase orders and invoice matching to ensure accurate inventory capitalization.
  • Coordinate with IT and ERP teams to troubleshoot system inventory errors, identify configuration issues and test fixes for inventory valuation and reporting.
  • Support cross-functional teams during new product onboarding to define inventory cost flows, scrap accounting and initial valuation procedures.

Required Skills & Competencies

Hard Skills (Technical)

  • Inventory accounting and valuation (FIFO, LIFO, weighted average) with proven experience preparing inventory journal entries and reconciliations.
  • Strong understanding of GAAP and/or IFRS inventory guidance, COGS recognition and disclosure requirements.
  • ERP proficiency: hands-on experience with one or more systems such as SAP MM/IM/FI, Oracle Cloud ERP, NetSuite, Microsoft Dynamics, Infor or similar WMS/MRP integrations.
  • Advanced Excel skills including pivot tables, VLOOKUP/XLOOKUP, INDEX/MATCH, complex formulas and experience building reconciliation templates.
  • Working knowledge of SQL or data query tools to extract inventory data and perform ad-hoc analyses (preferred).
  • Experience with cycle count programs, physical inventory planning and reconciliations in multi-site or multi-location environments.
  • Experience preparing schedules and responding to internal and external audit requests; familiarity with SOX control frameworks.
  • Cost accounting and production cost reconciliation experience, including allocation of overhead, scrap and freight into inventory cost.
  • Familiarity with inventory KPIs and reporting platforms (Power BI, Tableau, or ERP reporting modules).
  • Ability to construct and maintain inventory reserves/obsolescence calculations and document judgment criteria.

Soft Skills

  • Exceptional attention to detail and accuracy in high-volume transaction environments.
  • Strong analytical and problem-solving skills with the ability to translate data into actionable insights and process improvements.
  • Clear written and verbal communication skills to liaise with cross-functional teams, management and auditors.
  • Time management and organizational skills to manage competing month-end priorities and tight close deadlines.
  • Collaborative mindset, able to work with operations, procurement, IT and finance partners to drive inventory integrity.
  • Proactive ownership and accountability for resolving discrepancies and improving controls.
  • Ability to explain technical accounting concepts to non-accounting stakeholders in plain language.
  • Adaptability to changing systems, processes and business needs; comfortable driving change.
  • Ethics and integrity in handling confidential financial and inventory data.
  • Project management skills for leading cycle count programs, ERP changes and process improvement efforts.

Education & Experience

Educational Background

Minimum Education:

  • Bachelor's degree in Accounting, Finance, Business Administration, Supply Chain Management or a related field.

Preferred Education:

  • Bachelor's degree in Accounting or Finance with relevant certifications (e.g., CPA, CMA) or advanced coursework in cost accounting.
  • Any additional coursework or certificate in ERP systems, data analytics, or supply chain is a plus.

Relevant Fields of Study:

  • Accounting
  • Finance
  • Supply Chain Management
  • Business Administration

Experience Requirements

Typical Experience Range:

  • 2 to 5 years of progressive accounting experience with a minimum of 1–2 years focused on inventory accounting, cost accounting, manufacturing or distribution environments.

Preferred:

  • 3+ years in inventory accounting within manufacturing, retail, e-commerce or distribution, with demonstrated experience using major ERPs (SAP, Oracle, NetSuite).
  • Experience supporting audits, implementing SOX controls and driving inventory process improvements.
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