Control Intelligence

Inventory Reserves & Obsolescence

Excess & obsolete (E&O) reserves, NRV testing, and write-downs.

Sub-Process Score
35/ 100
Deficient
3/10 responses received
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Control Objectives (1)

INV-RS-01
COSO P10ICFR.INV.RS.01IIA IV.9.2
E&O reserve is calculated quarterly using a documented methodology.
Risk: Inventory carried above net realizable value.
Assessment Questions (3)
  • 01E&O reserve policy with aging buckets is documented.Document
  • 02Reserve adequacy is reviewed with the CFO each quarter.
  • 03Scrapped or donated inventory is tracked and authorized.