Manual stock adjustment vs physical stock count: which one, and when?

On the surface both screens do the same thing: correct a quantity. But the difference between them is accounting, not stock — and it is the single most important distinction in the whole Inventory module.

The rule in one line

• Manual adjustment — corrects a recording error. Produces no journal entry.
• Physical stock count — records a real gain or loss. Produces a journal entry.

The screen itself warns you about this before you begin — image 1.

When to use a manual adjustment

When you are certain the difference is a recording mistake rather than a genuine shortfall:

• An item bought while Track Stock was off, so the quantity was never recorded, and tracking was turned on later.
• Opening stock entered with the wrong quantity.
• A movement posted to the wrong warehouse and already corrected there.

In these cases the financial value was already posted by another document (the supplier bill, for instance), so a second entry here would book the same amount twice. That is why an adjustment produces no entry — deliberate behaviour, not a gap.

When to use a physical count

When you do not know why the difference exists, or you know it is a real loss: theft, damage, leakage, a short delivery nobody caught. Here the business really lost money, and the accounts must show it.

Steps: a manual adjustment

1. Open Inventory → Stock Adjustments and press New Stock Adjustment.
2. Pick the branch, then the warehouse.
3. Search for the product; the system fills in the system quantity automatically.
4. Enter the actual quantity and the difference is calculated in front of you.
5. Write the reason — a useful sentence, not one word.
6. Press Add line for each item, then Save Adjustment.

The adjustment applies immediately with no approval step, and appears in the stock ledger as type adjustment.

Notes

• A manual adjustment has no approval and no undo. Restrict the permission to people who understand its effect.
• The reason is free text but it is the most valuable thing in the record — six months later it is the only evidence the adjustment was justified.
• If you hesitate between the two screens, choose the physical count; it is safer for a loss to appear in the accounts than to be hidden.
• Repeated adjustments on the same item point to a data-entry problem, not a stock problem — go and find the root cause.