Journal of Accounting and Management Information Systems (JAMIS)

Inventories valuation: a “fairer” view

5/2003 ,   p52..53


Keywords:   inventories, valuation, input, production, safety

The inventories are considered as a material asset of any company, having a direct implication on profit and loss given that an over- or underestimation of their values would result in an over- or undervaluation of the company’s outcome. An efficient management implies, among other things, providing safety production-input inventories to preserve the on-going production process and company’s life. Viewed from this perspective, two questions regarding safety production-input inventories arise: (i) how should they be classified in the balance-sheet? and (ii) what would be their most appropriate end-year value? This article attempts to suggest some possible answers to the questions indicated above.